WSR 16-01-118

PREPROPOSAL STATEMENT OF INQUIRY

[Filed December 17, 2015, 4:15 p.m.]

Subject of Possible Rule Making: The securities division is planning to propose rules to preserve filing requirements in connection with offerings of securities to be made under the Securities and Exchange Commission's newly adopted federal crowdfunding rules.

Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 21.20.327, 21.20.340, 21.20.450.

Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: The securities division is planning to propose rules to preserve filing requirements in connection with offerings conducted under newly adopted federal crowdfunding rules so that it may provide oversight of these offerings in the interest of investor protection.

Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: Title III of the Jumpstart Our Business Startups (JOBS) Act amended Section 4 of the Securities Act of 1933 to create a new federal exemption for offerings of securities in crowdfunding campaigns. On October 30, 2015, the Securities and Exchange Commission adopted final rules that will implement this new exemption. See Regulation Crowdfunding, Release Nos. 33-9974; 34-76324, available at http://www.sec.gov/rules/final/2015/33-9974.pdf.

The JOBS Act further amended Securities Act Section 18 (b)(4) to preempt the ability of states to require registration of crowdfunding offerings conducted pursuant to federal law. However, states retain the authority to require notice filings of crowdfunding offerings if a state is the principal place of business of the issuer or if a state is home to purchasers of fifty percent or more of the aggregate value of the securities offered in the crowdfunding campaign. The securities division is filing this notice to commence the rule-making process to require notice filings as permitted by federal law.

Process for Developing New Rule: The securities division will adopt rules after considering all comments received.

Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication by contacting Nathan Quigley, Department of Financial Institutions, Securities Division, P.O. Box 9033, Olympia, WA 98507-9033, phone (360) 902-8797, fax (360) 704-6463, e-mail Nathan.Quigley@dfi.wa.gov.

December 17, 2015

William M. Beatty

Securities Administrator