Part 7ADMINISTRATION

Section § 25604

Explanation

This law states that the costs for running and enforcing the laws and programs of the Department of Financial Protection and Innovation are paid from the State Corporations Fund. The money from this fund comes from fees collected under specific sections, but not all fees are included, specifically some from Section 25608.

The administration and enforcement of, and the education of the public relative to, the laws and programs of the Department of Financial Protection and Innovation shall be supported from the State Corporations Fund. Funds appropriated from the State Corporations Fund and made available for expenditure for any law or program of the department may come from fees collected from the following:
(a)CA Corporations Code § 25604(a) Section 25608, except for fees collected pursuant to subdivisions (o) to (r), inclusive, of Section 25608.
(b)CA Corporations Code § 25604(b) Section 25608.1.
Department of Financial Protection and Innovation State Corporations Fund fees funding Section 25608 Section 25608.1 public education program enforcement law administration fee exemptions financial protection
(Amended by Stats. 2022, Ch. 452, Sec. 79. (SB 1498) Effective January 1, 2023.)

Section § 25605

Explanation

This law allows the commissioner to make public any information if it's in the public interest. However, that information can't be shared outside of necessary proceedings or with other regulatory bodies. The law does not change existing legal privileges when evidence is sought by subpoena. It's illegal for anyone in the commissioner's office to use confidential information for personal gain.

(a)CA Corporations Code § 25605(a) The commissioner may publish any information filed with him or obtained by him, if, in the judgment of the commissioner, such action is in the public interest. No provision of this law authorizes the commissioner or any of his assistants, clerks, or deputies to disclose any information withheld from public inspection except among themselves or when necessary or appropriate in a proceeding or investigation under this law or to other federal or state regulatory agencies. No provision of this law either creates or derogates from any privilege which exists at common law or otherwise when documentary or other evidence is sought under a subpoena directed to the commissioner or any of his assistants, clerks, or deputies.
(b)CA Corporations Code § 25605(b) It is unlawful for the commissioner or any of his assistants, clerks, or deputies to use for personal benefit any information which is filed with or obtained by the commissioner and which is not then generally available to the public.
commissioner information publication public interest confidentiality regulatory agencies investigation disclosure legal privilege confidential information subpoena personal benefit prohibition non-public information
(Amended by Stats. 1970, Ch. 1231.)

Section § 25606

Explanation

The Attorney General provides legal opinions and acts as a lawyer for the Commissioner of Financial Protection and Innovation when needed. Also, certain Government Code sections (11041, 11042, and 11043) do not apply to this commissioner.

(a)CA Corporations Code § 25606(a) The Attorney General shall render to the commissioner opinions upon all questions of law, relating to the construction or interpretation of any law under the commissioner’s jurisdiction or arising in the administration thereof, that may be submitted to the Attorney General by the commissioner, and upon the commissioner’s request shall act as the attorney for the commissioner in actions and proceedings brought by or against the commissioner under or pursuant to any provision of any law under the commissioner’s jurisdiction.
(b)CA Corporations Code § 25606(b) Sections 11041, 11042, and 11043 of the Government Code do not apply to the Commissioner of Financial Protection and Innovation.
Attorney General commissioner opinions Financial Protection and Innovation legal interpretation commissioner's jurisdiction legal representation action and proceedings Attorney General's duty Government Code sections exclusion commissioner requests
(Amended by Stats. 2022, Ch. 452, Sec. 80. (SB 1498) Effective January 1, 2023.)

Section § 25607

Explanation

This law prohibits certain government officials and employees working in the Department of Financial Protection and Innovation from having financial interests in entities they regulate, such as broker-dealers or investment advisers, to prevent conflicts of interest. However, they may hold or buy securities under strict conditions to ensure public interest protection. Specifically, assistants and deputies can buy securities following rules set for avoiding conflicts. The commissioner can also hold securities if they are exempt from certain legal requirements or are managed by an independent bank or trust with no advice from the commissioner. The commissioner must report all securities transactions regularly to the Attorney General to maintain transparency.

(a)CA Corporations Code § 25607(a) Neither the commissioner nor any of the commissioner’s assistants, clerks, or deputies shall be interested as a director, officer, shareholder, member (other than a member of an organization formed for religious purposes), partner, agent, or employee of any person who, during the period of the official’s or employee’s association with the Department of Financial Protection and Innovation, (1) was licensed or applied for license as a broker-dealer or investment adviser under this division, or (2) applied for or secured the qualification of the sale of securities under this division.
(b)CA Corporations Code § 25607(b) Nothing contained in subdivision (a) shall prohibit the holding or purchasing of any securities by any assistant, clerk, or deputy in accordance with rules as the commissioner shall adopt for the purpose of protecting the public interest and avoiding conflicts of interest.
(c)CA Corporations Code § 25607(c) Nothing contained in subdivision (a) shall prohibit the holding or purchasing of any securities by the commissioner if any of the following criteria is met:
(1)CA Corporations Code § 25607(c)(1) The securities held or purchased by the commissioner are exempt from the qualification requirements of Sections 25110, 25120, and 25130 by virtue of Section 25100, provided that the holding or purchasing of those securities is in accordance with rules adopted for the purpose of protecting the public interest and avoiding conflicts of interest.
(2)CA Corporations Code § 25607(c)(2) The securities held or purchased by the commissioner are not subject to Sections 25110, 25120, and 25130 by virtue of Section 25100.1, provided that the holding or purchasing of those securities is in accordance with rules adopted for the purpose of protecting the public interest and avoiding conflicts of interest.
(3)CA Corporations Code § 25607(c)(3) The holding or purchasing of any securities by the commissioner meets each of the following requirements:
(A)CA Corporations Code § 25607(c)(3)(A) The securities are held or purchased through a management account or trust administered by a bank or trust company authorized to do business in this state, and the bank or trust company has sole investment discretion regarding the holding, purchase, and sale of securities.
(B)CA Corporations Code § 25607(c)(3)(B) The commissioner did not, directly or indirectly, advise, counsel, command, or suggest the holding, purchase, or sale of any security or furnish any information relating to the security to the bank or trust company.
(C)CA Corporations Code § 25607(c)(3)(C) The account or trust does not at any time have more than 10 percent of its total assets invested in the securities of any one issuer or hold more than 5 percent of the outstanding shares or units of any class of securities of any one issuer.
(D)CA Corporations Code § 25607(c)(3)(D) The commissioner shall report to the Attorney General not less often than quarterly all holdings, purchases, and sales of securities by the commissioner as authorized in paragraph (3), which reports shall be retained by the Attorney General as public documents.
conflict of interest financial interests Department of Financial Protection and Innovation broker-dealer investment adviser securities commissioner rules public interest protection exempt securities management account trust investment discretion bank or trust company Attorney General securities transactions report
(Amended by Stats. 2022, Ch. 452, Sec. 81. (SB 1498) Effective January 1, 2023.)

