blue sky laws


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blue sky laws

n. laws intended to protect the public from purchasing stock in fraudulent companies that lack substance, such as those selling swamp land, non-existent gold strikes and dry oil wells, or who have no assets besides a post office box. Blue sky laws require that corporations advertising and selling shares to the public must get approval from the state corporations commissioner and/or the Securities Exchange Commission after providing details on financing and management. The term comes from the intent to prevent the existence of corporations that have nothing behind them but "blue sky." (See: corporation)

References in periodicals archive ?
Part II explains the current role of blue sky laws in regard to capital-formation regulation.
8) By the time Congress passed the federal Securities Act of 1933 (the 1933 Act), forty-seven of the forty-eight states as well as the then-territory of Hawaii had adopted blue sky laws.
Blue sky laws have an important role in the governance of capital formation.
These private and governmental state sanctions, therefore, amount to a significant role for blue sky laws.
The risk presented by the state blue sky laws and deceptive trade practices is particularly onerous because these regulations apply a negligence standard rather than one of fraud.
It is recommended that brokers check with their compliance officers or legal counsel for applicable Blue Sky laws and regulations pertaining to them.
and Falcon Strategies Two B LLC violated laws pertaining to fraud, negligent misrepresentation, 12(A)(2) of the 1933 Securities Act and Florida Blue Sky Laws in the sale and management of the Falcon Strategies Two B Fund.
Despite this, the company had maintained the Boston Stock Exchange listing, in part, due to certain exemptions from State Blue Sky laws available to issuers listed on the Boston Stock Exchange.
In any jurisdiction in which the securities laws or blue sky laws require the tender offers and consent solicitations to be made by a licensed broker or dealer, the tender offers and consent solicitations will be deemed to be made on behalf of EOP Operating Limited Partnership by the Dealer Managers (who are also the Solicitation Agents), or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction.
As part of the program, a full description of Language Access Network will also be published in the Daily News section of Standard Corporation Records, a recognized securities manual for secondary trading in approximately 37 states under the Blue Sky Laws.