Table of Contents
SIE PREP | FINANCIAL REGULATION COURSES
The Series 63 — formally titled the Uniform Securities Agent State Law Examination — is the state-level securities licensing examination developed by the North American Securities Administrators Association and administered by FINRA that qualifies individuals to register as securities agents in the states that require it — providing the state-level registration complement to the federal-level FINRA qualification examinations such as the Series 7, Series 6, and Series 57. While the Series 7 and other FINRA qualification examinations provide federal-level authorisation to conduct securities business as a registered representative, they do not by themselves satisfy state registration requirements — most states separately require that registered representatives pass the Series 63 or an equivalent state law examination before they may solicit securities transactions with investors residing in that state. The Series 63 is tested on the SIE and Series 7 examinations in the context of the dual federal-state regulatory framework governing securities agents, the distinction between the Series 63 and the Series 65 and Series 66, and the statutory framework of the Uniform Securities Act that governs state securities regulation.
The United States securities regulatory framework operates on two parallel levels simultaneously — the federal level governed by the SEC, FINRA, and the major federal securities statutes, and the state level governed by each state's securities administrator and the state securities laws commonly called blue sky laws. This dual regulatory structure means that a securities professional must typically satisfy both federal and state registration requirements before conducting securities business — federal FINRA registration through the appropriate qualification examination, and state registration through the applicable state-level examination.
The term blue sky laws derives from an early twentieth century reference to speculative securities schemes that offered investors the equivalent of a patch of blue sky — colorful promotions with no substance underneath. Kansas enacted the first blue sky law in 1911, and most states followed with their own securities statutes in the ensuing decades. The Blue Sky laws predated the Securities Act of 1933 and the Exchange Act of 1934 — when Congress enacted federal securities legislation, it preserved the states' authority to regulate securities transactions within their borders, creating the dual regulatory structure that persists today.
The Uniform Securities Act — developed by the Uniform Law Commission and first published in 1956 — is the model statute that most states have adopted as the basis for their state securities laws, with variations reflecting each state's own legislative history and policy preferences. NASAA has added its own amendments and commentary to the 1956 Uniform Securities Act, creating the version — the Uniform Securities Act with NASAA amendments — that governs the Series 63 examination content. The Series 63 is explicitly based on this version of the Uniform Securities Act rather than the Uniform Securities Act of 2002 that the Uniform Law Commission subsequently developed.
The North American Securities Administrators Association is the organisation of state and provincial securities regulators in the United States, Canada, and Mexico — representing the securities administrator of every state in the United States, every Canadian province and territory, and Mexico. NASAA was founded in 1919 — making it older than the SEC by fifteen years — and serves as the collective voice of state securities regulators in the development of uniform examination standards, model legislation and regulations, and policy positions on investor protection issues.
NASAA developed the Series 63 examination in cooperation with representatives of the securities industry and industry associations to create a uniform state-level qualification standard — the word uniform in the examination's name reflects its purpose as a standardised qualification that satisfies the state securities agent registration requirement in all participating states through a single examination, rather than requiring candidates to pass fifty separate state examinations. While NASAA develops and owns the examination content, FINRA administers the logistics of the examination programme — candidate registration, examination scheduling, testing infrastructure, and result reporting — through the same FINRA Gateway and Prometric testing network used for all FINRA qualification examinations.
Nearly all states require the Series 63 — or an equivalent examination — as a condition of state registration for securities agents. However, a small number of states and jurisdictions have different requirements that securities professionals should verify for the specific states in which they intend to conduct business.
Colorado, Florida, Louisiana, Maryland, and Ohio do not require the Series 63 — these states have waived the state law examination requirement for FINRA-registered representatives, relying on federal qualification examinations as a sufficient demonstration of competency without a separate state law examination. The District of Columbia and Puerto Rico similarly do not require the Series 63. New Hampshire and Wyoming have historically had particular examination and registration structures that differ from the majority of states.
The practical consequence is that most securities agents working with a national client base — conducting business across many states — will need the Series 63 to ensure state registration in the majority of states where their clients reside. A broker-dealer firm operating nationally almost universally requires its registered representatives to hold the Series 63 alongside their FINRA qualification examination, both to ensure immediate state registration capability in all major markets and to avoid the compliance complexity of tracking which clients reside in states requiring different examinations.
The Series 63 examination consists of sixty scored multiple-choice questions and five unscored pretest questions — sixty-five questions total — administered over seventy-five minutes. The passing score is seventy-two percent — forty-three correct answers out of sixty scored questions. The passing score of seventy-two percent is higher than the seventy percent passing score required for most FINRA-administered examinations, reflecting the precision required in state law knowledge. The examination is administered through Prometric testing centres.
The Series 63 examination content is organised around the Uniform Securities Act and NASAA model rules, covering three primary subject matter areas that reflect the actual regulatory knowledge a state-registered securities agent must possess.
Principles of State Securities Regulation Reflected in the Uniform Securities Act — the largest content area — covers the registration requirements applicable to securities agents and broker-dealers under state law, the exemptions from registration available for specific transactions and securities, the anti-fraud provisions of the Uniform Securities Act, the authority and investigative powers of state securities administrators, and the civil and criminal penalties applicable to violations of state securities law. The Uniform Securities Act's registration framework requires broker-dealers and their agents to register with the securities administrator of each state where they conduct securities business — unlike the federal FINRA framework in which registration is national, state registration must be obtained separately for each state.
Remedies and Administrative Provisions — covers the regulatory tools available to state securities administrators when violations occur, including the authority to conduct examinations, issue subpoenas, seek injunctive relief, impose civil penalties, and refer criminal matters for prosecution. The Uniform Securities Act grants state securities administrators broad investigative and enforcement authority — including the ability to deny, suspend, or revoke the registration of broker-dealers and agents within the state based on specified grounds including criminal convictions, regulatory violations, misrepresentations in registration applications, and unfair business practices.
