By Brimer H.B. No. 1773
77R3496 YDB-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the regulation of athlete agents.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Subchapter A, Chapter 2051, Occupations Code, is
1-5 amended by adding Section 2051.006 to read as follows:
1-6 Sec. 2051.006. UNIFORMITY OF APPLICATION AND CONSTRUCTION.
1-7 In applying this chapter, consideration must be given to the need
1-8 to promote uniformity of the law among states that have enacted
1-9 similar law.
1-10 SECTION 2. Section 2051.101, Occupations Code, is amended to
1-11 read as follows:
1-12 Sec. 2051.101. REGISTRATION REQUIRED. (a) Except as
1-13 provided by Subsection (b), a person may not act as [Unless] an
1-14 athlete agent in this state or represent that the person is an
1-15 athlete agent in this state unless the person holds a certificate
1-16 of registration [is registered] under this chapter[, the athlete
1-17 agent may not:]
1-18 [(1) contact, directly or indirectly, an athlete while
1-19 the athlete is eligible to participate in intercollegiate sports
1-20 contests; or]
1-21 [(2) enter into a contract with an athlete].
1-22 (b) Before the issuance of a certificate of registration
1-23 under this chapter, a person may act as an athlete agent in this
1-24 state for all purposes except signing an agent contract, if:
2-1 (1) an athlete or a person acting on behalf of the
2-2 athlete initiates communication with the person; and
2-3 (2) within seven days after the date of the initial
2-4 act as an athlete agent, the person submits an application for
2-5 registration under this chapter.
2-6 (c) An agent [A] contract negotiated by an unregistered
2-7 athlete agent is void.
2-8 SECTION 3. Section 2051.102, Occupations Code, is amended by
2-9 amending Subsections (a), (b), and (c) and adding Subsection (e) to
2-10 read as follows:
2-11 (a) Except as provided by Subsection (e), an [An] applicant
2-12 for registration as an athlete agent must apply on a form
2-13 prescribed by the secretary of state.
2-14 (b) An applicant must provide information required by the
2-15 secretary of state, including:
2-16 (1) the applicant's:
2-17 (A) name;
2-18 (B) principal business address;
2-19 (C) business or occupation for the five years
2-20 immediately preceding the date of application; and
2-21 (D) formal training, practical experience, and
2-22 educational background relating to the applicant's professional
2-23 activities as an athlete agent; [and]
2-24 (2) the name, sport, and last known team for each
2-25 person the applicant represented as an athlete agent during the
2-26 five years immediately preceding the date of application;
2-27 (3) whether the applicant or a person described by
3-1 Subdivision (5) has been subject to any of the following:
3-2 (A) a conviction of a crime that in this state
3-3 is a felony or a crime of moral turpitude;
3-4 (B) an administrative or a judicial
3-5 determination finding the applicant or other person made a false,
3-6 misleading, deceptive, or fraudulent representation;
3-7 (C) a sanction or suspension related to
3-8 occupational or professional conduct;
3-9 (D) a denial of an application for a certificate
3-10 of registration as an athlete agent; or
3-11 (E) a denial, revocation, or suspension of a
3-12 certification of registration as an athlete agent;
3-13 (4) whether the applicant or a person described by
3-14 Subdivision (5) has engaged in conduct that resulted in the
3-15 imposition on an athlete or educational institution of a sanction,
3-16 suspension, or declaration of ineligibility to participate in an
3-17 interscholastic or intercollegiate athletic event; and
3-18 (5) except as provided by Subsection (d), the name and
3-19 address of each person, except a bona fide employee on salary, who
3-20 is financially interested as a partner, associate, or profit sharer
3-21 in the applicant's business.
3-22 (c) An application[, if requested by the secretary of
3-23 state,] shall include the names and addresses of three [five]
3-24 professional references.
