3rd Sub. H.B. 382
LEGISLATIVE GENERAL COUNSEL
6 Approved for Filing: E.A. Evans 6
6 02-16-23 4:43 PM 6
H.B. 382
3rd Sub. (Cherry)
Representative Cheryl K. Acton proposes the following substitute bill:
1 AUTOMATIC RENEWAL CONTRACT REQUI REMENTS
2 2023 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Cheryl K. Acton
5 Senate Sponsor: Daniel W. Thatcher
6
7LONG TITLE
8General Description:
9 This bill addresses automatic renewal contract requirements.
10Highlighted Provisions:
11 This bill:
12 <defines terms;
13 <requires a person who offers a contract with an automatic renewal provision to
14disclose certain information to the consumer regarding the renewal and cancellation
15of the contract;
16 <requires a person who offers a trial period offer to disclose certain information to
17the consumer regarding the expiration of the trial period and purchase obligations
18upon expiration;
19 <authorizes the Division of Consumer Protection (division) to enforce the provisions
20in this bill;
21 <provides fines and civil penalties for a violation of the provisions in this bill;
22 <requires fines and civil penalties received by the division for a violation of the
23provisions in this bill to be placed in the Consumer Protection Education and
24Training Fund;
25 <grants administrative rulemaking authority; and
*HB0382S03* 3rd Sub. (Cherry) H.B. 382 02-16-23 4:43 PM
- 2 -
26 <makes technical and conforming changes.
27Money Appropriated in this Bill:
28 None
29Other Special Clauses:
30 This bill provides a special effective date.
31Utah Code Sections Affected:
32AMENDS:
33 13-2-1 (Effective 12/31/23), as last amended by Laws of Utah 2022, Chapters 201, 462
34ENACTS:
35 13-63-101, Utah Code Annotated 1953
36 13-63-201, Utah Code Annotated 1953
37 13-63-301, Utah Code Annotated 1953
38
39Be it enacted by the Legislature of the state of Utah:
40 Section 1. Section 13-2-1 (Effective 12/31/23) is amended to read:
41 13-2-1 (Effective 12/31/23). Consumer protection division established --
42Functions.
43 (1) There is established within the Department of Commerce the Division of Consumer
44Protection.
45 (2) The division shall administer and enforce the following:
46 (a) Chapter 5, Unfair Practices Act;
47 (b) Chapter 10a, Music Licensing Practices Act;
48 (c) Chapter 11, Utah Consumer Sales Practices Act;
49 (d) Chapter 15, Business Opportunity Disclosure Act;
50 (e) Chapter 20, New Motor Vehicle Warranties Act;
51 (f) Chapter 21, Credit Services Organizations Act;
52 (g) Chapter 22, Charitable Solicitations Act;
53 (h) Chapter 23, Health Spa Services Protection Act;
54 (i) Chapter 25a, Telephone and Facsimile Solicitation Act;
55 (j) Chapter 26, Telephone Fraud Prevention Act;
56 (k) Chapter 28, Prize Notices Regulation Act; 02-16-23 4:43 PM 3rd Sub. (Cherry) H.B. 382
- 3 -
57 (l) Chapter 32a, Pawnshop, Secondhand Merchandise, and Catalytic Converter
58Transaction Information Act;
59 (m) Chapter 34, Utah Postsecondary Proprietary School Act;
60 (n) Chapter 34a, Utah Postsecondary School State Authorization Act;
61 (o) Chapter 41, Price Controls During Emergencies Act;
62 (p) Chapter 42, Uniform Debt-Management Services Act;
63 (q) Chapter 49, Immigration Consultants Registration Act;
64 (r) Chapter 51, Transportation Network Company Registration Act;
65 (s) Chapter 52, Residential Solar Energy Disclosure Act;
66 (t) Chapter 53, Residential, Vocational and Life Skills Program Act;
67 (u) Chapter 54, Ticket Website Sales Act;
68 (v) Chapter 56, Ticket Transferability Act;
69 (w) Chapter 57, Maintenance Funding Practices Act; [and]
70 (x) Chapter 61, Utah Consumer Privacy Act[.]; and
71 (y) Chapter 63, Automatic Renewal Contracts Act.
72 Section 2. Section 13-63-101 is enacted to read:
73 CHAPTER 63. AUTOMATIC RENEWAL CONTRACTS ACT
74 Part 1. General Provisions
75 13-63-101. Definitions.
