US Investment Advisers Act of 1940 and SEC Adviser Rules (17 CFR Part 275) 206-3-principal-cross: Before completing a principal trade or an agency cross with a client, disclose the capacity in writing and obtain the client's consent

Section 206(3) prohibits an adviser, acting as principal for its own account, from knowingly selling a security to a client or buying one from the client, or, when acting as broker for a third party, from knowingly effecting a purchase or sale for the client's account, unless before the transaction is completed it discloses in writing the capacity in which it acts and obtains the client's consent. The disclosure and consent are per transaction. Rule 206(3)-2 permits agency cross transactions under a prospective written authorisation, with a written confirmation for each trade, an annual statement of the crosses and the client's right to revoke; rule 206(3)-1 exempts advisers also registered as broker-dealers for certain non-advisory transactions.