This post continues our discussion of rule changes proposed by the Oregon Liquor and Cannabis Commission (OLCC). (Other posts here and here, and please stay tuned for an omnibus post by Vince Sliwoski). Today the topic is a proposed revision to the rules governing changes in business structure. In particular, a proposed conditional approval rule that threatens the ability of licensees to raise capital.
How OLCC changes in business structure work today
When a licensee desires to change their business structure, the present rules require the licensee to provide notification to the OLCC pursuant to OAR 845-025-1160(4). Under the current rules, when a licensee changes its business structure by adding and individual or entity, the OLCC requires the licensee to notify the OLCC prior to addition of an individual when that person qualifies as an “applicant” as defined in OAR 845-025-1145.
Under that rule, among other things, an applicant includes an individual or person who holds or controls a direct or indirect interest of more than 20 percent, or entitled to receive a portion of revenue, proceeds, or profits more than 20 percent. For such persons the OLCC performs an inquiry to determine whether that person is licensable.
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