Investment Company and. Variable Contracts Products Principals (Series 26) Practice Exam

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Which of these is a correct statement regarding the filing requirements for first year firms?

They must file within 15 business days after use.
They must file 10 business days prior to communications.
They have no filing requirements.
They must file immediately after use.

The correct answer is: They must file 10 business days prior to communications.

The correct statement regarding the filing requirements for first year firms is that they must file 10 business days prior to communications. This requirement is in place to ensure that the communications intended for public dissemination are reviewed by appropriate regulatory bodies before they are actually used. This advance filing helps maintain compliance with regulations designed to protect investors and ensure that all promotional materials are accurate and not misleading. By requiring firms to file their communications in advance, regulators can assess the content and ensure that it aligns with regulatory standards. This is especially important for first-year firms that may be unfamiliar with all compliance obligations and might unintentionally create communications that could mislead investors or lack necessary disclosures.