Blue Sky Laws

State securities laws, which regulate the offering of Securities. While the federal securities laws focus on regulation of the national markets, the Blue Sky Laws focus on irregular Securities and newly formed enterprises, with a goal of protecting the investing public from fraud and worthless speculative offerings. While these laws vary from state to state, most contain provisions concerning (a) prohibitions against fraud; (b) regulation of brokers and dealers doing business in the state; and (c) registration of Securities. Issues of Bonds generally qualify for an exemption from state securities registration requirements, although brokers and dealers selling them are subject to many states’ registration and regulatory requirements.

Although state securities laws vary among the states, most Blue Sky Laws are based on the Securities Act, promulgated by the National Conference of Commissioners on Uniform State Laws. The Securities Act provides an exemption from registration of those Securities, including for federally covered Securities and for Securities (including revenue obligations or a separate Security, as defined in Rule 131 under the 1933 Act) issued by the United States, any state or any Political Subdivision or public instrumentality of one or more states.

Dive Deeper on State Law Matters

Learn more about the various aspects of state laws and how they intersect with municipal securities.

See Also

Blue Sky Memorandum

Memorandum to Underwriter(s) setting forth the requirements of the state securities laws in the states where the Bonds are anticipated to be sold.


Any note, stock, treasury stock, bond, debenture, evidence of indebtedness, certificate of interest or evidence of any participation in any profit-sharing agreement.

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