PERMANENT RULES
FINANCIAL INSTITUTIONS
(Securities Division)
Date of Adoption: October 23, 2002.
Purpose: The Washington Securities Division used guidelines and policies created by the North American Securities Administrators Association (NASAA) as the basis for regulating certain offerings and licensees. These guidelines and policies are periodically updated and occasionally new guidelines and policies are adopted. This amendment would update Washington's regulations to reflect the latest versions of all previously adopted guidelines. It would also adopt NASAA's risk disclosure guidelines and guidelines for general obligation financing by religious organizations for the first time. This will facilitate greater uniformity with the many other states that rely on NASAA guidelines and policies.
Citation of Existing Rules Affected by this Order: Amending WAC 460-16A-205.
Statutory Authority for Adoption: RCW 21.20.450.
Adopted under notice filed as WSR 02-19-092 on September 17, 2002.
Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.
Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.
Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 1, Repealed 0.
Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.
Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 1, Repealed 0.
Other Findings Required by Other Provisions of Law as Precondition to Adoption or Effectiveness of Rule: No rule
may be made unless the director of the Department of Financial
Institutions finds that the action is necessary or appropriate
in the public interest or for the protection of investors and
consistent with the purposes fairly intended by the policy and
provisions of chapter 21.20 RCW. The director hereby makes
such a finding with respect to this proposal.
Effective Date of Rule:
Thirty-one days after filing.
October 31, 2002
Helen P. Howell
Director
OTS-5798.1
AMENDATORY SECTION(Amending WSR 98-17-013, filed 8/10/98,
effective 9/10/98)
WAC 460-16A-205
Adoption of NASAA statements of policy.
(1) In order to promote uniform regulation, the administrator
adopts the following North American Securities Administrators
Association (NASAA) statements of policy for offerings
registering pursuant to RCW 21.20.180 or 21.20.210:
(a) Registration of publicly offered cattle feeding programs, as adopted September 17, 1980;
(b) Registration of commodity pool programs, as adopted with amendments through August 30, 1990;
(c) Equipment programs, as adopted with amendments through October 24, 1991;
(d) Registration of oil and gas programs, as adopted with amendments through October 24, 1991;
(e) Real estate investment trusts, as adopted with amendments through September 29, 1993;
(f) Real estate programs, as adopted with amendments
through ((October 24, 1991)) September 29, 1993;
(g) Loans and other material affiliated transactions, as adopted with amendments through November 18, 1997;
(h) Options and warrants, as adopted with amendments
through ((November 18, 1997)) September 28, 1999;
(i) Registration of direct participation programs - omnibus guidelines, as adopted March 29, 1992;
(j) Mortgage program guidelines, as adopted September 10, 1996;
(k) Church bonds, as adopted ((April 29, 1981)) April 14,
2002;
(l) Health care facility offerings, pertaining to the offering of nonprofit health care facility bonds, as adopted April 5, 1985;
(m) Corporate securities definitions, as adopted ((April
27, 1997)) September 28, 1999;
(n) Impoundment of proceeds, as adopted with amendments
through ((April 27, 1997)) September 28, 1999;
(o) Preferred stock, as adopted with amendments through April 27, 1997;
(p) Promotional shares, as adopted ((November 18, 1997))
September 28, 1999, except that the term promotional shares
shall be limited to those equity securities which were issued
within the last three years and that all promotional shares in
excess of twenty-five percent of the shares to be outstanding
upon completion of the offering may be required to be
deposited in escrow absent adequate justification that escrow
of such shares is not in the public interest and not necessary
for the protection of investors;
(q) Registration of asset-backed securities, as adopted October 25, 1995, except for offerings registering or required to register pursuant to chapter 460-33A WAC or RCW 21.20.705 through 21.20.855;
(r) Promoters' equity investment, as adopted with amendments through April 27, 1997;
(s) Specificity in use of proceeds, as adopted ((April
27, 1997)) September 28, 1999;
(t) Underwriting expenses, underwriter's warrants,
selling expenses, and selling security holders, as adopted
with amendments through ((April 27, 1997)) September 28, 1999;
(u) Unsound financial condition, as adopted ((April 27,
1997)) September 28, 1999; ((and))
(v) Unequal voting rights, as adopted October 24, 1991;
(w) Guidelines for general obligation financing by religious denominations, as adopted April 17, 1994; and
(x) Risk disclosure guidelines, as adopted September 9, 2001.
(2) An offering registering pursuant to RCW 21.20.180 or 21.20.210 that falls within one or more of the statements of policy listed in subsection (1) of this section must comply with the requirements of said statement of policy or policies.
(3) The statements of policy referred to in subsection (1) of this section are found in CCH NASAA Reports published by Commerce Clearing House. Copies are also available at the office of the securities administrator.
[Statutory Authority: RCW 21.20.450. 98-17-013, § 460-16A-205, filed 8/10/98, effective 9/10/98; 96-11-017, § 460-16A-205, filed 5/6/96, effective 6/6/96; 95-17-068, § 460-16A-205, filed 8/16/95, effective 9/16/95; 93-01-075, § 460-16A-205, filed 12/14/92, effective 1/14/93; 91-04-008, § 460-16A-205, filed 1/25/91, effective 2/25/91.]