3-25 (e) A person seeking certification as an athlete agent
3-26 under this chapter who holds a certification of registration or
3-27 license as an athlete agent in another state may submit a copy of
4-1 the previous application and certificate instead of submitting the
4-2 application required by this section. The secretary of state shall
4-3 accept the application and the certificate from the other state as
4-4 an application for registration in this state if the application to
4-5 the other state:
4-6 (1) was submitted to the other state not earlier than
4-7 the 180th day before the date the application is submitted in this
4-8 state and the applicant certifies that the information contained in
4-9 the application is current;
4-10 (2) contains information substantially similar or more
4-11 comprehensive than the information required by this section; and
4-12 (3) was signed by the applicant under penalty of
4-13 perjury.
4-14 SECTION 4. Section 2051.105, Occupations Code, is amended by
4-15 amending Subsection (b) and adding Subsections (c) and (d) to read
4-16 as follows:
4-17 (b) The secretary of state may deny an application for
4-18 registration if the secretary of state determines the applicant has
4-19 engaged in conduct that has a significant adverse effect on the
4-20 applicant's fitness to act as an athlete agent. In making the
4-21 determination, the secretary of state may consider whether the
4-22 applicant has:
4-23 (1) made a materially false, misleading, deceptive, or
4-24 fraudulent representation in the application or as an athlete
4-25 agent;
4-26 (2) engaged in conduct that would disqualify the
4-27 applicant from serving in a fiduciary capacity;
5-1 (3) engaged in conduct prohibited by Section 2051.351;
5-2 (4) had a registration or licensure as an athlete
5-3 agent denied, suspended, or revoked;
5-4 (5) been refused renewal of registration or licensure
5-5 as an athlete agent in any state;
5-6 (6) engaged in conduct that resulted in the imposition
5-7 on an athlete or educational institution of a sanction, suspension,
5-8 or declaration of ineligibility to participate in an
5-9 interscholastic or intercollegiate athletic event; or
5-10 (7) engaged in conduct that adversely reflects on the
5-11 applicant's credibility, honesty, or integrity.
5-12 (c) In making a determination under Subsection (b), the
5-13 secretary of state shall consider:
5-14 (1) how recently the conduct occurred;
5-15 (2) the nature of the conduct and the context in which
5-16 it occurred; and
5-17 (3) any other relevant conduct of the applicant.
5-18 (d) Judicial review of a denial of an application for
5-19 registration under Subsection (a) is by trial de novo and is
5-20 subject to Section 2001.173, Government Code.
5-21 SECTION 5. Section 2051.108, Occupations Code, is amended by
5-22 amending Subsection (a) and adding Subsection (e) to read as
5-23 follows:
5-24 (a) Except as provided by Subsection (e), an [An] applicant
5-25 for renewal of registration must apply on a form prescribed by the
5-26 secretary of state.
5-27 (e) A person who has submitted an application for renewal of
6-1 registration or licensure as an athlete agent in another state may
6-2 submit a copy of the application and certificate of registration or
6-3 licensure from the other state instead of submitting the
6-4 application required by this section. The secretary of state shall
6-5 accept the application for renewal from the other state as an
6-6 application for renewal under this section if the application to
6-7 the other state:
6-8 (1) was submitted to the other state not earlier than
6-9 the 180th day before the date the renewal application is submitted
6-10 in this state and the applicant certifies that the information
6-11 contained in the application is current;
6-12 (2) contains information substantially similar to or
6-13 more comprehensive than the information required by this section;
6-14 and
6-15 (3) was signed by the applicant under penalty of
6-16 perjury.
