Statute

§17550 - Legislative findings and declarations

The Leg­is­la­ture finds and declares that cer­tain adver­tis­ing, sales, and busi­ness prac­tices of sell­ers of trav­el have worked finan­cial hard­ship upon the peo­ple of this state; that the trav­el busi­ness has a sig­nif­i­cant impact upon the econ­o­my and well-being of this state and its peo­ple; that prob­lems have arisen that are pecu­liar to sell­ers of trav­el busi­ness; and that the pub­lic wel­fare requires reg­u­la­tion of sell­ers of trav­el in order to elim­i­nate unfair adver­tis­ing, sales, and busi­ness prac­tices; to estab­lish stan­dards that will safe­guard the peo­ple against finan­cial hard­ship; to encour­age com­pe­ti­tion, fair deal­ing, and pros­per­i­ty in the trav­el busi­ness; and to pro­vide cer­tain and reli­able fund­ing for the sell­er of trav­el reg­is­tra­tion pro­gram and enforce­ment by the office of the Attor­ney Gen­er­al of this article.

It is the intent of the Leg­is­la­ture in enact­ing this arti­cle that the Depart­ment of Jus­tice, to the extent that resources are avail­able, work togeth­er with rep­re­sen­ta­tives of the affect­ed busi­ness com­mu­ni­ty to devel­op sam­ple forms that will, to the max­i­mum extent pos­si­ble, enable sell­ers of trav­el to com­ply with the require­ment to pro­vide to per­sons mak­ing pay­ment the infor­ma­tion required by sub­di­vi­sion (c) and sub­di­vi­sions (e) to (l), inclu­sive, of Sec­tion 17550.13, in a man­ner that is sim­pli­fied, effi­cient, and nondu­plica­tive, and in a man­ner that rec­og­nizes the par­tic­u­lar bur­dens and sit­u­a­tions that may exist for small sell­ers of trav­el in their efforts to com­ply with the pro­vi­sions of that section.

§17550.1 - “Seller of travel”

(a) Sell­er of trav­el” means a per­son who sells, pro­vides, fur­nish­es, con­tracts for, arranges, or adver­tis­es that he or she can or may arrange, or has arranged, whole­sale or retail, either of the following:

(1) Air or sea trans­porta­tion either sep­a­rate­ly or in con­junc­tion with oth­er trav­el services.

(2) Land or water ves­sel trans­porta­tion, oth­er than sea car­riage, either sep­a­rate­ly or in con­junc­tion with oth­er trav­el ser­vices if the total charge to the pas­sen­ger exceeds three hun­dred dol­lars ($300).

(b) Sell­er of trav­el does not include any of the following:

(1) An air carrier.

(2) An ocean carrier.

(3) A hotel, motel, or sim­i­lar lodg­ing estab­lish­ment where in the course of sell­ing, pro­vid­ing, fur­nish­ing, con­tract­ing for, or arrang­ing tran­sient lodg­ing accom­mo­da­tions and relat­ed ser­vices for its reg­is­tered guests, it also arranges for trans­porta­tion and does not direct­ly or indi­rect­ly receive any mon­ey or oth­er valu­able con­sid­er­a­tion for arrang­ing or pro­vid­ing that transportation.

(4) A per­son or orga­ni­za­tion cer­ti­fied under Part 5 (com­menc­ing with Sec­tion 12140) of Divi­sion 2 of the Insur­ance Code, except such a per­son or orga­ni­za­tion shall com­ply with the reg­is­tra­tion and fee pro­vi­sions of Sec­tions 17550.20 and 17550.21 for each loca­tion at which air or sea trans­porta­tion is sold either sep­a­rate­ly or in con­junc­tion with oth­er trav­el services.

(5) A motor or rail car­ri­er or water ves­sel oper­a­tor hold­ing the required per­mit, license, or oth­er author­i­ty to oper­ate from a state, fed­er­al, or oth­er gov­ern­men­tal entity.

(c) Notwith­stand­ing any oth­er pro­vi­sion of law, a ref­er­ence in this arti­cle or Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35) to air or sea trans­porta­tion or to an air or sea car­ri­er, includes land or water ves­sel trans­porta­tion, as described in sub­di­vi­sion (a), and a motor car­ri­er or water ves­sel operator.

§17550.2 - “Advertise”

Adver­tise” means to make any rep­re­sen­ta­tion in the solic­i­ta­tion of air or sea trans­porta­tion, and includes com­mu­ni­ca­tion with oth­er mem­bers of the same part­ner­ship, cor­po­ra­tion, joint ven­ture, asso­ci­a­tion, orga­ni­za­tion, group, or oth­er entity.

§17550.3 - “Passenger”

Pas­sen­ger” is a per­son on whose behalf mon­ey or oth­er con­sid­er­a­tion has been giv­en or is to be giv­en to anoth­er, includ­ing anoth­er mem­ber of the same part­ner­ship, cor­po­ra­tion, joint ven­ture, asso­ci­a­tion, orga­ni­za­tion, group, or oth­er enti­ty, for air or sea trans­porta­tion, oth­er trav­el ser­vices, or both, for that person.

§17550.4 - “Air carrier”

An air car­ri­er is a trans­porter by air of per­sons that oper­ates under a cer­tifi­cate of con­ve­nience and neces­si­ty issued by the Unit­ed States Depart­ment of Trans­porta­tion or under the cer­ti­fi­ca­tion of a for­eign gov­ern­ment that is rec­og­nized by the Unit­ed States Depart­ment of Transportation.

§17550.5 - “Ticket or voucher”

Tick­et or vouch­er” means a writ­ing that is itself good and suf­fi­cient to obtain the entire air or ocean trans­porta­tion, or trav­el ser­vices, which the pas­sen­ger has purchased.

§17550.6 - “Officially appointed agent”

Offi­cial­ly appoint­ed agent” means an agent express­ly appoint­ed as such, with­out reser­va­tion, for a spec­i­fied time peri­od, in a writ­ten instru­ment exe­cut­ed by the prin­ci­pal or an autho­rized rep­re­sen­ta­tive of the prin­ci­pal. The writ­ten instru­ment shall iden­ti­fy the cur­rent name, address, and tele­phone num­bers of the prin­ci­pal and agent.