Section § 25608

Explanation

This law outlines various fees that must be paid to the California Commissioner of Corporations for different securities-related filings and applications. The fees vary based on the type of application and the value of the securities involved. For example, there's a $50 fee for certain applications and notices, while fees for securities qualifications can include a base fee plus a percentage of the securities' value. Broker-dealers and investment advisers have specific fees for certificates and renewals. Additionally, there are provisions for other fees related to exams, hearings, and publications ordered by the commissioner. These fees contribute to the Financial Protection Fund and support the administration of securities regulation in California.

(a)CA Corporations Code § 25608(a) The commissioner shall charge and collect the fees fixed in this section and Section 25608.1. All fees charged and collected under this section and Section 25608.1 shall be transmitted to the Treasurer at least weekly, accompanied by a detailed statement thereof and shall be credited to the Financial Protection Fund.
(b)CA Corporations Code § 25608(b) The fee for filing an application for a negotiating permit under subdivision (c) of Section 25102 is fifty dollars ($50).
(c)CA Corporations Code § 25608(c) The fee for filing a notice pursuant to paragraph (5) of subdivision (h) of Section 25102, for filing a notice pursuant to paragraph (4) of subdivision (f) of Section 25102, or for filing a notice pursuant to paragraph (10) of subdivision (r) of Section 25102, in addition to the fee prescribed in those paragraphs, if applicable, shall be determined based on the value of the securities proposed to be sold in the transaction for which the notice is filed and in accordance with subdivision (g), and shall be as follows:
Value of Securities
Proposed to be Sold
Filing Fee
$25,000 or less
$ 25
$25,001 to $100,000
$ 35
$100,001 to $500,000
$ 50
$500,001 to $1,000,000
$150
Over $1,000,000
$300
(d)CA Corporations Code § 25608(d) The fee for filing an application for designation of an issuer pursuant to subdivision (k) of Section 25100 is fifty dollars ($50).
(e)CA Corporations Code § 25608(e) The fee for filing an application for qualification of the sale of securities by notification under Section 25112 or by permit under paragraph (1) of subdivision (b) of Section 25113 (except applications for qualification by permit of the sale of any guarantee of any security, the fees for which applications are fixed in subdivision (k)) is two hundred dollars ($200) plus one-fifth of 1 percent of the aggregate value of the securities sought to be sold in this state up to a maximum aggregate fee of two thousand five hundred dollars ($2,500).
The fee for filing a small company application for qualification of the sale of securities by permit under paragraph (2) of subdivision (b) of Section 25113 is two thousand five hundred dollars ($2,500). In the case where the costs of processing a small company application exceed the filing fee, an additional fee shall be charged, not to exceed one thousand dollars ($1,000), over and above the filing fee based on the costs of the salary or other compensation paid to persons processing the application plus overhead costs reasonably incurred in the performance of the work. In determining the costs, the commissioner may use the estimated average hourly cost for all persons processing applications for the fiscal year.
(f)CA Corporations Code § 25608(f) The fee for filing an application for qualification of the sale of securities by coordination under Section 25111 or a notice of intention to sell under subdivision (t) of Section 25100 is two hundred dollars ($200) plus one-fifth of 1 percent of the aggregate value of the securities sought to be sold in this state up to a maximum aggregate fee of two thousand five hundred dollars ($2,500).
(g)CA Corporations Code § 25608(g) For the purpose of determining the fees fixed in subdivisions (e) and (f):
(1)CA Corporations Code § 25608(g)(1) The value of the securities shall be the price at which the company proposes to sell the securities, or the value, as alleged in the application, or the actual value, as determined by the commissioner, of the consideration (if other than money) to be received in exchange therefor, or of the securities when sold, whichever is greater.
(2)CA Corporations Code § 25608(g)(2) Interim or voting trust certificates shall have a value equal to the aggregate value of the securities to be represented by the interim or voting trust certificates.
(3)CA Corporations Code § 25608(g)(3) The value of a warrant or right to purchase or subscribe to another security of the same or another issuer shall be an amount equal to the consideration to be paid for that warrant or right plus an amount equal to the consideration to be paid upon purchase of the additional securities, provided that if the latter amount is not determinable at the time of qualification, that amount shall then be the value of the additional securities as determined by the commissioner.
(4)CA Corporations Code § 25608(g)(4) In the case of a share dividend where the shareholders are given an option to accept either cash or additional shares of common stock, the value of the securities to be sold shall be the maximum amount of cash that would be payable in the event that all shareholders elected to accept cash.
(h)CA Corporations Code § 25608(h) The fee for filing an application for qualification of the sale of securities by permit under Section 25121 is:
