Purpose: Change clarifies the prohibitions and explains the intent behind the restrictions on holding an interest in businesses at different marketing levels.

Citation of Existing Rules Affected by this Order: Amending WAC 230-30-225.

Statutory Authority for Adoption: RCW 9.46.070.

Adopted under notice filed as WSR 98-06-027 on February 24 [25], 1998 with a publication date of March 18, 1998.

Changes Other than Editing from Proposed to Adopted Version: The entire new section was deleted except for subsection (5). Subsection (5), relating to spouses of substantial interest holders, is reworded so that the standard is "not material" rather than "no" potential for involvement or influence in the business. Also, subsection (5) makes reference to WAC 230-30-220, i.e. "except as otherwise provided in WAC 230-30-220.".

Number of Sections Adopted in Order to Comply with Federal Statute: New 0, amended 0, repealed 0; Federal Rules or Standards: New 0, amended 0, repealed 0; or Recently Enacted State Statutes: New 0, amended 0, repealed 0.

Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, amended 0, repealed 0.

Number of Sections Adopted on the Agency's Own Initiative: New 0, amended 0, repealed 0.

Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, amended 0, repealed 0.

Number of Sections Adopted Using Negotiated Rule Making: New 0, amended 0, repealed 0; Pilot Rule Making: New 0, amended 0, repealed 0; or Other Alternative Rule Making: New 0, amended 0, repealed 0.

Effective Date of Rule: July 1, 1998.

Soojin Kim

Rules and Policy Coordinator

NEW SECTION

WAC 230-30-225  Interest in separate business involving punch boards and pull-tabs at a different marketing level prohibited--Effect of spouse's interest. If my spouse is a substantial interest holder in a punch board or pull-tab operator, manufacturer, or distributor, will I be considered a substantial interest holder in the same business?

Except as otherwise provided in WAC 230-30-220, the spouse of an individual who is a holder of a substantial interest in a business involved in punch boards or pull-tabs may not be considered a substantial interest holder in such business if, after considering the entire circumstances surrounding the relationship and business, the director finds the potential for involvement or influence in the business by the spouse is not material. When spouses are involved in both the operation of and/or the supply of punch boards and pull-tabs, the director may impose additional requirements on either licensee, including, but not limited to prohibiting a manufacturer or distributor from making sales or providing services to an operator:

(a) Community or marital property agreements;

(b) Separate property agreements;

(c) Prenuptial agreements; or

(d) Wills and codicils.

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