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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to commercial financing product 2
brokers and providers; creating part XIII of ch. 559, 3
F.S., entitled "Florida Commercial Financing 4
Disclosure Law"; creating s. 559.961, F.S.; providing 5
a short title; creating s. 559.9611, F.S.; providing 6
definitions; creating s. 559.9612, F.S.; providing 7
scope; creating s. 559.9613, F.S.; providing 8
requirements for disclosure of certain information by 9
commercial financing product providers under certain 10
circumstances; creating s. 559.9614, F.S.; providing 11
prohibited acts by commercial financing product 12
providers; creating s. 559.9615, F.S.; providing 13
exclusive authority of the Attorney General to enforce 14
specified provisions; providing fines; providing 15
construction; providing an effective date. 16
17
Be It Enacted by the Legislature of the State of Florida: 18
19
Section 1. Part XIII of chapter 559, Florida Statutes, 20
consisting of sections 559.961, 559.9611, 559.961 2, 559.9613, 21
559.9614, and 559.9615, is created to read: 22
PART XIII 23
FLORIDA COMMERCIAL FINANCING DISCLOSURE LAW 24
559.961 Short title. —This part may be cited as the 25
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"Florida Commercial Financing Disclosure Law." 26
559.9611 Definitions. —As used in this part, the term: 27
(1) "Accounts receivable purchase transaction" means a 28
transaction in which a business forwards or otherwise sells to a 29
person all or a portion of the business' accounts, as defined in 30
s. 679.1021, or payment intangibles, as defined in s. 679. 1021, 31
at a discount to the expected value of the account or payment 32
intangibles. For purposes of this part, the provider's 33
characterization of an accounts receivable purchase transaction 34
as a purchase is conclusive that the accounts receivable 35
purchase transaction is not a loan or a transaction for the use, 36
forbearance, or detention of money. 37
(2) "Advance fee" means any consideration that is assessed 38
or collected by a broker before the closing of a commercial 39
financing product transaction. 40
(3) "Broker" means a person who, for compensation or the 41
expectation of compensation, arranges a commercial financing 42
product transaction or an offer between a third party and a 43
business in the state which would, if executed, be binding upon 44
that third party. The term excludes a provider and any 45
individual or entity whose compensation is not based or 46
dependent upon on the terms of the specific commercial financing 47
product transaction obtained or offered. 48
(4) "Business" means an individual or group of 49
individuals, a sole proprietorship, a corporation, a limited 50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
liability company, a trust, an estate, cooperative, an 51
association, or a limited or general partnership engaged in a 52
business activity. 53
(5) "Commercial financing product" means a commercial 54
loan, accounts recei vable purchase transaction, commercial open -55
end credit plan, or each to the extent the transaction is a 56
business purpose transaction. As used in this subsection, the 57
term "business purpose transaction" means a transaction the 58
proceeds of which are provided to a business or are intended to 59
be used to carry on a business and not for personal, family, or 60
household purposes. For purposes of determining whether a 61
transaction is a business purpose transaction, the provider may 62
rely on any written statement of int ended purpose signed by the 63
business. The statement may be a separate statement or may be 64
contained in an application, agreement, or other document signed 65
by the business or the business owner. 66
(6) "Commercial loan" means a loan to a business, whether 67
secured or unsecured. 68
(7) "Commercial open -end credit plan" means commercial 69
financing extended by any provider under a plan in which: 70
(a) The provider reasonably contemplates repeat 71
transactions. 72
(b) The amount of financing that may be extended to the 73
business during the term of the plan, up to any limit set by the 74
provider, is generally made available to the extent that any 75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
outstanding balance is repaid. 76
(8) "Depository institution" means: 77
(a) A bank, a trust company, or an industrial loan company 78
doing business under the authority of, or in accordance with, a 79
license, certificate, or charter issued by the United States, 80
this state, or any other state, district, territory, or 81
commonwealth of the United States which is authorized to 82
transact business in this state; 83
(b) A federally chartered savings and loan association, 84
federal savings bank, or federal credit union that is authorized 85
to transact business in th e state; or 86
(c) A savings and lo an association, savings bank, or 87
credit union organized under the laws of this or any other state 88
which is authorized to transact business in th e state. 89
(9) "Provider" means a person who consummates more than 90
five commercial financing product transaction s to a business 91
located in the state in any calendar year. The term also 92
includes a person who enters into a written agreement with a 93
depository institution to arrange for the extension of a 94
commercial financing product by the depository institution to a 95
business via an online lending platform administered by the 96
person. The fact that a provider extends a specific offer for a 97
commercial financing product on behalf of a depository 98
institution may not be construed to mean that the provider 99
engaged in lending or financing or originated that loan or 100
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financing. 101
559.9612 Scope of this part. —This part applies to any 102
commercial financing product transaction consummated on or after 103
January 1, 2024. This part does not apply to: 104
(1) A provider that is: 105
(a) A federally insured depository institution or an 106
affiliate or holding company of such institution; or 107
(b) A subsidiary or service corporation that is owned and 108
controlled by a federally insured depository institution. 109
(2) A provider that is a lender regulat ed under the Farm 110
Credit Act of 1971, 12 U.S.C. ss. 2001 et seq. 111
(3) A commercial financing product transaction that is: 112
(a) Secured by real property; 113
(b) A lease; or 114
(c) A purchase money obligation that is incurred as all or 115
part of the price of t he collateral or for value given to enable 116
