Washington ReportKeeping Members Informed About Regulatory Issues Contents |
STATE LEGISLATIVE UPDATEFor further information on state issues, contact Jerry Cerasale at 202-861-2423 or jcerasale@the-dma.org or Elizabeth Scanlon at 202-861-2418 or escanlon@the-dma.org. New LawsPRIVACY AND DATA USE California S.B. 129 (ch. 984, effective January 1, 2001) establishes within the state department of consumer affairs the Office of Privacy Protection, which would be instructed to "identify consumer problems", facilitate the development of fair information practices, develop educational materials, and assist and coordinate in the training of local, state, and federal law enforcement agencies. The Director of the Office will be required to make an annual report to the Legislature. State departments and agencies are required to develop privacy policies including the following provisions: that the purposes for which personally identifiable data are collected will be specified at or before the time of collection, and that further use is limited to similar purposes; that personal data must not be used for purposes other than those specified, except with the consent of the data subject or as authorized by law; personal data collected must be relevant to the purpose for which it is collected; and the general means by which personal data is protected against unauthorized access or disclosure must be posted. California A.B. 2869 (ch. 977, effective January 1, 2001 ) revises current law requiring credit card issuers to notify customers when they disclose marketing information to additionally require the notice to contain both a preprinted form and a toll-free telephone number which cardholders may use to prohibit disclosure. TAX California A.B. 330 (ch. 617, effective September 24, 2000) states that a business will not be considered a "retailer engaged in business" in the state if its sole physical presence in California is to engage in convention and trade shows for not more than 15 days during any 12 month period and it does not derive more than $100,000 of gross income from those activities in any calendar year. Illinois S.B. 1682 (Public Act 91-0882, effective June 30, 2000) requires the state Department of Revenue to begin discussions with other states for the development of a voluntary, simplified, multi-state system for sales and use tax collection and administration. On or before March 1, 2001, the Department must report on the status of the multi-state discussions and, if a proposed system has been agreed upon by participating states, recommend to the legislature whether the state should participate in that system. The law becomes inoperative on May 15, 2002. MAIL-ORDER SALE OF ALCOHOLIC BEVERAGES Michigan H.B. 4752 (Act 289, effective July 10, 2000) requires those who sell liquor by mail, Internet, telephone, computer, or other electronic device to be licensed by the state and to pay any applicable state taxes. Sellers must verify the age of the buyer and record the name, address, date of birth, and telephone number of the person placing the order on the order or other verifiable record. The shipping container must be printed with a notice that clearly and prominently states that the package contains alcoholic liquor and that the recipient at time of delivery must verify his or her age and provide a signature. Delivery persons who determine that the recipient is not of legal age are authorized to return the shipment to the retailer without liability for any damages. Vetoed Legislation PRIVACY AND DATA USE California A.B. 2704: The bill would have authorized electronic mail service providers to register with the state, certifying that they had policies against unsolicited electronic mail advertising and banning the use of their equipment in the dissemination of unsolicited e-mail. Providers would have been required to post a notice of their participation in the registry on their home pages or by a hyperlink on the home page. In addition, the legislation instructed the attorney general to maintain a registry of providers and make it available for inspection. TAX California A.B. 2412: The legislation stated that the processing of orders electronically, by fax, telephone, the Internet, or other electronic means would not relieve a retailer of the responsibility of collecting the sales and use tax if the retailer is engaged in business in California. The bill presumed that a retailer has an agent in California if it is related to a retailer with sales locations in the state, provided the retailer sells the same or substantially similar line of products under a similar name as the California retailer, or facilities or employees of the related California retailer are used to advertise or promote sales to California residents. California S.B. 1949: This bill directed the governor or his representatives to enter into discussions with other states regarding the development of a multi-state, voluntary, streamlined system for the collection and administration of sales and use taxes. By March 1, 2001, a report on the status of the multi-state discussions was to be presented to the legislature along with a recommendation about whether to participate in any proposed system agreed to by participating states. The proposed law would have expired on January 1, 2002, unless extended by the legislature. Pending Legislation PRIVACY AND DATA USE The New York State Insurance Department is considering adopting privacy regulations granting insurance customers privacy protection similar to that available to financial customers under the federal Gramm-Leach-Bliley Act (GLBA). Some of the areas covered in the proposed regulations include protection of health information, treatment of group policies, and treatment of policy beneficiaries and claimants. The proposed regulations require an insurance provider in New York to annually provide a clear and conspicuous notice of its privacy policies and practices to customers and consumers and to specify:
Ohio S.B. 201 restricts anyone selling tangible personal property to Ohio residents over the Internet, who has not appointed an agent for service of process in Ohio, to the laws and judicial forum of Ohio for resolution of disputes in connection with such sales, unless the seller files and continuously maintains a written appointment of an agent for service of process with the Secretary of State. The seller must also display all of the following on any web site and order or purchase forms shown on the web site: the name of the legal owner of each domain name from which the web site is accessible; the address of the seller's principal office; and the name, address, and telephone number of the seller's agent for service of process in Ohio. Ohio H.B. 636 prohibits guardians of public records from knowingly disclosing or making available personal information in state files for surveys, marketing, solicitation, or other commercial purposes without written authorization. TELEPHONE MARKETING New Jersey A.B. 860 requires all commercial telephone sellers to register annually with the state and post a $50,000 bond. Those required to register must inform the customer of his cancellation rights under the law, state the registration number issued by the state, and give the street address of the commercial telephone seller. Sales are not final until the seller receives a signed, written contract from the buyer. Commercial telephone sellers may not make or submit any charge to the customer's account or make an electronic transfer of funds until receiving the signed contract. In addition to registration requirements, A.B. 860 prohibits sending unsolicited commercial electronic mail without the recipient's consent. Unsolicited commercial e-mail must include the word "advertisement" in the subject line of the message; the name, mailing address, telephone number and return electronic mail address of the sender at the beginning of the message text; and the date and time the message is sent. Senders of unsolicited commercial e-mail must immediately discontinue transmission at the request of the recipient. MAIL-ORDER SALE OF ALCOHOLIC BEVERAGES Pennsylvania H.B. 2705 requires out-of-state retailers to file an application and pay a $100 registration fee to obtain an out-of-state wine shipper's license before sending wine to Pennsylvania residents. Upon obtaining the license, retailers may ship up to twenty-four bottles per month of any wine directly to any resident who is at least twenty-one years old for personal use and not for resale.
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