Washington Administrative Code

As a condition to registration pursuant to RCW 21.20.180 or 21.20.210, the administrator may require an issuer, whose securities are being offered and sold directly by or for its own account, to file quarterly reports during the term of the offering on a form specified by the adm…

Quarterly reports will be filed on a quarterly basis, said quarters to be based upon the issuer's fiscal year. The quarterly reports shall be filed with the division within thirty calendar days from the end of each quarterly period.[Order SD-131-77, § 460-60A-035, filed 11/23/77;…

As set forth in RCW 21.20.710, the phrase "cash or comparable liquid assets" means: Legal tender of the United States of America, U.S. Treasury notes or bills, or other negotiable government securities with an ascertainable public market or other liquid assets as allowed with the…

The paid-in capital requirements enumerated in RCW 21.20.710 must be maintained at all times.[Statutory Authority: RCW 21.20.710 and 21.20.450. WSR 87-03-052 (Order SDO-05-87), § 460-64A-020, filed 1/21/87; Order 304, § 460-64A-020, filed 2/28/75, effective 4/1/75.]

A document is filed with the director when it is received by the director or by a person as the director designates by rule or order.[Statutory Authority: Chapter 19.100 RCW, RCW 19.100.250, 19.100.010, 19.100.030, 19.100.040, 19.100.050, 19.100.070, 19.100.080, 19.100.100, and 1…

The director, in his or her discretion, may honor requests from interested persons for no-action letters and interpretive opinions pursuant to RCW 19.100.250. The following procedures must be followed in requesting a no-action letter or interpretive opinion from the director:(1) …

Any franchisor or subfranchisor who claims an exemption under RCW 19.100.030 (4)(a) and (b)(i) shall file with the director a completed Annual Notice of Claim of Exemption form along with the fee prescribed in RCW 19.100.240 made payable to the treasurer of the state of Washingto…

For the purpose of the exemption of RCW 19.100.030(5), an "accredited investor" shall mean any person who comes within any of the following categories, or who the franchisor reasonably believes comes within any of the following categories, at the time of the sale of the franchise…

All applications for registration, renewal or amendment of a franchise shall be in the form as provided by the director and contain the information specified therein. The application for registration, renewal or amendment must be accompanied by the fee prescribed in RCW 19.100.24…

The following must be adhered to with respect to all applications for registration, registration renewal or registration amendment:(1) Completion of application. An application for registration of the offer or sale of franchises shall include the following, all of which shall be …

An application to renew or amend a franchise registration must comply with the following requirements:(1) An application for renewal of a franchise registration must be filed with the director no later than fifteen business days prior to the expiration of registration in order to…

All applications for initial registration or renewal of a franchise broker license shall be filed through the online franchise filing system administered by the director.[Statutory Authority: RCW 19.100.250. WSR 19-08-034, § 460-80-138, filed 3/27/19, effective 4/27/19.]

The Franchise Disclosure Document must include financial statements that comply with the instructions for Item 21 of the Franchise Disclosure Document, 16 C.F.R. Sec. 436.5.[Statutory Authority: RCW 19.100.250 and 19.100.040. WSR 15-14-130, § 460-80-140, filed 7/1/15, effective 8…

A registration statement for the selling of a franchise under RCW 19.100.060 becomes effective if no stop order is in effect and no proceeding pending under RCW 19.100.120 at 3:00 p.m., P.S.T. on the afternoon of the 15th business day after the filing of the registration or the l…

The filing of the application for registration or the effectiveness of the registration does not constitute a finding by the director that any document filed under the Franchise Investment Protection Act, chapter 19.100 RCW, is true, complete and not misleading. Neither any such …

(1) Each person that sells a franchise that is registered or required to be registered pursuant to RCW 19.100.020 shall ensure that the Franchise Disclosure Document and other required documents are delivered to each offeree in accordance with RCW 19.100.080 and shall obtain a si…

Every franchisor registered or required to be registered pursuant to RCW 19.100.020 shall, in each sale of a franchise in Washington, conform its franchise agreement to the Franchise Investment Protection Act, chapter 19.100 RCW, and the rules adopted thereunder or include in its…

To implement the offering circular and disclosure requirements of RCW 19.100.030 (4)(a) and 19.100.040, the director adopts the requirements for preparing the contents of a Franchise Disclosure Document set forth in sections III. and VII. of the 2008 Franchise Registration and Di…

In order to promote uniform regulation, the administrator adopts the North American Securities Administrators Association (NASAA) Statement of Policy Regarding the Use of Franchise Questionnaires and Acknowledgments, as adopted September 18, 2022.[Statutory Authority: RCW 19.100.…

The director may, by rule or order, require as a condition to the effectiveness of the registration the impound of franchise fees if he or she finds that such requirement is appropriate to protect prospective franchisees.[Statutory Authority: Chapter 19.100 RCW, RCW 19.100.250, 1…

In a case where the applicant has failed to demonstrate that adequate financial arrangements have been made to fulfill obligations to provide real estate, improvements, equipment, inventory, training or other items included in the offering, the director may impose as a condition …

When an impound condition is imposed in connection with the registration of a franchise offering, one hundred percent of franchisee fees and all other funds paid by the franchisees or subfranchisors for any purpose shall within 48 hours of the receipt of such funds, be placed wit…

Funds subject to an impound condition shall be placed in a separate trust account with a bank, trust company, or an independent escrow agent acceptable to the director. A copy of the impound agreement shall be filed with the director.[Statutory Authority: Chapter 19.100 RCW, RCW …