(1)CA Corporations Code § 25608(h)(1) Two hundred dollars ($200) in connection with any change (including any stock split or reverse stock split or stock dividend, except a stock dividend where the shareholders are given an option to accept either cash or additional shares of common stock) in the rights, preferences, privileges, or restrictions of or on outstanding securities.
(2)CA Corporations Code § 25608(h)(2) Two hundred dollars ($200) plus one-fifth of 1 percent of the value, as alleged in the application, or the actual value, as determined by the commissioner, of the consideration to be received in exchange therefor, up to a maximum aggregate fee of two thousand five hundred dollars ($2,500), in any exchange of securities by the issuer with its existing security holders exclusively, or in any exchange in connection with any merger or consolidation or purchase of corporate assets in consideration of the issuance of securities, or any entity conversion transaction.
(i)CA Corporations Code § 25608(i) The fee for filing an application for qualification of the sale of securities by notification under Section 25131 shall be one hundred dollars ($100).
(j)CA Corporations Code § 25608(j) The fee for an application for the removal of any condition under Section 25141 is fifty dollars ($50).
(k)CA Corporations Code § 25608(k) The fee for filing any application for a permit to execute or issue any guarantee of any security is fifty dollars ($50).
(l)CA Corporations Code § 25608(l) The fee for acting as escrowholder for securities under Section 25149 is fifty dollars ($50). In addition, a fee of two dollars and fifty cents ($2.50) shall be paid for the deposit with the commissioner of each new certificate or other document resulting from a transfer in escrow.
(m)CA Corporations Code § 25608(m) The fee for filing an application for an order (1) consenting to the transfer in escrow of securities or (2) consenting to the transfer of securities subject to any condition imposed by the commissioner requiring the commissioner’s consent to the transfer is twenty dollars ($20) for each transfer.
(n)CA Corporations Code § 25608(n) The filing fee for an amendment to an application filed after the effective date of the qualification of the sale of securities is fifty dollars ($50) plus any additional fee that would have been required to be paid with the original application for qualification of the sale of securities under this section if the matters set forth in the amendment had been included in the original application.
(o)Copy CA Corporations Code § 25608(o)
(1)Copy CA Corporations Code § 25608(o)(1) The fee for filing an application for a broker-dealer certificate under Section 25211 is three hundred dollars ($300).
(2)CA Corporations Code § 25608(o)(2) Each broker-dealer shall pay to the commissioner its pro rata share of all costs and expenses, reasonably incurred in the administration of the broker-dealer program under this division, as estimated by the commissioner for the ensuing year and any deficit actually incurred or anticipated in the administration of the program in the year in which the assessment is made. The pro rata share shall be the proportion that the broker-dealer and the number of its agents in this state bears to the aggregate number of broker-dealers and agents in this state as shown by records maintained by or on behalf of the commissioner. The pro rata share may include the costs of any examinations, audit, or investigation provided for in subdivision (r).
(3)CA Corporations Code § 25608(o)(3) Every broker-dealer who has secured from the commissioner a certificate shall, in order to keep the certificate in effect for an additional period, pay a minimum assessment of seventy-five dollars ($75) on or before the 31st of December in each year.
(4)CA Corporations Code § 25608(o)(4) The commissioner may assess and levy against each broker-dealer any additional amount above the minimum assessment amount of seventy-five dollars ($75) that is reasonable and necessary to support the broker-dealer program under this division. If an additional amount is assessed, the commissioner shall notify each broker-dealer by mail of any additional amount assessed and levied against it on or before the 30th day of May in each year, and that amount shall be paid within 20 days thereafter. If payment is not made within 20 days, the commissioner shall assess and collect a penalty in addition to the assessment of 1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.
(5)CA Corporations Code § 25608(o)(5) If a broker-dealer fails to pay any assessment on or before the 30th day of the month following the day upon which payment is due, the commissioner may by order summarily suspend or revoke the certificate issued to the broker-dealer. If, after that order is made, a request for hearing is filed in writing and a hearing is not held within 60 days thereafter, the order is deemed rescinded as of its effective date. During any period when its certificate is revoked or suspended, a broker-dealer shall not conduct business pursuant to this division except as may be permitted by order of the commissioner; provided, however, that the revocation, suspension, or surrender of a certificate shall not affect the powers of the commissioner as provided under this division.
(6)CA Corporations Code § 25608(o)(6) In determining the amount assessed, the commissioner shall consider all appropriations from the Financial Protection Fund for the support of the broker-dealer program under this division and all reimbursements applicable to the administration of the broker-dealer program under this division.
(p)Copy CA Corporations Code § 25608(p)
(1)Copy CA Corporations Code § 25608(p)(1) The commissioner shall charge a fee of fifty dollars ($50) for the filing of a notice or report required by rules adopted pursuant to subdivision (b) of Section 25210 or subdivision (b) of Section 25230.
