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January 24, 1989
TO: BOARD OF GOVERNORS NO. 6-89
STATE SECURITIES MEMBERS NO. 4-89
UNIT INVESTMENT TRUST MEMBERS NO. 10-89
RE: MICHIGAN ADOPTS BLUE CHIP EXEMPTION AND INCREASES
REGISTRATION FEES
__________________________________________________________
Currently, all mutual funds and unit trusts that offer
their shares to Michigan residents must register the offering
with the Michigan Corporation & Securities Bureau. To register
in Michigan, a fund or trust must submit the Form U-1, U-2, U-2A
and a copy of the prospectus and statement of additional
information.
We are pleased to inform you that as a result of the
Institute's efforts, effective December 27, 1988, Michigan has
enacted an exemption for qualified mutual funds and unit trusts
based on the similar exemption in the Revised Uniform Securities
Act of 1985. The exemption is an alternative to the registration
process.
A mutual fund is exempt from registration if its investment
adviser or an affiliate of its investment adviser has been
registered under the Investment Advisers Act of 1940 for at least
three years. If qualified, a mutual fund may claim the exemption
by submitting annually to the Michigan Corporation & Securities
Bureau, the name and address of the issuer, the name of the
securities to be offered, a consent to service and $1250.
A unit trust is exempt from registration if its principal
underwriter has been the principal underwriter for registered
investment companies with aggregate total assets in excess of
$100,000,000 for at least three years. If qualified, a unit
trust may claim the exemption by submitting annually to the
Michigan Corporation & Securities Bureau, the name and address of
the issuer, the name of the securities to be offered, a consent
to service and $750.
The fees set forth in the exemption have a sunset provision
of December 1, 1990. Attached is a copy of the relevant
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provisions of the bill, the form to claim the exemption, and a
copy of the Bureau's release discussing the exemption. Michigan
is the sixth state to adopt the blue chip exemption.
In a related matter, until December 1, 1990, the minimum
and maximum fees have been increased to $100 and $1250
respectively. After December 1, 1990, the minimum and maximum
fees will be $50 and $500 respectively.
Natalie Shirley
Associate General Counsel
Attachment