Assembly Bill No. 343–Assemblyman Carpenter
(by request)

 

March 17, 2003

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Makes various changes related to sellers of travel. (BDR 52‑881)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to sellers of travel; requiring a seller of travel to include his registration number in his advertising; requiring a seller of travel to maintain a trust account for money received for the purchase of travel services; revising the definition of “seller of travel”; requiring the Division to mail to a seller of travel an application for the renewal of his certificate before the expiration of his current certificate; allowing a seller of travel to comply with certain financial security requirements by maintaining a specified policy of insurance; providing an exclusion from certain financial security requirements; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1. Chapter 598 of NRS is hereby amended by adding

1-2  thereto the provisions set forth as sections 2 and 3 of this act.

1-3  Sec. 2.  A seller of travel shall include the registration

1-4  number from his certificate of registration in any advertising

1-5  conducted by, or on the behalf of, the seller of travel.

1-6  Sec. 3.  1.  A seller of travel shall maintain a trust account

1-7  in a bank, credit union or savings and loan association in this

1-8  state for the purpose of depositing money paid to the seller of

1-9  travel by a person for the purchase of travel services.

2-1  2.  A seller of travel shall deposit all money received by the

2-2  seller of travel from a person for the purchase of travel services

2-3  into the trust account within 3 business days after receiving the

2-4  money.

2-5  3.  The seller of travel shall pay out of the trust account the

2-6  money paid by a person for the purchase of travel services as

2-7  needed to complete the purchase of travel services purchased by

2-8  the person.

2-9  Sec. 4.  NRS 598.0999 is hereby amended to read as follows:

2-10      598.0999  1.  A person who violates a court order or

2-11  injunction issued pursuant to the provisions of NRS 598.0903 to

2-12  598.0999, inclusive, upon a complaint brought by the

2-13  Commissioner, the Director, the district attorney of any county of

2-14  this state or the Attorney General shall forfeit and pay to the State

2-15  General Fund a civil penalty of not more than $10,000 for each

2-16  violation. For the purpose of this section, the court issuing the order

2-17  or injunction retains jurisdiction over the action or proceeding. Such

2-18  civil penalties are in addition to any other penalty or remedy

2-19  available for the enforcement of the provisions of NRS 598.0903 to

2-20  598.0999, inclusive.

2-21      2.  In any action brought pursuant to the provisions of NRS

2-22  598.0903 to 598.0999, inclusive, if the court finds that a person has

2-23  willfully engaged in a deceptive trade practice, the Commissioner,

2-24  the Director, the district attorney of any county in this state or the

2-25  Attorney General bringing the action may recover a civil penalty not

2-26  to exceed $2,500 for each violation. The court in any such action

2-27  may, in addition to any other relief or reimbursement, award

2-28  reasonable attorney’s fees and costs.

2-29      3.  A natural person, firm, or any officer or managing agent of

2-30  any corporation or association who knowingly and willfully engages

2-31  in a deceptive trade practice:

2-32      (a) For the first offense, is guilty of a misdemeanor.

2-33      (b) For the second offense, is guilty of a gross misdemeanor.

2-34      (c) For the third and all subsequent offenses, is guilty of a

2-35  category D felony and shall be punished as provided in

2-36  NRS 193.130.

2-37      4.  Any offense which occurred within 10 years immediately

2-38  preceding the date of the principal offense or after the principal

2-39  offense constitutes a prior offense for the purposes of subsection 3

2-40  when evidenced by a conviction, without regard to the sequence of

2-41  the offenses and convictions.

2-42      5.  If a person violates any provision of NRS 598.0903 to

2-43  598.0999, inclusive, 598.100 to 598.2801, inclusive, 598.305

2-44  to 598.395, inclusive, and sections 2 and 3 of this act, 598.405 to

2-45  598.525, inclusive, 598.741 to 598.787, inclusive, or 598.840 to

3-1  598.966, inclusive, fails to comply with a judgment or order of any

3-2  court in this state concerning a violation of such a provision, or fails

3-3  to comply with an assurance of discontinuance or other agreement

3-4  concerning an alleged violation of such a provision, the

3-5  Commissioner or the district attorney of any county may bring an

3-6  action in the name of the State of Nevada seeking:

3-7  (a) The suspension of the person’s privilege to conduct business

3-8  within this state; or

3-9  (b) If the defendant is a corporation, dissolution of the

3-10  corporation.

3-11  The court may grant or deny the relief sought or may order other

3-12  appropriate relief.

3-13      Sec. 5.  NRS 598.305 is hereby amended to read as follows:

3-14      598.305  As used in NRS 598.305 to 598.395, inclusive, and

3-15  sections 2 and 3 of this act, unless the context otherwise requires,

3-16  the words and terms defined in NRS 598.315 to 598.356, inclusive,

3-17  have the meanings ascribed to them in those sections.

3-18      Sec. 6.  NRS 598.335 is hereby amended to read as follows:

3-19      598.335  “Seller of travel” means a person , including, without

3-20  limitation, a business entity, who offers for sale, directly or

3-21  indirectly, transportation by air, land, rail or water, travel services,

3-22  vacation certificates or any combination thereof, to a person or

3-23  group of persons for a fee, commission or other valuable

3-24  consideration. The term:

3-25      1.  Includes any person who offers membership in a travel club

3-26  or any services related to travel for an advance fee [or payment.] ,

3-27  payment or deposit.