(2)CA Corporations Code § 25608(p)(2) The commissioner shall charge a fee up to fifty dollars ($50) to keep in effect for the following year any notice or report required by rules adopted pursuant to subdivision (b) of Section 25210 or subdivision (b) of Section 25230.
(3)CA Corporations Code § 25608(p)(3) No person shall, on behalf of a broker-dealer licensed pursuant to Section 25211, effect any transaction in, or induce or attempt to induce the purchase or sale of, any security in this state unless the broker-dealer pays the annual fee required by paragraph (2) of this subdivision on or before the day upon which payment is due.
(4)CA Corporations Code § 25608(p)(4) No person may, in this state, on behalf of an investment adviser licensed pursuant to Section 25231, offer or negotiate for the sale of investment advisory services of the investment adviser, determine which recommendations shall be made to, make recommendations to, or manage the accounts of, clients of the investment adviser, or determine the reports or analyses concerning securities to be published by the investment adviser, unless the investment adviser pays the annual fee required by paragraph (2) on or before the day upon which payment is due.
(5)CA Corporations Code § 25608(p)(5) The commissioner may by order summarily enjoin an individual from performing any activity under paragraph (3) or (4) if the annual fee in paragraph (2) is not paid on or before the day upon which payment is due. An order under this paragraph may not be made before 10 days after notice by the commissioner that the fee is due and unpaid.
(q)Copy CA Corporations Code § 25608(q)
(1)Copy CA Corporations Code § 25608(q)(1) Except as provided for in paragraph (2), the fee for filing an application for an investment adviser under Section 25231 is one hundred twenty-five dollars ($125), and payment of this amount shall keep the certificate, if granted, in effect during the calendar year during which it is granted. Every investment adviser who has secured from the commissioner a certificate shall, in order to keep the certificate in effect for an additional period, pay a renewal fee of one hundred twenty-five dollars ($125) on or before the 31st day of December.
(2)CA Corporations Code § 25608(q)(2) Paragraph (1) shall not apply to a broker-dealer licensed under Section 25210.
(r)Copy CA Corporations Code § 25608(r)
(1)Copy CA Corporations Code § 25608(r)(1) Except as provided for in paragraph (2), the fee for any routine or nonroutine regulatory examination, audit, or investigation is the amount of the salary or other compensation paid to the persons making the examination, audit, or investigation plus the amount of expenses including overhead reasonably incurred in the performance of the work. In determining the costs associated with an examination, audit, or investigation, the commissioner may use the estimated average hourly cost for all persons performing examinations, audits, or investigations for the fiscal year.
(2)CA Corporations Code § 25608(r)(2) An investment adviser licensed under Section 25230 pursuant to the Investment Adviser Registration Depository shall not be subject to paragraph (1) only in regard to the fee for a routine regulatory examination of its investment advisory services for which it is licensed under Section 25230.
(s)CA Corporations Code § 25608(s) The fee for any hearing held by the commissioner pursuant to Section 25142 shall be the sum determined by the commissioner to cover the actual expense of noticing and holding the hearing.
(t)CA Corporations Code § 25608(t) The commissioner may fix by rule a reasonable charge for any publications issued under the commissioner’s authority. The charges shall not apply to reports of the commissioner in the ordinary course of distribution.
(u)CA Corporations Code § 25608(u) The fee for filing an offer under subdivision (b) of Section 25507 shall be the amount of filing fee payable under subdivision (e), (f), (h), or (i) of this section if an application had been filed to qualify the transaction in which the securities upon which the offer is to be made were sold in violation of the qualification provisions of this law.
(v)CA Corporations Code § 25608(v) The fee for filing an application for exemption pursuant to subdivision (l) of Section 25100 is two hundred fifty dollars ($250).
(w)CA Corporations Code § 25608(w) The commissioner may by rule require payment of a fee for filing a notice or report required by a rule adopted pursuant to Section 25105. The fee required in connection with a transaction as defined by that rule shall not exceed the fees specified in subdivision (c) based on the value of the securities sold, but the commissioner may permit a single notice for more than one transaction.
(x)CA Corporations Code § 25608(x) The fee for filing the first notice of transaction under subdivision (n) of Section 25102 is six hundred dollars ($600).
(y)CA Corporations Code § 25608(y) The fee for filing a notice of transaction under subdivision (o) of Section 25102 shall be the fee for filing an application for qualification of the sale of securities by permit under paragraph (1) of subdivision (b) of Section 25113 as set forth in subdivision (e) of this section.
(z)CA Corporations Code § 25608(z) The fee for filing a notice of transaction under subdivision (h) of Section 25103 shall be six hundred dollars ($600).
securities fees negotiating permit broker-dealer certificate investment adviser fee small company application Financial Protection Fund filing fees securities qualification permit fees escrowholder fee amendment fees annual assessment regulatory examination transaction notice exemption application
(Amended by Stats. 2025, Ch. 20, Sec. 5. (AB 137) Effective June 30, 2025.)

