BILL ANALYSIS Ó
AB 632
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Date of Hearing: May 5, 2015
ASSEMBLY COMMITTEE ON BUSINESS AND PROFESSIONS
Susan Bonilla, Chair
AB 632
(Eggman) - As Amended March 26, 2015
SUBJECT: Secondhand dealers and coin dealers: reporting:
handheld electronic devices.
SUMMARY: Permits a secondhand dealer or pawnbroker to submit
the International Mobile Station Equipment Identity (IMEI) or
the mobile equipment identifier (MEID) or other unique number
assigned to a handheld electronic device in lieu of the serial
number for reporting purposes and defines a "handheld electronic
device."
EXISTING LAW:
1)Defines a "secondhand dealer" as any person, co-partnership,
firm, or corporation whose business includes buying, selling,
trading, taking in pawn, accepting for sale on consignment,
accepting for auctioning, or auctioning secondhand tangible
personal property and specifies that a "secondhand dealer"
does not include a coin dealer or participant at gun shows or
events, as specified. (Business and Professions Code (BPC)
Section 21626 (a))
2)States that "tangible personal property" includes, but is not
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limited to, all secondhand tangible personal property which
bears a serial number or personalized initials or inscription,
or which at the time it is acquired by the secondhand dealer,
bears evidence of having had a serial number or personalized
initials or inscription. (BPC Section 21627(a))
3)Requires every secondhand dealer or coin dealer, as specified,
to report daily, or on the first working day after receipt or
purchase of secondhand tangible personal property, on forms or
through an electronic reporting system approved by the
Department of Justice (DOJ), all secondhand tangible personal
property, except for firearms, which he or she has purchased,
taken in trade, taken in pawn, accepted for sale on
consignment, or accepted for auctioning, to the chief of
police or to the sheriff, as specified. (BPC Section 21628)
4)Requires the report to be legible, prepared in English,
completed where applicable, and include, but not be limited
to, the following information: (BPC Section 21628)
a) The name and current address of the intended seller or
pledger of the property;
b) The identification of the intended seller or pledger, as
specified;
c) A complete and reasonably accurate description of
serialized property, including, but not limited to: serial
number and other identifying marks or symbols,
owner-applied numbers, manufacturer's named brand, and
model name or number;
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d) A complete and reasonably accurate description of
non-serialized property, including, but not limited to:
size, color, material, manufacturer's pattern name (when
known), owner-applied numbers and personalized
inscriptions, and other identifying marks or symbols;
e) A certification by the intended seller or pledger that
he or she is the owner of the property or has the authority
of the owner to sell or pledge the property;
f) A certification by the intended seller or pledger that
to his or her knowledge and belief the information is true
and complete;
g) A legible fingerprint taken from the intended seller or
pledger, as specified; and,
h) When a secondhand dealer complies with all of the
provisions of this section, he or she shall be deemed to
have received from the seller or pledger adequate evidence
of authority to sell or pledge the property, as specified.
5)When a secondhand dealer complies with all of the provisions
of this section, he or she shall be deemed to have received
from the seller or pledger adequate evidence of authority to
sell or pledge the property, as specified.
THIS BILL:
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6) Permits a secondhand dealer to use the International Mobile
Station Equipment Identity (IMEI), the mobile equipment
identifier (MEID), or other unique identifying number assigned
to that device by the manufacture, in place of the serial
number for reporting purposes.
7)Defines a "handheld electronic device" to mean any portable
device that is capable of creating, receiving, accessing, or
storing electronic data or communications and includes, but is
not limited, to a cellular phone, smartphone or tablet.
8)Makes other minor technical and clarifying amendments.
FISCAL EFFECT: None. This bill is keyed non-fiscal by the
Legislative Counsel.
COMMENTS:
Purpose. This bill is sponsored by the author. According to
the author, "[this bill] updates California's secondhand
dealer laws to increase recycling of handheld electronic
devices. According to the U.S. Environmental Protection
Agency, in 2012 the [U.S.] generated 3.4 million tons of
electronic waste. Of that amount only 29 percent was
recycled. Handheld electronic devices (smart phones, cell
phones, tablets, MP3 players, etc.) make up an increasing
proportion of electronic waste. Typically unused handheld
electronic devices are not recycled and often end up in a
landfill. The low rate of recycling is largely because
e-waste is unnecessarily difficult.
For example, under existing statute, entities that purchase used
electronic devices for refurbishment or recycling are required
to obtain a secondhand dealers' license and, as such, must
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follow all secondhand dealer laws. However, California's
secondhand dealer laws were largely crafted in the early 1980s
and do not reflect current technology or practice. More
specifically, secondhand dealers must report serial numbers
for all serialized property they receive to law enforcement.
This is a problem because not all electronic devices are
marked with a "serial number." Some manufacturers use [IMEI]
or [MEID] numbers in place of serial numbers. This bill
expands the definition of 'serial number' for handheld
electronic devices to allow secondhand dealers to report to
law enforcement the IMEI, MEID, or other unique identifying
number assigned to that device by the device manufacturer."
Background. A secondhand dealer includes a person, business or
corporation whose main purpose is to buy, sell, trade, take in
pawn, accept for sale on consignment, or accept for auction
secondhand tangible personal property. Current law
specifically exempts certain individuals from the definition
of a secondhand dealer, including coin dealers, certain
auctioneers, and certain appliance repair persons.
