AR
Arkansas Senate Bill SB329

Arkansas 2025 Regular Session

Arkansas Senate Bill SB329 Compare Versions

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11 Stricken language would be deleted from and underlined language would be added to present law.
2-Act 426 of the Regular Session
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5-State of Arkansas As Engrossed: S3/10/25 1
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3+State of Arkansas 1
64 95th General Assembly A Bill 2
75 Regular Session, 2025 SENATE BILL 329 3
86 4
97 By: Senator J. Boyd 5
108 By: Representative R. Burkes 6
119 7
1210 For An Act To Be Entitled 8
1311 AN ACT TO CREATE THE ONLINE MARKETPLACE GUARANTEES 9
1412 ACT; AND FOR OTHER PURPOSES. 10
1513 11
1614 12
1715 Subtitle 13
1816 TO CREATE THE ONLINE MARKETPLACE 14
1917 GUARANTEES ACT. 15
2018 16
2119 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 17
2220 18
2321 SECTION 1. Arkansas Code Title 23, Chapter 66, is amended to add an 19
2422 additional subchapter to read as follows: 20
2523 21
2624 Subchapter 8 — Online Marketplace Guarantees Act 22
2725 23
2826 23-66-801. Title. 24
2927 This subchapter shall be known and may be cited as the "Online 25
3028 Marketplace Guarantees Act". 26
3129 27
3230 23-66-802. Purposes. 28
3331 The purpose of this subchapter is to: 29
3432 (1) Create a legal framework within which an online marketplace 30
3533 or its affiliates may offer or sell an online marketplace guarantee in this 31
3634 state; 32
3735 (2) Protect consumers by promoting transparency, fairness, and 33
3836 accountability related to online marketplace guarantees and placing the risk 34
3937 of innovation on the online marketplace providers rather than consumers; 35
40- (3) Encourage innovation in the marketing and development of 36 As Engrossed: S3/10/25 SB329
38+ (3) Encourage innovation in the marketing and development of 36 SB329
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4541 more economical and effective means of providing an online marketplace 1
4642 guarantee; and 2
4743 (4) Permit and encourage fair and effective competition among 3
4844 different providers. 4
4945 5
5046 23-66-803. Definitions. 6
5147 As used in this subchapter: 7
5248 (1) "Online marketplace" means a person that: 8
5349 (A) Provides an online application, software, website, 9
5450 system, or other medium through which a service is advertised or is offered 10
55-to the public as available in this state; 11
51+to the public as available in this state; and 11
5652 (B) Provides, directly or indirectly, or maintains a 12
57-platform for services by performing: 13
53+platform for services by performing any of the following: 13
5854 (i) Transmitting or otherwise communicating the 14
59-offer or acceptance of a transaction between two (2) platform users; or 15
55+offer or acceptance of a transaction between two (2) platform users; 15
6056 (ii) Owning or operating the electronic 16
6157 infrastructure or technology that brings two (2) or more platform users 17
6258 together; 18
63- (C) If engaged in the sale or offering of online 19
59+ (iii) If engaged in the sale or offering of online 19
6460 marketplace guarantees, engages only in a manner that is ancillary to the 20
6561 conduct of its primary legitimate business or activity; and 21
66- (D) Provides services not provided as a state or local 22
62+ (iv) Services provided as a state or local 22
6763 government entity or vendor; 23
6864 (2) "Online marketplace guarantee" means a contract or agreement 24
6965 issued in connection with an online marketplace, whether or not for a 25
7066 separate consideration, to guarantee a platform user’s obligation to repair, 26
7167 replace, or indemnify another platform user for any damages or loss of income 27
7268 arising out of use of the online marketplace, with or without additional 28
7369 provision for incidental payment of indemnity; 29
7470 (3) "Person" means an individual, partnership, corporation, 30
7571 incorporated or unincorporated association, joint stock company, reciprocal, 31
7672 syndicate, or any similar entity or combination of entities acting in 32
7773 concert; 33
7874 (4) "Platform contract holder" means a platform user who is the 34
7975 beneficiary or holder of an online marketplace guarantee; 35
80- (5) "Platform user" means a user of an online marketplace who is 36 As Engrossed: S3/10/25 SB329
