2688-S.E AMS LAB S5474.2
ESHB 2688 - S COMM AMD
By Committee on Labor & Commerce
NOT ADOPTED 3/4/94
Strike everything after the enacting clause and insert the following:
"Sec. 1. RCW 19.138.010 and 1986 c 283 s 1 are each amended to read as follows:
The legislature finds
and declares that advertising, sales, and business practices of certain ((travel
charter or tour operators)) sellers of travel have worked financial
hardship upon the people of this state; that the travel business has a
significant impact upon the economy and well-being of this state and its
people; that problems have arisen regarding certain ((segments of the travel
charter or tour operator business)) sales of travel; and that the
public welfare requires ((regulation)) registration of ((travel
charter or tour operators)) sellers of travel in order to eliminate
unfair advertising, sales and business practices. The legislature further
finds it necessary to establish standards that will safeguard the people
against financial hardship and to encourage fair dealing and prosperity in the
travel business.
NEW SECTION. Sec. 2. Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.
(1) "Department" means the department of licensing.
(2) "Director" means the director of licensing or the director's designee.
(3) "Seller of travel" means a person, firm, or corporation both inside and outside the state of Washington, who transacts business with Washington consumers, including, but not limited to, travel agencies, who sell, provide, furnish contracts for, arrange, or advertise, either directly or indirectly, by any means or method, to arrange or book any travel services including travel reservations or accommodations, tickets for domestic or foreign travel by air, rail, ship, bus, or other medium of transportation or hotel or other lodging accommodation and vouchers or coupons to be redeemed for future travel or accommodations for a fee, commission, or other valuable consideration.
(a) "Seller of travel" includes a travel agent and any person who is an independent contractor or outside agent for a travel agency or other seller of travel whose principal duties include consulting with and advising persons concerning travel arrangements or accommodations in the conduct or administration of its business. If a seller of travel is employed by a seller of travel who is registered under this chapter, the employee need not also be registered.
(b) "Seller of travel" does not include:
(i) An air carrier;
(ii) An owner or operator of a vessel including an ocean common carrier as defined in 46 U.S.C. App. 1702(18), an owner or charterer of a vessel that is required to establish its financial responsibility in accordance with the requirements of the federal maritime commission, 46 U.S.C. App. 817 (e), and a steamboat company as defined in RCW 84.12.200 whether or not operating over and upon the waters of this state;
(iii) A motor carrier;
(iv) A rail carrier;
(v) A charter party carrier of passengers as defined in RCW 81.70.020;
(vi) An auto transportation company as defined in RCW 81.68.010;
(vii) A hotel or other lodging accommodation;
(viii) An affiliate of any person or entity described in (i) through (vii) of this subsection (3)(b) that is primarily engaged in the sale of travel services provided by the person or entity. For purposes of this subsection (3)(b)(viii), an "affiliate" means a person or entity owning, owned by, or under common ownership, with "owning," "owned," and "ownership" referring to equity holdings of at least eighty percent.
(4) "Travel services" includes transportation by air, sea, or rail ground transportation, hotel or any lodging accommodations, or package tours, whether offered or sold on a wholesale or retail basis.
(5) "Advertisement" includes, but is not limited to, a written or graphic representation in a card, brochure, newspaper, magazine, directory listing, or display, and oral, written, or graphic representations made by radio, television, or cable transmission that relates to travel services.
NEW SECTION. Sec. 3. No person, firm, or corporation may act or hold itself out as a seller of travel unless, prior to engaging in the business of selling or advertising to sell travel services, the person, firm, or corporation registers with the director under this chapter and rules adopted under this chapter.
(1) The registration number must be conspicuously posted in the place of business and must be included in all advertisements. Any corporation which issues a class of equity securities registered under section 12 of the securities exchange act of 1934, and any subsidiary, the majority of voting stock of which is owned by such corporation including any wholly owned subsidiary of such corporation are not required to include company registration numbers in advertisements.
(2) The director shall issue duplicate registrations upon payment of a nominal duplicate registration fee to valid registration holders operating more than one office.
(3) No registration is assignable or transferable.
(4) If a registered seller of travel sells his or her business, when the new owner becomes responsible for the business, the new owner must comply with all provisions of this chapter, including registration.