Traditional secondhand dealer transactions typically take
place through face-to-face encounters where applicable state
and local laws apply. Under current law, secondhand dealers
are required to report all secondhand tangible personal
property that comes into their possession daily or on the
first working day after receipt of the item on forms or
through the electronic database (once completely functional).
Reporting Requirements. Secondhand dealers are required to
report items that they have acquired including all items which
bear a serial number such as electronics. The author notes that
not all electronic devices today bear a serial number as many of
these devices such as mobile phones have moved away from a
serial number to a more unique IMEI or MEID number. This bill
simply allows a secondhand dealer or pawnbroker to report the
IMEI or MEID number in lieu of a serial number when they are
reporting certain electronic items to law enforcement as
required. In order to clarify what those items are that may
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contain an IMEI or MEID number, this bill defines a "handheld
electronic device" to mean any portable device that is capable
of creating, receiving, accessing or storing electronic data or
communications; items such as cell phones, smartphones and
tablets. This bill does not change any of the current reporting
requirements for secondhand dealers, but instead expands the
categories of information which may be reported to law
enforcement as required.
Unwanted cell phones are regulated as universal waste electronic
devices. Under California's Cell Phone Recycling Act of 2004,
retailers who sell cell telephones are required to take them
back from consumers. While many individuals may be willing to
recycle their used handheld electronic devices, such as cell
phones, for free, many may prefer to sell them to a secondhand
dealer. A New York Times article, A Second Chance for Idle
Electronics, noted that while most old electronics "are destined
for the recycling heap (You do recycle, right?). As for the
others - the phones, tablets, game consoles, high-end digital
cameras and other electronic goodies bought this decade - that's
cash sitting neglected in those drawers. Beats by Dr. Dre Studio
headphones that sell for $270 new could be worth $200. A
Wi-Fi-only 16-gigabyte iPad 2 that costs $400 new could fetch
$300 or more." In an effort to alleviate any potential reasons
for secondhand dealers to not accept these items, this bill will
revise the definition of "handheld electronic device" and permit
secondhand dealers to use the IMEI or MEID numbers when
reporting these items in place of their serial numbers. The
author notes that requiring the use of a serial number for
reporting purposes may dissuade potential secondhand dealers
from accepting these products because the serial number is often
hard to access as it may be part of the internal components of a
device.
IMEI and MEID. IMEI and MEID numbers may be referred to as
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device-specific identifiers and can be used to help wireless
carriers and cell phone manufactures identify specific devices.
IMEI numbers are typically found on handheld electronic devices
with cellular capacity while MEID numbers are typically found on
other items such as tablets without cellular capacity.
According to IMEI.org, if a mobile phone is stolen or lost, and
it is reported to the mobile service provider, that provider
will block the device to access their network and can even block
access to other networks and the use of other regions. Most
cell phone carriers will have a record of the IMEI number. The
police maintain a record of all stolen phones and use the IMEI
numbers to identify the devices. Further, IMEI.org explains
that every smartphone and other mobile station equipments have
an MEID identifier that is "burned" into the gadget which cannot
be modified. The Federal Communications Commission recommends
people write down their IMEI or MEID numbers in case their
handheld electronic device is stolen. The goal of the
secondhand reporting requirements is to help provide law
enforcement agencies with a means to curtail the selling of
stolen property and to facilitate its recovery by means of a
uniform statewide, state- reporting program. This bill provides
secondhand dealers an alternative means to report "serial
numbers" by allowing the report of IMEI, MEID, and other unique
identifying numbers for certain handheld electronic devices such
as cell phone or smartphones.
Current Related Legislation. AB 1182 (Santiago) of the current
legislative session, narrows the current definition of
tangible personal property, as specified, and requires the
Department of Justice (DOJ) to annually update the list of
items which represent a significant class of stolen goods and
post it on its website. STATUS: This bill is pending in the
Assembly Appropriations Committee.
Prior Related Legislation. AB 391 (Pan), Chapter 172, Statutes
of 2012, established the process and fee schedule to implement
a single, statewide, uniform electronic reporting system for
pawnbrokers and secondhand dealers, as specified, administered
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by the DOJ.
ARGUMENTS IN SUPPORT:
The Californians Against Waste writes in support?"while
Californians lead the nation in recycling of most
materials-including many electronic wastes, the recycling of the
ubiquitous cell phone has languished, at the same time that the
number of discarded phones has skyrocketed. Despite a 2006
state law requiring cell phone retailers to take back old phones
for recycling, many consumers are not ready to recycle their old
phone at the time of purchase or upgrade?.[This bill] will
update California's secondhand dealer laws to foster ongoing
efforts to increase recycling rates for handheld electronic
devices."
ARGUMENTS IN OPPOSITION:
None on file.
REGISTERED SUPPORT:
California Asian Pacific Chamber of Commerce
California Police Chiefs Association
Californians Against Waste
ecoATM
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Latin Business Association
Planning and Conservation League
TechNet
REGISTERED OPPOSITION:
None on file.
Analysis Prepared by:Elissa Silva / B. & P. / (916) 319-3301