Amended in Senate August 10, 2016

Amended in Assembly April 20, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2138

Introduced by Assembly Members Low and Bonta

February 17, 2016

An act to amend Section 17550.20 of the Business and Professions Code, relating to business.

LEGISLATIVE COUNSEL’S DIGEST

AB 2138, as amended, Low. Sellers of travel.

Existing law regulates sellers of travel, as defined, and requires their registration with the Attorney General. Under existing law, a seller of travel is deemed to do business in this state if the seller of travel solicits business from locations in this state or solicits prospective purchasers who are located in this state.

This bill would clarify that a seller of travel is deemed to do business in this state if the seller of travel solicits business from locations in this state regardless of the geographic location of the prospective purchaser including persons located outside of this state or the country.

begin insert

This bill would incorporate additional changes to Section 17550.20 of the Business and Professions Code proposed by AB 2106 that would become operative if this bill and AB 2106 are enacted and this bill is enacted last.

end insert

Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 17550.20 of the Business and Professions
Code is amended to read:

17550.20.  

(a) Not less than 10 days prior to doing business in
this state, a seller of travel shall apply for registration with the
office of the Attorney General by filing with the Consumer Law
Section the information required by Section 17550.21 and a filing
fee of one hundred dollars ($100) for each location from which
the seller of travel conducts business. A late fee of five dollars
($5) per day, up to a maximum of five hundred dollars ($500),
shall be paid for each day after the time specified by this section
until the filing fee and the information required by Section
17550.21 are received. No registration shall be issued or approved
until the late fee, and the filing and late fees for each year the seller
of travel operated without being registered, have been paid. A
seller of travel shall be deemed to do business in this state if the
seller of travel solicits business from locations in this state
regardless of the geographic location of the prospective purchaser
including persons located outside of this state or the country or
solicits prospective purchasers who are located in this state.

(b) Registration shall be valid for one year from the effective
date thereof shown on the registration issued by the office of the
Attorney General and may be annually renewed by making the
filing required by Section 17550.21 and paying a filing fee of one
hundred dollars ($100) for each location from which the seller of
travel conducts business. A late fee of five dollars ($5) per day,
up to a maximum of five hundred dollars ($500), shall be paid for
each day after the time specified by this section until the filing fee
and the information required by Section 17550.21 are received.
No registration shall be renewed until the late fee, and the filing
and late fees for each year the seller of travel operated without
being registered, have been paid.

(c) Whenever, prior to expiration of a seller of travel’s annual
registration, there is a material change in the information required
by Section 17550.21, the seller of travel shall, within 10 days, file
an addendum updating the information with the Consumer Law
Section of the office of the Attorney General.

(d) (1) Not less than 10 days prior to the transfer or sale of any
interest in a seller of travel, the selling or transferring owner shall
file with the office of the Attorney General, Seller of Travel
Program, a notice of encumbrance, sale, or transfer of ownership,
using a form provided for that purpose by the office of the Attorney
General. The notice shall provide the information required pursuant
to subdivision (d) of Section 17550.21 as to each transferee.

(2) Until the time the notice of encumbrance, sale, or transfer
of ownership required in paragraph (1) is filed as required, the
selling, encumbering, or transferring owner is responsible for all
acts of and obligations imposed by law on the transferee sellers of
travel to the same extent as they would have been responsible had
there been no transfer, sale, or encumbrance.

(e) The office of the Attorney General shall suspend the
registration of any seller of travel who (1) fails to make any
payment required pursuant to Article 2.7 (commencing with
Section 17550.35) or (2) submits a check in payment of a
registration fee or late fee required by this section that is not
honored by the institution on which it is drawn. The Attorney
General shall provide written notice to the seller of travel by
first-class mail at the seller of travel’s place of business set forth
in the registration statement that the seller of travel’s registration
has been suspended until all fees that are due have been paid. The
registration of the seller of travel shall be suspended until all such
payments due have been collected.

(f) The Attorney General may, at his or her discretion and
subject to supervision by the Attorney General or his or her
delegate, contract out all or any part of the processing of
registrations required by this section.

(g) This section does not apply to an individual, natural person
who meets all of the following conditions:

(1) Has a written contract with a registered seller of travel to
act on that registered seller of travel’s behalf in offering or selling
air or sea transportation and other travel goods or services in
connection with the transportation.

