HBA-NRS S.B. 560 77(R) BILL ANALYSIS Office of House Bill AnalysisS.B. 560 By: Sibley Business & Industry 5/9/2001 Engrossed BACKGROUND AND PURPOSE Current law protects consumers from abuse resulting from door-to-door sales by requiring a merchant who solicits a consumer away from the merchant's place of business to permit a consumer to cancel an agreement entered into with the merchant within three days. Both insurance sales regulated by the Texas Department of Insurance and sales of real property are exempt from this provision. A residential service contract may be considered similar to an insurance policy in that it involves a premium to repair or replace many of the mechanical, electrical, structural, or plumbing systems in a consumer's home. Senate Bill 560 exempts a residential service contract from law pertaining to the cancellation of certain transactions that take place away from the merchant's place of business. 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. ANALYSIS Senate Bill 560 amends the Business & Commerce Code to exempt a residential service contract sale regulated by the Texas Real Estate Commission from provisions regarding the cancellation of consumer transactions in which an agreement involves the purchase of goods or services in excess of $25 or real property for more than $100 at a place other than the merchant's place of business. EFFECTIVE DATE September 1, 2001.