§17550.7 - “Participate in the Travel Consumer Restitution Fund”

Par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund” is a reg­is­tered sell­er of trav­el with its prin­ci­pal place of busi­ness in Cal­i­for­nia, who does busi­ness with per­sons locat­ed in Cal­i­for­nia, or is a reg­is­tered sell­er of trav­el that does busi­ness in Cal­i­for­nia, from one or more loca­tions in Cal­i­for­nia, and that meets the require­ments of para­graph (16) of sub­di­vi­sion (e) of Sec­tion 17511.1.

§17550.8 - “Provider”

Provider” means the per­son or enti­ty who actu­al­ly pro­vides any trans­porta­tion or trav­el services.

§17550.9 - “Travel services”

Trav­el ser­vices” includes, but is not lim­it­ed to, lodg­ing, sur­face trans­porta­tion, trans­fers, tours, meals, guides, bag­gage trans­fer, sight­see­ing, recre­ation­al activ­i­ties, vehi­cle rental, or oth­er trav­el-relat­ed ser­vices, how­ev­er denom­i­nat­ed, includ­ing, but not lim­it­ed to, trav­el cer­tifi­cates, reg­is­tra­tion fees, and pro­cess­ing fees. Trav­el ser­vices” does not include trav­el ser­vices ren­dered by providers of lodg­ing such as a hotel, motel, or sim­i­lar lodg­ing estab­lish­ment where the provider of lodg­ing sup­plies only that service.

§17550.10 - “Travel certificate”

Trav­el cer­tifi­cate” means a writ­ing that rep­re­sents the hold­er is enti­tled to air or sea trans­porta­tion or trav­el ser­vices, to a dis­count or reduced price for that trans­porta­tion or those trav­el ser­vices, or to pur­chase that trans­porta­tion orthose trav­el ser­vices from a spec­i­fied source, whether or not the hold­er is required to pay addi­tion­al mon­ey or ful­fill any require­ments in order to uti­lize the certificate.

§17550.11 - “Adequate bond”

(a) Ade­quate bond” means a bond exe­cut­ed by an admit­ted sure­ty insur­er in an amount at all times no less than at least equal to the amount required to be held in a trust account pur­suant to Sec­tion 17550.15 by any sell­er of trav­el in con­junc­tion with such trans­porta­tion, for the ben­e­fit of every pas­sen­ger who sus­tains a mon­e­tary loss as a result of any vio­la­tion of this arti­cle by a sell­er of trav­el or any fail­ure by a sell­er of trav­el or by any offi­cial, agent, or employ­ee of the sell­er of trav­el act­ing in the course or scope of his or her employ­ment or agency. A sell­er of trav­el fil­ing the bond shall main­tain the bond in force in the prop­er amount as a con­di­tion of con­tin­u­ing to engage in busi­ness. The admit­ted sure­ty insur­er issu­ing the bond shall pro­vide 30 days’ writ­ten notice pri­or to can­cel­la­tion or ter­mi­na­tion of the bond to the sell­er of trav­el fil­ing the bond and the office of the Attor­ney Gen­er­al, Con­sumer Law Sec­tion. Can­cel­la­tion of the bond shall not lim­it or exon­er­ate the sure­ty insur­er from claims against the bond aris­ing dur­ing the peri­od it was in force.

(b) No pas­sen­ger may recov­er upon the bond a sum greater than that which the pas­sen­ger paid to the sell­er of trav­el, pro­vid­ed that this lim­i­ta­tion shall not restrict a pas­sen­ger from recov­er­ing sums greater than those paid to the sell­er of trav­el from sources oth­er than the bond.

§17550.13 - Required information to be given

(a)

(1) A sell­er of trav­el shall not receive any mon­ey or oth­er valu­able con­sid­er­a­tion in pay­ment for air or sea trans­porta­tion or oth­er trav­el ser­vices offered by the sell­er of trav­el unless at the time of or pri­or to the receipt of pay­ment, the sell­er of trav­el first fur­nish­es to the per­son mak­ing that pay­ment writ­ten mate­ri­als con­spic­u­ous­ly set­ting forth the fol­low­ing information:

(A) The name and busi­ness address and tele­phone num­ber of the sell­er of travel.

(B) The total amount to be paid by or on behalf of the pas­sen­ger, amount paid to date, the date of any future pay­ment, the pur­pose of the pay­ment made, and an item­ized state­ment of the bal­ance due, if any.

(C) The name of the provider of the air or sea trans­porta­tion, and the date, time, and place of each depar­ture, or the cir­cum­stances under which the date, time, and place of depar­ture will be determined.

(D) All terms and con­di­tions relat­ing to the air or sea trans­porta­tion or trav­el ser­vices being pur­chased by the pas­sen­ger, includ­ing can­cel­la­tion con­di­tions. An air car­ri­er’s or an ocean car­ri­er’s stan­dard con­tract of car­riage is not required to be dis­closed pri­or to the sell­er of trav­el receiv­ing any mon­ey or oth­er valu­able consideration.

(E) A clear and con­spic­u­ous state­ment that upon can­cel­la­tion of the trans­porta­tion or trav­el ser­vices, where the pas­sen­ger is not at fault and has not can­celed in vio­la­tion of any terms and con­di­tions pre­vi­ous­ly clear­ly and con­spic­u­ous­ly dis­closed to and agreed to by the pas­sen­ger, all sums paid to the sell­er of trav­el for ser­vices not pro­vid­ed will be prompt­ly paid to the pas­sen­ger, unless the pas­sen­ger oth­er­wise advis­es the sell­er of trav­el in writ­ing, after cancellation.

(F) If the sell­er of trav­el is required by this arti­cle to have a trust account or bond, a clear and con­spic­u­ous dis­clo­sure stat­ing: Cal­i­for­nia law requires cer­tain sell­ers of trav­el to have a trust account or bond. This busi­ness has [a trust account] or [a bond issued by (com­pa­ny) in the amount of ($X)].”

