HF 229 – Regulation of free trial offers, buying club memberships
FLOOR ACTION:
HF 229 modifies the regulation of free trial offers and buying club memberships under Iowa’s consumer fraud law and exempts Internet sales from current rights of cancellation and limitations on membership periods. The legislation passed the House on a mostly party-line vote of 59-40, with dissenting Democrats maintaining that the proposal substantially weakens consumer protections in these areas. A Senate Commerce Committee amendment clarifies that “free offer” does not include enrollment in a subscription to publications, including magazines, newspapers and other periodicals that allow the customer to cancel at any time and receive a full refund for issues not yet distributed; and adjust the bill’s language relating to door-to-door sales so that an exemption only applies to the sale of buying club memberships transacted through the Internet by a company primarily engaged in the sale of goods through the Internet. The latter was drafted after consultation with the Iowa Attorney General’s Consumer Protection Division. The bill returns to the House for further consideration. [4/9: 48-0 (Kraayenbrink, Zumbach absent)]