By Elkins                                        H.B. No. 306

      75R354 DWS-D                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to the law that applies to a contract made over the

 1-3     Internet.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  Subchapter D, Chapter 35, Business & Commerce

 1-6     Code, is amended by adding Section 35.531 to read as follows:

 1-7           Sec. 35.531.  LAW APPLICABLE TO CONTRACT MADE OVER INTERNET.

 1-8     (a) Subject to Subsection (d), this section applies only to a

 1-9     contract made solely over  the Internet between  a person located

1-10     in this state and a person located outside this state who does not

1-11     maintain an office or agent in this state for doing business in

1-12     this state.

1-13           (b)  A contract to which this section applies is governed by

1-14     the law of this state unless each party to the contract who is

1-15     located in this state:

1-16                 (1)  is given notice that the law of the state in which

1-17     another party to the contract is located applies to the contract;

1-18     and

1-19                 (2)  agrees to the application of that state's law.

1-20           (c)  A person asserting that the law of another state applies

1-21     to a contract has the burden of proving that notice was given and

1-22     agreement was obtained as provided by Subsection (b).

1-23           (d)  Sections 1.105 and 35.53 do not apply to a contract to

 2-1     which this section applies.  This section does not apply to a

 2-2     contract to which Section 35.51 applies.

 2-3           (e)  In this section, "Internet" means the largest

 2-4     nonproprietary nonprofit cooperative public computer network,

 2-5     popularly known as the Internet.

 2-6           SECTION 2.  Section 35.531, Business & Commerce Code, as

 2-7     added by this Act, applies only to a contract made on or after the

 2-8     effective date of this Act.

 2-9           SECTION 3.  This Act takes effect September 1, 1997.

2-10           SECTION 4.  The importance of this legislation and the

2-11     crowded condition of the calendars in both houses create an

2-12     emergency and an imperative public necessity that the

2-13     constitutional rule requiring bills to be read on three several

2-14     days in each house be suspended, and this rule is hereby suspended.