Network Companies

Who needs a network company license?

Chapter 6.700 of the Seattle Municipal Code (SMC) requires all network companies subject to the App-Based Worker Minimum Payment Ordinance (SMC Chapter 8.37), OR the App-Based Worker Deactivation Rights Ordinance (SMC Chapter 8.40), OR both, to obtain a network company license (SMC 6.700.040).

The license requirements established in SMC Chapter 6.700 are administered by the Seattle Department of Finance and Administrative Services (FAS), while SMC Chapters 8.37 and 8.40 are administered by the Seattle Office of Labor Standards (OLS). Therefore, this guidance was developed by FAS in consultation with OLS. Likewise, coverage determinations under SMC Chapter 6.700 will be made by FAS in consultation with OLS.

A “network company” is defined by the SMC as any organization that uses an online-enabled platform, such as an application dispatch system, to connect customers with app-based workers, to present offers to app-based workers through a worker platform, and/or to facilitate the provision of services for compensation by app-based workers (SMC 6.700.030).

Any company or organization that meets the following criteria is considered a “network company” for the purpose of this ordinance and is required to obtain a network company license (see SMC 6.700.030, 8.37.040, and 8.40.040):

• The company facilitates “offers” (work) to app-based workers through an online-enabled application or platform;
• At least one of these “offers” results in services performed in whole or part within Seattle city limits; AND
• The company connects at least 250 app-based workers with work through an online platform worldwide.

A company or organization that meets any of the following criteria is NOT considered a “network company” for the purpose of SMC Chapter 6.700, and is NOT required to obtain a network company license:

• A company that merely provides a service for people to advertise, schedule, or pay, without additional intermediation between parties or oversight of service provision, specifically:
  • Appointment scheduling and/or payment processing companies (e.g., a company that makes scheduling platforms for exercise classes or salon services, etc.); and
  • Digital advertising or messaging companies (e.g., Craigslist).
• A company that meets the definition of a “transportation network company” (TNC) as defined by RCW 46.04.652.
• A company that meets the definition of “for-hire vehicle company” or “taxicab association” as defined by SMC 6.310.110 or 311.040.
• A company that exclusively facilitates the following types of transactions, which are excluded from the definition of “online order” in SMC 6.700.030 and therefore not subject to the $0.10-per-online-order fee*:
  • Sales or rentals of products or real estate;
  • Services subject to a license to practice law or medicine;**
  • Services provided wholly digitally;
  • Creative services or works; and
  • Trips dispatched by TNCs (e.g., Lyft) or provided by taxicabs or for-hire vehicles.

* See Seattle Human Rights Rules (SHRR) Chapters 240 and 260, issued by OLS. According to section 100.10.c of SHRR Chapter 240 and section 090.6.b of SHRR Chapter 260, network companies that exclusively facilitate transaction types that are excluded from the definition of “online order” are not subject to SMC Chapter 8.37 or SMC Chapter 8.40, respectively. Per SMC 6.700.040, only network companies subject to Chapter 8.37 and/or Chapter 8.40 are required to obtain a license. 

**SMC 6.700.030 excludes “Payment in exchange for a service subject to professional licensure that has been listed in rules issued by the OLS Director pursuant to Section 8.37.020” from the definition of “online order.”  See SHRR Chapter 240 – Practices for administering App-Based Worker Minimum Payment Ordinance requirements under Seattle Municipal Code 8.37, issued by OLS. Specifically, section 100.12.b.ii states “The term ‘online order’ excludes transactions subject to the following professional licenses: license to practice law and license to practice medicine.”

When do network companies need to obtain a license and how do I apply?

Network companies must obtain a license by or before Jan. 1, 2026 (SMC 6.700.050).

You can apply for a license online at any time through the Seattle Services Portal.

First, you must create a Seattle Services Portal account. To create an account, visit Permits, Licenses and Regulatory Compliance - Seattle Services Portal | Seattle.gov.

After creating your Portal account, apply for a network company license here: Licenses - Short Term Rental or Network Company - Seattle Services Portal | seattle.gov.

For step-by-step instructions, please see:  

• How to Register for a Seattle Services Portal Account
• How to Submit a Network Company License Application

The licensing fee is $0.10 per online order that results in an app-based worker’s delivery of goods or provision of services in Seattle.

On a quarterly basis, each network company is required to submit a report to the City’s Department of Finance and Administrative Services that shows their total number of online orders subject to the licensing fee. These quarterly reports are used to determine each network company’s quarterly licensing fee.

For more information on quarterly reporting requirements, refer to “How does the quarterly report process work?”