NEW SECTION. Sec. 4. An application for registration as a seller of travel shall be submitted in the form prescribed by rule by the director, and shall contain but not be limited to the following:
(1) The name, address, and telephone number of the seller of travel;
(2) Proof that the seller of travel holds a valid business license in the state of its principal state of business;
(3) A registration fee in an amount determined under RCW 43.24.086;
(4) The name, address, and social security numbers of all employees who sell travel and are covered by the seller of travel's registration. This subsection shall not apply to the out-of-state employees of a corporation that issues a class of equity securities registered under section 12 of the securities exchange act of 1934, and any subsidiary, the majority of voting stock of which is owned by the corporation.
NEW SECTION. Sec. 5. (1) Each seller of travel shall renew its registration on or before July 1 of every other year or as otherwise determined by the director.
(2) Renewal of a registration is subject to the same provisions covering issuance, suspension, and revocation of a registration originally issued.
(3) The director may refuse to renew a registration for any of the grounds set out under section 6 of this act, and where the past conduct of the applicant affords reasonable grounds for belief that the applicant will not carry out the applicant's duties in accordance with law and with integrity and honesty. The director shall promptly notify the applicant in writing by certified mail of its intent to refuse to renew the registration. The registrant may, within twenty-one days after receipt of that notice or intent, request a hearing on the refusal. The director may permit the registrant to honor commitments already made to its customers, but no new commitments may be incurred, unless the director is satisfied that all new commitments are completely bonded or secured to insure that the general public is protected from loss of money paid to the registrant. It is the responsibility of the registrant to contest the decision regarding conditions imposed or registration denied through the process established by the administrative procedure act, chapter 34.05 RCW.
NEW SECTION. Sec. 6. (1) The director may deny, suspend, or revoke the registration of a seller of travel if the director finds that the applicant:
(a) Was previously the holder of a registration issued under this chapter, and the registration was revoked for cause and never reissued by the director, or the registration was suspended for cause and the terms of the suspension have not been fulfilled;
(b) Has been found guilty of a felony within the past five years involving moral turpitude, or of a misdemeanor concerning fraud or conversion, of suffers a judgment in a civil action involving willful fraud, misrepresentation, or conversion;
(c) Has made a false statement of a material fact in an application under this chapter or in data attached to it;
(d) Has violated this chapter or failed to comply with a rule adopted by the director under this chapter;
(e) Has failed to display the registration as provided in this chapter;
(f) Has published or circulated a statement with the intent to deceive, misrepresent, or mislead the public;
(g) Has committed a fraud or fraudulent practice in the operation and conduct of a travel agency business, including, but not limited to, intentionally misleading advertising; or
(h) Has aided or abetted a person, firm, or corporation that they know has not registered in this state in the business of conducting a travel agency or other sale of travel.
(2) If the seller of travel is found in violation of this chapter or in violation of the consumer protection act, chapter 19.86 RCW, by the entry of a judgment or by settlement of a claim, the director may revoke the registration of the seller of travel, and the director may reinstate the registration at the director's discretion.
NEW SECTION. Sec. 7. The department, in cooperation with the industry, shall examine the establishment of a cost recovery account to indemnify industry customers and shall report to the legislature by December 1, 1994, concerning legislation to establish such an account.
NEW SECTION. Sec. 8. A seller of travel shall perform its duties reasonably and with ordinary care in providing travel services.
Sec. 9. RCW 19.138.030 and 1986 c 283 s 3 are each amended to read as follows:
A ((travel charter
or tour operator)) seller of travel shall not advertise that air,
sea, or land transportation either separately or in conjunction with other
services is or may be available unless he or she has, prior to ((such)) the
advertisement, ((received written confirmation with a carrier for the
transportation advertised)) determined that the product advertised was
available at the time the advertising was placed. This determination can be
made by the seller of travel either by use of an airline computer reservation
system, or by written confirmation from the vendor whose program is being
advertised.
It is the responsibility of the seller of travel to keep written or printed documentation of the steps taken to verify that the advertised offer was available at the time the advertising was placed. These records are to be maintained for at least two years after the placement of the advertisement.
