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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of accounts receivable purchase |
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transaction actions |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Title 4, Business and Commerce Code, is amended |
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by adding a new Chapter 60 as follows: |
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CHAPTER 60. ACCOUNTS RECEIVABLE PURCHASE TRANSACTIONS |
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Sec. 60.001. DEFINITIONS. For the purposes of this |
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chapter, these terms are defined as follows: |
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(1) "Account receivable purchase transaction" means a |
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transaction in which a business forwards or otherwise sells to a |
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person all or a portion of the business's accounts or payment |
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intangibles, as defined in Texas Business and Commerce Code, |
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Chapter 9, Section 9.102, at a discount to the accounts' or payment |
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intangibles' expected value. |
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(2) "Broker" means any person who, for compensation or |
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the expectation of compensation, obtains an account receivable |
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purchase transaction or an offer for an account receivable purchase |
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transaction from a third party that would, if executed, be binding |
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upon that third party and communicates that offer to a business |
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located in Texas. The term "broker" excludes a "provider," and any |
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person whose compensation is not based on or dependent upon the |
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terms of the specific account receivable purchase transaction |
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obtained or offered. |
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(3) "Provider" means a person who consummates more |
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than five account receivable purchase transactions in Texas during |
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any calendar year, including a person who, under a written |
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agreement with a depository institution, offers one or more account |
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receivable purchase transactions provided by the depository |
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institution via an online platform that the person administers. |
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Sec. 60.02. EXEMPTIONS. The provisions of this subsection |
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do not apply to |
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(a) an account receivable purchase transaction offered or |
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made by a provider: |
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(1) that is a depository institution, a subsidiary of |
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a depository institution, or a service corporation for a depository |
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institution that is regulated by a federal banking agency; |
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(2) that is regulated under the federal Farm Credit |
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Act 12 U.S.C. Sec. 2001 et seq.; and |
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(3) that is licensed as a money transmitter in any |
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state; |
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(b) a person who consummates five or fewer account |
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receivable purchase transactions in Texas during any 12-month |
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period; |
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(c) a person who offers or makes an account receivable |
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purchase transaction in connection with the sale or lease of a |
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product or service that: |
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(1) the person manufactures, licenses, or |
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distributes; |
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(2) the person's parent company or the person's |
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directly or indirectly owned and controlled subsidiary |
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manufactures, licenses, or distributes. |
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(d) an account receivable purchase transaction of more than |
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$500,000. |
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Sec. 60.03. DISCLOSURES. (a) At or before consummating an |
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account receivable purchase transaction, a provider shall disclose |
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the terms of the account receivable purchase transaction in |
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accordance with subsection (c). |
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(b) Only one disclosure must be provided for each account |
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receivable purchase transaction, and a disclosure is not required |
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as a result of a modification or forbearance. |
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(c) A provider shall disclose the following terms of the |
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account receivable purchase transaction: |
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(1) the total amount of funds provided to the |
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business; |
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(2) the total amount of funds disbursed to the |
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business, if less than the amount described in Subsection (c)(1); |
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(3) the total amount to be paid to the provider; |
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(4) the total dollar cost, calculated by finding the |
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difference between: |
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(A) the amount described in Subsection (c)(1); |
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aStatutes affected:
Introduced: ()
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