87R20577 MLH-D
  By: Guerra H.B. No. 2259
  Substitute the following for H.B. No. 2259:
  By:  Turner of Tarrant C.S.H.B. No. 2259
  relating to requirements for subscription service contracts;
  providing a civil penalty.
         SECTION 1.  Title 12, Business & Commerce Code, is amended by
  adding Chapter 608 to read as follows:
         Sec. 608.001.  DEFINITIONS. In this chapter:
               (1)  "Automatic renewal clause" means a provision of a
  contract that extends the term of or renews a contract for a period
  of at least one month if the consumer does not take a specified
               (2)  "Consumer" means a person who acquires goods or
  services for personal, family, or household purposes.
               (3)  "Service provider" means a business that provides
  a service to a consumer.
               (4)  "Subscription service" means a service provided by
  a service provider to a consumer under a contract that:
                     (A)  has an automatic renewal clause; or
                     (B)  continues indefinitely until canceled by a
         Sec. 608.002.  APPLICABILITY OF CHAPTER.  This chapter does
  not apply to:
               (1)  an offering or contract of insurance; or
               (2)  evidence of coverage under Chapter 843, Insurance
  CONTRACTS. (a) If a service provider and a consumer enter into a
  contract for a subscription service, the service provider shall:
               (1)  at the time the service provider enters into the
  contract with the consumer, clearly and conspicuously disclose to
  the consumer the nature of the contract;
               (2)  in the disclosure required under Subdivision (1)
  or in a retainable confirmation sent to the consumer not later than
  the fifth day after the date the service provider enters into the
  contract with the consumer, clearly and conspicuously disclose to
  the consumer the procedure for canceling the contract; and
               (3)  if the contract has a term of 12 months or more and
  automatically renews for a term of more than one month, give the
  consumer additional written notice of the automatic renewal and the
  procedure for canceling the contract not earlier than the 90th day
  and not later than the 15th day before the date the contract is set
  to renew.
         (b)  A service provider may provide the written notice
  required under Subsection (a)(3):
               (1)  by regular mail or certified mail;
               (2)  on an invoice delivered to the consumer; or
               (3)  by written electronic communication, including
  electronic mail, if agreed to by the consumer.
         (c)  Notice provided under Subsection (b) must be clear and
  conspicuous. For purposes of Subsection (b)(1), the service
  provider may assume that written notice sent by regular mail is
  received by the consumer on the third business day after the date
  the notice is deposited in the mail.
         Sec. 608.004.  METHOD OF CANCELLATION. (a)  Subject to
  Subsections (b) and (c), a service provider shall provide a
  consumer with multiple methods for canceling a contract for a
  subscription service, which may include cancellation by:
               (1)  toll-free telephone number;
               (2)  electronic mail;
               (3)  mailing address, if the service provider bills the
  consumer using mail; and
               (4)  any other cost-effective, timely, and easy-to-use
         (b)  A service provider shall allow a consumer to cancel a
  contract for a subscription service by using the same method as the
  consumer used to enter into the contract, including allowing
  cancellation online, by mail, or by telephone.
         (c)  If a subscription service contract is not entered into
  electronically, the service provider shall allow the consumer to
  cancel the contract by mail.
         Sec. 608.005.  DECEPTIVE TRADE PRACTICE. Except as provided
  by Section 608.006, a violation of this chapter is a false,
  misleading, or deceptive act or practice under Subchapter E,
  Chapter 17, and is actionable under that subchapter.
         Sec. 608.006.  NO PRIVATE CAUSE OF ACTION. A private cause
  of action for a violation of this chapter may not be brought under
  this chapter or under Subchapter E, Chapter 17.
         Sec. 608.007.  OPPORTUNITY TO CURE. (a)  Before the attorney
  general may bring an action against a service provider under
  Section 608.008 for an initial violation of this chapter, the
  attorney general, on behalf of a consumer, must provide written
  notice to the service provider identifying the specific provisions
  of this chapter that the service provider allegedly violated.
         (b)  Not later than the 30th day after the date the notice
  required by Subsection (a) was received by the service provider,
  the service provider shall:
               (1)  cure each violation alleged in the notice; and
               (2)  provide a written statement to the attorney
  general certifying that:
                     (A)  each violation alleged in the notice has been
  cured; and
                     (B)  no further violation of this chapter will
         Sec. 608.008.  CIVIL PENALTY; REMEDIES.  (a)  A service
  provider who violates this chapter is liable to this state for a
  civil penalty of not more than $2,000 for each violation for each
  month the violation continues if the service provider:
               (1)  fails to cure the violation as provided by Section
  608.007; or
               (2)  commits the violation after curing an initial
  violation and providing a written statement to the attorney general
  under Section 608.007.
         (b)  The attorney general may bring an action to:
               (1)  recover the civil penalty imposed under this
               (2)  obtain a temporary or permanent injunction to
  restrain the violation; or
               (3)  seek restitution for consumers who are residents
  of this state and who incurred damages as a direct result of the
         (c)  An action under this section may be brought in a
  district court in:
               (1)  Travis County; or
               (2)  a county in which any part of the violation occurs.
  AFFECTED. Nothing in this chapter relieves a consumer of the
  consumer's duties under a contract before the date the contract is
         SECTION 2.  Chapter 608, Business & Commerce Code, as added
  by this Act, applies only to a contract entered into or renewed on
  or after the effective date of this Act.
         SECTION 3.  This Act takes effect September 1, 2021.