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Form ADV Part 1A Item 2A(13) · Answer type: yn · Item 2 - SEC Registration
Item 2A(13) asks whether the firm is no longer eligible to remain registered with the SEC.
This checkbox captures transition periods when a firm's circumstances have changed so that it no longer meets the requirements that originally allowed SEC registration. The firm might be in the process of withdrawing from SEC registration or transitioning to state-only registration.
Common triggers include AUM falling below maintenance thresholds, changes in business model that eliminate SEC registration basis, or corporate restructuring that affects registration eligibility. The firm continues filing with the SEC during the transition period.
This is not a disciplinary status like those in Item 11 disclosure questions. It reflects changed business circumstances rather than regulatory violations or enforcement actions.
Do not confuse 2A(13) with active registration statuses in other Item 2A boxes. A firm marking Yes here is typically moving away from SEC registration, not establishing new eligibility.
Yes
The firm reports that it is no longer eligible to remain registered with the SEC under Item 2A(13).
No
The firm does not report ineligibility - it continues to meet requirements for SEC registration under other Item 2A criteria.
2A(13) - Are no longer eligible to remain registered with the SEC (Yes / No).
This appears in Item 2, SEC Registration, which explains the firm's basis for SEC registration eligibility.
A Yes on 2A(13) signals a firm in regulatory transition. This might indicate shrinking business, restructuring, or changes in service model that affect SEC registration requirements. The timing and reason for ineligibility can provide insights into the firm's trajectory.
However, loss of SEC registration eligibility does not necessarily indicate business problems. Some firms voluntarily reduce scope to operate under state registration by preference. Others undergo corporate changes that affect registration requirements without impacting client service.
The answer does not reveal specific reasons for ineligibility or timeline for registration changes. A firm might be winding down operations, transferring assets to affiliates, or simply falling below AUM thresholds due to market conditions.
Use 2A(13) as a flag for additional research into the firm's current status and future plans. Clients of firms marking Yes should understand potential impacts on service continuity and regulatory oversight.
Yes
The firm reports ineligibility to remain SEC-registered under Item 2A(13). On Best Investors, check the ADV filing date to understand how recent this status change is. Recent filings with Yes answers may indicate ongoing transitions.
Review regulatory AUM in Item 5F(2)(c) to see whether AUM changes drove the ineligibility. Compare current AUM with large adviser thresholds in Item 2A(1) or other registration minimums.
Check business activities in Item 6A and services in Item 5G for changes that might affect registration eligibility. Firms sometimes restructure business lines in ways that impact SEC registration basis.
Look for recent amendments or updates to the firm's Form ADV that might explain the eligibility change. The firm may have filed additional disclosures about registration transitions.
No
The firm does not claim ineligibility on this line. Check which other Item 2A boxes are marked Yes to see the firm's current registration basis. Most continuing SEC registrants qualify under standard paths like large adviser status or specialized categories.