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The following is from the AKC page re: Limited Registration

AKC Limited Registration
AKC registration application forms provide the option for registering dogs with limited registration. Limited registration means that litters produced by the dog are not eligible for AKC registration. The dog is eligible to compete in all AKC-licensed events except breed competition at an AKC-licensed dog show. The decision as to the registration status of a dog is the responsibility of the litter owner(s). The litter owner(s) must check the appropriate box in section A of the individual registration application form to indicate whether the dog should be designated as having limited or full registration privileges. If no box is checked, full registration will be assigned.

Limited registration can only be designated at the time the dog is individually registered. The limited designation may be removed upon the written permission of the litter owner(s) and upon submission of a form for that purpose which, is available from the AKC, and required fee. Once the limited designation has been deleted it may not be reimposed.

The decision as to whether or not a dog will be registered with limited registration is left solely to the litter owner(s). Limited registration is a tool with which the litter owner(s) can protect their breeding program. We would strongly recommend that if a dog is being sold with limited registration that the litter owner(s) make this condition clear to the potential dog buyer(s) so that there is no confusion about the terms under which the dog was purchased. If breeders provide a written bill of sale in addition to the registration application form, we would urge that the bill of sale include the fact that the dog is being sold with limited registration and that the buyer acknowledges in writing that the dog is being accepted with that condition.