The director will authorize the depository to release to the franchisor such amounts of the impounded funds applicable to a specified franchisee (or subfranchisor) upon a showing that the franchisor has fulfilled its obligations under the franchise agreement, or that for other re…

In lieu of an impound under RCW 19.100.050, the director may accept a guarantee of the franchisor's performance under the franchise agreement by the franchisor's parent or affiliate, a surety bond, an agreement to defer payment of the franchise fee, or other arrangements to prote…

All advertising to be used to offer a franchise, subject to the registration requirement, for sale must be filed in the office of the director at least seven days prior to the publication.[Statutory Authority: Chapter 19.100 RCW, RCW 19.100.250, 19.100.010, 19.100.030, 19.100.040…

All advertising to be used to offer a franchise, subject to the registration requirement, for sale is subject to the following limitations:(1) An advertisement shall not contain any statement or inference that a purchase of a franchise is a safe investment or that failure, loss, …

"Advertisement" as defined under RCW 19.100.010 includes, in addition to the items expressly set forth in that provision, communications on the internet and at trade shows in connection with an offer or sale of a franchise.[Statutory Authority: Chapter 19.100 RCW, RCW 19.100.250,…

Internet advertising of a franchise offering that is required to be registered in this state is not subject to the requirements for filing advertisements set forth in RCW 19.100.100 so long as the following conditions are satisfied:(1) The franchisor discloses to the director the…

The offer or sale of a franchise via the internet is not subject to registration pursuant to RCW 19.100.020 where:(1) The offer is made pursuant to an available and perfected exemption from franchise registration; or(2) If the franchise is not registered or exempt:(a) The interne…

Each franchise broker license issued pursuant to RCW 19.100.140 is effective for the calendar year and shall expire on the last day of the year.[Statutory Authority: Chapter 19.100 RCW and RCW 19.100.250. WSR 10-10-055, § 460-82-050, filed 4/29/10, effective 5/30/10.]

Every franchise broker shall make and keep current the following books and records:(1) Records of each sale of a franchise including:(a) The name and address of the franchisee;(b) The aggregate purchase price;(c) Records of any payments collected by the franchise broker in connec…

The rules in this chapter apply to the exemption from registration set forth in RCW 21.20.880 (crowdfunding exemption) for intrastate offerings of securities exempt under section 3 (a)(11) of the federal Securities Act of 1933 and Securities and Exchange Commission Rule 147, 17 C…

(1) "Escrow agent" means a bank, trust company, savings bank, national banking association, building and loan association, mortgage banker, credit union, insurance company, an escrow agent that is registered under chapter 18.44 RCW, or any other independent escrow agent acceptabl…

(1) These rules are intended to allow start-up companies to raise capital in small securities offerings to Washington residents. The rules in this chapter provide for the use of a simplified offering document designed to provide adequate disclosure to investors concerning the iss…

In addition to filing a properly completed Washington Crowdfunding Form, issuers seeking to rely on the crowdfunding exemption in RCW 21.20.880 shall file the following with the division:(1) The filing fee as prescribed in WAC 460-99C-260;(2) The issuer's articles of incorporatio…

The issuer shall furnish to prospective investors, at a reasonable time prior to the sale of securities in reliance on the crowdfunding exemption in RCW 21.20.880, the most recent Washington Crowdfunding Form declared exempt by the director, including all required exhibits theret…

An offering made in reliance on the crowdfunding exemption in RCW 21.20.880 shall not commence until the director has declared the offering exempt. Neither the fact that an offering has been declared exempt under RCW 21.20.880 nor the fact that a Washington Crowdfunding Form has …

A crowdfunding offering under RCW 21.20.880 may be declared exempt for a maximum of twelve months. An exempt offering may be renewed for one additional twelve-month period in accordance with WAC 460-99C-100.[Statutory Authority: RCW 21.20.450, 21.20.880, 21.20.883, 21.20.886, and…

The director may in his or her discretion send notice to the issuer in any pending crowdfunding offering under RCW 21.20.880 in which no action has been taken for nine months immediately prior to the sending of such notice, advising the issuer that the pending filing will be term…

In an offering made in reliance on the crowdfunding exemption in RCW 21.20.880, if at any time while the offering is ongoing there is a material change that would affect the accuracy of the information contained in the Washington Crowdfunding Form after the offering is declared e…

(1) A crowdfunding offering declared exempt under RCW 21.20.880 may be renewed by filing a renewal notice no later than thirty days prior to the expiration of the original exempt offering period declared by the director.(2) A renewal notice shall consist of the following:(a) A re…

(1) The issuer shall specify a minimum target offering amount and deadline to raise the minimum target offering amount in its Washington Crowdfunding Form. The issuer must demonstrate to the director that the minimum target offering amount, together with other sources of financin…

(1) In an offering conducted under RCW 21.20.880, an investor may cancel an investment commitment for any reason until such time as the target minimum offering amount has been raised.(2) If there is a material change to the terms of the offering or to the information provided by …

(1) The issuer must enter into an escrow agreement with an independent escrow agent, as defined in WAC 460-99C-020, located in the state of Washington that includes the following terms:(a) All offering proceeds shall be maintained in an account controlled by the escrow agent;(b) …

Prior to accepting investor funds or an irrevocable commitment to invest, the issuer must obtain, from each investor, a copy of the Investor Certifications and Acknowledgements Form prescribed by the director that has been either manually or electronically signed by the investor.…

(1) In each sale of securities in reliance on the crowdfunding exemption under RCW 21.20.880, the issuer must reasonably believe that the aggregate amount of securities sold to any investor, other than an "accredited investor" as that term is defined under the Securities Act of 1…