For more information on paying your licensing fee, refer to “When did the licensing fee go into effect, how do I pay it, and when is it due?”

For more information on which online orders are subject to the $0.10-per-online-order licensing fee, refer to “What is an “online order” for the purposes of calculating the $0.10-per-online-order licensing fee? How is it distinct from an “offer”?” and “What transactions are exempt from the $0.10-per-online-order fee?”

How does the quarterly report process work?

Network companies are required to submit reports to the City’s Department of Finance and Administrative Services containing the total number of online orders subject to the licensing fee facilitated by the network company during the reporting period.

Reporting for all four quarters of calendar year 2025 is due on Jan. 30, 2026. License fees and reports are due at the same time. For more information on the license fee process, refer to “When did the licensing fee go into effect, how do I pay it, and when is it due?” 

Beginning in calendar year 2026, reports must be submitted quarterly. Quarterly reports are due on the 30^th day of the month following the last month of the quarter, specifically:

Reports must be filed through the Seattle Services Portal using the account you created when applying for your network company license. You can log in to your Seattle Services Portal account by visiting https://services.seattle.gov/Portal/Login.aspx. For step-by-step instructions for submitting a quarterly report, see How to Submit a Network Company Quarterly Report.

When did the licensing fee go into effect, how do I pay it, and when is it due?

The $0.10-per-online-order licensing fee went into effect on Jan.1, 2025.

The amount of the license fee depends on the total number of eligible online orders self-reported by the network company. Therefore, paying the license fee is tied to the reporting process, and license fees and reports are due at the same time. For more information on the reporting process, refer to “How does the quarterly report process work?”

After submitting a quarterly report (or annual report for 2025) through your Seattle Services Portal account, the system will automatically calculate the license fee amount owed for that reporting period and generate an invoice.

Then, the system will ask you how you want to pay: either by check or credit card. After you make your selection, further instructions for completing the transaction will be provided. Step-by-step instructions for submitting a payment are also available – see How to Pay by Credit Card and How to Pay by Check.

The license fee for all four quarters of calendar year 2025 is due on Jan. 30, 2026.

Beginning in calendar year 2026, licensing fees must be paid quarterly. Quarterly licensing fees, like quarterly reports, are due on the 30^th day of the month following the last month of the quarter, specifically:

What is an “online order” for the purposes of calculating the $0.10-per-online-order licensing fee? How is it distinct from an “offer”?

“Online order” is defined by the Seattle Municipal Code as an order for services that is placed through an online-enabled application or platform, such as an application dispatch system, and that is facilitated by a network company or presented by a network company for its own benefit (SMC 6.700.030). Certain transactions are not “online orders” for purposes of calculating the per online order licensing fee. See “What transactions are exempt from the $0.10 per-online-order fee?”

An online order is distinct from an “offer,” which is defined by the Seattle Municipal Code as one or more online orders presented to an app-based worker as one opportunity to perform services for compensation that the app-based worker may accept or reject (SMC 6.700.030).

The $0.10 per-online-order fee applies to each individual online order that results in an app-based worker’s delivery of goods or provision of services in Seattle. This means that a single “offer” may include multiple “online orders” and may therefore be subject to multiple $0.10-per-online-order fees.

To illustrate the difference between online orders and offers, consider the following common examples where a single “offer” constitutes multiple “online orders”:

• Grocery: App-based worker (ABW) accepts one “offer” of work from network company to deliver three “online orders” of groceries (all including non-grocery items as well) to three different customers. The ABW travels to the grocery store, loads the three orders, and delivers them to the customers. The ABW receives minimum payment and receipt for the work performed as one “offer.” This example would be subject to three $0.10-per-online-order fees.
• Restaurant delivery: ABW accepts one “offer” of work from network company to deliver two “online orders” for lunches to two different customers. The ABW might pick up from the same restaurant or from two different restaurants nearby, load the two orders, and deliver them to the customers. This example would be subject to two $0.10-per-online-order fees.
• Package or other warehouse delivery: ABW accepts a two-hour shift or “block” delivering items from a warehouse. They might pick up forty packages and deliver them to 30 customers on a route (30 “online orders” consisting of one or two packages) or spend the shift traveling back and forth from the warehouse to make 30 deliveries to customers on demand. This example would be subject to 30 $0.10-per-online-order fees.

Likewise, a single online order may have been “offered” to multiple app-based workers before it was accepted and completed by an individual ABW. In this case, multiple “offers” would constitute only one “online order,” and would therefore be subject to only one $0.10-per-online-order fee.

What transactions are exempt from the $0.10-per-online-order fee?

