Full Text of HB2970 98th General Assembly
HB2970 98TH GENERAL ASSEMBLY |
| | 98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014 HB2970 Introduced , by Rep. Mike Smiddy SYNOPSIS AS INTRODUCED: |
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815 ILCS 601/5 |
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815 ILCS 601/10 |
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815 ILCS 601/20 |
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Amends the Automatic Contract Renewal Act. Expands scope of the Act to cover contracts containing a negative option feature. Defines terms. Requires additional disclosures regarding those contracts. Provides that it is a violation of the Act to fail to promptly terminate a contract upon written request or to ship substituted merchandise without the express consent of the consumer. Effective immediately.
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| | A BILL FOR |
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| 1 | | AN ACT concerning business.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Automatic Contract Renewal Act is amended by | 5 | | changing Sections 5, 10, and 20 as follows:
| 6 | | (815 ILCS 601/5)
| 7 | | Sec. 5. Definition. In this Act:
| 8 | | "Contract" means a written
agreement between 2 or more | 9 | | parties.
| 10 | | "Contract-complete consumer" means a consumer who has | 11 | | purchased the minimum quantity of merchandise required by the | 12 | | terms of a negative option plan. | 13 | | "Negative option feature" means a contractual plan or | 14 | | arrangement under which a seller periodically sends to | 15 | | consumers an announcement that identifies merchandise (other | 16 | | than annual supplements to previously acquired merchandise) it | 17 | | proposes to send to consumers under the plan and the consumers | 18 | | thereafter receive and are billed for the merchandise | 19 | | identified in each announcement, unless by a date or within a | 20 | | time specified by the seller with respect to each announcement | 21 | | the consumers, in conformity with the provisions of the plan, | 22 | | instruct the seller not to send the identified merchandise. | 23 | | "Parties" include individuals and other legal entities, |
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| 1 | | but do not include
the federal government, this State or | 2 | | another state, a
unit of local government, or a school | 3 | | district.
| 4 | | "Seller" means a person, firm, partnership, association, | 5 | | corporation, limited liability company, or any other entity | 6 | | that sells or offers to sell products or services. | 7 | | (Source: P.A. 91-674, eff. 6-1-00.)
| 8 | | (815 ILCS 601/10)
| 9 | | Sec. 10. Automatic renewal; requirements. | 10 | | (a) Any person, firm, partnership, association, or | 11 | | corporation that sells or offers to sell any products or | 12 | | services to a consumer pursuant to a contract, where such | 13 | | contract automatically renews unless the consumer cancels the | 14 | | contract, shall disclose the automatic renewal clause clearly | 15 | | and conspicuously in the contract, including the cancellation | 16 | | procedure.
| 17 | | (b) Any person, firm, partnership, association, or | 18 | | corporation that sells or offers to sell any products or | 19 | | services to a consumer pursuant to a contract, where such | 20 | | contract term is a specified term of 12 months or more, and | 21 | | where such contract automatically renews for a specified term | 22 | | of more than one month unless the consumer cancels the | 23 | | contract, shall notify the consumer in writing of the automatic | 24 | | renewal. Written notice shall be provided to the consumer no | 25 | | less than 30 days and no more than 60 days before the |
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| 1 | | cancellation deadline pursuant to the automatic renewal | 2 | | clause. Such written notice shall disclose clearly and | 3 | | conspicuously: | 4 | | (i) that unless the consumer cancels the contract it | 5 | | will automatically renew; and | 6 | | (ii) where the consumer can obtain details of the | 7 | | automatic renewal provision and cancellation procedure | 8 | | (for example, by contacting the business at a specified | 9 | | telephone number or address or by referring to the | 10 | | contract).
| 11 | | (b-5) A seller that sells or offers to sell products or | 12 | | services to a consumer under a contract that includes a | 13 | | negative option feature must disclose truthfully in a clear and | 14 | | conspicuous manner all material terms and conditions of the | 15 | | negative option feature including, but not limited to, the fact | 16 | | that the consumer's account will be charged unless the consumer | 17 | | takes an affirmative action to avoid the charge, the date the | 18 | | charge will be submitted for payment, and the specific steps | 19 | | the consumer must take to avoid the charge. It is a violation | 20 | | of this Act for a seller to fail to terminate promptly the | 21 | | contract of a properly identified contract-complete consumer | 22 | | upon his written request. It is a violation of this Act for a | 23 | | seller to ship without the express consent of the consumer, | 24 | | substituted merchandise for that ordered by the consumer. | 25 | | (c) A person, firm, partnership, association, or | 26 | | corporation will not be liable for a violation of this Act or |
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| 1 | | the Consumer Fraud and Deceptive Business Practices Act if such | 2 | | person, firm, partnership, association, or corporation | 3 | | demonstrates that, as part of its routine business practice: | 4 | | (i) it has established and implemented written | 5 | | procedures to comply with this Act and enforces compliance | 6 | | with the procedures; | 7 | | (ii) any failure to comply with this Act is the result | 8 | | of error; and | 9 | | (iii) where an error has caused a failure to comply | 10 | | with this Act, it provides a full refund or credit for all | 11 | | amounts billed to or paid by the consumer from the date of | 12 | | the renewal until the date of the termination of the | 13 | | account, or the date of the subsequent notice of renewal, | 14 | | whichever occurs first.
| 15 | | (Source: P.A. 93-950, eff. 1-1-05.)
| 16 | | (815 ILCS 601/20)
| 17 | | Sec. 20. Applicability. | 18 | | (a) This Act does not apply to a contract
entered into | 19 | | before the effective date of this Act.
| 20 | | (b) This amendatory Act of the 93rd General Assembly does | 21 | | not apply to a contract entered into before the effective date | 22 | | of this amendatory Act of the 93rd General Assembly.
This | 23 | | amendatory Act of the 98th General Assembly does not apply to a | 24 | | contract entered into before the effective date of this | 25 | | amendatory Act of the 98th General Assembly. |
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| 1 | | (c) This Act does not apply to business-to-business | 2 | | contracts.
| 3 | | (d) This Act does not apply to banks, trust companies, | 4 | | savings and loan associations, savings banks, or credit unions | 5 | | licensed or organized under the laws of any state or the United | 6 | | States, or any foreign bank maintaining a branch or agency | 7 | | licensed or organized under the laws of any state of the United | 8 | | States, or any subsidiary or affiliate thereof.
| 9 | | (e) This Act does not apply to a contract that is extended | 10 | | beyond the original term of the contract as the result of the | 11 | | consumer's initiation of a change in the original contract | 12 | | terms.
| 13 | | (Source: P.A. 93-950, eff. 1-1-05.)
| 14 | | Section 99. Effective date. This Act takes effect upon | 15 | | becoming law.
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