6-17 SECTION 6. Section 2051.203, Occupations Code, is amended by
6-18 amending Subsection (a) and adding Subsection (d) to read as
6-19 follows:
6-20 (a) An agent contract or a financial services contract must
6-21 include:
6-22 (1) a schedule of fees, including:
6-23 (A) the amount and method of computing the
6-24 consideration to be paid by the athlete for services to be provided
6-25 by the athlete agent under the contract; and
6-26 (B) any other consideration the athlete agent
6-27 received or will receive from any other source for entering into
7-1 the contract or for providing the services; [and]
7-2 (2) a description of the professional services that
7-3 the athlete agent will perform for the athlete;
7-4 (3) the name of any person not listed in the
7-5 application for registration or renewal of registration who will be
7-6 compensated because the athlete signed the agent contract;
7-7 (4) a description of any expenses of the agent the
7-8 athlete agrees to reimburse;
7-9 (5) the duration of the contract; and
7-10 (6) the date the contract was signed.
7-11 (d) The athlete agent shall give a signed copy of the
7-12 contract to the athlete at the time the contract is signed.
7-13 SECTION 7. Section 2051.204(a), Occupations Code, is amended
7-14 to read as follows:
7-15 (a) An agent contract or a financial services contract must
7-16 include the following notice:
7-17 (1) THIS ATHLETE AGENT IS REGISTERED WITH THE
7-18 SECRETARY OF STATE OF THE STATE OF TEXAS. REGISTRATION WITH THE
7-19 SECRETARY OF STATE DOES NOT IMPLY APPROVAL OR ENDORSEMENT BY THE
7-20 SECRETARY OF STATE OF THE COMPETENCE OF THE ATHLETE AGENT OR OF THE
7-21 SPECIFIC TERMS AND CONDITIONS OF THIS CONTRACT.
7-22 NOTICE TO CLIENT
7-23 (2) DO NOT SIGN THIS CONTRACT UNTIL YOU HAVE READ IT
7-24 OR IF IT CONTAINS BLANK SPACES.
7-25 (3) IF YOU DECIDE THAT YOU DO NOT WISH TO PURCHASE THE
7-26 SERVICES OF THE ATHLETE AGENT, YOU MAY CANCEL THIS CONTRACT BY
7-27 NOTIFYING THE ATHLETE AGENT IN WRITING OF YOUR DESIRE TO CANCEL THE
8-1 CONTRACT NOT LATER THAN THE 16TH DAY AFTER THE DATE ON WHICH YOU
8-2 SIGN THIS CONTRACT. YOU MAY NOT WAIVE THE RIGHT TO CANCEL THIS
8-3 CONTRACT. IF YOU CANCEL THIS CONTRACT WITHIN 16 DAYS, YOU ARE NOT
8-4 REQUIRED TO PAY ANY CONSIDERATION UNDER THE CONTRACT OR RETURN ANY
8-5 CONSIDERATION RECEIVED.
8-6 (4) YOU MAY LOSE YOUR ELIGIBILITY TO COMPETE AS AN
8-7 ATHLETE IN YOUR SPORT. CANCELLATION OF THIS CONTRACT MAY NOT
8-8 REINSTATE YOUR ELIGIBILITY.
8-9 (5) IF YOU HAVE AN ATHLETIC DIRECTOR, WITHIN 72 HOURS
8-10 AFTER ENTERING INTO THIS CONTRACT BOTH YOU AND YOUR ATHLETE AGENT
8-11 MUST NOTIFY YOUR ATHLETIC DIRECTOR.