the business to acquire rights in or the use of the collateral 117
if the value is in fact so used. 118
(4) A commercial financing product transaction in which 119
the recipient is a motor vehicle dealer or an affiliate of such 120
a dealer, or a vehicle rental company or an affiliate of such a 121
company, pursuant to a commercial loan or commercial open -end 122
credit plan of at least $50,000 or a commercial financing 123
product offered by a person in connection with the sale or lease 124
of products or services that such person manufactures, licenses, 125
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or distributes, or whose parent company or any of its directly 126
or indirectly owned and controlled subsidiaries manufacturers, 127
licenses or distributes. 128
(5) A provider that is licensed as a mon ey transmitter in 129
accordance with a license, certificate, or charter issued by 130
this state or any other state, district, territory, or 131
commonwealth of the United States. 132
(6) A provider that consummates no more than five 133
commercial financing product transactions in the state in a 12 -134
month period. 135
(7) A commercial financing product transaction of more 136
than $500,000. 137
559.9613 Disclosures. — 138
(1) A provider that consummates a commercial financing 139
product transaction shall disclose the terms of the co mmercial 140
financing product transaction as required by this part. The 141
disclosures must be provided at or before consummation of the 142
transaction. Only one disclosure must be provided for each 143
commercial financing product transaction, and a disclosure is 144
not required as result of a modification, forbearance, or change 145
to a consummated commercial financing product transaction. 146
(2) A provider must disclose the following information in 147
connection with each commercial financing product transaction: 148
(a) The total amount of funds provided to the business 149
under the terms of the agreement. 150
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(b) The total amount of funds disbursed to the business if 151
less than the amount specified in paragraph (a) as a result of 152
any fees deducted or withheld at disbursement, any amo unt paid 153
to the provider to satisfy a prior balance, and any amount paid 154
to a third party on behalf of the business. 155
(c) The total amount to be paid to the provider under the 156
terms of the agreement. 157
(d) The total dollar cost under the terms of the 158
agreement, calculated by finding the difference between the 159
amount specified in paragraph (a) and the amount specified in 160
paragraph (c). 161
(e) The manner, frequency, and amount of each payment. If 162
the payments may vary, the provider shall instead disclose the 163
manner, frequency, and the estimated amount of the initial 164
payment and a description of the methodology for calculating any 165
variable payment and the circumstances when payments may vary. 166
(f) A statement of whether there are any costs or 167
discounts associated with prepayment, including a reference to 168
the paragraph in the agreement which creates the contractual 169
rights of the parties related to prepayment. 170
559.9614 Prohibited acts. —A broker may not: 171
(1) Assess, collect, or solicit an advance fee fr om a 172
business to provide services as a broker . However, this 173
subsection does not preclude a broker from soliciting a business 174
to pay for, or preclude a business from paying for, actual 175
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services necessary to apply for a commercial financing product, 176
including, but not limited to, a credit check or an appraisal of 177
security, if such payment is made by check or money order 178
payable to a party independent of the broker; 179
(2) Make or use any false or misleading representation or 180
omit any material fact in the offe r or sale of the services of a 181
broker or engage, directly or indirectly, in any act that 182
operates or would operate as fraud or deception upon any person 183
in connection with the offer or sale of the services of a 184
broker, notwithstanding the absence of relian ce by the business; 185
(3) Make or use any false or deceptive representation in 186
its business dealings; or 187
(4) Offer the services of a broker by making, publishing, 188
disseminating, circulating, or placing before the public within 189
the state an advertisement in a newspaper or other publication 190
or an advertisement in the form of a book, notice, handbill, 191
poster, sign, billboard, bill, circular, pamphlet, letter, 192
photograph, or motion picture or an advertisement circulated by 193
radio, loudspeaker, telephone, telev ision, telegraph, or in any 194
other way, in which the offer or advertisement does not disclose 195
the name, business address, and telephone number of the broker. 196
For purposes of this subsection, the broker shall disclose the 197
actual address and telephone number of the business of the 198
broker in addition to the address and telephone number of any 199
forwarding service that the broker may use. 200
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
559.9615 Enforcement. — 201
(1) The Attorney General has exclusive authority to 202
enforce this part. The Attorney General may: 203
(a) Receive and act on complaints. 204
(b) Take action designed to obtain voluntary compliance 205
with this part. 206
(c) Commence administrative or judicial proceedings to 207
enforce compliance with this part. 208
(2)(a) A violation of any provision of this part is 209
punishable by a fine of $500 per incident, not to exceed $20,000 210
for all aggregated violations arising from the use of the 211
transaction documentation or materials found to be in violation 212
of this part. 213
(b) A violation of any provision of this part after 214
receipt of a written notice of a prior violation from the 215
Attorney General is punishable by a fine of $1,000 per incident, 216
not to exceed $50,000 for all aggregated violations arising from 217
the use of the transaction documentation or materials found to 218
be in violation of this part. 219
(c) A violation of any provision of this part does not 220
affect the enforceability or validity of the underlying 221
commercial financing product transaction. 222
(3) Nothing in this part creates or is intended to create 223
a private right of action against any person or entity based 224
upon compliance or noncompliance with the provisions of this 225
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
part. 226
Section 2. This act shall take effect July 1, 2023. 227