76+ (5) "Platform user" means a user of an online marketplace who is 36 SB329
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8579 subject to the online marketplace’s terms of service; 1
8680 (6) "Provider" means an online marketplace or an affiliate or 2
8781 representative of an online marketplace who issues, makes, provides, sells, 3
8882 or offers to sell as well as administers, either directly or through a third 4
8983 party, an online marketplace guarantee; 5
9084 (7) "Reimbursement insurance policy" means a policy of insurance 6
9185 issued to a provider and under which the insurer agrees, for the benefit of 7
9286 platform contract holders, to discharge all of the obligations and 8
9387 liabilities of the provider under the terms of the online marketplace 9
9488 guarantee in the event of nonperformance by the provider; and 10
9589 (8)(A) "Separate consideration" means a separately stated 11
9690 consideration paid to a provider for an online marketplace guarantee that is 12
9791 paid at the voluntary election of the person purchasing the online 13
9892 marketplace guarantee. 14
9993 (B) "Separate consideration" does not include a revenue 15
10094 sharing agreement between a provider and platform user or any consideration 16
10195 collected by the online marketplace that is primarily related to the 17
10296 underlying service provided by the online marketplace. 18
10397 19
10498 23-66-804. Requirements for doing business. 20
10599 (a) An online marketplace guarantee shall not be issued, sold, or 21
106100 offered for sale in this state unless the provider has: 22
107101 (1) If sold for separate consideration, provided an electronic 23
108102 or written record of the purchase of the online marketplace guarantee to the 24
109103 platform contract holder; 25
110104 (2) Made the online marketplace guarantee terms available on the 26
111105 provider’s website; and 27
112106 (3) Complied with this subchapter. 28
113107 (b) A provider of online marketplace guarantees sold or offered in 29
114108 this state shall file a registration with the Insurance Commissioner on a 30
115109 form and at a fee prescribed by the commissioner. 31
116110 (c) To ensure the faithful performance of a provider’s obligations to 32
117111 its platform contract holders, each provider who is obligated to a platform 33
118112 contract holder shall comply with at least one (1) of the following 34
119113 requirements: 35
120- (1) Insure all online marketplace guarantees under a 36 As Engrossed: S3/10/25 SB329
114+ (1) Insure all online marketplace guarantees under a 36 SB329
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125117 reimbursement insurance policy issued by an insurer authorized to transact 1
126118 insurance in this state or issued under § 23 -65-308; 2
127119 (2) For at least thirty (30) days in any ninety -day period, 3
128120 maintain a market capitalization of at least two hundred million dollars 4
129121 ($200,000,000) on a securities exchange registered as a national securities 5
130122 exchange or a securities market regulated under the Securities Exchange Act 6
131123 of 1934, 15 U.S.C. §§ 78 et seq., as it existed on January 1, 2025, as 7
132124 reported by the national securities exchange at the close of each trading 8
133125 day; or 9
134126 (3)(A) Maintain a net cash balance or net worth of at least 10
135127 fifty million dollars ($50,000,000). 11
136128 (B) Upon request, the provider or provider’s parent 12
137129 company shall provide the commissioner with financial statements to support 13
138130 the net cash balance or net worth as required under subdivision (c)(3)(A) of 14
139131 this section. 15
140132 (C) Financial statements may include without limitation: 16
141133 (i) A Form 10-K or Form S-1 filed with the United 17
142134 States Securities and Exchange Commission within the last calendar year, 18
143135 including any amendments; or 19
144136 (ii) A copy of the company’s audited financial 20
145137 statements with a reporting date within the last calendar year. 21
146138 (D) If the provider’s parent company’s financial 22
147139 statements are provided to meet the provider’s financial stability 23
148140 requirement, then the parent company shall agree to guarantee the obligations 24
149141 of the provider relating to online marketplace guarantees sold by the 25
150142 provider in this state. 26
151143 27
152144 23-66-805. Online marketplace guarantees. 28