(G) If the sell­er of trav­el is a par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund and the pas­sen­ger, or the per­son mak­ing pay­ment for the pas­sen­ger, was locat­ed in Cal­i­for­nia at the time of the sale of air or sea trans­porta­tion or trav­el ser­vices, a clear and con­spic­u­ous notice of the right of the pas­sen­ger, or the right of the per­son mak­ing pay­ment for the pas­sen­ger, to make a claim on that fund. The notice shall include a descrip­tion of the loss­es cov­ered, the method for mak­ing a claim, the time lim­it with­in which the claim shall be made, and the amount which may be claimed.

(H) If the sell­er of trav­el is a par­tic­i­pant in a Con­sumer Pro­tec­tion Deposit Plan that meets the cri­te­ria set forth in sub­di­vi­sion (b) of Sec­tion 17550.16, a clear and con­spic­u­ous notice of the pas­sen­ger’s right to make a claim on the plan. That notice shall include a descrip­tion of the loss­es cov­ered, the method for mak­ing a claim, the time lim­it with­in which the claim shall be made, and the amount that may be claimed.

(I) If the sell­er of trav­el is a par­tic­i­pant in a Con­sumer Pro­tec­tion Escrow Plan that meets the cri­te­ria set forth in sub­di­vi­sion (c) of Sec­tion 17550.16, a clear and con­spic­u­ous notice of the pas­sen­ger’s right to make a claim on the plan. That notice shall include a descrip­tion of the loss­es cov­ered, the method for mak­ing a claim, the time lim­it with­in which the claim shall be made, and the amount that may be claimed.

(J) If the sell­er of trav­el is not a par­tic­i­pant, a clear and con­spic­u­ous dis­clo­sure that the sell­er of trav­el is not a par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund. That dis­clo­sure shall be made both oral­ly and in writing.

(K) If the sell­er of trav­el is a par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund and the pas­sen­ger or any per­son who made a pay­ment on behalf of the pas­sen­ger for trav­el ser­vices is locat­ed in Cal­i­for­nia, a clear and con­spic­u­ous dis­clo­sure made both oral­ly and in writ­ing that the trans­ac­tion is cov­ered by the Trav­el Con­sumer Resti­tu­tion Fund.

(2) There is no vio­la­tion of this sub­di­vi­sion if both of the fol­low­ing occur:

(A) Com­pli­ance was ren­dered impos­si­ble as a direct result of an unfore­seen con­di­tion beyond the con­trol of the sell­er of travel.

(B) The sell­er of trav­el obtains from each pas­sen­ger, writ­ten acknowl­edg­ment that the pas­sen­ger has not received dis­clo­sure of the terms and con­di­tions required by this section.

(b) If a sell­er of trav­el offers, sells, pro­vides, or dis­trib­utes a trav­el cer­tifi­cate as defined in Sec­tion 17550.10 and any pas­sen­ger pay­ment is non­re­fund­able, in whole or in part, the sell­er of trav­el shall obtain the writ­ten acknowl­edg­ment of that lim­i­ta­tion from the end user pri­or to, or at the time of, receipt of any mon­ey or oth­er valu­able consideration.

(c) Notwith­stand­ing any oth­er pro­vi­sion of this sec­tion, if mon­ey or oth­er valu­able con­sid­er­a­tion is received from a cus­tomer to whom the sell­er of trav­el has sold air or sea trans­porta­tion with­in the pre­ced­ing 12 months and the dis­clo­sures required by this sec­tion are sub­stan­tial­ly the same as the dis­clo­sures giv­en in con­nec­tion with the pri­or trav­el, the dis­clo­sures required by this sec­tion shall be made with­in five days of receipt of that mon­ey or oth­er valu­able consideration.

(d) Notwith­stand­ing any oth­er pro­vi­sion of this sec­tion, if mon­ey or oth­er valu­able con­sid­er­a­tion is received in pay­ment for air trans­porta­tion and the sell­er of trav­el is an offi­cial­ly appoint­ed agent in good stand­ing of the Air­lines Report­ing Cor­po­ra­tion and for­wards the amount paid, with­out off­set­ting or reduc­ing the amount for­ward­ed by any amounts due or claimed in con­nec­tion with any oth­er trans­ac­tion, to the air­line pro­vid­ing the trans­porta­tion or to the Air­lines Report­ing Cor­po­ra­tion, the dis­clo­sures required by this sec­tion with respect to that air trans­porta­tion may be made orally.

§17550.14 - Failure to provide transportation

(a) The sell­er of trav­el has an oblig­a­tion either to pro­vide the air or sea trans­porta­tion or trav­el ser­vices pur­chased by the pas­sen­ger or to make a refund as pro­vid­ed by this sec­tion. The sell­er of trav­el shall return to the pas­sen­ger all mon­eys paid for air or sea trans­porta­tion or trav­el ser­vices not actu­al­ly pro­vid­ed to the pas­sen­ger, with­in either of the fol­low­ing peri­ods, whichev­er is earlier:

(1) Thir­ty days from one of the fol­low­ing dates:

(A) The sched­uled date of departure.

(B) The day the pas­sen­ger requests a refund.

(C) The day of can­cel­la­tion by the sell­er of travel.

(2) Three days from the day the sell­er of trav­el is first unable to pro­vide the air or sea trans­porta­tion or trav­el ser­vices.

As used in this sec­tion, unable to pro­vide” includes, but is not lim­it­ed to, any day on which the pas­sen­ger’s funds are not in the trust account required by Sec­tion 17550.15 and sub­di­vi­sion (g) of Sec­tion 17550.21 or the funds nec­es­sary to pro­vide the pas­sen­ger’s trans­porta­tion or trav­el ser­vices have been dis­bursed oth­er than as allowed by Sec­tion 17550.15 or sub­di­vi­sion (a) of Sec­tion 17550.16.