3-28      2.  Does not include:

3-29      (a) A person who:

3-30          (1) Contracts with a seller of travel to sell travel services on

3-31  behalf of the seller of travel;

3-32          (2) Receives compensation for selling the travel services

3-33  only from the seller of travel; and

3-34          (3) Requires a purchaser of travel services to pay for the

3-35  travel services by transmitting payment directly to the provider of

3-36  the travel services or the seller of travel;

3-37      (b) A hotel that provides or arranges travel services for its

3-38  patrons or guests;

3-39      [(b)] (c) A person who, for compensation, transports persons or

3-40  property by air, land, rail or water; or

3-41      [(c)] (d) A tour broker or tour operator who is subject to the

3-42  provisions of NRS 598.405 to 598.525, inclusive.

 

 

 

4-1  Sec. 7.  NRS 598.365 is hereby amended to read as follows:

4-2  598.365  1.  Before advertising its services or conducting

4-3  business in this state, a seller of travel must register with the

4-4  Division by:

4-5  (a) Submitting to the Division an application for registration on

4-6  a form prescribed by the Division;

4-7  (b) Paying to the Division a fee of $25; and

4-8  (c) Depositing the security required pursuant to NRS 598.375, if

4-9  any, with the Division.

4-10      2.  The Division shall issue a certificate of registration to the

4-11  seller of travel upon receipt of:

4-12      (a) The security in the proper form if the seller of travel is

4-13  required to deposit security pursuant to NRS 598.375; and

4-14      (b) The payment of the fee required by this section.

4-15      3.  A certificate of registration:

4-16      (a) Is not transferable or assignable; and

4-17      (b) Expires 1 year after it is issued.

4-18      4.  A seller of travel must renew a certificate of registration

4-19  issued pursuant to this section before the certificate expires by:

4-20      (a) Submitting to the Division an application for the renewal of

4-21  the certificate on a form prescribed by the Division; and

4-22      (b) Paying to the Division a fee of $25.

4-23      5.  The Division shall mail an application for the renewal of a

4-24  certificate to the last known address of a seller of travel at least 30

4-25  days before the expiration of the certificate.

4-26      6.  The provisions of this section do not require a person

4-27  described in paragraph (a) of subsection 2 of NRS 598.335 to

4-28  register with the Division.

4-29      Sec. 8.  NRS 598.375 is hereby amended to read as follows:

4-30      598.375  1.  Except as otherwise provided in subsection 8,

4-31  each seller of travel shall deposit with the Division:

4-32      (a) A bond executed by a corporate surety approved by the

4-33  Commissioner and licensed to do business in this state;

4-34      (b) An irrevocable letter of credit for which the seller of travel is

4-35  the obligor, issued by a bank whose deposits are federally insured;

4-36  [or]

4-37      (c) Written proof that the seller of travel maintains a policy of

4-38  insurance covering liability for errors and omissions of the seller

4-39  of travel for activities relating to the provisions of NRS 598.305 to

4-40  598.395, inclusive, and sections 2 and 3 of this act; or

4-41      (d) A certificate of deposit in a financial institution which is

4-42  doing business in this state and which is federally insured or insured

4-43  by a private insurer approved pursuant to NRS 678.755. The

4-44  certificate of deposit may be withdrawn only on the order of the

5-1  Commissioner, except that the interest may accrue to the seller of

5-2  travel.

5-3  2.  The term of the bond, letter of credit , policy of insurance,

5-4  or certificate of deposit, or any renewal thereof, must be not less

5-5  than 1 year.

5-6  3.  The amount of the bond, letter of credit , policy of insurance

5-7  or certificate of deposit, or any renewal thereof, must be [$50,000.]

5-8  $10,000.

5-9  4.  If the seller of travel deposits a bond[,] or written proof of

5-10  maintaining a policy of insurance, the seller of travel shall keep

5-11  accurate records of the bond or policy of insurance and the

5-12  payments made on the premium. The records must be open to

5-13  inspection by the Division during business hours. The seller of

5-14  travel shall notify the Division not later than 30 days before the date

5-15  of expiration of the bond or policy of insurance and provide written

5-16  proof of the renewal of the bond or policy of insurance to the

5-17  Division.

5-18      5.  The Commissioner may reject any bond, letter of credit ,

5-19  policy of insurance or certificate of deposit that fails to comply with

5-20  the requirements of this chapter.

5-21      6.  A seller of travel may change the form of security that he

5-22  has deposited with the Division. If the seller of travel changes the

5-23  form of the security, the Commissioner may retain for not more than

5-24  1 year any portion of the security previously deposited by the seller

5-25  of travel as security for claims arising during the time the previous

5-26  security was in effect.

5-27      7.  If the amount of the deposited security falls below the

5-28  amount required by this chapter for that security, the seller of travel

5-29  shall be deemed not to be registered as required by NRS 598.365 for

5-30  the purposes of this chapter.

5-31      8.  The provisions of this section do not apply to a seller of

5-32  travel who [is] :

5-33      (a) Is accredited by and appointed as an agent of the Airlines

5-34  Reporting Corporation[.] ; or

5-35      (b) Has sold travel services in this state for 3 continuous years

5-36  pursuant to the provisions of NRS 598.305 to 598.395, inclusive,

5-37  and sections 2 and 3 of this act, and who has not been the subject

5-38  of a complaint made to the Division concerning activities governed

5-39  by NRS 598.305 to 598.395, inclusive, and sections 2 and 3 of this

5-40  act.

5-41      Sec. 9.  This act becomes effective on July 1, 2003.

 

5-42  H