Sec. 10. RCW 19.138.040 and 1986 c 283 s 4 are each amended to read as follows:
At or prior to the time
of full or partial payment for air, sea, or land transportation or any other
services offered by the seller of travel ((charter or tour operator))
in conjunction with ((such)) the transportation, the seller of
travel ((charter or tour operator)) shall furnish to the person making
the payment a written statement conspicuously setting forth the following
information:
(1) The name and
business address and telephone number of the ((travel charter or tour
operator)) seller of travel.
(2) The amount paid, the date of such payment, the purpose of the payment made, and an itemized statement of the balance due, if any.
(3) The ((location
and)) registration number of the ((trust account or bond)) seller
of travel required by this chapter.
(4) The name of the ((carrier))
vendor with whom the ((travel charter or tour operator)) seller
of travel has contracted to provide ((the transportation, the type of
equipment contracted, and the date, time, and place of each departure:
PROVIDED, That the information required in this subsection may be provided at
the time of final payment)) travel arrangements for a consumer and all
pertinent information relating to the travel as known by the seller of travel
at the time of booking. The seller of travel will make known further details
as soon as received from the vendor. All information will be provided with
final documentation.
(5) The conditions, if
any, upon which the contract between the ((travel charter or tour operator))
seller of travel and the passenger may be canceled, and the rights and
obligations of all parties in the event of ((such)) cancellation.
(6) A statement in eight-point boldface type in substantially the following form:
"If transportation
or other services are canceled by the ((travel charter or tour operator))
seller of travel, all sums paid to the ((travel charter or tour
operator)) seller of travel for services not performed in accordance
with the contract between the ((travel charter or tour operator)) seller
of travel and the ((passenger)) purchaser will be refunded
within ((fourteen)) thirty days ((after the cancellation by
the travel charter or tour operator to the passenger or the party who
contracted for the passenger unless mutually acceptable alternative travel
arrangements are provided)) of receiving the funds from the vendor with
whom the services were arranged, or if the funds were not sent to the vendor,
the funds shall be returned within fourteen days after cancellation by the
seller of travel to the purchaser unless the purchaser requests the seller of
travel to apply the money to another travel product and/or date."
Sec. 11. RCW 19.138.050 and 1986 c 283 s 5 are each amended to read as follows:
(1) If the
transportation or other services contracted for are canceled ((the travel
charter or tour operator)), or if the money is to be refunded for any
reason, the seller of travel shall ((return)) refund to the
((passenger within fourteen days after the cancellation all moneys paid for
services not performed in accordance with the contract unless mutually
acceptable alternative travel arrangements are provided)) person with
whom it contracts for travel services, the money due the person within thirty
days of receiving the funds from the vendor with whom the services were
arranged. If the funds were not sent to the vendor and remain in the
possession of the seller of travel, the funds shall be refunded within fourteen
days.
(2) Any material misrepresentation with regard to the transportation and other services offered shall be deemed to be a cancellation necessitating the refund required by this section.
(3) When travel services are paid to a vendor and charged to a consumer's credit card by the seller of travel, and the arrangements are subsequently canceled by the consumer, the vendor, or the seller of travel, any refunds to the consumer's credit card must be applied for within ten days from the date of cancellation.
(4) The seller of travel shall not be obligated to refund any cancellation penalties imposed by the vendor with whom the services were arranged if these penalties were disclosed in the statement required under RCW 19.138.040.
NEW SECTION. Sec. 12. The director has the following powers and duties:
(1) To adopt, amend, and repeal rules to carry out the purposes of this chapter;
(2) To issue and renew registrations under this chapter and to deny or refuse to renew for failure to comply with this chapter;
(3) To suspend or revoke a registration for a violation of this chapter;
(4) To establish fees;
(5) Upon receipt of a complaint, to inspect and audit the books and records of a seller of travel. The seller of travel shall immediately make available to the director those books and records as may be requested at the seller of travel's place of business or at a location designated by the director. For that purpose, the director shall have full and free access to the office and places of business of the seller of travel during regular business hours; and
(6) To do all things necessary to carry out the functions, powers, and duties set forth in this chapter.