(b) If the sell­er of trav­el has dis­bursed the pas­sen­ger’s funds pur­suant to para­graph (1), (2), (3), or (4) of sub­di­vi­sion (c) of Sec­tion 17550.15 and the dis­burse­ment is in full pay­ment for the ser­vices or trans­porta­tion pur­chased by the pas­sen­ger, the sell­er of trav­el may, instead of pro­vid­ing a refund, pro­vide to the pas­sen­ger a writ­ten state­ment accom­pa­nied by bank records estab­lish­ing that the pas­sen­ger’s funds were dis­bursed as required by those pro­vi­sions and, if dis­bursed to a sell­er of trav­el, proof of cur­rent reg­is­tra­tion of that sell­er of trav­el. A sell­er of trav­el who is exempt from the require­ments of Sec­tion 17550.15 pur­suant to sub­di­vi­sion (a) of Sec­tion 17550.16 and who is in com­pli­ance with sub­di­vi­sion (a) of Sec­tion 17550.16 may com­ply with this sec­tion by main­tain­ing and pro­vid­ing to the pas­sen­ger doc­u­men­tary proof of dis­burse­ment in com­pli­ance with sub­di­vi­sion (a) of Sec­tion 17550.16, and proof of cur­rent reg­is­tra­tion of the sell­er of trav­el to whom the funds were dis­bursed, which reg­is­tra­tion shall note that the reg­is­tered sell­er of trav­el either has a trust account in com­pli­ance with Sec­tion 17550.15, or is exempt from the require­ments of Sec­tion 17550.15 pur­suant to sub­di­vi­sion (b) or (c) of Sec­tion 17550.16. This sub­di­vi­sion does not apply to refunds sub­ject to sub­di­vi­sion (c) or (d).

(c) If terms and con­di­tions relat­ing to a refund upon can­cel­la­tion by the pas­sen­ger have been dis­closed and agreed to by the pas­sen­ger and the pas­sen­ger elects to can­cel for any rea­son oth­er than a sell­er of trav­el being unable to pro­vide the air or sea trans­porta­tion or trav­el ser­vices pur­chased, the mak­ing of a refund in accor­dance with those terms and con­di­tions shall be deemed to con­sti­tute com­pli­ance with this section.

(d) Any mate­r­i­al mis­rep­re­sen­ta­tion by the sell­er of trav­el shall be deemed to be a vio­la­tion of this arti­cle and can­cel­la­tion by the sell­er of trav­el, neces­si­tat­ing a refund as required by sub­di­vi­sion (a).

§17550.15 - Deposit of payments in trust account

(a) This sec­tion applies to a sell­er of trav­el as defined in Sec­tion 17550.1.

(b) The sell­er of trav­el shall deposit direct­ly into a trust account in a fed­er­al­ly insured bank, sav­ings and loan asso­ci­a­tion, or cred­it union 100 per­cent of all sums received from any per­son or enti­ty, includ­ing, but not lim­it­ed to, those pay­ments made in cash, by cred­it card, or any oth­er method of pay­ment, for air or sea trans­porta­tion for any per­son, or for any trav­el ser­vices offered by the sell­er of trav­el, and any refunds made by car­ri­ers or providers of trav­el ser­vices. This sub­di­vi­sion does not require that a sell­er of trav­el estab­lish a sep­a­rate trust account for each transaction.

(c) The sell­er of trav­el shall not in any man­ner encum­ber the cor­pus of the trust account and shall not with­draw mon­ey there­from except as follows:

(1) In par­tial or full pay­ment to the car­ri­er for trans­porta­tion, or to the provider of trav­el ser­vices, for the ser­vices or trans­porta­tion pur­chased by the passenger.

(2) In par­tial or full pay­ment to the car­ri­er or provider of trav­el ser­vices if pay­ment is made by wire trans­fer direct­ly to an account of the Air­lines Report­ing Cor­po­ra­tion, or by check or draft paid to the Air­lines Report­ing Cor­po­ra­tion for the trans­porta­tion or ser­vices con­tract­ed for by the passenger.

(3) Upon deliv­ery of all tick­ets or vouch­ers nec­es­sary for the pas­sen­ger to obtain from the car­ri­er or provider of trav­el ser­vices the trans­porta­tion or ser­vices pur­chased by the pas­sen­ger, at which time the sell­er of trav­el may with­draw the por­tion of the sum paid by the pas­sen­ger that is due the sell­er of trav­el as com­pen­sa­tion for sale of the trans­porta­tion or trav­el ser­vices to that pas­sen­ger. Tick­ets or vouch­ers shall be deemed deliv­ered if per­son­al­ly deliv­ered, turned over to an inde­pen­dent third-par­ty deliv­ery ser­vice for reg­u­lar deliv­ery to the pas­sen­ger at the address des­ig­nat­ed by the pas­sen­ger on the next busi­ness day, or deposit­ed in the Unit­ed States mail with first-class postage prepaid.

(4) Upon full pay­ment to the provider of trans­porta­tion or trav­el ser­vices, direct­ly to the trust account iden­ti­fied in the reg­is­tra­tion of anoth­er sell­er of trav­el to whom the funds are paid, or to anoth­er reg­is­tered sell­er of trav­el whose reg­is­tra­tion states that the oth­er reg­is­tered sell­er of trav­el is exempt pur­suant to sub­di­vi­sion (b) or (c) of Sec­tion 17550.16 from the require­ments of this sec­tion, of the total amount that is required by the car­ri­er or provider of trans­porta­tion or trav­el ser­vices or oth­er reg­is­tered sell­er of trav­el in order to pro­vide the trans­porta­tion or ser­vices pur­chased by the pas­sen­ger, at which time the sell­er of trav­el may with­draw from the trust account that por­tion of the sum paid by the pas­sen­ger which is com­mis­sion due the sell­er of trav­el for sale of the trans­porta­tion or trav­el ser­vices to that passenger.

(5) To make refunds to the passenger.

(d) Sub­di­vi­sion (c) shall not pre­vent pay­ment of the inter­est earned on the trust account to the sell­er of travel.

(e) The sell­er of trav­el shall serve as trustee of the trust accounts required by this arti­cle. If an indi­vid­ual per­son is the sell­er of trav­el, the indi­vid­ual per­son shall be the trustee; if the sell­er of trav­el is a cor­po­ra­tion, part­ner­ship, lim­it­ed lia­bil­i­ty com­pa­ny, or oth­er legal enti­ty, a man­ag­ing part­ner or part­ners, or the chief exec­u­tive offi­cer of the cor­po­ra­tion, or exec­u­tive offi­cer or man­ag­er of a lim­it­ed lia­bil­i­ty com­pa­ny shall be the trustee. The trustee may des­ig­nate in writ­ing that an offi­cer or employ­ee may man­age the trust account if that offi­cer or employ­ee is under the trustee’s super­vi­sion and con­trol, and the orig­i­nal of that writ­ing is on file with the Attor­ney Gen­er­al’s office.

