CONFERENCE COMMITTEE REP. NO. 18

 

Honolulu, Hawaii

                 , 2015

 

RE:    S.B. No. 464

       S.D. 1

       H.D. 2

       C.D. 1

 

 

 

Honorable Donna Mercado Kim

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2015

State of Hawaii

 

Honorable Joseph M. Souki

Speaker, House of Representatives

Twenty-Eighth State Legislature

Regular Session of 2015

State of Hawaii

 

Madam and Sir:

 

     Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 464, S.D. 1, H.D. 2, entitled:

 

"A BILL FOR AN ACT RELATING TO CONSUMER PROTECTION,"

 

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

 

     The purpose of this measure is to require:

 

     (1)  Clear and conspicuous disclosure of a continuous service clause for a product or service and the procedure for cancellation;

 

     (2)  Persons charging a consumer's credit or debit card or account for an automatic renewal or a continuous service to obtain affirmative consent from the affected consumer and an acknowledgment regarding terms, cancellation policy, and the cancellation procedure;

 

     (3)  Free trial offers to clearly and conspicuously disclose the right of the consumer to cancel before payment is made and the cancellation procedure; and

 

     (4)  Clear and conspicuous notice of any material change to the terms of an automatic renewal or continuous service offer.

 

     Your Committee on Conference finds that automatic renewal and continuous service offers may be problematic for consumers if there is inadequate disclosure of material terms, informed consent is not obtained prior to billing or charging a consumer for goods or services, or an effective method of cancellation is not provided.  Your Committee on Conference further finds that clear disclosure of all terms and conditions in a consumer contract and affirmative consent on behalf of a consumer, prior to being charged for automatic renewal or continuous service offers, are important aspects of consumer protection.  Accordingly, this measure enhances the regulation of automatic renewal and continuous service clauses and ensures adequate safeguards for Hawaii consumers subject to these clauses.

 

     Your Committee on Conference has amended this measure by:

 

     (1)  Specifying that a person making automatic renewal or continuous service offers pursuant to a consumer contract must include certain information for the consumer;

 

     (2)  In the case of a material change in the terms of the automatic renewal or continuous service offer, requiring clear and conspicuous notice of the material change and information on how to cancel in a manner that can be retained by the consumer prior to the implementation of the material change;

 

     (3)  Amending the exempt entities to include a telecommunications provider subject to chapter 269, Hawaii Revised Statutes, and a cable operator subject to chapter 440G or 440J, Hawaii Revised Statutes;

 

     (4)  Inserting an effective date of July 1, 2015; and

 

     (5)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

 

     As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 464, S.D. 1, H.D. 2, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 464, S.D. 1, H.D. 2, C.D. 1.

 

Respectfully submitted on behalf of the managers:

 

ON THE PART OF THE HOUSE

 

ON THE PART OF THE SENATE

 

____________________________

ANGUS L.K. MCKELVEY, Co-Chair

 

____________________________

ROSALYN H. BAKER, Chair

____________________________

KARL RHOADS, Co-Chair