Communication with Customers and Ethical Practices — covers the ethical standards applicable to securities agents in their dealings with customers, including the prohibition on misrepresentations, churning, unsuitable recommendations, excessive charges, unauthorised transactions, and the various other prohibited practices enumerated in the Uniform Securities Act's anti-fraud provisions and NASAA's model rules on dishonest and unethical business practices.
The Series 63 and the Series 65 are both NASAA-developed state law examinations administered by FINRA, but they serve fundamentally different registration purposes that are among the most important and most tested distinctions in the securities licensing framework.
The Series 63 qualifies the holder as a securities agent — the state-level registration for individuals who work for broker-dealers and conduct securities transactions with customers. It is the state complement to the Series 7 or other FINRA representative-level qualification examinations. A registered representative holding the Series 7 and the Series 63 has both federal FINRA registration and state securities agent registration — the complete dual-level registration required to conduct securities business with customers in most states.
The Series 65 — the Uniform Investment Adviser Law Examination — qualifies the holder as an investment adviser representative — the state-level registration for individuals who work for registered investment advisory firms and provide investment advice to clients for compensation. It is the primary qualification for investment adviser representatives in most states and is discussed in its own entry in this dictionary.
A securities professional who both sells securities as a broker-dealer registered representative and provides investment advice as an investment adviser representative may need to hold the Series 63 for the broker-dealer function and the Series 65 for the investment adviser function — or may combine both into the single Series 66 examination that covers the content of both.
The Series 66 — the Uniform Combined State Law Examination — combines the content of the Series 63 and the Series 65 into a single examination that satisfies both the securities agent state registration requirement and the investment adviser representative state registration requirement simultaneously. The Series 66 is discussed in its own entry in this dictionary.
A securities professional who expects to function as both a registered representative and an investment adviser representative — conducting both securities transactions and investment advisory services for clients — may choose to take the Series 66 rather than taking both the Series 63 and the Series 65 separately. The Series 66 is paired with the Series 7 to achieve the combined federal FINRA and dual state registration that a full-service securities and advisory practice requires.
A critical practical difference between the Series 63 and the FINRA qualification examinations is that the Series 63 does not require the candidate to hold or have passed the Securities Industry Essentials examination as a prerequisite. The Series 63 is a standalone NASAA examination — it can be taken without firm sponsorship and without passing the SIE.
This open access structure means that individuals who are uncertain about their career direction can sit for the Series 63 examination before committing to a specific FINRA registration path — testing their knowledge of state securities law without simultaneously committing to the firm sponsorship and top-off examination obligations of FINRA registration. However, passing the Series 63 alone does not confer any securities registration — state registration as a securities agent requires both the Series 63 and an appropriate FINRA qualification examination — typically the Series 7 or Series 6 — plus firm sponsorship.
NASAA has adopted a model rule for an Exam Validity Extension Program for Broker-Dealer Agents that allows individuals to maintain the validity of their Series 63 result for up to five years — beyond the standard two-year lapse period — by completing annual continuing education requirements in states that have adopted the model rule. This extension programme parallels FINRA's Maintaining Qualifications Programme that allows individuals to maintain their FINRA examination results during gaps in industry employment.
Although the Series 63's primary purpose is to qualify broker-dealer securities agents for state registration, NASAA includes investment adviser regulatory content within the Series 63 examination scope because of what NASAA describes as the close intersections between securities brokerage and advisory services and the necessity for broker-dealer agents to understand the limits of permissible broker-dealer activity relative to regulated investment advisory activity. A registered representative who crosses the line from permissible incidental investment advice — which is covered by the broker-dealer exclusion from the investment adviser definition in the Uniform Securities Act — into providing investment advisory services for special compensation becomes subject to state investment adviser registration requirements. Understanding where that line falls and what constitutes regulated investment advisory activity requiring separate registration is therefore relevant knowledge for broker-dealer securities agents even under the Series 63's broker-dealer agent scope.
The Series 63 is tested on the SIE and Series 7 examinations in the context of the federal-state dual registration framework, the distinction between federal FINRA registration and state securities agent registration, and the relationship between the Series 63, the Series 65, and the Series 66.
The key points to retain are these.
The Series 63 — Uniform Securities Agent State Law Examination — is developed by NASAA and administered by FINRA, qualifying individuals as securities agents for state registration purposes under the state blue sky laws based on the Uniform Securities Act with NASAA amendments. Most states require the Series 63 — or an equivalent — as a condition of state securities agent registration alongside the federal FINRA qualification examination. States that do not require the Series 63 include Colorado, Florida, Louisiana, Maryland, Ohio, the District of Columbia, and Puerto Rico. The examination consists of sixty scored questions and five unscored pretest questions over seventy-five minutes — passing score is seventy-two percent, forty-three correct answers out of sixty scored. Three content areas cover the Uniform Securities Act registration framework and exemptions, regulatory remedies and administrator authority, and ethical practices and prohibited conduct.
The Series 63 complements the Series 7 or Series 6 for broker-dealer agents — the Series 7 provides federal FINRA registration and the Series 63 provides state securities agent registration. The Series 63 does not require passage of the SIE as a prerequisite and does not require firm sponsorship — it can be taken independently before obtaining FINRA sponsorship. Passing the Series 63 alone confers no registration — state registration requires both the Series 63 and an appropriate FINRA qualification examination plus firm sponsorship. The Series 63 is distinguished from the Series 65 — which qualifies investment adviser representatives rather than broker-dealer securities agents — and from the Series 66 — which combines the Series 63 and Series 65 content into a single examination satisfying both agent and adviser representative state registration requirements simultaneously.