(f)(1) Except as oth­er­wise pro­vid­ed in this sec­tion, all trust accounts required by this arti­cle shall be main­tained at a branch of a fed­er­al­ly insured bank, sav­ings and loan asso­ci­a­tion, or cred­it union.

(2) The sell­er of trav­el shall file with the Attor­ney Gen­er­al an irrev­o­ca­ble agree­ment in writ­ing allow­ing the Attor­ney Gen­er­al, a dis­trict attor­ney, or their rep­re­sen­ta­tives, upon writ­ten request, to exam­ine and obtain copies of all busi­ness records, includ­ing, but not lim­it­ed to, those relat­ed to the trust account wher­ev­er those records may be, and includ­ing, but not lim­it­ed to, those records relat­ing to any trav­el busi­ness account, or any account used for any trav­el busi­ness trans­ac­tion, or account to which trust funds have been deposit­ed. The state­ment shall indi­cate that the autho­riza­tion remains in effect as long as the sell­er of trav­el, finan­cial insti­tu­tion, or oth­er cus­to­di­an of records retains records.

(g) Every sell­er of trav­el has a fidu­cia­ry respon­si­bil­i­ty with respect to all sums received for trans­porta­tion or trav­el services.

(h) The fol­low­ing are deemed to be held in trust for passengers:

(1) All sums received by the sell­er of trav­el for trans­porta­tion or trav­el ser­vices whether or not required to be deposit­ed in an actu­al trust account and regard­less of whether any of these sums were required to be deposit­ed or actu­al­ly were deposit­ed in a trust account.

(2) All prop­er­ty with which any of the sums described in para­graph (1) has been com­min­gled if any of these sums can­not be iden­ti­fied because of the commingling.

(i) Upon any judi­cial­ly ordered dis­tri­b­u­tion of any mon­ey or prop­er­ty required to be held in trust and after all expens­es of dis­tri­b­u­tion approved by the court have been paid, every pas­sen­ger has a claim on the trust for pay­ments made for trans­porta­tion and oth­er trav­el ser­vices not pro­vid­ed. Unless a pas­sen­ger can iden­ti­fy his or her funds in the trust with­in the time estab­lished by the court, each pas­sen­ger shall receive a pro­por­tion­al share based on the amount paid.

(j) The sell­er of trav­el is not required to com­ply with the direct deposit require­ment set forth in sub­di­vi­sion (b) if all of the fol­low­ing apply:

(1) The pay­ment is made by cred­it card.

(2) The sell­er of trav­el does not deposit, nego­ti­ate, or fac­tor the cred­it card charge or oth­er­wise seek or obtain pay­ment of the cred­it card charge or the cred­it­ing of the amount of the cred­it card charge to any account over which the sell­er of trav­el has any control.

(3)(A) If the charge includes trans­porta­tion, the car­ri­er that is to pro­vide the trans­porta­tion process­es the cred­it card charge.

(B) If the charge is only for ser­vices, the provider of ser­vices process­es the cred­it card charge.

(k) In lieu of the trust account required by this arti­cle, an ade­quate bond as set forth in Sec­tion 17550.11 may be main­tained by the sell­er of trav­el. Pri­or to the adver­tise­ment of trans­porta­tion or ser­vices, or both, by the sell­er of trav­el, the sell­er of trav­el shall file a copy of that bond with the Attor­ney General.

§17550.16 - Exemption from trust account

(a) A sell­er of trav­el is exempt from the require­ments of sub­di­vi­sions (a) to (f), inclu­sive, of Sec­tion 17550.15 for all trans­ac­tions in which the sell­er of trav­el is in com­pli­ance with para­graphs (1) to (6), inclu­sive, or with para­graph (7).

(1) The sell­er of trav­el sells, pro­vides, fur­nish­es, con­tracts for, or arranges air or sea trans­porta­tion in trans­ac­tions with per­sons in Cal­i­for­nia, only from loca­tions in Cal­i­for­nia, and the air or sea trans­porta­tion or trav­el ser­vices are to be fur­nished by (A) a reg­is­tered sell­er of trav­el that is in com­pli­ance with this arti­cle and Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35) or (B) an air or sea carrier.

(2) The sell­er of trav­el for­wards the pas­sen­ger’s funds, with­out off­set­ting or reduc­ing the amount for­ward­ed by any amounts due or claimed in con­nec­tion with any oth­er trans­ac­tion, to (A) the provider of the trans­porta­tion or trav­el ser­vices, (B) the Air­lines Report­ing Cor­po­ra­tion, (C) the trust account iden­ti­fied in the reg­is­tra­tion of the sell­er of trav­el to whom the funds are for­ward­ed, or (D) a reg­is­tered sell­er of trav­el whose reg­is­tra­tion states that the reg­is­tered sell­er is exempt pur­suant to sub­di­vi­sion (b) or (c) from the require­ments of Sec­tion 17550.15, and the sell­er of trav­el who for­wards funds pur­suant to sub­para­graph (C) or (D) obtains and keeps a copy of the reg­is­tra­tion referred to in sub­para­graph (C) or (D).

(3) The sell­er of trav­el is an offi­cial­ly appoint­ed agent in good stand­ing of the Air­lines Report­ing Cor­po­ra­tion and the air trans­porta­tion, if any, is sold to the pas­sen­ger pur­suant to that agency appointment.

(4) The sell­er of trav­el has been in busi­ness under the same own­er­ship for a peri­od of three years, unless acquired or formed by a reg­is­tered sell­er of trav­el that has been in busi­ness under the same own­er­ship for a peri­od of three years. For the pur­pos­es of this para­graph, the fol­low­ing shall not con­sti­tute a change in ownership:

(A) Any struc­tur­al change involv­ing a change in the type of enti­ty, such as from a cor­po­ra­tion to a part­ner­ship, and not involv­ing the addi­tion of any new, under­ly­ing own­er­ship interest.

