1-1                                   AN ACT

 1-2     relating to exemptions from regulation as a food manufacturer or

 1-3     wholesaler.

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

 1-5           SECTION 1.  Section 431.221, Health and Safety Code, is

 1-6     amended by adding Subdivision (5) to read as follows:

 1-7                 (5)  "Direct seller" means an individual:

 1-8                       (A)  who is not affiliated with a permanent

 1-9     retail establishment and who engages in the business of:

1-10                             (i)  in-person sales of prepackaged

1-11     nonperishable foods, including dietary supplements, to a buyer on a

1-12     buy-sell basis, a deposit-commission basis, or a similar basis for

1-13     resale in a home; or

1-14                             (ii)  sales of prepackaged nonperishable

1-15     foods, including dietary supplements, in a home;

1-16                       (B)  who receives substantially all remuneration

1-17     for a service, whether in cash or other form of payment, which is

1-18     directly related to sales or other output, including the

1-19     performance of the service, and not to the number of hours worked;

1-20     and

1-21                       (C)  who performs services under a written

1-22     contract between the individual and the person for whom the service

1-23     is performed, and the contract provides that the individual is not

1-24     treated as an employee with respect to federal tax purposes.

 2-1           SECTION 2.  Section 431.2211, Health and Safety Code, is

 2-2     amended to read as follows:

 2-3           Sec. 431.2211.  Application of Subchapter.  This subchapter

 2-4     does not apply to:

 2-5                 (1)  a person, firm, or corporation that harvests,

 2-6     packages, washes, or ships raw fruits or vegetables; or

 2-7                 (2)  an individual who sells prepackaged nonperishable

 2-8     foods, including dietary supplements, from a private home as a

 2-9     direct seller.

2-10           SECTION 3.  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.

         _______________________________     _______________________________

             President of the Senate              Speaker of the House

               I certify that H.B. No. 1362 was passed by the House on April

         11, 1997, by a non-record vote; and that the House concurred in

         Senate amendments to H.B. No. 1362 on May 29, 1997, by a non-record

         vote.

                                             _______________________________

                                                 Chief Clerk of the House

               I certify that H.B. No. 1362 was passed by the Senate, with

         amendments, on May 26, 1997, by the following vote:  Yeas 31, Nays

         0.

                                             _______________________________

                                                 Secretary of the Senate

         APPROVED:  _____________________

                            Date

                    _____________________

                          Governor