AN
ACT Relating to facilitating interstate operations for Washington professional
corporations; and amending RCW 18.100.060, 18.100.065, 18.100.090, 18.100.100,
25.15.045, and 18.100.114, and adding a new section to chapter 18.100 RCW.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec.
1. RCW
18.100.060 and 1983 c 51 s 3 are each amended to read as follows:
(1)
No corporation organized under this chapter may render professional services
except through individuals who are duly licensed or otherwise legally
authorized to render such professional services within this state((:
PROVIDED, That)). However, nothing in this chapter shall be
interpreted to:
(a)
Prohibit a person duly licensed or otherwise legally authorized to render
professional services in any jurisdiction other than this state from becoming a
member of a professional corporation in this state organized for the purpose of
rendering the same professional services;
(b)
Prohibit a professional corporation from rendering services outside this state
through individuals who are not duly licensed or otherwise legally authorized
to render professional services within this state; or
(c)
Require the licensing of clerks, secretaries, bookkeepers, technicians, and
other assistants employed by a professional corporation who are not usually and
ordinarily considered by custom and practice to be rendering professional
services to the public for which a license or other legal authorization is
required.
(2)
Persons engaged in a profession and otherwise meeting the requirements of this
chapter may operate under this chapter as a professional corporation so long as
each shareholder personally engaged in the practice of the profession in this
state is duly licensed or otherwise legally authorized to practice the
profession in this state and:
(a)
At least one officer and one director of the corporation is duly licensed or
otherwise legally authorized to practice the profession in this state; or
(b)
Each officer in charge of an office of the corporation in this state is duly
licensed or otherwise legally authorized to practice the profession in this
state.
Sec.
2. RCW
18.100.065 and 1983 c 51 s 7 are each amended to read as follows:
Except
as otherwise provided in RCW 18.100.118, all directors of a corporation
organized under this chapter and all officers other than the secretary and the
treasurer shall be duly licensed or otherwise legally authorized to render the
same specific professional services within this or any other state as
those for which the corporation was incorporated.
Sec.
3. RCW
18.100.090 and 1997 c 18 s 2 are each amended to read as follows:
Except
as otherwise provided in RCW 18.100.118, no professional corporation organized
under the provisions of this chapter may issue any of its capital stock to
anyone other than the trustee of a qualified trust or an individual who is duly
licensed or otherwise legally authorized to render the same specific
professional services within this or any other state as those for which
the corporation was incorporated.
Sec.
4. RCW
18.100.100 and 1969 c 122 s 10 are each amended to read as follows:
((If
any)) Unless a director, officer, shareholder, agent or employee of
a corporation organized under this chapter who has been rendering professional
service to the public ((becomes)) is legally ((disqualified))
qualified at all times to render such professional services within ((this))
at least one state in which the corporation conducts business, he
or she shall sever all employment with, and financial interests in, such
corporation forthwith. A corporation's failure to require compliance with this
provision shall constitute a ground for the forfeiture of its articles of
incorporation and its dissolution. When a corporation's failure to comply with
this provision is brought to the attention of the office of the secretary of
state, the secretary of state forthwith shall certify that fact to the attorney
general for appropriate action to dissolve the corporation.
Sec.
5. RCW
25.15.045 and 1997 c 390 s 4 are each amended to read as follows:
(1)
A person or group of persons licensed or otherwise legally authorized to render
professional services within this or any other state may organize and
become a member or members of a professional limited liability company under
the provisions of this chapter for the purposes of rendering professional service.
A "professional limited liability company" is subject to all the
provisions of chapter 18.100 RCW that apply to a professional corporation, and
its managers, members, agents, and employees shall be subject to all the
provisions of chapter 18.100 RCW that apply to the directors, officers,
shareholders, agents, or employees of a professional corporation, except as
provided otherwise in this section. Nothing in this section prohibits a person
duly licensed or otherwise legally authorized to render professional services
in any jurisdiction other than this state from becoming a member of a
professional limited liability company organized for the purpose of rendering
the same professional services. Nothing in this section prohibits a
professional limited liability company from rendering professional services
outside this state through individuals who are not duly licensed or otherwise
legally authorized to render such professional services within this state. ((Notwithstanding
RCW 18.100.065,)) Persons engaged in a profession and otherwise
meeting the requirements of this chapter may operate under this chapter as a
professional limited liability company so long as each member personally
engaged in the practice of the profession in this state is duly licensed or
otherwise legally authorized to practice the profession in this state and:
(a)
At least one manager of the company is duly licensed or otherwise legally
authorized to practice the profession in this state; or
(b)
Each member in charge of an office of the company in this state is duly
licensed or otherwise legally authorized to practice the profession in this
state.
