Blue Sky State Filling Fees

Blue Sky Filings : What It Is and Why It Matters in Private Offerings

If you’re raising capital through a private placement under Regulation D, your compliance obligations don’t end with the SEC. You must also satisfy individual state-level securities laws—commonly known as “Blue Sky Laws.” These laws require issuers to make notice Blue Sky filings in each state where they offer or sell securities, even if your offering is exempt under federal law.

For attorneys, fund managers, entrepreneurs, and legal advisors, understanding Blue Sky State Filing is critical to protecting your offering from regulatory penalties and ensuring full legal compliance at both the federal and state levels.

What Is a Blue Sky Filing?

A Blue Sky Filing is a state-level notice filing that issuers must submit when offering or selling securities to residents of that state. The name comes from early 20th-century laws aimed at preventing speculative fraud—said to offer nothing but “blue sky” to investors.

In today’s private capital markets, Blue Sky Laws remain an essential part of securities compliance, especially for issuers conducting offerings under SEC Regulation D, including Rule 504, Rule 506(b), and Rule 506(c).

Why Blue Sky Filings Are Required

Even though Regulation D offerings are exempt from full SEC registration, they are not exempt from state oversight. Most states require issuers to file Form D along with a state-specific notice, filing fee, and sometimes consent to service of process.

Failing to comply can result in:

• Civil penalties and fines
• Disqualification from selling in the state
• Liability for rescission (returning investor funds)
• Damage to issuer reputation

When Do You File?

The timing of Blue Sky Filings varies by state, but generally:

• For Rule 506(b) and 506(c): File within 15 days of the first sale to an investor in that state
• For Rule 504 Offerings: Some states may require pre-sale registration or approval

Many states use the NASAA EFD (Electronic Filing Depository) system for streamlined filing, but several states still require manual or direct submissions.

What Does a Blue Sky Filing Include?

A typical state Blue Sky filing package may consist of:

• Form D (as filed with the SEC)
• State-specific notice form (e.g., U-2 or U-2A consent to service)
• Blue Sky Filings fee (varies by state, often between $100 and $500)
• Cover letter or transmittal form (in some cases)

For funds or companies raising capital from multiple investors across different states, a coordinated, accurate state filing plan is essential.

Tools and Platforms for Filing

Many issuers and attorneys use:

• NASAA EFD (www.efdnasaa.org) – Accepts Form D state filings for over 45 states and jurisdictions
• State securities portals – For direct or manual filings in states not participating in EFD (e.g., California)
• Compliance software – To manage filing deadlines, fees, and investor geography

For issuers working with multiple placement agents or accepting investors nationwide, professional support is recommended to track and fulfill all obligations efficiently.

Who Needs to File?

Any issuer raising capital through a Regulation D offering should prepare for Blue Sky filings in every state where investors reside, including:

• Startups raising venture capital
• Private equity and hedge funds
• Real estate syndications and sponsors
• FinTech and crypto-related issuers
• Franchisors and private companies

Even if your investors are all accredited and your PPM is attorney-reviewed, failure to make timely Blue Sky filings can still result in state-level enforcement actions.

Best Practices for Blue Sky Compliance

1. Track investor locations from the first subscription
2. Coordinate Form D filing with your state Blue Sky filings
3. Use EFD where available to simplify submission and track receipts
4. Calendar key filing deadlines—especially for multiple closings or ongoing capital raises
5. Maintain records and receipts for each filing to demonstrate good-faith compliance

Final Thoughts

Blue Sky Filings are not optional—they’re a mandatory part of securities compliance at the state level. For financial professionals and legal advisors, ensuring that filings are made correctly and on time is essential to avoid penalties and maintain a clean regulatory record.

If you’re launching a private offering and need help with PPMs, Form D filings, or Blue Sky compliance, our team offers legal-grade templates and filing support to streamline the process and keep your raise on track.