The following transactions are not subject to the $0.10-per-online-order fee:

• Sale or rental of products or real estate;
• Payment in exchange for a service subject to a license to practice law or medicine;
• Payment in exchange for services wholly provided digitally;
• Payment in exchange for creative services or works;
• Trips dispatched by TNCs (e.g., Lyft) or provided by taxicabs or for-hire vehicles
• Online orders for an app-based worker’s delivery of exclusively groceries, as defined in RCW 82.84.030 (online orders for an app-based worker’s delivery of both grocery and non-grocery items ARE subject to the fee).

What will fee revenue be used for?

Fee revenue will be used to recover the regulatory costs of licensing and implementing labor standards in the App-Based Worker Minimum Payment Ordinance (SMC Chapter 8.37) and App-Based Worker Deactivation Rights Ordinance (SMC Chapter 8.40). More information about app-based worker protections can be found on the Office of Labor Standard’s website here: https://www.seattle.gov/laborstandards/ordinances/app-based-worker-ordinances

My organization is a marketplace network company. Do I still need to obtain a network company license and pay the network company license fee?

Yes, marketplace network companies are required to obtain a network company license and pay the network company licensing fee.

Although marketplace network companies are not subject to the App-Based Worker Minimum Payment Ordinance (SMC Chapter 8.37), they are subject to the App-Based Worker Deactivation Rights Ordinance (SMC Chapter 8.40). Seattle Municipal Code requires companies that are subject to either SMC Chapter 8.37 OR SMC Chapter 8.40 OR both to obtain a network company license and pay the licensing fee. Thus marketplace network companies are subject to the licensing and fee requirement (SMC 6.700.040).

Links to Helpful Resources

Relevant sections of Seattle Municipal Code (SMC), ordinances, and director’s rules:

Network Company License and Fee Ordinance (Ordinance 126953): https://clerk.seattle.gov/search/ordinances/126953

SMC Chapter 6.700 Network Companies: https://library.municode.com/wa/seattle/codes/municipal_code?nodeId=TIT6BURE_SUBTITLE_IVNELICO_CH6.700NECO

App-Based Worker Minimum Payment Ordinance (Ordinance 126595): https://clerk.seattle.gov/search/ordinances/126595

SMC Chapter 8.37 App-Based Worker Minimum Payment: https://library.municode.com/wa/seattle/codes/municipal_code?nodeId=TIT8LAST_CH8.37ASEWOMIPA

Seattle Office of Labor Standards Seattle Human Rights Rules (SHRR) Chapter 240 – Practices for Administering App-Based Worker Minimum Payment Ordinance Requirements under Seattle Municipal Code 8.37: https://www.seattle.gov/documents/Departments/LaborStandards/FinalSHRRChapter240_Updated_10082024.pdf

App-Based Worker Deactivation Rights Ordinance (Ordinance 126878): https://clerk.seattle.gov/search/ordinances/126878

Seattle Office of Labor Standards Seattle Human Rights Rules (SHRR) Chapter 260 – Practices for Administering App-Based Worker Deactivation Rights Ordinance Requirements Under Seattle Municipal Code 8.40: https://www.seattle.gov/documents/Departments/LaborStandards/SHRR%20260%20Final%20Rules%203.26.25.pdf

Seattle Services Portal How-To Articles: step-by-step instructions for navigating the Seattle Services Portal to apply for a license, submit quarterly reports, and pay the license fee

How to Register for a Portal Account: https://seattlegov.zendesk.com/hc/en-us/categories/115000576628

How to Submit a Network Company Application: https://seattlegov.zendesk.com/hc/en-us/articles/31778159528727

How to Submit a Network Company Quarterly Report: https://seattlegov.zendesk.com/hc/en-us/articles/31778146012823

How to Pay by Credit Card: https://seattlegov.zendesk.com/hc/en-us/articles/115005864427

How to Pay by Check: https://seattlegov.zendesk.com/hc/en-us/articles/31798270038423

How to Print an Invoice: https://seattlegov.zendesk.com/hc/en-us/articles/31271350664855

How to Print a Receipt: https://seattlegov.zendesk.com/hc/en-us/articles/31271708386711

Seattle Services Portal Links:

Seattle Services Portal: https://services.seattle.gov/Portal/

Portal Account Registration Link: https://services.seattle.gov/Portal/CommunityView/account/new

Direct Link to NC Application Page: https://services.seattle.gov/Portal/urlrouting.ashx?type=1002&CAPType=ICMSRegulatory/Network%20Company/License/NA&module=ICMSRegulatory&IsSkipDisclaimer=Y