(2) Acts only on behalf of a registered seller of travel with whom
the person has a written contract in the offer or sale to a passenger
of air or sea transportation and other goods or services in
connection with the transportation and sells no other air or sea
transportation or travel services to that passenger.

(3) Provides air or sea transportation or travel services that are
offered or sold pursuant to the official agency appointment of the
registered seller of travel with whom the person has a written
contract.

(4) Does not receive any consideration for air or sea
transportation or other travel services from the passenger.

(5) Requires the passenger to pay all consideration for air or
sea transportation or other travel services directly to the air carrier
or ocean carrier or to the registered seller of travel.

(6) Discloses both of the following:

(A) The person is acting on behalf of a registered seller of travel.

(B) The name, address, telephone number, and registration
number of the registered seller of travel on whose behalf the person
is acting.

The person shall make the disclosures required by this paragraph
in writing to the passenger at the same time the passenger receives
notice under Section 17550.13. If the person transacts business in
this state on the Internet, the disclosures also shall appear on the
home page of the person’s Web site and shall be prominently set
forth in the first electronic mail message sent to the passenger that
refers to the passenger’s purchase of air or sea transportation or
travel services.

(h) Whenever the Attorney General determines that a registration
application is accurate and complete, the application shall be
processed and a registration certificate shall be issued to the seller
of travel within 21 days.

begin insert

begin insert SEC. 1.5. end insert   

end insert

begin insert Section 17550.20 of the end insert begin insert Business and Professions
Code end insert begin insert is amended to read: end insert

17550.20.  

(a)  begin insert (1) end insert begin insert   end insert Not less than 10 days prior to doing business
in this state, a seller of travel shall apply for registration with the
office of the Attorney General by filing with the Consumer Law
Section the information required by Section 17550.21 and begin delete a filing
fee of one hundred dollars ($100) for each location from which
the seller of travel conducts business. A late fee of five dollars
($5) per day, up to a maximum of five hundred dollars ($500),
shall be paid for each day after the time specified by this section
until the filing fee and the information required by Section
17550.21 are received. No registration shall be issued or approved
until the late fee, and the filing and late fees for each year the seller
of travel operated without being registered, have been paid. A
seller of travel shall be deemed to do business in this state if the
seller of travel solicits business from locations in this state or
solicits prospective purchasers who are located in this state. end delete begin insert paying
the following fees, as applicable: end insert

begin insert

(A) A filing fee of one hundred dollars ($100) for each location
from which the seller of travel conducts business.

end insert begin insert

(B) A late fee of five dollars ($5) per day, up to a maximum of
five hundred dollars ($500), for each day after the time specified
by this section until the filing fee and the information required by
Section 17550.21 are received.

end insert begin insert

(2) A seller of travel may annually renew its registration by
making the filing required by Section 17550.21 and paying the
filing fees and late fees required by paragraph (1).

end insert begin insert

(3) A registration shall not be issued, approved, or renewed
until the late fee, the filing and late fees for each year the seller
of travel operated without being registered, and any outstanding
assessments due to the Travel Consumer Restitution Corporation
as required by Sections 17550.43 and 17550.44 have been paid.

end insert begin insert

(4) A seller of travel shall be deemed to do business in this state
if the seller of travel solicits business from locations in this state
regardless of the geographic location of the prospective purchaser
including persons located outside of this state or the country or
solicits prospective purchasers who are located in this state.

end insert

(b) Registration shall be valid for one year from the effective
date thereof shown on the registration issued by the office of the
Attorney begin delete General and may be annually renewed by making the
filing required by Section 17550.21 and paying a filing fee of one
hundred dollars ($100) for each location from which the seller of
travel conducts business. A late fee of five dollars ($5) per day,
up to a maximum of five hundred dollars ($500), shall be paid for
each day after the time specified by this section until the filing fee
and the information required by Section 17550.21 are received.
No registration shall be renewed until the late fee, and the filing
and late fees for each year the seller of travel operated without
being registered, have been paid. end delete begin insert General. end insert

(c) Whenever, prior to expiration of a seller of travel’s annual
registration, there is a material change in the information required
by Section 17550.21, the seller of travel shall, within 10 days, file
an addendum updating the information with the Consumer Law
Section of the office of the Attorney General.

