Bill Summary for H 686 (2019-2020)

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Summary date: 

Apr 10 2019

Bill Information:

View NCGA Bill Details2019-2020 Session
House Bill 686 (Public) Filed Wednesday, April 10, 2019
Intro. by Stevens.

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Bill summary

Amends GS 75-41, which sets forth certain requirements for any person engaged in commerce that sells, leases, or offers to sell or lease, any products or services to a consumer under a contract that automatically renews unless the consumer cancels the contract.

Under current law, the person must disclose the automatic renewal clause in the contract and contract offer and disclose how to cancel the contract in the initial contract, contract offer, or with delivery of products or services. Now instead requires that a person engaged in such business must provide a separate disclosure statement that provides notice that the contract will be automatically renewed if the customer signs the contract and the disclosure statement; that the notice of termination will be provided to the consumer at least 60 days prior to the contract termination date if the customer does not sign the contract and disclosure statement; the length of the initial and each renewal term under the contract; the amount to be charged to the consumer for the initial term and any renewal terms; a list and explanation of any contract terms that will change upon contract renewal; and an email address, mailing address and phone number that the consumer can use to terminate the automatic renewal. Adds a requirement for the person to send a notice to a consumer who does not sign the disclosure statement at least 60 days prior to the contract termination date, which provides the date that the contract is scheduled to terminate and the renewal options available to the consumer; allows delivery of the notice by personal delivery, email, or first-class mail. Also requires the person to provide written confirmation and notice of termination of the automatic renewal within 30 days of receipt of cancellation if a customer cancels the automatic renewal in accordance with the act. Maintains the additional notice requirements for any automatic renewal exceeding 60 days.

Prohibits a person subject to the statute from automatically renewing a contract, charging a consumer a higher fee or contract amount, or otherwise penalizing a consumer if the consumer did not sign a disclosure statement. Adds a new requirement for a person to terminate the automatic renewal provision of a contract within 30 days of receipt of a notice from a consumer that the consumer has permanently relocated to a hospital, nursing home, or assisted living facility.

Makes conforming changes.

Applies to contracts entered into on or after January 1, 2020.