(B) The dele­tion of any own­er or own­er­ship interest.

(5) The sell­er of trav­el sells, pro­vides, fur­nish­es, con­tracts for, or arranges air or sea trans­porta­tion or trav­el ser­vices only at retail direct­ly to the gen­er­al pub­lic and not through any oth­er sell­er of trav­el, all of which air or sea trans­porta­tion and trav­el ser­vices are to be fur­nished by oth­er, unre­lat­ed providers or sell­ers of travel.

(6) The sell­er of trav­el is in com­pli­ance with the require­ments of Sec­tion 17550.20 and Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35). Any sell­er of trav­el seek­ing to qual­i­fy for this exemp­tion shall pro­vide all infor­ma­tion nec­es­sary for the Attor­ney Gen­er­al or his or her del­e­gate to deter­mine that the sell­er of trav­el meets the cri­te­ria set forth in para­graphs (1) to (6), inclu­sive.

(7) A sell­er of trav­el in a trans­ac­tion where the air or sea trans­porta­tion or trav­el ser­vices are fur­nished by a busi­ness enti­ty that (A) is locat­ed and pro­vid­ing trans­porta­tion or trav­el ser­vices out­side of the Unit­ed States and (B) is not in com­pli­ance with the pro­vi­sions of this arti­cle is exempt from the require­ments of Sec­tion 17550.15 for that trans­ac­tion if the sell­er of trav­el obtains each pas­sen­ger’s writ­ten acknowl­edg­ment of receiv­ing, pri­or to mak­ing any pay­ment, a clear, con­spic­u­ous, and com­plete writ­ten dis­clo­sure that the provider of trans­porta­tion or trav­el ser­vices is not in com­pli­ance with the Sell­er of Trav­el Law and the trans­ac­tion is not cov­ered by the Trav­el Con­sumer Resti­tu­tion Fund, and of the atten­dant risks and con­se­quences thereof.

(8) If the Attor­ney Gen­er­al or his or her del­e­gate finds, pur­suant to Sec­tion 17550.52, that the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion has failed or ceased to oper­ate, a sell­er of trav­el who was a par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund shall no longer be exempt from com­pli­ance with the require­ments of Sec­tion 17550.15 and 17550.17.

If Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35) ceas­es to oper­ate for any rea­son, includ­ing, but not lim­it­ed to, repeal pur­suant to Sec­tion 17550.59, no sell­er of trav­el shall be exempt from com­pli­ance with the require­ments of Sec­tions 17550.15 and 17550.17 unless in com­pli­ance with sub­di­vi­sion (b) or (c).

(b) A sell­er of trav­el who is a par­tic­i­pant, with respect to all sales of air or sea trans­porta­tion and trav­el ser­vices, in a Con­sumer Pro­tec­tion Deposit Plan that meets the cri­te­ria of para­graphs (1) to (3), inclu­sive, and who com­plies with para­graph (4) need not com­ply with Sec­tion 17550.15.

(1) The plan is oper­at­ed and admin­is­tered by an enti­ty who demon­strates to the sat­is­fac­tion of the Attor­ney Gen­er­al or his or her del­e­gate that the oper­at­ing and admin­is­ter­ing enti­ty is com­pe­tent and reli­able and that the plan will achieve ful­ly the pur­pos­es and objec­tives of this arti­cle. Each approved plan shall include pro­vi­sions requir­ing that each par­tic­i­pat­ing sell­er of trav­el (A) has been engaged in busi­ness as a sell­er of trav­el in the Unit­ed States under the same own­er­ship for not less than three years, unless acquired or formed by a sell­er of trav­el already par­tic­i­pat­ing and in good stand­ing in the plan, and (B) has deposit­ed with the admin­is­tra­tor of the plan a min­i­mum of one mil­lion dol­lars ($1,000,000) in secu­ri­ty in the form of a bond, let­ter of cred­it, or cer­tifi­cate of deposit, which secu­ri­ty shall be (i) in favor sole­ly of the plan, (ii) held by the plan pur­suant to the terms of the plan, (iii) used sole­ly to refund pas­sen­ger pay­ments or deposits or to com­plete tours, and (iv) payable sole­ly in the event that (I) the sell­er of trav­el fails to refund pas­sen­ger pay­ments or deposits due as a result of the bank­rupt­cy, insol­ven­cy, or ces­sa­tion of oper­a­tions of the sell­er of trav­el or after the can­cel­la­tion or mate­r­i­al fail­ure by the sell­er of trav­el to com­plete per­for­mance of the pas­sen­ger’s trans­porta­tion or trav­el ser­vices or (II) the sell­er of trav­el fails to replace the secu­ri­ty with anoth­er meet­ing the cri­te­ria set forth in sub­para­graph (B) no lat­er than 30 days pri­or to its expiration.

(2) Claims filed against the Con­sumer Pro­tec­tion Deposit Plan are decid­ed with­in 45 days of receipt and paid with­in 30 days of decision.

(3) The Con­sumer Pro­tec­tion Deposit Plan has been reviewed and approved in writ­ing by the Attor­ney Gen­er­al or his or her del­e­gate as meet­ing the cri­te­ria set forth above, includ­ing a find­ing that the plan will effec­tu­ate the pur­pos­es of this arti­cle. Should the approved plan cease to pro­vide the con­sumer pro­tec­tions set forth in para­graph (1), the Attor­ney Gen­er­al or his or her del­e­gate shall revoke his or her approval imme­di­ate­ly. Upon that revo­ca­tion, the sell­er of trav­el shall no longer be exempt from com­pli­ance with the require­ments of Sec­tions 17550.15 and 17550.17.

