March 20, 1991
TO: UNIT INVESTMENT TRUST MEMBERS NO. 13-91
RE: UTAH AMENDS MANUAL EXEMPTION PROVISION
__________________________________________________________
Senate Bill 147 was recently passed by the Utah State
Legislature which amends, among other items, the provision for
the manual exemption contained in Section 61-1-14(2)(b) of the
Utah Securities Act. The amendment repeals the statutory listing
requirements to claim the manual exemption and grants the Utah
Securities Division the authority to define the information
required to be in the listing by rule. In addition, the
amendment also grants the Division the authority to specify the
manauls that will be recognized for purposes of the manual
exemption by rule. The amendment will be effective on April 28,
1991. A copy of the amendment is attached.
Rule R177-14-2b of the Utah Securities Division sets forth
the information required to be included in the listing. It
should be noted that this rule was amended last summer to require
that the financial statements in the listing contain an
unqualified audit report by an independent public accountant.
The Institute contacted the staff of the Securities Division to
discuss the effect this requirement may have on sponsors of unit
trusts relying on the manual exemption for resales of units of
unit trusts since the initial listing for a unit trust generally
contains unaudited financial information. Since it was unclear
whether a sponsor of a unit trust could still rely on the manual
exemption, the Institute requested that the Division provide, by
rule or order, a specific exemption for resales of units of unit
trusts in that registration of such resales was not necessary or
appropriate for the protection of investors. A copy of the
Institute's letters to the Securities Division is also attached.
The staff of the Securities Division has informed the
Institute that it will be proposing amendments to several of its
rules in the near future and we have been assured that the
proposed rules will include a specific provision for resales of
units of unit trusts. We will keep you advised of developments.
Patricia Louie
Assistant General Counsel
Attachments