Bill Text: MI HB5727 | 2017-2018 | 99th Legislature | Engrossed
Bill Title: Businesses; franchises; prohibition against pyramid schemes; revise in franchise investment law. Amends sec. 28 of 1974 PA 269 (MCL 445.1528). TIE BAR WITH: HB 5726'18
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2018-08-15 - Assigned Pa 187'18 With Immediate Effect [HB5727 Detail]
Download: Michigan-2017-HB5727-Engrossed.html
HB-5727, As Passed Senate, May 23, 2018
SUBSTITUTE FOR
HOUSE BILL NO. 5727
A bill to amend 1974 PA 269, entitled
"Franchise investment law,"
by amending section 28 (MCL 445.1528).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
28. (1) A person may not offer or sell any form of
participation
in a pyramid or chain promotion. A pyramid or chain
promotion
is any plan or scheme or device by which (a) a
participant
gives a valuable consideration for the opportunity to
receive
compensation or things of value in return for inducing
other
persons to become participants in the program or (b) a
participant
is to receive compensation when a person introduced by
the
participant introduces one or more additional persons into
participation
in the plan, each of whom receives the same or
similar
right, privilege, license, chance, or opportunity.
(2)
A pyramid or chain promotion is declared to be illegal and
against
the public policy of the state. Any contract made in
violation
of this section is voidable at the sole option of the
purchaser.
(3)
The department shall not accept for
filing a franchise
which
involves a pyramid or chain distribution contrary to the laws
of
this state.that involves a
pyramid promotional scheme that
violates the pyramid promotional scheme act, MCL 445.2581 to
445.2586.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.
Enacting section 2. This amendatory act does not take effect
unless House Bill No. 5726 of the 99th Legislature is enacted into
law.