Section § 25608.1

Explanation

This section details the fees associated with various types of filings for investment companies, issuers, and investment advisers in California. An investment company must pay $200 plus a small percentage of the securities' value, capped at $2,500, for filing a notice to sell securities. Issuers have different flat rates of $300 or $600 depending on the subsection they file under. Investment advisers have a $125 fee for filing a notice, with additional possible fees for other specific reports or notices. Also, the commissioner can prevent someone from performing activities if they fail to pay required annual fees, notifying them 10 days before any action.

(a)CA Corporations Code § 25608.1(a) The fee for an investment company filing a notice pursuant to subdivision (b) of Section 25100.1 is two hundred dollars ($200) plus one-fifth of 1 percent of the aggregate value of the securities sought to be sold in this state up to a maximum aggregate fee of two thousand five hundred dollars ($2,500).
(b)CA Corporations Code § 25608.1(b) The fee for an issuer filing a notice pursuant to subdivision (a) of Section 25102.1 is six hundred dollars ($600).
(c)CA Corporations Code § 25608.1(c) The fee for an issuer filing a notice pursuant to subdivision (d) of Section 25102.1 is three hundred dollars ($300).
(d)Copy CA Corporations Code § 25608.1(d)
(1)Copy CA Corporations Code § 25608.1(d)(1)  The fee for an investment adviser filing a notice pursuant to subdivision (b) of Section 25230.1 is one hundred twenty-five dollars ($125) and the fee for filing a notice or report required by rules adopted pursuant to subdivision (c) of Section 25230.1 is twenty-five dollars ($25).
(2)CA Corporations Code § 25608.1(d)(2) The commissioner may charge a fee up to thirty-five dollars ($35) to keep in effect for the following year any notice or report required by rules adopted pursuant to subdivision (b) of Section 25210 or subdivision (b) of Section 25230.
(3)CA Corporations Code § 25608.1(d)(3) The commissioner may by order summarily enjoin an individual from performing any activity under subdivision (c) of Section 25230.1 if the annual fee required by paragraph (2) is not paid on or before the day upon which payment is due. An order under this paragraph may not be made before 10 days after notice by the commissioner that the fee is due and unpaid.
investment company fee securities sale filing issuer filing fee investment adviser fee notice filing fees aggregate value fee commissioner's order delinquent payment consequences annual fee subdivision fees flat rate fee notice to sell securities
(Amended by Stats. 2013, Ch. 335, Sec. 10. (SB 538) Effective January 1, 2014.)

Section § 25608.2

Explanation

Starting from July 1, 2000, certain maximum fees can be charged for filing notices related to securities offerings. These fees are set under specific sections of the law. The commissioner has the authority to set these fees lower than the maximums, and they are adjusted each year around June 1. If the commissioner doesn't set the new fees, the maximum fees automatically apply for the next fiscal year.

Commencing July 1, 2000, the fee provisions of subdivision (c) of Section 25608, as they apply to the fee for filing a notice pursuant to paragraph (4) of subdivision (f) of Section 25102, and the fee provisions of subdivisions (a), (b), and (c) of Section 25608.1, shall be the maximum fees that may be levied on a notice filing under subdivision (b) of Section 25100.1, subdivision (f) of Section 25102, and subdivisions (a), (c), and (d) of Section 25102.1. The commissioner, however, may set the notice filing fee under subdivision (c) of Section 25608, as it relates to a notice filing under subdivision (f) of Section 25102, and the notice filing fees under subdivisions (a), (b), and (c) of Section 25608.1, at amounts below the maximum fees set forth in those sections. The commissioner shall set the notice filing fees under those sections for the upcoming fiscal year on or about June 1 of each year. If the commissioner fails to set the notice filing fees for the upcoming fiscal year, then the filing fees shall be the maximum fees that may be levied under those sections for the upcoming fiscal year.
maximum filing fees notice filing fee securities offering commissioner authority annual fee setting fiscal year fees subdivision fee limits fee adjustment deadline notice filing regulations Section 25102 Section 25100.1 Section 25608 Section 25608.1 filing fee adjustments
(Amended by Stats. 2001, Ch. 264, Sec. 7. Effective January 1, 2002.)

Section § 25608.3

Explanation

This law gives the commissioner the ability to set fees lower than the maximum allowed under certain sections, ensuring they are enough to cover costs but not exceed limits. The commissioner usually sets fees around June 1 each year, but for some specific past periods, they adjusted fees earlier. From July 1, 2003, onward, if the commissioner doesn't set the new fee by June 1, the previous year's fee continues. The commissioner must also manage fees to keep a fund balance below 25% of the State Corporations Fund by mid-2007. Additionally, the department has to report on fee reductions and their financial impact through 2007 to key legislative committee leaders.

(a)CA Corporations Code § 25608.3(a) Notwithstanding Sections 25608 and 25608.1, the commissioner may set any fee under those sections at an amount below the maximum fee set forth in those sections. The commissioner shall set the fee for the upcoming fiscal year on or about June 1 of each year, except that for the six-month period of January 1, 2002, through June 30, 2002, and for the 2002–03 fiscal year, the commissioner, on January 1, 2002, shall, in a reasonable and prudent manner, reduce any fee under Sections 25608 and 25608.1 by an amount below the maximum fee set forth in those sections. For the fiscal year commencing on July 1, 2003, and thereafter, the commissioner shall establish the level of fees adequate to cover anticipated costs, including the maintenance of a prudent reserve, but not to exceed the maximum fees that may be levied under Sections 25608 and 25608.1. If, for the fiscal year commencing on July 1, 2003, or thereafter, the commissioner fails to set the fee for the upcoming fiscal year on or before June 1, then the fee for the next fiscal year shall be the fee that was in effect for the current fiscal year.
(b)CA Corporations Code § 25608.3(b) In carrying out this section, the commissioner shall reduce or suspend fees to achieve no more than a 25-percent fund balance in the State Corporations Fund by June 30, 2007, and thereafter.
(c)CA Corporations Code § 25608.3(c) The department shall report by February 1, 2002, to the Chair of the Joint Legislative Budget Committee and the chairs of the budget committees on the fees to be reduced and the projected revenue and fund balance impact on the State Corporations Fund through the 2006–07 fiscal year. Each year from 2002 through 2007, the department shall submit a status update report by November 1 on the fees reduced, the revenue and fund balance impact in the prior fiscal year, and the projected revenue and fund balance impact through the 2006–07 fiscal year.
commissioner fee setting maximum fee limits fiscal year fee adjustment prudent reserve corporations fund balance fee reduction suspend fees state corporations fund anticipated costs legislative report budget committees revenue impact fund balance impact Joint Legislative Budget Committee status update report
(Added by Stats. 2001, Ch. 118, Sec. 1. Effective July 30, 2001.)

