---
kind: "section"
citation: "17 C.F.R. § 401.4"
title: "17"
number: "401.4"
heading: "Exemption for financial institutions engaged in limited government securities dealer activities."
url: "https://uscodex.org/cfr/17/401.4"
---

# §401.4. Exemption for financial institutions engaged in limited government securities dealer activities.

- (a) Subject to the requirements of [paragraph (b)](#b) of this section, a financial institution shall be exempt from the provisions of sections 15C (a), (b), and (d) of the Act (15 U.S.C. [78o-5 (a)](/usc/15/78o-5.md?p=a), [(b)](/usc/15/78o-5.md?p=b), [(d)](/usc/15/78o-5.md?p=d)) and the regulations of this subchapter if its government securities dealer activities are limited to one or more of the following activities:
  - (1) Sales or purchases in a fiduciary capacity;
  - (2) The sale and subsequent repurchase and the purchase and subsequent resale of government securities pursuant to a repurchase or reverse repurchase agreement; and
  - (3) **Such other activities as have been exempted by regulation under this subchapter.**
- (b)
  - (1) A financial institution that relies on the exemption contained in [paragraph (a)](#a) of this section is required to comply with:
    - (i) The regulations of [part 450](/cfr/17/part450.md) of this chapter concerning custodial holdings of government securities for customers; and
    - (ii) [Section 403.5(d)](/cfr/17/403.5.md?p=d) of this chapter concerning certain repurchase transactions with customers.
  - (2) A branch or agency of a foreign bank that relies on the exemption contained in [paragraph (a)](#a) of this section is in addition required to comply with [§ 403.5(e)](/cfr/17/403.5.md?p=e) of this chapter.
- (c) For the purposes of this section “financial institution” includes an insured credit union, as defined in [12 U.S.C. 1752(7)](/usc/12/1752.md?p=7).

## Notes

### Authority

Authority: Sec. 101, Pub. L. 99-571, 100 Stat. 3209 (15 U.S.C. 78o-5(a)(4)).

### Source

Source: 52 FR 27930, July 24, 1987, unless otherwise noted.