153145 (a) Online marketplace guarantees do not constitute insurance and are 29
154146 not required to comply with the Arkansas Insurance Code other than as 30
155147 expressly made applicable in this subchapter, provided the provider has 31
156148 registered with the Insurance Commissioner as required by § 23 -66-804. 32
157149 (b) The following activities by a provider or a provider’s 33
158150 representative do not constitute the transaction of insurance and are 34
159151 likewise exempt from any licensing requirements under the Arkansas Insurance 35
160-Code: 36 As Engrossed: S3/10/25 SB329
152+Code: 36 SB329
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165155 (1) Marketing, providing, selling, or offering to sell online 1
166156 marketplace guarantees in compliance with this subchapter; 2
167157 (2) Determining amounts payable under online marketplace 3
168158 guarantees including, with respect to claims made by platform contract 4
169159 holders: 5
170160 (A) Investigating, negotiating, or administering 6
171161 settlements of claims; or 7
172162 (B) Applying the factual circumstances of the claim to the 8
173163 online marketplace guarantee’s terms; or 9
174164 (3) Collecting separate consideration in connection with online 10
175165 marketplace guarantees. 11
176166 (c) A provider may: 12
177167 (1) Charge separate consideration for an online marketplace 13
178168 guarantee; and 14
179169 (2)(A) Provide varying levels of service and functionality 15
180170 depending on whether a platform user has paid separate consideration. 16
181171 (B) Any separate consideration collected for online 17
182172 marketplace guarantees shall not be subject to premium taxes. 18
183173 (d) This subchapter shall not be construed to limit a provider’s 19
184174 rights to seek recourse from a platform user to the extent of any contractual 20
185175 obligation by any means permitted under an online marketplace’s terms of 21
186176 service. 22
187177 (e) An online marketplace guarantee may set a minimum threshold amount 23
188178 of damages that limit amounts payable to a platform contract holder if the 24
189179 minimum threshold amount is disclosed under § 23 -66-807(e). 25
190180 26
191181 23-66-806. Reimbursement insurance policy. 27
192182 (a) A reimbursement insurance policy insuring online marketplace 28
193183 guarantees sold or offered in this state shall clearly state that, upon 29
194184 failure of the provider to perform under the online marketplace guarantee, 30
195185 the insurer that issued the policy shall pay on behalf of the provider any 31
196186 sums the provider is obligated to pay according to such online marketplace 32
197187 guarantee. 33
198188 (b)(1) A reimbursement insurance policy is subject to the laws and 34
199189 rules governing termination and nonrenewal of an insurance policy in this 35
200-state. 36 As Engrossed: S3/10/25 SB329
190+state. 36 SB329
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205193 (2) The termination of a reimbursement insurance policy shall 1
206194 not reduce the issuer’s responsibility for online marketplace guarantees 2
207195 issued by providers before the effective date of the termination. 3
208196 (c)(1) For purposes of § 23 -64-207, a provider is considered to be the 4
209197 agent of the insurer which issued the reimbursement insurance policy. 5
210198 (2) The insurer retains the right to seek indemnification or 6
211199 subrogation from the provider if the insurer pays or is obligated to pay sums 7
212200 to the platform contract holder that the provider was obligated to pay under 8
213201 the online marketplace guarantee. 9
214202 (3) This subchapter does not prevent or limit the insurer's 10
215203 right in this regard. 11
216204 12
217205 23-66-807. Consumer protection disclosures. 13
218206 (a) An online marketplace guarantee issued, sold, or offered for sale 14
219207 in this state shall be written in clear, understandable language and 15
220208 conspicuously disclose the requirements in this section, as applicable. 16
221209 (b) An online marketplace guarantee insured under a reimbursement 17
222210 insurance policy under § 23 -66-804(c)(1) shall contain a statement in 18
223211 substantially the following form: 19
224212 “Obligations of the provider under this online marketplace guarantee are 20
225213 guaranteed under a reimbursement insurance policy. If the provider fails to 21
