HBA-DMD H.B. 2653 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 2653 By: Elkins Business & Industry 3/17/1999 Introduced BACKGROUND AND PURPOSE Currently, business conducted over the Internet with businesses out of state is not subject to Texas law. H.B. 2653 provides that a contract made over the Internet, between a person in this state and a person outside this state, is governed by the law of this state unless the party in this state is given notice that the law of the state where the other party is located applies to the contract and agrees to the application of that law. This bill sets out provisions that do not apply to this type of contract. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Subchapter D, Chapter 35, Business & Commerce Code, by adding Section 35.531, as follows: Sec. 35.531. LAW APPLICABLE TO CONTRACT MADE OVER INTERNET. (a) Defines "Internet." (b) Provides that, subject to Subsection (e), this section applies only to a contract made solely over the Internet between a person located in this state and a person located outside this state who does not maintain an office or agent in this state for doing business in this state. (c) Provides that a contract to which this section applies is governed by the law of this state unless each party to the contract who is located in this state is given notice that the law of the state in which another party to the contract is located applies to the contract, and agrees to the application of that state's law. (d) Provides that a person asserting that the law of another state applies to a contract has the burden of proving that notice was given and agreement was obtained as provided by Subsection (c). (e) Provides that Sections 1.105 (Territorial Application of the Title; Parties' Power to Choose Applicable Law), and 35.53 (Notice of Law; Dispute Resolution Forum Applicable to Contract), Business & Commerce Code, do not apply to a contract to which this section applies. Provides that this section does not apply to a contract to which Section 35.51 (Rights of Parties to Choose Law Applicable to Certain Transactions), Business and Commerce Code, applies. SECTION 2.Sets forth that this Act applies only to a contract made on or after the effective date of this Act. SECTION 3.Effective date: September 1, 1999. SECTION 4.Emergency clause.