This filing was published in the 06/15/2009, issue, Vol. 2009, No. 12, of the Utah State Bulletin.
Commerce, Consumer Protection
NOTICE OF PROPOSED RULE
DAR File No.: 32687
Filed: 05/21/2009, 02:23
Received by: NL
Purpose of the rule or reason for the change:
The purpose of this amendment is to eliminate inconsistent and confusing Utah requirements at a time when more transactions cross state boundaries.
Summary of the rule or change:
This amendment makes Utah requirements for negative options consistent with federal requirements. If there are changes to the federal requirements, Utah requirements will automatically reflect those changes.
State statutory or constitutional authorization for this rule:
Sections 63G-3-201 and 13-2-5, and Title 13, Chapter 11
Anticipated cost or savings to:
the state budget:
No change in status quo. The Division of Consumer Protection will continue to enforce this rule.
This rule is not applicable to local governments and, therefore, does not impact such budgets.
small businesses and persons other than businesses:
A cost savings would be realized by small businesses in Utah who now only have to meet the federal standards governing negative options.
Compliance costs for affected persons:
Compliance costs for suppliers that operate negative options may be reduced now that they will not have to meet federal, as well as state standards which may differ.
Comments by the department head on the fiscal impact the rule may have on businesses:
This rule filing could result in a cost savings to businesses as suppliers would now only have the federal standard to meet regarding negative options. Francine Giani, Executive Director
The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:Commerce
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY UT 84111-2316
Direct questions regarding this rule to:
Angela Hendricks at the above address, by phone at 801-530-6035, by FAX at 801-538-6001, or by Internet E-mail at firstname.lastname@example.org
Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:
This rule may become effective on:
Kevin V Olsen, Director
R152. Commerce, Consumer Protection.
R152-11. Utah Consumer Sales Practices Act.
R152-11-12. Negative Options.
A. Definitions: 1. A "negative option plan" means a
contract under which a supplier either: a. sends or offers to a consumer an
announcement, advertisement or notice that: i. the supplier proposes to send goods or
provide services to the consumer (other than periodic supplements to previously
acquired merchandise), and ii. the consumer is required to pay for those
goods or services unless the consumer affirmatively communicates that he
refuses to accept the goods or services; or b. sends or offers to a consumer a notice
accompanying goods or services provided to the consumer that requires or
purports to require that the consumer pay for those goods or services unless
the customer affirmatively communicates that he refuses to accept the goods or
services. 2. "Contract" includes, but is not
limited to, any contract, marketing plan, arrangement or agreement between a
supplier and a consumer. B. Except as provided in paragraph C herein,
the following acts or practices constitute a deceptive or unconscionable act or
practice: 1. a supplier sends of offers goods or provides
services to a consumer pursuant to a negative option plan; 2. a supplier interrupts, terminates, cancels
or denies delivery of or provision of goods or services previously contracted
for to a consumer solely on the basis that the consumer has not paid for or
returned to the supplier goods or services which the consumer has not ordered,
requested or authorized from the supplier. C. Negative option plans do not constitute deceptive
or unconscionable acts or practices if: 1. the supplier first receives specific
approval, in writing and signed by the consumer, to send goods or services
pursuant to a negative option plan. a. The "specific approval" referred
to in subparagraph B.1. of this rule shall be in writing and shall include the
signature of the consumer. b. The supplier shall maintain the original
signed written consent of the consumer for a period of at least five (5) years
after the date of signing or two (2) years after termination of the contract or
agreement, whichever is longer; and 2. The following disclosures, or disclosures
substantially similar to the following, are on the face of the contract or
document evidencing the negative option plan and provided to the consumer
before the consumer approves of the plan: a. in bolded type which is 10 points or larger,
that the transaction includes a "NEGATIVE OPTION PLAN"; and b. the terms and conditions under which the
negative option may be exercised, clearly and understandably stated; and c. near the signature of the person entering
into the consumer transaction, in bold type which is 10 points or larger: "I UNDERSTAND THAT THIS CONSUMER
TRANSACTION INVOLVES A NEGATIVE OPTION, AND THAT I MAY BE LIABLE FOR PAYMENT OF
FUTURE GOODS AND SERVICES UNDER THE TERMS OF THIS AGREEMENT IF I FAIL TO NOTIFY
THE SUPPLIER NOT TO SUPPLY THE GOODS OR SERVICES DESCRIBED."]
KEY: advertising, bait and switch, consumer protection
Date of Enactment or Last Substantive
December 22, 2006]
Notice of Continuation: February 1, 2007
Authorizing, and Implemented or Interpreted Law: 63G-3-201; 13-2-5; 13-11
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For questions regarding the content or application of this rule, please contact Angela Hendricks at the above address, by phone at 801-530-6035, by FAX at 801-538-6001, or by Internet E-mail at email@example.com
For questions about the rulemaking process, please contact the Division of Administrative Rules (801-538-3764). Please Note: The Division of Administrative Rules is NOT able to answer questions about the content or application of these administrative rules.
Last modified: 07/14/2009 8:03 PM