H.F. 229 Section 1. Section 552A.2, Code 2015, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 7. The sale of goods or services transacted 3 through the internet. 4 Sec. 2. Section 552A.3, Code 2015, is amended to read as 5 follows: 6 552A.3 Right of cancellation —— requirement of writing. 7 The requirements of sections 555A.1 through 555A.5 , relating 8 to door-to-door sales, shall apply to sales of buying club 9 memberships , irrespective of the place or manner of sale or 10 the purpose for which they are purchased subject to regulation 11 under this chapter . In addition to the requirements of chapter 12 555A , a contract shall not be enforceable against a person 13 acquiring a membership in a buying club unless the contract is 14 in writing and signed by the purchaser. 15 Sec. 3. Section 714.16, subsection 2, Code 2015, is amended 16 by adding the following new paragraph: 17 NEW PARAGRAPH . o. (1) It is an unlawful practice for 18 a person to make a free offer to a consumer, or impose a 19 financial obligation on the consumer as a result of the 20 consumer’s acceptance of a free offer, unless the person 21 provides the consumer with clear and conspicuous information 22 regarding the terms of the free offer before the consumer 23 agrees to accept the free offer, including at a minimum all of 24 the following: 25 (a) Identification of all goods or services, or enrollments 26 in a membership, subscription, or service contract, that the 27 consumer will receive or incur a financial obligation for as a 28 result of accepting the free offer. 29 (b) The cost to the consumer of any financial obligation 30 the consumer will incur if the consumer accepts the free offer, 31 including any fees or charges. 32 (c) Any requirement, if applicable, that the consumer take 33 affirmative action to reject the free offer and instructions 34 about how the consumer is to indicate the consumer’s rejection 35 -1- HF 229 (2) 86 av/rj/md 1/ 4

H.F. 229 of the free offer. 1 (d) A statement, if applicable, that by accepting the free 2 offer, the consumer will become obligated for additional goods 3 or services, or enrollment in a membership, subscription, or 4 service contract, unless the consumer takes affirmative action 5 to cancel the free offer or otherwise reject receipt of the 6 additional goods or services or the enrollment in a membership, 7 subscription, or service contract. 8 (e) Except as provided in subparagraph division (h), the 9 consumer’s right to cancel the free offer using procedures 10 specifically intended for that purpose that, at a minimum, 11 enable the consumer to cancel by calling a toll-free telephone 12 number or to cancel in a manner substantially similar to that 13 by which the consumer accepted the free offer. 14 (f) The time period during which the consumer must cancel in 15 order to avoid incurring a financial obligation as a result of 16 accepting the free offer. 17 (g) If applicable, the consumer’s right to receive a credit 18 on goods or services received as a result of accepting the free 19 offer when the goods or services are returned or rejected, and 20 the time period during which the goods or services must be 21 returned or rejected for the purpose of receiving a credit. 22 (h) With respect to a free offer that is for a publication, 23 including but not limited to a magazine, newspaper, or other 24 periodical, a statement that the consumer will receive, at 25 the time the consumer receives an invoice to pay for the 26 publication, information regarding the consumer’s right to 27 cancel the free offer and an explanation of the procedure to 28 cancel the free offer, including but not limited to written 29 notice of cancellation by mail to the person providing the free 30 offer. 31 (2) It is an unlawful practice for a person to cause 32 a consumer to incur a financial obligation as a result of 33 accepting a free offer unless one of the following occurs: 34 (a) The person obtains the consumer’s billing information 35 -2- HF 229 (2) 86 av/rj/md 2/ 4

H.F. 229 directly from the consumer. For purposes of this subparagraph 1 division, a person obtains a consumer’s billing information 2 directly from the consumer if the billing information is 3 obtained by the person or by the person’s agent or employee. 4 (b) The consumer gives affirmative consent at the time the 5 consumer accepts a free offer for the person to provide billing 6 information to a person other than the person making the free 7 offer. 8 (3) It is an unlawful practice for a person to impose 9 a financial obligation on a consumer as a result of the 10 consumer’s acceptance of a free offer unless the consumer’s 11 affirmative consent to the terms of the free offer as disclosed 12 in subparagraph (1) is obtained. 13 (4) It is an unlawful practice for a person that makes a 14 free offer to a consumer to fail or refuse to cancel the free 15 offer if the consumer has used, or made reasonable efforts to 16 attempt to use, one of the procedures required to be available 17 to the consumer as described in subparagraph (1), subparagraph 18 division (e). 19 (5) This paragraph “o” does not apply to free offers made 20 in connection with services that are subject to the federal 21 Communications Act of 1934, 47 U.S.C. §151 et seq. 22 (6) For purposes of this paragraph “o” : 23 (a) “Affirmative consent” means a consumer’s agreement to 24 incur a financial obligation as a result of accepting a free 25 offer, or to provide the consumer’s billing information, given 26 or made in the manner specifically identified for the consumer 27 to indicate the consumer’s agreement. 28 (b) “Billing information” means any record or information 29 compiled or maintained with respect to a consumer that 30 identifies the consumer and provides a means by which the 31 consumer’s financial obligation incurred by accepting a free 32 offer may be paid or otherwise satisfied, including but not 33 limited to information pertaining to a consumer’s credit card, 34 payment card, charge card, debit card, checking, savings, 35 -3- HF 229 (2) 86 av/rj/md 3/ 4

H.F. 229 or other banking account, and electronic funds transfer 1 information. 2 (c) “Clear and conspicuous information” means language that 3 is readily understandable and presented in such size, color, 4 contrast, and location, or audibility and cadence, compared to 5 other language, as to be readily noticed and understood, and 6 that is in close proximity to the request for consent to a free 7 offer. 8 (d) “Consumer” means an individual who seeks to accept or 9 accepts a free offer. 10 (e) (i) “Free offer” means an offer of goods or services 11 without cost, or for a one-time payment to cover only 12 incidental charges such as shipping or handling, to a consumer 13 that, if accepted, causes the consumer to incur a financial 14 obligation for any of the following: 15 (A) The goods or services received. 16 (B) Additional goods or services other than those initially 17 received. 18 (C) Enrollment in a membership, subscription, or service 19 contract as a result of accepting the offer. 20 (ii) “Free offer” does not include a free good or service 21 that is received by a consumer as a result of the consumer’s 22 entering into an agreement for enrollment in a membership, 23 subscription, or service contract that is not otherwise a free 24 offer or a consequence of the consumer’s agreement to accept 25 a free offer. 26 -4- HF 229 (2) 86 av/rj/md 4/ 4