(d) (1) Not less than 10 days prior to the transfer or sale of any
interest in a seller of travel, the selling or transferring owner shall
file with the office of the Attorney General, Seller of Travel
Program, a notice of encumbrance, sale, or transfer of ownership,
using a form provided for that purpose by the office of the Attorney
General. The notice shall provide the information required pursuant
to subdivision (d) of Section 17550.21 as to each transferee.

(2) Until the time the notice of encumbrance, sale, or transfer
of ownership required in paragraph (1) is filed as required, the
selling, encumbering, or transferring owner is responsible for all
acts of and obligations imposed by law on the transferee sellers of
travel to the same extent as they would have been responsible had
there been no transfer, sale, or encumbrance.

begin insert

(e) (1) The office of the Attorney General shall suspend the
registration of a seller of travel who does any of the following:

end insert begin insert

(A) Fails to make any payment required pursuant to Article 2.7
(commencing with Section 17550.35).

end insert begin insert

(B) Submits a check in payment of a registration fee or late fee
required by this section that is not honored by the institution on
which it is drawn.

end insert begin insert

(C) Fails to provide the file number assigned by the Secretary
of State or the Franchise Tax Board to the seller of travel, as
required by subdivision (m) of Section 17550.21.

end insert begin delete

(e)

end delete

begin insert (2) end insert  The begin delete office of the end delete Attorney General shall begin delete suspend the
registration of any seller of travel who (1) fails to make any
payment required pursuant to Article 2.7 (commencing with
Section 17550.35) or (2) submits a check in payment of a
registration fee or late fee required by this section that is not
honored by the institution on which it is drawn. The Attorney
General shall end delete provide written notice to the seller of travel by
first-class mail at the seller of travel’s place of business set forth
in the registration statement that the seller of travel’s registration
has been suspended until all fees that are due have been paid. The
registration of the seller of travel shall be suspended until all such
payments due have been collected.

(f) The Attorney General may, at his or her discretion and
subject to supervision by the Attorney General or his or her
delegate, contract out all or any part of the processing of
registrations required by this section.

begin delete

(g) This section does not apply to an individual, natural person
who meets all of the following conditions:

end delete begin insert

(g) This section does not apply to a person who is an individual,
a single-member limited liability company whose sole member is
an individual, or a single-shareholder “S” corporation whose sole
shareholder is an individual, that meets all of the following:

end insert

(1) Has a written contract with a registered seller of travel to
act on that registered seller of travel’s behalf in offering or selling
air or sea transportation and other travel goods or services in
connection with the transportation.

(2) Acts only on behalf of a registered seller of travel with whom
the person has a written contract in the offer or sale to a passenger
of air or sea transportation and other goods or services in
connection with the transportation and sells no other air or sea
transportation or travel services to that passenger.

(3) Provides air or sea transportation or travel services that are
offered or sold pursuant to the official agency appointment of the
registered seller of travel with whom the person has a written
contract.

(4) Does not receive any consideration for air or sea
transportation or other travel services from the passenger.

(5) Requires the passenger to pay all consideration for air or
sea transportation or other travel services directly to the air carrier
or ocean carrier or to the registered seller of travel.

(6) Discloses both of the following:

(A) The person is acting on behalf of a registered seller of travel.

(B) The name, address, telephone number, and registration
number of the registered seller of travel on whose behalf the person
is acting.

The person shall make the disclosures required by this paragraph
in writing to the passenger at the same time the passenger receives
notice under Section 17550.13. If the person transacts business in
this state on the Internet, the disclosures also shall appear on the
home page of the person’s begin insert Internet end insert Web site and shall be
prominently set forth in the first electronic mail message sent to
the passenger that refers to the passenger’s purchase of air or sea
transportation or travel services.

(h) Whenever the Attorney General determines that a registration
application is accurate and complete, the application shall be
processed and a registration certificate shall be issued to the seller
of travel within 21 days.

begin insert

begin insert SEC. 2. end insert   

end insert begin insert

Section 1.5 of this bill incorporates amendments to
Section 17550.20 of the Business and Professions Code proposed
by both this bill and Assembly Bill 2106. It shall only become
operative if (1) both bills are enacted and become effective on or
before January 1, 2017, (2) each bill amends Section 17550.20 of
the Business and Professions Code, and (3) this bill is enacted
after Assembly Bill 2106, in which case Section 1 of this bill shall
not become operative.

end insert