Section § 25609

Explanation

In California, if you're not happy with a final decision or action made by the commissioner, you can have it reviewed by a court.

Every final order, decision, license, or other official act of the commissioner is subject to judicial review in accordance with law.
final decision judicial review commissioner official act court review license appeal legal review process administrative decision appeal rights review by court challenge decision California commissioner legal actions
(Added by Stats. 1968, Ch. 88.)

Section § 25610

Explanation

This law allows the commissioner to create or change rules, forms, and orders as needed to enforce the law. The commissioner can set rules about applications and reports and define terms, as long as they don't conflict with existing laws. They can also categorize securities, people, and matters under their authority and set different rules for each category. If a rule isn't necessary to protect the public or investors, the commissioner can choose to waive it.

The commissioner may from time to time make, amend and rescind such rules, forms, and orders as are necessary to carry out the provisions of this law, including rules and forms governing applications and reports, and defining any terms, whether or not used in this law, insofar as the definitions are not inconsistent with the provisions of this law. For the purpose of rules and forms, the commissioner may classify securities, persons, and matters within his jurisdiction, and may prescribe different requirements for different classes. The commissioner may in his discretion waive any requirement of any rule or form in situations where in his opinion such requirement is not necessary in the public interest or for the protection of investors.
commissioner rules forms orders applications reports securities classification waive requirements public interest investor protection jurisdiction definitions inconsistent provisions different requirements categorizing
(Added by Stats. 1968, Ch. 88.)

Section § 25611

Explanation

The commissioner can create and share lists of people whose securities meet the trading rules in California, are exempt from these rules, or don't need to meet them. They can charge for these lists to cover the costs of making and sharing them.

The commissioner may prepare and make available to interested persons lists of persons whose securities are qualified for trading purposes in this state, are exempt from qualification, or are not subject to qualification as the commissioner may determine to be necessary or desirable, and the commissioner may make reasonable charges for those lists to defray the expenses of preparation and dissemination.
commissioner securities qualified for trading exempt from qualification not subject to qualification lists of persons reasonable charges dissemination expenses trading purposes interested persons preparation costs
(Amended by Stats. 1998, Ch. 48, Sec. 8. Effective January 1, 1999.)

Section § 25612

Explanation
This law states that any new rule, change, or cancellation of existing rules in corporate regulations can only happen if the commissioner decides it's crucial for public safety or investor protection and aligns with the law's goals.
No rule, form or order may be made, amended, or rescinded unless the commissioner finds that the action is necessary or appropriate in the public interest or for the protection of investors and consistent with the purposes fairly intended by the policy and provisions of this law.
public interest protection of investors commissioner decision corporate regulations rule amendment necessary actions public safety investor protection rule changes corporate law policies law goals consistency rule rescinding necessary action
(Amended by Stats. 1995, Ch. 596, Sec. 1. Effective January 1, 1996.)

Section § 25612.3

Explanation

This law states that the commissioner requires specific forms for various securities industry filings and actions. For broker-dealer applications, Form BD is used. If a broker-dealer wants to withdraw, they must use Form BDW. Investment advisers use Form ADV to register, and Form ADV-W to withdraw. When reporting personnel in the securities industry, Form U4 is used for new registrations or transfers and Form U5 for terminations.

Unless otherwise provided by rule, the commissioner shall require the use of the following forms:
(a)CA Corporations Code § 25612.3(a) Form BD (Uniform Application for Broker-Dealer Registration) for a broker-dealer application.
(b)CA Corporations Code § 25612.3(b) Form ADV (Uniform Application for Investment Adviser Registration) for an investment adviser application.
(c)CA Corporations Code § 25612.3(c) Form BDW (Uniform Request for Broker-Dealer Withdrawal) for withdrawing from licensure as a broker-dealer.
(d)CA Corporations Code § 25612.3(d) Form ADV-W (Notice of Withdrawal from Registration as an Investment Adviser) for withdrawing from licensure as an investment adviser.
(e)CA Corporations Code § 25612.3(e) Form U4 (Uniform Application for Securities Industry Registration or Transfer) for the reporting of an agent of a broker-dealer or an investment adviser representative or associated person of an investment adviser.
(f)CA Corporations Code § 25612.3(f) Form U5 (Uniform Termination Notice for Securities Industry Registration) for the reporting of the termination of an agent of a broker-dealer or an investment adviser representative or associated person of an investment adviser.
broker-dealer registration investment adviser registration Form BD Form ADV Form BDW Form ADV-W Form U4 Form U5 securities industry broker-dealer withdrawal investment adviser withdrawal agent registration termination notice reporting requirements commissioner requirements
(Amended by Stats. 2019, Ch. 143, Sec. 51. (SB 251) Effective January 1, 2020.)

Section § 25612.5

Explanation

This law section allows the commissioner to work with other states, countries, and various national and international agencies to ensure consistent enforcement of securities and franchise laws. This cooperation can include standardizing forms and applications, participating in nationwide systems for securities and investment adviser registration, and engaging in activities related to the USA Patriot Act. It also mentions that any electronically filed registration or application will be considered valid when converted to paper by the financial protection department. An "electronic record" in this context follows a specific definition from the Civil Code.

