By Chisum                                             H.B. No. 2198
         76R7023 WP-F                           
                                A BILL TO BE ENTITLED
 1-1                                   AN ACT
 1-2     relating to certain out-of-state transactions and the operation of
 1-3     certain out-of-state business entities.
 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 35.49 to read as follows:
 1-7           Sec. 35.49.  PROHIBITED OUT-OF-STATE CONTRACTS.  (a)  A
 1-8     contract for goods or services entered into in another state  may
 1-9     not be enforced in this state if providing the goods or services
1-10     would violate the law or is against the public policy of this
1-11     state.
1-12           (b)  A judgment that arises under a contract for goods or
1-13     services that is unenforceable under Subsection (a) may not be
1-14     enforced in this state.
1-15           SECTION 2.  The Texas Professional Association Act (Article
1-16     1528f, Vernon's Texas Civil Statutes) is amended by adding Section
1-17     27 to read as follows:
1-18           Sec. 27.  CERTAIN PROHIBITED OUT-OF-STATE PROFESSIONAL
1-19     ASSOCIATIONS.  A professional association established under the
1-20     laws of another state may not do business in this state or be
1-21     recognized in this state if the requirements for the formation of
1-22     the professional association in the other state are not
1-23     substantially similar to the requirements for the formation of a
1-24     professional association in this state.
 2-1           SECTION 3.  The Texas Non-Profit Corporation Act (Article
 2-2     1396-1.01 et seq., Vernon's Texas Civil Statutes) is amended by
 2-3     adding Article 2.01A to read as follows:
 2-4           Art. 2.01A.  CERTAIN PROHIBITED OUT-OF-STATE CORPORATIONS.  A
 2-5     non-profit corporation, including a charitable non-business entity,
 2-6     formed under the laws of another state is prohibited from operating
 2-7     in this state if:
 2-8                 (1)  the non-profit corporation is formed by members
 2-9     ineligible to form a non-profit corporation in this state; or
2-10                 (2)  the purpose for which the non-profit corporation
2-11     was formed is illegal or against the public policy of this state.
2-12           SECTION 4.  This Act takes effect September 1, 1999.
2-13           SECTION 5.  The importance of this legislation and the
2-14     crowded condition of the calendars in both houses create an
2-15     emergency and an imperative public necessity that the
2-16     constitutional rule requiring bills to be read on three several
2-17     days in each house be suspended, and this rule is hereby suspended.