Washington Administrative Code
Title 314 - Liquor and Cannabis Board
Chapter 314-55 - Cannabis licenses, application process, requirements, and reporting
Section 314-55-137 - Receiverships
Universal Citation: WA Admin Code 314-55-137
Current through Register Vol. 24-18, September 15, 2024
(1) Service and notice.
(a) Any person who files any receivership or
trustee action involving any cannabis licensee must serve the board with
original notice of the action. Service is accomplished by delivery of the
original notice of action to the board through one of the following methods:
(i) Delivery to the board at 1025 Union
Avenue S.E., Olympia, WA 98504; or
(ii) Mailed to the board. Mailed notice must
be addressed to: LCB, ATTN: Licensing - Receiverships, P.O. Box 43076, Olympia,
WA 98504-3076 or, for certified mail, LCB, ATTN: Licensing - Receiverships,
1025 Union Avenue S.E., Olympia, WA 98504; or
(iii) Electronic delivery to the board at
licensingappeals@lcb.wa.gov.
(b) The board will find a licensee compliant
with this section only if it receives original notice of the action and the
receiver is selected consistent with board requirements.
(2) The role of a receiver when a licensee is placed in receivership. If a cannabis licensee is placed under receivership, the receiver:
(a) Upon
compliance with the requirements listed in this section, the receiver may
operate the licensee's business during the receivership period;
(b) The receiver assumes all licensee
reporting responsibilities under this chapter including, but not limited to,
full responsibility for maintaining records and entries into the traceability
system maintained by the board; and
(c) The receiver is required to comply with
all applicable laws under chapter 69.50 RCW and rules in this chapter
including, but not limited to, the responsibilities of cannabis licensees set
forth in WAC 314-55-110.
(d)
Failure to abide by the requirements set forth in chapter 69.50 RCW and this
chapter as specified in this subsection may result in enforcement action
against the license under chapter 69.50 RCW and rules under this chapter and
may result in the receiver being disqualified to act as a receiver by the
board.
(3) Who may serve as a receiver. Any person who meets the requirements of chapter 7.60 RCW and the following additional requirements may serve as a receiver for a cannabis business:
(a) Is currently in good
standing on the preapproved receiver list maintained by the board; or
(b) Is approved by the board under the
requirements in subsection (5) of this section to serve as a receiver of a
cannabis licensee.
(4) Qualifying for the board's preapproved receiver list.
(a) The following requirements must be met to
qualify for the board's preapproved receiver list:
(i) Submit a complete receiver application
with the board;
(ii) Be a
Washington state resident for at least six months prior to the application for
preapproval as a receiver and maintain residency throughout the term of the
receivership;
(iii) Submit to and
pass a criminal background check;
(iv) Provide any financial disclosures
requested by the board; and
(v)
Disclose any interests the person has in any cannabis licensee(s).
(b) Review and qualification
requirements in this subsection only apply to persons or entities actively
participating in the management of the receivership and do not apply to spouses
of those persons or persons involved in a business entity or fellow members of
a business entity that are not actively involved in the management of the
receivership.
(c) A receiver placed
on the preapproved receiver list maintained by the board must annually update
all information and disclosures required under this subsection to remain
eligible to act as a receiver and be on the preapproved receiver list. Annual
updates must be made one calendar year after the date the receiver is
approved.
(5) Appointing a receiver who is not preapproved by the LCB.
(a) Within two days of filing of any action
to appoint a receiver, a proposed receiver must:
(i) Submit a complete application with the
board to serve as receiver for the licensee;
(ii) Be a Washington resident for six months
prior to appointment as a receiver and maintain residency throughout the term
of the receivership;
(iii) Submit
to and pass a criminal background check;
(iv) Provide any financial disclosures
requested by the LCB; and
(v)
Disclose any interest the proposed receiver has in any cannabis
licensee(s).
(b) Review
and qualification requirements in this subsection only apply to persons or
entities actively participating in the management of the receivership and do
not apply to spouses of those persons or persons involved in a business entity
or fellow members of a business entity that are not actively involved in the
management of the receivership.
(c)
If the proposed receiver is denied approval by the board at any time, a
substitute receiver may be proposed for board approval. The substitute receiver
must provide all information required by this subsection.
(d) If the proposed receiver is not approved
by the board at the time the receiver is appointed by the court, the receiver
will not be considered compliant with this section, and may be subject to
penalty under chapter 69.50 RCW, or as provided in this chapter and may result
in the receiver being disqualified to act as a receiver by the board.
(6) Limitations on a person's ability to serve as a receiver.
(a) As operators and controllers of licensed
cannabis establishments, receivers are subject to the same limits as licensees
or any other person. Those limits include, but are not limited to:
(i) No person serving as a receiver of a
licensed cannabis producer or licensed cannabis processor shall have a
financial interest in, or simultaneously serve as a receiver for, a licensed
cannabis retailer; and
(ii) No
person shall serve as a receiver for, or be a true party of interest in, more
than five cannabis retail licensees or more than three cannabis producer,
processor, or producer/processor licensees at the same time.
(b) If the board determines that a
receiver is violating or has violated the restrictions in this subsection, the
receiver may be disqualified to act as a receiver by the board.
Disclaimer: These regulations may not be the most recent version. Washington may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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