Due to preemption, a state administrator cannot impose additional requirements on a federally covered adviser that are not consistent with the Investment Advisers Act of 1940. However, the State Administrator has the authority to conduct audits of any federally covered or uncovered adviser operating inside the State's borders.
Issuers of federally covered securities may be required by the rule or order of the state Administrator to file records with the state that are included in a registration statement filed with the SEC. Federally protected advisers are exempt from registering with the state, although they must still file a notice with the Administrator in the majority of states. The SEC registration paperwork, a consent to service of process form, and the filing fee make up this package.
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