Most states do not have securities laws which provide hedge fund managers with an exemption from investment advisor registration at the state level.  However, Florida does have an exemption which many Florida based hedge fund managers rely upon in order to avoid registration with the Florida Securities Division.

Specifically, Section 517.021(13)(b) of the Florida laws provide that the term “investment adviser” does not include “any person who does not hold herself or himself out to the general public as an investment adviser and has no more than 15 clients within 12 consecutive months in this state.”  Of course the Florida hedge fund manager or prospective manager and the hedge fund attorney should discuss whether the manager’s investment advisory activities will fall within this definition.  Continue reading →