(a) Except as otherwise provided in this subchapter, no person shall provide, advertise, or otherwise hold itself out as providing professional employer services in Arkansas unless the person is licensed as a professional service organization under this subchapter.
(b)
(1) Each professional employer organization required to be licensed under this subchapter shall provide the Insurance Commissioner information required by the commissioner on forms prescribed by the commissioner.
(2) The information required under subdivision (b)(1) of this section shall include the following information:
(A) The legal name of the professional employer organization and all other names under which the professional employer organization conducts business;
(B) The address of the principal place of business of the professional employer organization and the address of each office it maintains in Arkansas;
(C) The professional employer organization's taxpayer or employer identification number;
(D) A list by jurisdiction of each name under which the professional employer organization has operated in the preceding five (5) years, including any fictitious names, alternative names, names of predecessors, and, if known, successor business entities;
(E) A statement of ownership that shall include the name and evidence of the business experience of all controlling persons;
(F) A statement of each controlling person disclosing any interest in any other professional employer organization, whether licensed or not in Arkansas, in which the controlling person has a ten percent (10%) or greater interest;
(G) A statement of management, which shall include the name and evidence of the business experience of any person who serves as president or chief executive officer or otherwise has the authority to act as senior executive officer of the professional employer organization; and
(H)
(i) A financial statement setting forth the financial condition of the professional employer organization as of a date not earlier than one hundred eighty (180) days before the date the financial statement is submitted to the commissioner.
(ii) The financial statement under subdivision (b)(1)(H)(i) of this section shall be prepared in accordance with generally accepted accounting principles, and unless the professional employer organization provides financial assurance as set forth in § 23-92-408(a)(2), the financial statement shall be audited by an independent certified public accountant licensed to practice in Arkansas or the state of domicile of the professional employer organization.
(iii) A professional employer organization group may submit combined or consolidated financial statements to meet the requirements of this section.
(c)
(1) Each professional employer organization operating within this state as of July 16, 2003, shall complete its initial licensing no later than December 31, 2003.
(2) Each professional employer organization not operating within Arkansas as of July 16, 2003, shall complete its initial licensing before beginning operations within this state.
(d)
(1) No later than the biennial anniversary date of its licensing, each licensee shall renew its licensing by notifying the commissioner of any changes in the information provided in the licensee's most recent licensing or renewal and by paying a renewal fee.
(2) If a licensee under this subchapter fails to renew its license at the time of renewal and pay the renewal fee, its license shall become delinquent.
(3)
(A) Licensees under this subchapter shall have thirty (30) days after the renewal date in which to renew their licenses and pay in addition to the renewal fee under subdivision (d)(1) of this section a late fee not to exceed one thousand dollars ($1,000).
(B) If payment is not received within the thirty-day time period under subdivision (d)(3)(A) of this section:
(i) The license shall automatically become void without further action by the commissioner; and
(ii)
(a) The commissioner shall enter a temporary order compelling the professional employer organization to cease and desist from any professional employer services in Arkansas.
(b) The order under subdivision (d)(3)(B)(ii)(a ) of this section shall provide for an opportunity for the professional employer organization to request a hearing.
(c) If the professional employer organization does not request a hearing within thirty (30) days after the entry of the order or if the commissioner finds after a hearing that the professional employer organization's license should not be renewed, the order entered under subdivision (d)(3)(B)(ii)(a ) of this section shall become permanent.
(d) The commissioner shall provide a copy of the order entered under subdivision (d)(3)(B)(ii)(a) of this section to the Workers' Compensation Commission and the Division of Workforce Services or their successors.
(e)
(1) A professional employer organization group may satisfy any reporting and financial requirements of this subchapter on a consolidated basis.
(2) As a condition of licensing as a professional employer organization group, each affiliate of the professional employer organization group shall guarantee payment of all financial obligations with respect to wages, employment taxes, and employee benefits of each affiliate of the professional employer organization group.
(f)
(1) A professional employer organization is exempt from the licensing requirements contained in subsections (a)-(e) of this section and §§ 23-92-405, 23-92-406, and 23-92-408 if the professional employer organization:
(C) Does not maintain an office in this state or solicit in any manner clients located or domiciled within this state; and
(D) Has one hundred (100) or fewer covered employees employed or domiciled in Arkansas.
(i) The commissioner shall reject an application for a license or for an exemption from license if the commissioner finds that:
(A) Submits a properly executed request for exemption on a form provided by the State Insurance Department;
(B) Is domiciled outside of Arkansas and is licensed or registered as a professional employer organization in another state that has requirements the same or greater than this subchapter;
(2) A professional employer organization's exemption from the licensing requirements under this subchapter shall be valid for two (2) years, subject to renewal, for as long as the professional employer organization:
(A) Continues to qualify for the exemption; and
(B) On or before the biennial anniversary date of the original grant of exemption, requests the exemption to continue.
(g) The commissioner shall maintain a list of professional employer organizations licensed or exempted under this subchapter.
(h) The commissioner may prescribe forms necessary to promote the efficient administration of this section.
(1) Any controlling person named in the license or exemption application is not of good moral character, business integrity, or financial responsibility; or
(2) The controlling person has violated a provision of this subchapter.
(j) A person engaged in the business of providing professional employer services shall be subject to licensing under this subchapter regardless of its use of the name “professional employer organization”, “PEO”, “staff leasing company”, “licensed staff leasing company”, “employee leasing company”, or any other name.