NEW SECTION. Sec. 13. (1) A nonresident seller of travel soliciting business or selling travel in the state of Washington, by mail, telephone, or otherwise, either directly or indirectly, is deemed, absent any other appointment, to have appointed the director to be the seller of travel's true and lawful attorney upon whom may be served any legal process against that nonresident arising or growing out of a transaction involving travel services. That solicitation signifies the nonresident's agreement that process against the nonresident that is served as provided in this chapter is of the same legal force and validity as if served personally on the nonresident seller of travel.
(2) Service of process upon a nonresident seller of travel shall be made by leaving a copy of the process with the director. The fee for the service of process shall be determined by the director by rule. That service is sufficient service upon the nonresident if the plaintiff or plaintiff's attorney of record sends notice of the service and a copy of the process by certified mail before service or immediately after service to the defendant at the address given by the nonresident in a solicitation furnished by the nonresident, and the sender's post office receipt of sending and the plaintiff's or plaintiff's attorney's affidavit of compliance with this section are returned with the process in accordance with Washington superior court civil rules. Notwithstanding the foregoing requirements, however, once service has been made on the director as provided in this section, in the event of failure to comply with the requirement of notice to the nonresident, the court may order that notice be given that will be sufficient to apprise the nonresident.
NEW SECTION. Sec. 14. The director, in the director's discretion, may:
(1) Annually, or more frequently, make public or private investigations within or without this state as the director deems necessary to determine whether a registration should be granted, denied, revoked, or suspended, or whether a person has violated or is about to violate this chapter or a rule adopted or order issued under this chapter, or to aid in the enforcement of this chapter or in the prescribing of rules and forms of this chapter;
(2) Publish information concerning a violation of this chapter or a rule adopted or order issued under this chapter; and
(3) Investigate complaints concerning practices by sellers of travel for which registration is required by this chapter.
NEW SECTION. Sec. 15. For the purpose of an investigation or proceeding under this chapter, the director or any officer designated by the director may administer oaths and affirmations, subpoena witnesses, compel their attendance, take evidence, and require the production of any books, papers, correspondence, memoranda, agreements, or other documents or records which the director deems relevant or material to the inquiry.
NEW SECTION. Sec. 16. If it appears to the director that a person has engaged in an act or practice constituting a violation of this chapter or a rule adopted or order issued under this chapter, the director may, in the director's discretion, issue an order directing the person to cease and desist from continuing the act or practice. Reasonable notice of an opportunity for a hearing shall be given. The director may issue a temporary order pending the hearing, which shall remain in effect until ten days after the hearing is held and which shall become final if the person to whom the notice is addressed does not request a hearing within fifteen days after the receipt of the notice.
NEW SECTION. Sec. 17. The attorney general, a county prosecuting attorney, the director, or any person may, in accordance with the law of this state governing injunctions, maintain an action in the name of this state to enjoin a person or entity selling travel services for which registration is required by this chapter without registration from engaging in the practice until the required registration is secured. However, the injunction shall not relieve the person or entity selling travel services without registration from criminal prosecution therefor, but the remedy by injunction shall be in addition to any criminal liability.
NEW SECTION. Sec. 18. A person or business that violates an injunction issued under this chapter shall pay a civil penalty, as determined by the court, of not more than twenty-five thousand dollars, that shall be paid to the department. For the purpose of this section, the superior court issuing an injunction shall retain jurisdiction and the cause shall be continued, and in such cases the attorney general acting in the name of the state may petition for the recovery of civil penalties.
NEW SECTION. Sec. 19. The director or individuals acting on the director's behalf are immune from suit in any action, civil or criminal, based on disciplinary proceedings or other official acts performed in the course of their duties in the administration and enforcement of this chapter.
NEW SECTION. Sec. 20. (1) The director may assess against a person or organization that violates this chapter, or a rule adopted under this chapter, a civil penalty of not more than one thousand dollars for each violation.
(2) The person or organization shall be afforded the opportunity for a hearing, upon request made to the director within thirty days after the date of issuance of the notice of assessment. The hearing shall be conducted in accordance with chapter 34.05 RCW.
(3) A civil penalty shall be imposed by the court for each violation of this chapter in an amount not less than five hundred dollars nor more than two thousand dollars per violation.
