Continuous Benefits Beyond Blue Sky Compliance

Maintaining Blue Sky compliance is not only complicated but also adds significant cost and operational pressure to firms that are constantly reacting to an extensive variety of regulatory changes and payment terms across every state.  

Responding to regulatory changes at pace requires dedicated resources to undertake detailed coordination with jurisdictions to analyze specific requirements, which only further accelerates costs. Failure to adhere to regulations and file appropriately may result in significant financial penalties and reputational damage.

As a result, asset managers are searching for a fully outsourced Blue Sky administration partner to deliver benefits beyond compliance. SS&C Blue Sky Administration’s full-service operations, proprietary technology, and legal expertise has responded to the market and is leading the way for Blue Sky compliance services.

In 2023, our dedication to delivering simplified, efficient and actively managed Blue Sky compliance was recognized by 18 new clients who switched to join SS&C Blue Sky Administration. We enable the asset management industry to remain focused on its core objectives while guaranteeing the most cost-efficient compliance without any operational complexities.

Exceeding Market Expectations

Maintaining complex multi-jurisdictional requirements should be the bare minimum consideration when selecting the right Blue Sky administration provider. SS&C Blue Sky Administration’s purpose is to work as an extension of your team to drive continuous improvements aligned with every one of our clients’ unique requirements.

Significant Compliance Savings

Our proactive, consultative, and data-driven approach in conducting systematic daily reviews and monitoring sales activity has led to remarkable savings in state Blue Sky compliance fees across all clients in 2023:

• $84,495,557.48 estimated savings in sales to existing shareholder (SES) exemption initiatives.
• $7,282,252.81 estimated institutional exemption savings.

Enriched Portal Technology

• Advanced Nebraska Filing Process: We have introduced a new methodology for managing Nebraska filing complexities. The enhanced process enables a refined data-driven approach to determine the most cost-effective filing option for each investment product—whether it's registering for a Definite amount (minimum fee of $100) or the Indefinite method (minimum fee of $1000). This is achieved by evaluating client-defined preferences and historical sales information, systematically recommending the most advantageous filing strategy based on current data.
• Social Code Exemptions: In 2023 we implemented a solution to exempt qualified sales based on social code criteria. We partner with clients to identify potential exemption opportunities based on the investment product, jurisdiction and social code, further reducing Blue Sky expenses beyond traditional sales to existing shareholder (SES) exemptions.
• Faster access: We have now implemented an improved onboarding process to expedite access for all clients, ensuring seamless access to our system.
• Expanded Client-Facing Features: Our client portal now includes three new comprehensive components:
  • Registration: Provides insight into current Blue Sky Registration information including Permit details and Fees paid
  • Funding Component: Provides detailed information related to Funding invoices
  • Reporting Component (New December 2023): Features a range of self-service reports, including:
    • Fees Paid by Share Class
    • Fund/State Registration Matrix
    • Sales to Existing Shareholders (SES) Matrix
    • Active Permits
    • Fees Paid Summary
    • Exempted Sales

Enhanced Internal Processes

SS&C Blue Sky Administration is leveraging SS&C Blue Prism’s intelligent automation (IA) to continue enhancing our internal processes. Incorporating intelligent automation into our service model enables us to accelerate efficiencies, eliminate manual errors and enhance accuracy, all of which benefit our clients.

Electronic Filing Receipts Review:

• Function: IA meticulously examines all incoming electronic filing addenda from various states, comparing them against the permit information in our Blue Sky Portal.
• Purpose: The primary objective is to ensure that our permits remain in alignment with state records.
• Outcome: In instances of differences, it generates a work item for our staff's resolution. Since its implementation, it has processed over 66,000 items, autonomously reviewed and approved 56,000, and flagged 10,000 for our team's review.

Flat Fee Renewal Evaluations and Approvals:

• Function: IA is tasked with evaluating and approving renewals for states that levy a flat annual fee. It rigorously reviews pertinent permit data and notice filing information.
• Purpose: To ensure the accuracy of state fees and Form NF data.
• Outcome: Since its deployment, it has reviewed over 23,000 filings, and approved 17,000 with the rest earmarked for secondary review by our staff.

Integrating intelligent automation represents our commitment to leveraging SS&C's cutting-edge technology to enhance efficiency and accuracy in our operations.

What’s Next?

SS&C Blue Sky Administration prides itself on going above and beyond meeting minimum regulatory requirements. Our dedicated team of industry experts understands how best to overcome the complexities and costs of Blue Sky compliance and proactively consults with clients to present a range of options to determine the perfect approach for each firm. Our commitment to continuously enhance the robust framework of technology, expertise and partnerships we have built ensures our clients always benefit from:

• Minimized complexity and eliminated the risk of non-compliance.
• Maximized compliance savings.
• Seamless conversion with no disruption.

To learn more about the complexities of Blue Sky compliance, download our "Blue Sky Laws for Hedge Funds – The Top Five Misconceptions of State Regulatory Compliance" whitepaper.