(4) Any par­tic­i­pant in a Con­sumer Pro­tec­tion Deposit Plan seek­ing to qual­i­fy for this exemp­tion shall pro­vide all infor­ma­tion nec­es­sary for the Attor­ney Gen­er­al or his or her del­e­gate to deter­mine (A) that the Con­sumer Pro­tec­tion Deposit Plan in which the sell­er of trav­el is a par­tic­i­pant meets the cri­te­ria set forth in para­graphs (1), (2), and (3), (B) that the sell­er of trav­el is a par­tic­i­pant in full com­pli­ance with the terms and con­di­tions of an approved con­sumer pro­tec­tion deposit plan, and (C) pro­vide a writ­ten agree­ment from the autho­rized rep­re­sen­ta­tive of the Con­sumer Pro­tec­tion Deposit Plan in which the plan admin­is­tra­tor agrees to give the office of the Attor­ney Gen­er­al, Con­sumer Law Sec­tion, imme­di­ate writ­ten and tele­phon­ic notice in the event of ter­mi­na­tion of the sell­er of trav­el’s par­tic­i­pa­tion in the plan.

(c) A sell­er of trav­el who uti­lizes for all trans­ac­tions a Con­sumer Pro­tec­tion Escrow Plan which meets the cri­te­ria of para­graphs (1) to (6), inclu­sive, and who com­plies with para­graph (7) is exempt from the require­ments of Sec­tion 17550.15.

(1) The plan is oper­at­ed and admin­is­tered as escrow hold­er by a fed­er­al­ly insured bank that demon­strates to the Attor­ney Gen­er­al or his or her del­e­gate that the man­ner in which it will admin­is­ter the plan will be con­sis­tent with the pur­pos­es of this arti­cle. Each approved escrow plan shall include pro­vi­sions requir­ing that all air tick­ets sold by par­tic­i­pants in the plan be issued through the Air­lines Report­ing Corporation.

(2) All funds deliv­ered to the escrow hold­er, by cash, check, charge card, or oth­er­wise, are held and dis­bursed by the escrow hold­er for the ben­e­fit of, and to pro­tect the inter­ests of, the passenger.

(3) All funds are sep­a­rate­ly account­ed for by book­ing num­ber and pas­sen­ger name.

(4) Claims filed against the escrow plan are decid­ed with­in 45 days of receipt and paid with­in 30 days of decision.

(5) All pas­sen­ger funds are to be deliv­ered to the escrow hold­er as required by Sec­tion 17550.15.

(6) The Con­sumer Pro­tec­tion Escrow Plan has been reviewed and approved in writ­ing by the Attor­ney Gen­er­al or his or her del­e­gate as meet­ing the cri­te­ria set forth here­in, includ­ing a find­ing that the plan will effec­tu­ate the pur­pos­es and objec­tives of this arti­cle. Should the approved plan cease to pro­vide the con­sumer pro­tec­tions set forth in para­graphs (1) to (5), inclu­sive, the Attor­ney Gen­er­al or his or her del­e­gate shall revoke his or her approval of the plan imme­di­ate­ly. Upon that revo­ca­tion, the sell­er of trav­el shall no longer be exempt from com­pli­ance with the require­ments of Sec­tions 17550.15 and 17550.17.

(7) Any par­tic­i­pant in a con­sumer pro­tec­tion plan seek­ing to qual­i­fy for this exemp­tion shall pro­vide all infor­ma­tion nec­es­sary for the Attor­ney Gen­er­al or his or her del­e­gate to (A) deter­mine that the Con­sumer Pro­tec­tion Escrow Plan in which the sell­er of trav­el is a par­tic­i­pant meets the cri­te­ria set forth in para­graphs (1) to (6), inclu­sive, (B) deter­mine that the sell­er of trav­el is a par­tic­i­pant in full com­pli­ance with the terms and con­di­tions of an approved Con­sumer Pro­tec­tion Escrow Plan, and (C) pro­vide a writ­ten agree­ment from the autho­rized rep­re­sen­ta­tive of the Con­sumer Pro­tec­tion Escrow Plan in which the plan admin­is­tra­tor agrees to give the office of the Attor­ney Gen­er­al, Con­sumer Law Sec­tion, imme­di­ate writ­ten and tele­phon­ic notice in the event of ter­mi­na­tion of the sell­er of trav­el’s par­tic­i­pa­tion in the plan.

§17550.17 - Issuance and delivery of ticket

(a) This sec­tion does not apply to sell­ers of trav­el who are exempt from the require­ments of Sec­tion 17550.15 pur­suant to Sec­tion 17550.16.

(b) Upon pay­ment in full by the pas­sen­ger for air or sea trans­porta­tion and any relat­ed ser­vices with a cred­it card or with cash, the sell­er of trav­el shall issue and deliv­er the tick­et or vouch­er to the pas­sen­ger or his or her des­ig­nat­ed agent with­in 72 hours.

(c) Upon pay­ment in full by the pas­sen­ger for air or sea trans­porta­tion and any relat­ed ser­vices with a check, the sell­er of trav­el shall issue and deliv­er the tick­et or vouch­er to the pas­sen­ger or his or her des­ig­nat­ed agent with­in 72 hours of the ear­li­er of the following:

(1) The time the pas­sen­ger’s pay­ment is cred­it­ed to the sell­er of trav­el’s account.

(2) The expi­ra­tion of the max­i­mum hold peri­od spec­i­fied in Sec­tion 10.190405 of Title 10 of the Cal­i­for­nia Code of Regulations.

(d) Tick­ets, vouch­ers, or receipts shall be deemed to have been deliv­ered if they have been turned over to an inde­pen­dent third-par­ty deliv­ery ser­vice or the Unit­ed States Postal Ser­vice for reg­u­lar delivery.

(e) If the sell­er of trav­el is unable to issue tick­ets or vouch­ers upon pay­ment as set forth in sub­di­vi­sions (b) and (c), the sell­er of trav­el may com­ply with this sec­tion by tak­ing either of the fol­low­ing actions:

(1) Time­ly for­ward­ing to the air or sea car­ri­er or provider of trav­el ser­vices, the por­tion of the sum paid by the pas­sen­ger that is required by the air or sea car­ri­er or provider of trav­el ser­vices from the sell­er of trav­el in order to pro­vide the trans­porta­tion or ser­vices pur­chased by that pas­sen­ger and send­ing to the pas­sen­ger with­in five busi­ness days of the date of the pur­chase or before the date of the pas­sen­ger’s depar­ture, whichev­er occurs first, a receipt describ­ing the trans­porta­tion and ser­vices that were pur­chased. The sell­er of trav­el may not off­set or reduce the amount for­ward­ed by any amounts due or claimed in con­nec­tion with any oth­er transaction.