(2)
If the company's members are required to be licensed to practice such
profession, and the company fails to maintain for itself and for its members
practicing in this state a policy of professional liability insurance, bond, or
other evidence of financial responsibility of a kind designated by rule by the
state insurance commissioner and in the amount of at least one million dollars
or a greater amount as the state insurance commissioner may establish by rule
for a licensed profession or for any specialty within a profession, taking into
account the nature and size of the business, then the company's members are
personally liable to the extent that, had the insurance, bond, or other
evidence of responsibility been maintained, it would have covered the liability
in question.
(3)
For purposes of applying the provisions of chapter 18.100 RCW to a professional
limited liability company, the terms "director" or
"officer" means manager, "shareholder" means member,
"corporation" means professional limited liability company,
"articles of incorporation" means certificate of formation,
"shares" or "capital stock" means a limited liability
company interest, "incorporator" means the person who executes the
certificate of formation, and "bylaws" means the limited liability
company agreement.
(4)
The name of a professional limited liability company must contain either the
words "Professional Limited Liability Company," or the words
"Professional Limited Liability" and the abbreviation
"Co.," or the abbreviation "P.L.L.C." or "PLLC"
provided that the name of a professional limited liability company organized to
render dental services shall contain the full names or surnames of all members
and no other word than "chartered" or the words "professional
services" or the abbreviation "P.L.L.C." or "PLLC."
(5)
Subject to the provisions in article VII of this chapter, the following may be
a member of a professional limited liability company and may be the transferee
of the interest of an ineligible person or deceased member of the professional
limited liability company:
(a)
A professional corporation, if its shareholders, directors, and its officers
other than the secretary and the treasurer, are licensed or otherwise legally
authorized to render the same specific professional services as the
professional limited liability company; and
(b)
Another professional limited liability company, if the managers and members of
both professional limited liability companies are licensed or otherwise legally
authorized to render the same specific professional services.
(6)(a)
Notwithstanding any other provision of this chapter, health care professionals
who are licensed or certified pursuant to chapters 18.06, 18.19, 18.22, 18.25,
18.29, 18.34, 18.35, 18.36A, 18.50, 18.53, 18.55, 18.57, 18.57A, 18.64, 18.71,
18.71A, 18.79, 18.83, 18.89, 18.108, and 18.138 RCW may own membership
interests in and render their individual professional services through one
limited liability company and are to be considered, for the purpose of forming
a limited liability company, as rendering the "same specific professional
services" or "same professional services" or similar terms.
(b)
Formation of a limited liability company under this subsection does not
restrict the application of the uniform disciplinary act under chapter 18.130
RCW, or any applicable health care professional statutes under Title 18 RCW,
including but not limited to restrictions on persons practicing a health
profession without being appropriately credentialed and persons practicing
beyond the scope of their credential.
Sec.
6. RCW
18.100.114 and 1983 c 51 s 8 are each amended to read as follows:
(((1)))
A corporation organized under this chapter may merge or consolidate with
another corporation, domestic or foreign, organized to render the same specific
professional services, only if every shareholder of each corporation is
eligible to be a shareholder of the surviving or new corporation.
(((2)
Upon the merger or consolidation of a corporation organized under this chapter,
the surviving or new corporation, as the case may be, may render professional
services in this state only if it is organized under, and complies with, the
provisions of this chapter.))
NEW
SECTION. Sec. 7. A
new section is added to chapter 18.100 RCW to read as follows:
A
foreign professional corporation may render professional services in this state
so long as it complies with chapter 23B.15 RCW and each individual rendering
professional services in this state is duly licensed or otherwise legally
authorized to render such professional services within this state.
