SRC-HRD H.B. 306 75(R)   BILL ANALYSIS


Senate Research Center   H.B. 306
By: Elkins (Ellis)
Jurisprudence
5-18-97
Engrossed


DIGEST 

Currently, Texas law provides no statutes regarding interstate contractual
transactions made over the Internet.              

As proposed, H.B. 306 would provide that a contract made solely over the
Internet between a person located in this state and a person located
outside this state is governed by the law of this state unless otherwise
agreed to by each party.  

PURPOSE

As proposed, H.B. 306 provides that a contract made solely over the
Internet between a person located in this state and a person located
outside this state is governed by the law of this state unless otherwise
agreed to by each party.  


RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 35, Business & Commerce Code, by adding
Subchapter I, as follows: 

SUBCHAPTER I.  INTERNET ACTIVITIES

Sec. 35.961.  DEFINITION.  Defines "Internet."

Sec. 35.962.  LAW APPLICABLE TO CONTRACT MADE OVER INTERNET.  Provides
that this section applies only to a contract, subject to Subsection (d),
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.  Provides that a contract
to which this section applies is governed by the law of this state except
under certain conditions.  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 (b).
Provides that Sections 1.105 and 35.53 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 applies.   

Sec. 35.963.  RECIPROCAL SUSPENSION OF STATE LAWS.  Provides that except
as provided by Section 35.962, if a person in another state transmits
information into this state over the Internet or conducts an activity over
the Internet in this state and the transmission or activity would violate
a law of this state, the activity does not violate the law of this state
under certain conditions. 

SECTION 2. Makes application of this Act prospective.

SECTION 3. Effective date: September 1, 1997.
 

SECTION 4. Emergency clause.