(4) If a person fails to pay an assessment after it has become a final and unappealable order, or after the court has entered final judgment in favor of the state, the director may recover the amount assessed by action in the appropriate superior court. In the action, the validity and appropriateness of the final order imposing the penalty shall not be subject to review.
NEW SECTION. Sec. 21. The director may assess against a person or organization that violates this chapter, or a rule adopted under this chapter, the full amount of restitution as may be necessary to restore to a person an interest in money or property, real or personal, that may have been acquired by means of an act prohibited by or in violation of this chapter.
NEW SECTION. Sec. 22. In order to maintain or defend a lawsuit, a seller of travel must be registered with the department as required by this chapter and rules adopted under this chapter.
NEW SECTION. Sec. 23. (1) Each person who knowingly violates this chapter or who knowingly gives false or incorrect information to the director, attorney general, or county prosecuting attorney in filing statements required by this chapter, whether or not the statement or report is verified, is guilty of a gross misdemeanor punishable under chapter 9A.20 RCW.
(2) A person who violates this chapter or who gives false or incorrect information to the director, attorney general, or county prosecuting attorney in filing statements required by this chapter, whether or not the statement or report is verified, is guilty of a misdemeanor punishable under chapter 9A.20 RCW.
NEW SECTION. Sec. 24. The administrative procedure act, chapter 34.05 RCW, shall, wherever applicable, govern the rights, remedies, and procedures respecting the administration of this chapter.
NEW SECTION. Sec. 25. All information, documents, and reports filed with the director under this chapter are matters of public record and shall be open to public inspection, subject to reasonable regulation. The director may make public, on a periodic or other basis, the information as may be necessary or appropriate in the public interest concerning the registration, reports, and information filed with the director or any other matters to the administration and enforcement of this chapter.
NEW SECTION. Sec. 26. The legislature finds that the practices governed by this chapter are matters vitally affecting the public interest for the purpose of applying the consumer protection act, chapter 19.86 RCW. Any violation of this chapter is not reasonable in relation to the development and preservation of business and is an unfair and deceptive act or practice and unfair method of competition in the conduct of trade or commerce in violation of RCW 19.86.020. Remedies provided by chapter 19.86 RCW are cumulative and not exclusive.
NEW SECTION. Sec. 27. In addition to any other penalties or remedies under chapter 19.86 RCW, a person who is injured by a violation of this chapter may bring an action for recovery of actual damages, including court costs and attorneys' fees. No provision in this chapter shall be construed to limit any right or remedy provided under chapter 19.86 RCW.
NEW SECTION. Sec. 28. The following acts or parts of acts are each repealed:
(1) RCW 19.138.020 and 1986 c 283 s 2;
(2) RCW 19.138.060 and 1986 c 283 s 6;
(3) RCW 19.138.070 and 1986 c 283 s 7; and
(4) RCW 19.138.080 and 1986 c 283 s 8.
NEW SECTION. Sec. 29. Any state funds appropriated to the department of licensing for implementation of chapter . . ., Laws of 1994 (this act) for the biennium ending June 30, 1995, shall be reimbursed by June 30, 1997, by an assessment of fees sufficient to cover all costs of implementing chapter . . ., Laws of 1994 (this act).
NEW SECTION. Sec. 30. A violation of RCW 19.138.030 through 19.138.070 shall constitute a violation of RCW 19.86.020.
NEW SECTION. Sec. 31. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.
NEW SECTION. Sec. 32. Sections 1 through 28 of this act shall take effect January 1, 1996.
NEW SECTION. Sec. 33. Sections 2 through 6, 8, 12 through 27, 29, and 30 of this act are each added to chapter 19.138 RCW.
NEW SECTION. Sec. 34. The director of licensing, beginning July 1, 1995, may take such steps as are necessary to ensure that this act is implemented on its effective date."
ESHB 2688 - S COMM AMD
By Committee on Labor & Commerce
NOT ADOPTED 3/4/94
On page 1, line 1 of the title, after "travel;" strike the remainder of the title and insert "amending RCW 19.138.010, 19.138.030, 19.138.040, and 19.138.050; adding new sections to chapter 19.138 RCW; creating new sections; repealing RCW 19.138.020, 19.138.060, 19.138.070, and 19.138.080; prescribing penalties; and providing an effective date."
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