(a)CA Corporations Code § 25612.5(a) To encourage uniform interpretation and administration of this law and the Franchise Investment Law (Division 5 (commencing with Section 31000)) and effective securities and franchise regulation and enforcement, the commissioner may cooperate with the securities agencies or administrators of one or more states, Canadian provinces or territories, or other countries, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Securities Investor Protection Corporation, any self-regulatory organization, any national or international organization or securities officials or agencies, and any governmental law enforcement or regulatory agency.
(b)CA Corporations Code § 25612.5(b) The cooperation authorized by subdivision (a) includes, but is not limited to, the following actions:
(1)CA Corporations Code § 25612.5(b)(1) Prescribing rules and forms with a view to achieving maximum uniformity in the form and content of registration statements, applications, and reports wherever practicable.
(2)CA Corporations Code § 25612.5(b)(2) Participating in a nationwide central depository for qualification or registration of securities under this law and for documents or records required or allowed to be maintained under this law.
(3)CA Corporations Code § 25612.5(b)(3) Participating in the Central Registration Depository, or any successor or alternative nationwide or regional depository, for the registering, certifying, or licensing of broker-dealers or agents, or both.
(4)CA Corporations Code § 25612.5(b)(4) Participating in the Investment Adviser Registration Depository, or any successor or alternative nationwide or regional depository, for the registering, certifying, or licensing of investment advisers or investment adviser representatives, or both.
(5)CA Corporations Code § 25612.5(b)(5) Cooperating in any regulatory activity necessary in the administration of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56; USA Patriot Act), consistent with state law.
(c)CA Corporations Code § 25612.5(c) Notwithstanding any other provision of law, any application for qualification, amendment to the application or related securities qualification or registration document or notice under Sections 25100.1, 25101.1, 25102, 25102.1, 25110, 25120, 25130, and 25230.1 or record otherwise required to be signed that is filed in this state as an electronic record pursuant to a nationwide central depository for qualification or registration of securities, or any electronic record filed through the Central Registration Depository or the Investment Adviser Registration Depository, shall be deemed to be a valid original document upon reproduction to paper form by the Department of Financial Protection and Innovation.
(d)CA Corporations Code § 25612.5(d) For purposes of this section, “electronic record” has the same meaning as in subdivision (g) of Section 1633.2 of the Civil Code.
securities regulation franchise regulation uniform interpretation nationwide depository broker-dealer registration investment adviser registration USA Patriot Act cooperation electronic records Department of Financial Protection and Innovation registration statements application standardization international cooperation financial enforcement state cooperation Securities and Exchange Commission
(Amended by Stats. 2022, Ch. 452, Sec. 82. (SB 1498) Effective January 1, 2023.)

Section § 25613

Explanation

This law lets the commissioner make rules about financial statements. They can decide what form these statements should take, when multiple companies need to combine their financial statements, and when the statements need to be examined by independent accountants.

The commissioner may by rule or order prescribe (1) the form and content of financial statements required under this law, (2) the circumstances under which consolidated financial statements shall be filed, and (3) the circumstances under which financial statements shall be audited by independent certified public accountants or public accountants.
commissioner rules form of financial statements content of financial statements consolidated financial statements audited financial statements independent certified public accountants public accountants financial audit requirements statement filing circumstances rules for accountants
(Added by Stats. 1968, Ch. 88.)

Section § 25614

Explanation

This law says that any rules the commissioner wants to make, change, or cancel must follow the process outlined in the Administrative Procedure Act. However, rules about running the department itself are excluded. New rules can be prepared before a law’s official start date, so they're ready to go when the law takes effect.

All rules of the commissioner (other than those relating solely to the internal administration of the Department of Financial Protection and Innovation) shall be made, amended, or rescinded in accordance with the provisions of the Administrative Procedure Act, Chapter 4 (commencing with Section 11370) of Part 1 of Division 3 of Title 2 of the Government Code. Rules may be adopted prior to the effective date of this law to become effective upon its effective date.
commissioner rules Administrative Procedure Act rule amendment rule rescission internal administration Department of Financial Protection and Innovation rule-making process effective date government code division procedures adoption of rules regulatory procedures department rules
(Amended by Stats. 2022, Ch. 452, Sec. 83. (SB 1498) Effective January 1, 2023.)

Section § 25615

Explanation
A document is considered filed once the commissioner gets it, but a sale of securities can't go ahead until the right fees are paid.
A document is filed when it is received by the commissioner; but no qualification of the sale of securities shall become effective until the appropriate fee has been paid.
filed document receipt by commissioner qualification sale of securities effective qualification appropriate fee paid fees securities sales commissioner approval filing requirements
(Added by Stats. 1968, Ch. 88.)

Section § 25616

Explanation

This law requires the commissioner to maintain a record of all approvals (qualifications), as well as any denials, suspensions, or revocations of permits and certificates that have been issued under this regulation.

The commissioner shall keep an index of all qualifications which are or have ever been effective, all denial, suspension, or revocation orders which have been entered and all permits and certificates which have been issued by him under this law.
commissioner duties qualifications index denial orders suspension orders revocation orders permits certificates record keeping government oversight regulatory compliance document maintenance administrative records business regulation permit issuance certificate maintenance
(Added by Stats. 1968, Ch. 88.)

Section § 25617

Explanation

If you need a copy of a public document from the commissioner, they can provide you with one for a reasonable fee. However, public officials don’t have to pay for copies they need for their official duties. If you ever need to use one of these certified copies in court, it can serve as initial proof of what's in the document.