76 As used in this chapter:
77 (1) "Automatic renewal provision" means a provision under a contract that is
78automatically renewed at the end of a definite term for a subsequent term that is longer than 45
79days.
80 (2) "Clearly and conspicuously disclose" means to disclose:
81 (a) in print:
82 (i) in larger type than the surrounding text;
83 (ii) in contrasting type, font, or color to the surrounding text of the same size; or
84 (iii) in a manner set off from the surrounding text of the same size by symbols or other
85marks that clearly call attention to the language; or
86 (b) through audio, in a volume and cadence sufficient to be readily audible and
87understandable. 3rd Sub. (Cherry) H.B. 382 02-16-23 4:43 PM
- 4 -
88 (3) "Division" means the Division of Consumer Protection established in Section
8913-2-1.
90 (4) "Trial period offer" means an offer to provide a period of time to sample or use a
91product or service without payment.
92 Section 3. Section 13-63-201 is enacted to read:
93 Part 2. Automatic Renewal Contract
94 13-63-201. Automatic renewal provisions -- Trial period offers -- Notice --
95Exceptions.
96 (1) Except as provided in Subsection (3), a person who provides an individual a
97product or service under a contract with an automatic renewal provision shall provide a notice
98to the individual, at least 30 but not more than 60 days before the day on which the automatic
99renewal provision renews, that clearly and conspicuously discloses:
100 (a) the renewal date;
101 (b) the total renewal cost; and
102 (c) options for cancellation of the contract.
103 (2) Except as provided in Subsection (3), a person who provides an individual a trial
104period offer shall provide a notice to the individual, at least three days before the day on which
105the period of time under the trial period offer expires, that clearly and conspicuously discloses:
106 (a) the trial period offer expiration date; and
107 (b) the price to be charged for the product or service, or any further purchase
108obligations to be imposed on the individual, after the expiration date.
109 (3) This section does not apply to:
110 (a) an insurance organization or an affiliate of an insurance organization regulated
111under Title 31A, Insurance Code;
112 (b) a person providing a service contract, as defined in Section 31A-6a-101;
113 (c) a financial institution or an affiliate of a financial institution regulated under Title V
114of the Gramm-Leach-Bliley Act, 15 U.S.C. Sec. 6801 et seq.;
115 (d) a public utility, as defined in Section 54-2-1; or
116 (e) an entity or an affiliate of the entity that provides services regulated by the Federal
117Communications Commission, Federal Energy Regulatory Commission, or federal
118Professional Services Council. 02-16-23 4:43 PM 3rd Sub. (Cherry) H.B. 382
- 5 -
119 Section 4. Section 13-63-301 is enacted to read:
120 Part 3. Enforcement
121 13-63-301. Administration and enforcement -- Division powers -- Fees --
122Rulemaking.
123 (1) The division shall administer and enforce this chapter in accordance with Chapter
1242, Division of Consumer Protection.
125 (2) In addition to the division's enforcement powers under Chapter 2, Division of
126Consumer Protection:
127 (a) the division director may impose an administrative fine of up to $2,500 for each
128violation of this chapter; and
129 (b) the division may bring a civil action to enforce this chapter.
130 (3) In a civil action by the division to enforce this chapter, the court may:
131 (a) declare that an act or practice violates this chapter;
132 (b) issue an injunction for a violation of this chapter;
133 (c) order disgorgement of any money received after a violation of this chapter;
134 (d) order payment of disgorged money to an injured individual;
135 (e) impose a civil penalty of up to $2,500 for each violation of this chapter; or
136 (f) award any other relief that the court deems reasonable and necessary.
137 (4) If a court grants judgment or injunctive relief to the division, the court shall award
138the division:
139 (a) reasonable attorney fees;
140 (b) court costs; and
141 (c) investigative fees.
142 (5) (a) A person who violates an administrative or court order issued for a violation of
143this chapter is subject to a civil penalty of no more than $5,000 for each violation.
144 (b) A civil penalty authorized under this section may be imposed in any civil action
145brought by the division.
146 (c) The division shall deposit money received for the payment of a fine or civil penalty
147under this section into the Consumer Protection Education and Training Fund created in
148Section 13-2-8.
149 (6) The division may make rules in accordance with Title 63G, Chapter 3, Utah 3rd Sub. (Cherry) H.B. 382 02-16-23 4:43 PM
- 6 -
150Administrative Rulemaking Act, to enforce this chapter.
151 Section 5. Effective date.
152 This bill takes effect on January 1, 2024.