226214 pay or provide service on a claim within one hundred eighty (180) days after 22
227215 proof of loss has been filed, the platform contract holder is entitled to 23
228216 make a claim directly against the insurance company subject to the terms of 24
229217 the policy.” 25
230218 (c) An online marketplace guarantee not insured under a reimbursement 26
231219 insurance policy under § 23 -66-804(c)(1) shall contain a statement in 27
232220 substantially the following form: 28
233221 “Obligations of the provider under this online marketplace guarantee are not 29
234222 covered under a reimbursement insurance policy and are backed only by the 30
235223 provider (issuer).” 31
236224 (d) If sold for separate consideration, online marketplace guarantees 32
237225 shall conspicuously state the total purchase price and the terms under which 33
238226 the online marketplace guarantee is sold before the sale. 34
239227 (e) An online marketplace guarantee shall: 35
240- (1) Identify each provider obligated to provide payment for 36 As Engrossed: S3/10/25 SB329
228+ (1) Identify each provider obligated to provide payment for 36 SB329
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245231 claims under the contract or otherwise involved in the contract’s issuance or 1
246232 sale; 2
247233 (2) Conspicuously state the existence and amount of any damage 3
248234 recovery minimum threshold; 4
249235 (3) Specify the services to be provided and any limitations, 5
250236 exceptions, or exclusions; 6
251237 (4)(A) State any terms, restrictions, or conditions, including 7
252238 conditions governing transferability or conditions governing termination of 8
253239 the online marketplace guarantees by the platform contract holder. 9
254240 (B) The provider of the online marketplace guarantee shall 10
255241 mail or email a written notice to the platform contract holder within thirty 11
256242 (30) days of the date of termination under subdivision (e)(4)(A) of this 12
257243 section; and 13
258244 (5) Include a statement in substantially the following form: 14
259245 “This agreement is not an insurance contract.” 15
260246 (f) An online marketplace guarantee sold for separate consideration 16
261247 shall clearly and conspicuously state, at the time of sale, the applicable 17
262248 cancellation and refund policy. 18
263249 19
264250 23-66-808. Prohibited acts. 20
265251 (a) A provider shall not make, permit, or cause to be made any false 21
266252 or misleading statement or deliberately omit any material statement that 22
267253 would be considered misleading if omitted in connection with the sale, offer 23
268254 to sell, or advertisement of an online marketplace guarantee. 24
269255 (b) If an online marketplace guarantee is offered for separate 25
270256 consideration, a provider shall not require the purchase of an online 26
271257 marketplace guarantee as a condition of the use of the online marketplace’s 27
272258 platform. 28
273259 29
274260 23-66-809. Enforcement provisions. 30
275261 (a) When necessary or appropriate to enforce this subchapter and the 31
276262 Insurance Commissioner’s rules and orders and to protect platform contract 32
277263 holders in this state, the commissioner may take action under § 23 -61-103. 33
278264 (b)(1) An online marketplace aggrieved by an order issued under this 34
279265 section may request a hearing before the commissioner under § 23 -61-303. 35
280- (2) Pending a hearing requested under subdivision (b)(1) of this 36 As Engrossed: S3/10/25 SB329
266+ (2) Pending a hearing requested under subdivision (b)(1) of this 36 SB329
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285269 section and the decision by the commissioner, the commissioner shall suspend 1
286270 the effective date of any order. 2
287271 3
288272 23-66-810. Rules. 4
289273 The Insurance Commissioner may promulgate rules to implement and 5
290274 administer this subchapter including rules related to recordkeeping by a 6
291275 provider. 7
292276 8
293277 23-66-811. Severability. 9
294278 If a provision of this subchapter or the application of this subchapter 10
295279 to a person or circumstances shall be held invalid, the remainder of this 11
296280 subchapter and the application of this subchapter to a person or 12
297281 circumstances other than those as to which it is held invalid shall not be 13
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