Upon request and at such reasonable charges as he prescribes by rule, the commissioner shall furnish to any person photostatic or other copies (certified under his seal of office if requested) of any document which is retained as a matter of public record, except that he shall not charge or collect any fee for photostatic or other copies of any document furnished to public officers for use in their official capacity. In any judicial proceeding or prosecution, any copy so certified is prima facie evidence of the contents of the document certified.
commissioner photostatic copies public record reasonable charges certified copies seal of office public officers judicial proceeding prima facie evidence official capacity
(Added by Stats. 1968, Ch. 88.)

Section § 25618

Explanation

The commissioner has the option to respond to requests from people who want an official explanation or interpretation of certain financial regulations.

The commissioner in his discretion may honor requests from interested persons for interpretive opinions.
commissioner interpretive opinions requests discretion financial regulations interpretation official explanation interested persons
(Added by Stats. 1968, Ch. 88.)

Section § 25619

Explanation

This law outlines the conditions under which the commissioner can destroy certain documents, such as applications, notices, and certificates that are no longer needed. After four years, with approval, these can be disposed of, except for records of disciplinary actions, which must be kept permanently. Additionally, the commissioner can discard securities certificates for corporations that have been dissolved or inactive for at least two years. Permanent records of the destroyed items must be preserved. Certified copies of destroyed documents, whether on microfilm or other forms, are considered as good as the originals.

(a)CA Corporations Code § 25619(a) The commissioner may destroy any applications, notices, orders, permits, and revoked or surrendered certificates, together with the files and folders, as useless or obsolete, four years after the date of filing or issuance, with the approval of the Department of General Services; provided, that a permanent record shall be maintained of any disciplinary action taken by the commissioner.
(b)CA Corporations Code § 25619(b) When acting as escrow holder for securities, the commissioner may destroy any certificates evidencing securities of any corporation which has been dissolved or whose charter has been suspended for a period of not less than two years for nonpayment of taxes or penalties and may destroy any other records pertaining to the escrow of the securities destroyed, and he or she shall have no further liability or accountability therefor; provided, that the commissioner shall maintain a permanent record containing such information as he or she may by rule prescribe relating to the certificates and records so destroyed.
(c)CA Corporations Code § 25619(c) Copies on microfilm or in other form which may be retained by the commissioner in his discretion of any records destroyed under this section shall be accepted for all purposes as equivalent to the original when certified by the commissioner.
commissioner document destruction obsolete records four-year rule disciplinary action records permanent record securities escrow dissolved corporation charter suspension tax nonpayment certificate destruction microfilm copies Department of General Services approval escrow holder accountability certified copies
(Amended by Stats. 1997, Ch. 391, Sec. 35. Effective January 1, 1998.)

Section § 25620

Explanation

This law allows the commissioner to accept electronic records and signatures in certain cases, but they are not required to do so. An "electronic record" can be any document or communication stored, sent, or received digitally, such as applications, reports, decisions, and correspondence with the commissioner. An "electronic signature" is any digital mark or process that shows a person's intent to sign a document. The law encourages the Department of Financial Protection and Innovation to continue expanding its use of electronic filings, as resources permit.

(a)CA Corporations Code § 25620(a) Notwithstanding any other law, the commissioner may by rule or order prescribe circumstances under which to accept electronic records or electronic signatures. This section does not require the commissioner to accept electronic records or electronic signatures.
(b)CA Corporations Code § 25620(b) For purposes of this section, the following terms have the following meanings:
(1)CA Corporations Code § 25620(b)(1) “Electronic record” means a record created, generated, sent, communicated, received, or stored by electronic means. “Electronic record” also includes, but is not limited to, all of the following:
(A)CA Corporations Code § 25620(b)(1)(A) An application, amendment, supplement, and exhibit, filed for any qualification, registration, order, permit, certificate, license, consent, or other authority.
(B)CA Corporations Code § 25620(b)(1)(B) A financial statement, report, or advertising.
(C)CA Corporations Code § 25620(b)(1)(C) An order, permit, certificate, license, consent, or other authority.
(D)CA Corporations Code § 25620(b)(1)(D) A notice of public hearing, accusation, and statement of issues in connection with any application, qualification, registration, order, permit, certificate, license, consent, or other authority.
(E)CA Corporations Code § 25620(b)(1)(E) A proposed decision of a hearing officer and a decision of the commissioner.
(F)CA Corporations Code § 25620(b)(1)(F) The transcripts of a hearing.
(G)CA Corporations Code § 25620(b)(1)(G) A release, newsletter, interpretive opinion, determination, or specific ruling.
(H)CA Corporations Code § 25620(b)(1)(H) Correspondence between a party and the commissioner directly relating to any document listed in subparagraphs (A) to (G), inclusive.
(2)CA Corporations Code § 25620(b)(2) “Electronic signature” means an electronic sound, symbol, or process attached to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.
(c)CA Corporations Code § 25620(c) The Legislature finds and declares that the Department of Financial Protection and Innovation has continuously implemented methods to accept records filed electronically, including broker-dealer and investment adviser applications, and is encouraged to continue to expand its use of electronic filings to the extent feasible, as budget, resources, and equipment are made available to accomplish that goal.
electronic records electronic signatures Department of Financial Protection and Innovation electronic filings broker-dealer applications investment adviser applications electronic communication digital documents public hearings financial statements correspondence digital signatures administrative hearings interpretive opinion registration
(Amended by Stats. 2022, Ch. 452, Sec. 84. (SB 1498) Effective January 1, 2023.)