Texas 2025 - 89th Regular

Texas Senate Bill SB838 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	89R3897 MLH-D
2	2	By: Hinojosa of Hidalgo S.B. No. 838
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7	7	A BILL TO BE ENTITLED
8	8	AN ACT
9	9	relating to requirements for subscription service contracts;
10	10	providing a civil penalty.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Title 12, Business & Commerce Code, is amended by
13	13	adding Chapter 611 to read as follows:
14	14	CHAPTER 611. SUBSCRIPTION SERVICE CONTRACTS
15	15	Sec. 611.001. DEFINITIONS. In this chapter:
16	16	(1) "Automatic renewal clause" means a provision of a
17	17	contract that extends the term of or renews a contract for a period
18	18	of at least one month if the consumer does not take a specified
19	19	action.
20	20	(2) "Consumer" means a person who acquires goods or
21	21	services for personal, family, or household purposes.
22	22	(3) "Service provider" means a business that provides
23	23	a service to a consumer.
24	24	(4) "Subscription service" means a service provided by
25	25	a service provider to a consumer under a contract that:
26	26	(A) has an automatic renewal clause; or
27	27	(B) continues indefinitely until canceled by a
28	28	party.
29	29	Sec. 611.002. APPLICABILITY OF CHAPTER. This chapter does
30	30	not apply to:
31	31	(1) an offering or contract of insurance; or
32	32	(2) evidence of coverage under Chapter 843, Insurance
33	33	Code.
34	34	Sec. 611.003. NOTICE REQUIREMENTS FOR SUBSCRIPTION SERVICE
35	35	CONTRACTS. (a) If a service provider and a consumer enter into a
36	36	contract for a subscription service, the service provider shall:
37	37	(1) at the time the service provider enters into the
38	38	contract with the consumer, clearly and conspicuously disclose to
39	39	the consumer the nature of the contract;
40	40	(2) in the disclosure required under Subdivision (1)
41	41	or in a retainable confirmation sent to the consumer not later than
42	42	the fifth day after the date the service provider enters into the
43	43	contract with the consumer, clearly and conspicuously disclose to
44	44	the consumer the procedure for canceling the contract; and
45	45	(3) if the contract has a term of 12 months or more and
46	46	automatically renews for a term of more than one month, give the
47	47	consumer additional written notice of the automatic renewal and the
48	48	procedure for canceling the contract not earlier than the 90th day
49	49	and not later than the 15th day before the date the contract is set
50	50	to renew.
51	51	(b) A service provider may provide the written notice
52	52	required under Subsection (a)(3):
53	53	(1) by regular mail or certified mail;
54	54	(2) on an invoice delivered to the consumer; or
55	55	(3) by written electronic communication, including
56	56	electronic mail, if agreed to by the consumer.
57	57	(c) Notice provided under Subsection (b) must be clear and
58	58	conspicuous. For purposes of Subsection (b)(1), the service
59	59	provider may assume that written notice sent by regular mail is
60	60	received by the consumer on the third business day after the date
61	61	the notice is deposited in the mail.
62	62	Sec. 611.004. METHOD OF CANCELLATION. (a) Subject to
63	63	Subsections (b) and (c), a service provider shall provide a
64	64	consumer with multiple methods for canceling a contract for a
65	65	subscription service, which may include cancellation by:
66	66	(1) toll-free telephone number;
67	67	(2) electronic mail;
68	68	(3) mailing address, if the service provider bills the
69	69	consumer using mail; and
70	70	(4) any other cost-effective, timely, and easy-to-use
71	71	method.
72	72	(b) A service provider shall allow a consumer to cancel a
73	73	contract for a subscription service by using the same method the
74	74	consumer used to enter into the contract, including allowing
75	75	cancellation online, by mail, or by telephone. A consumer who
76	76	enters into a contract online must be able to cancel the contract
77	77	online.
78	78	(c) If a subscription service contract is not entered into
79	79	electronically, the service provider shall allow the consumer to
80	80	cancel the contract by mail.
81	81	Sec. 611.005. DECEPTIVE TRADE PRACTICE. Except as provided
82	82	by Section 611.006, a violation of this chapter is a false,
83	83	misleading, or deceptive act or practice under Subchapter E,
84	84	Chapter 17, and is actionable under that subchapter.
85	85	Sec. 611.006. NO PRIVATE CAUSE OF ACTION. A private cause
86	86	of action for a violation of this chapter may not be brought under
87	87	this chapter or under Subchapter E, Chapter 17.
88	88	Sec. 611.007. OPPORTUNITY TO CURE. (a) Before the attorney
89	89	general may bring an action against a service provider under
90	90	Section 611.008 for an initial violation of this chapter, the
91	91	attorney general, on behalf of a consumer, must provide written
92	92	notice to the service provider identifying the specific provisions
93	93	of this chapter that the service provider allegedly violated.
94	94	(b) Not later than the 30th day after the date the notice
95	95	required by Subsection (a) was received by the service provider,
96	96	the service provider shall:
97	97	(1) cure each violation alleged in the notice; and
98	98	(2) provide a written statement to the attorney
99	99	general certifying that:
100	100	(A) each violation alleged in the notice has been
101	101	cured; and
102	102	(B) no further violation of this chapter will
103	103	occur.
104	104	Sec. 611.008. CIVIL PENALTY; REMEDIES. (a) A service
105	105	provider who violates this chapter is liable to this state for a
106	106	civil penalty of not more than $2,000 for each violation for each
107	107	month the violation continues if the service provider:
108	108	(1) fails to cure the violation as provided by Section
109	109	611.007; or
110	110	(2) commits the violation after curing an initial
111	111	violation and providing a written statement to the attorney general
112	112	under Section 611.007.
113	113	(b) The attorney general may bring an action to:
114	114	(1) recover the civil penalty imposed under this
115	115	section;
116	116	(2) obtain a temporary or permanent injunction to
117	117	restrain the violation; or
118	118	(3) seek restitution for consumers who are residents
119	119	of this state and who incurred damages as a direct result of the
120	120	violation.
121	121	(c) An action under this section may be brought in a
122	122	district court in:
123	123	(1) Travis County; or
124	124	(2) a county in which any part of the violation occurs.
125	125	Sec. 611.009. CONSUMER'S OBLIGATIONS UNDER CONTRACT NOT
126	126	AFFECTED. Nothing in this chapter relieves a consumer of the
127	127	consumer's duties under a contract before the date the contract is
128	128	canceled.
129	129	SECTION 2. Chapter 611, Business & Commerce Code, as added
130	130	by this Act, applies only to a contract entered into or renewed on
131	131	or after the effective date of this Act.
132	132	SECTION 3. This Act takes effect September 1, 2025.