8-12 SECTION 8. Section 2051.351(a), Occupations Code, is amended
8-13 to read as follows:
8-14 (a) An athlete agent may not:
8-15 (1) publish or cause to be published:
8-16 (A) false, fraudulent, or misleading
8-17 information; or
8-18 (B) a false, fraudulent, or misleading:
8-19 (i) representation;
8-20 (ii) notice; or
8-21 (iii) advertisement;
8-22 (2) provide false information;
8-23 (3) make a false promise or representation relating to
8-24 employment;
8-25 (4) divide fees with or receive compensation from:
8-26 (A) a person exempt from registration under this
8-27 chapter under Section 2051.005; or
9-1 (B) a professional sports league or franchise,
9-2 including a representative or employee of the league or franchise;
9-3 (5) enter into a written or oral agreement with an
9-4 employee of an institution of higher education in which the athlete
9-5 agent offers a thing of value to the employee for the referral of
9-6 clients by the employee;
9-7 (6) offer a thing of value to induce the athlete to
9-8 enter into an agreement with the athlete agent in which the athlete
9-9 agent will represent the athlete; [and]
9-10 (7) except as provided by this chapter, before an
9-11 athlete completes the athlete's last intercollegiate football or
9-12 basketball contest:
9-13 (A) directly contact the athlete; or
9-14 (B) enter into an oral or written agreement with
9-15 the athlete for the athlete agent to represent the athlete;
9-16 (8) furnish anything of value to any person other than
9-17 the athlete or another registered athlete agent;
9-18 (9) initiate contact with an athlete unless registered
9-19 under this chapter;
9-20 (10) fail to retain or permit inspection of the
9-21 records required to be retained by Section 2051.352;
9-22 (11) predate or postdate an agent contract; or
9-23 (12) fail to notify an athlete before the athlete
9-24 signs an agent contract that the signing may make the athlete
9-25 ineligible to participate in intercollegiate sports.
9-26 SECTION 9. Section 2051.352(a), Occupations Code, is amended
9-27 to read as follows:
10-1 (a) An athlete agent shall maintain a record of:
10-2 (1) each athlete represented by the athlete agent,
10-3 including:
10-4 (A) the name and address of the athlete;
10-5 (B) fees paid by the athlete; and
10-6 (C) services performed by the athlete agent for
10-7 the athlete; [and]
10-8 (2) travel and entertainment expenses incurred by the
10-9 athlete agent, including expenses for:
10-10 (A) food and beverages;
10-11 (B) hospitality rooms;
10-12 (C) sporting events;
10-13 (D) theater and music events; and
10-14 (E) transportation, lodging, and admission
10-15 relating to entertainment;
10-16 (3) any agent contract entered into by the athlete
10-17 agent; and
10-18 (4) any direct costs incurred by the athlete agent in
10-19 recruiting or soliciting an athlete to enter into an agent
10-20 contract.
10-21 SECTION 10. Section 2051.402, Occupations Code, is amended by
10-22 adding Subsection (c) to read as follows:
10-23 (c) By acting as an athlete agent in this state, a
10-24 nonresident appoints the secretary of state as the nonresident's
10-25 agent for service of process in a civil action in this state
10-26 related to an act by the person as an athlete agent.
10-27 SECTION 11. Section 2051.551, Occupations Code, is amended to
11-1 read as follows:
11-2 Sec. 2051.551. CIVIL SUIT. (a) An institution of higher
11-3 education adversely affected by an athlete agent's violation of
11-4 this chapter may file suit against the athlete agent for damages.
11-5 (b) A cause of action under this section does not accrue
11-6 until the educational institution discovers or by the exercise of
11-7 reasonable diligence would have discovered the violation by the
11-8 athlete agent or former athlete.
11-9 (c) Any liability of the athlete agent or the former athlete
11-10 under this section is several and not joint.
11-11 (d) This chapter does not restrict the rights, remedies, or
11-12 defense of any person under any other law.
11-13 SECTION 12. (a) A registration under Chapter 2051,
11-14 Occupations Code, in effect on the effective date of this Act
11-15 continues in effect under the former law until it expires or is
11-16 revoked, and the former law is continued in effect for that
11-17 purpose.
11-18 (b) A person who submits an application required by Chapter
11-19 2051, Occupations Code, that is pending on the effective date of
11-20 this Act must resubmit an application as required by Chapter 2051,
11-21 Occupations Code, as amended by this Act.
11-22 (c) A contract entered into under Chapter 2051, Occupations
11-23 Code, as it existed immediately before the effective date of this
11-24 Act, is covered by the former law, and the former law is continued
11-25 in effect for that purpose.
11-26 SECTION 13. This Act takes effect September 1, 2001.