(2) Com­ply­ing with Sec­tions 17550.13, 17550.14, and 17550.15.

(f) There is no vio­la­tion of this sec­tion if com­pli­ance with this sec­tion was ren­dered impos­si­ble as a direct result of an unfore­seen con­di­tion beyond the con­trol of the sell­er of trav­el, and the sell­er of trav­el com­plied with this sec­tion or made resti­tu­tion to the pas­sen­ger with­in 30 days after the trans­porta­tion or trav­el ser­vices pur­chased by the pas­sen­ger were not provided.

(g) For pur­pos­es of this sec­tion, 72 hours” means three busi­ness days as defined in Sec­tion 9 of the Civ­il Code.

§17550.18 - Severability of provisions

(a) If any pro­vi­sion of this arti­cle or the appli­ca­tion there­of to any per­son or cir­cum­stance is held invalid, such inva­lid­i­ty shall not affect oth­er pro­vi­sions or appli­ca­tions of the arti­cle which can be giv­en effect with­out the invalid pro­vi­sion or appli­ca­tion, and to this end the pro­vi­sions of this arti­cle are severable.

(b) In a crim­i­nal action, a sell­er of trav­el has the bur­den of pro­duc­ing evi­dence to estab­lish any excep­tion to the pro­vi­sions of this chap­ter; and in a civ­il action, a sell­er of trav­el has the bur­den of proof to estab­lish any excep­tion to the pro­vi­sions of this chapter.

(c) Any action or pro­ceed­ing to attack, review, set aside, void, change, or annul any deci­sion, deter­mi­na­tion, or find­ing of the Attor­ney Gen­er­al or his or her del­e­gate pur­suant to Arti­cle 2.6 (com­menc­ing with Sec­tion 17550) or Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35) shall be in accor­dance with the pro­vi­sions of Sec­tion 1094.5 of the Code of Civ­il Procedure.

In such action or pro­ceed­ing, the inquiry shall extend only to whether there was a prej­u­di­cial abuse of dis­cre­tion. Abuse of dis­cre­tion shall be found by the court only if the deci­sion, deter­mi­na­tion, or find­ing was not sup­port­ed by sub­stan­tial evi­dence in light of the entire writ­ten record before the Attor­ney Gen­er­al or his or her del­e­gate at the time the deci­sion, deter­mi­na­tion, or find­ing was made. The record before the court shall be the same writ­ten record upon which the Attor­ney Gen­er­al or his or her del­e­gate acted.

§17550.19 - Penalties

In addi­tion to any civ­il penal­ties pro­vid­ed in this divi­sion, vio­la­tion of this arti­cle is pun­ish­able as follows:

(a) As a mis­de­meanor by a fine of not more than ten thou­sand dol­lars ($10,000), by impris­on­ment in a coun­ty jail for not more than one year, or by both that fine and impris­on­ment for each violation.

(b) In addi­tion, any vio­la­tion of Sec­tion 17550.14 or sub­di­vi­sion (b) or (c) of Sec­tion 17550.15 where mon­ey or real or per­son­al prop­er­ty received or obtained by a sell­er of trav­el for trans­porta­tion or trav­el ser­vices from any and all per­sons aggre­gates one thou­sand dol­lars ($1,000) or more in any con­sec­u­tive 12- month peri­od, or the pay­ment or pay­ments by or on behalf of any one pas­sen­ger exceeds in the aggre­gate four hun­dred dol­lars ($400) in any 12-month peri­od, is pun­ish­able either as a mis­de­meanor or as a felony by impris­on­ment in the state prison for 16 months, or two or three years, by a fine of not more than twen­ty-five thou­sand dol­lars ($25,000), or by both that fine and impris­on­ment for each violation.

(c) In addi­tion, any inten­tion­al use for any pur­pose of a false sell­er of trav­el reg­is­tra­tion num­ber, with intent to defraud, by an unreg­is­tered sell­er of trav­el is pun­ish­able as a mis­de­meanor or felony as pro­vid­ed in this section.

(d) Any vio­la­tion of Sec­tion 17550.15 shall be a mis­de­meanor and shall be pun­ished as pro­vid­ed in this sec­tion. Every act in vio­la­tion of Sec­tion 17550.15 may be pros­e­cut­ed as a sep­a­rate and dis­tinct vio­la­tion and con­sec­u­tive sen­tences may be imposed for each violation.

(e) Sell­ers of trav­el shall also com­ply with Sec­tions 17537, 17537.1, and 17537.2 of the Busi­ness and Pro­fes­sions Code and all oth­er applic­a­ble laws. This sec­tion shall not be con­strued to pre­clude the applic­a­bil­i­ty of any oth­er pro­vi­sion of the crim­i­nal law of this state that applies or may apply to any transaction.

§17550.195 - Felony conviction

(a) The Attor­ney Gen­er­al shall imme­di­ate­ly sus­pend the reg­is­tra­tion of a sell­er of trav­el who has been con­vict­ed of a felony offense pur­suant to Sec­tion 17550.19.

(b) A per­son who has been con­vict­ed of a felony offense pur­suant to Sec­tion 17550.19 is pro­hib­it­ed, for a peri­od of sev­en years com­menc­ing on the date of his or her con­vic­tion, from reg­is­ter­ing as a sell­er of trav­el and from par­tic­i­pat­ing in the Trav­el Con­sumer Resti­tu­tion Fund.

§17550.20 - Registration

(a)(1) Not less than 10 days pri­or to doing busi­ness in this state a sell­er of trav­el shall apply for reg­is­tra­tion with the office of the Attor­ney Gen­er­al by fil­ing with the Con­sumer Law Sec­tion the infor­ma­tion required by Sec­tion 17550.21 and pay­ing the fol­low­ing fees, as applicable: 

(A) A fil­ing fee of one hun­dred dol­lars ($100) for each loca­tion from which the sell­er of trav­el con­ducts business. 

(B) A late fee of five dol­lars ($5) per day, up to a max­i­mum of five hun­dred dol­lars ($500), for each day after the time spec­i­fied by this sec­tion until the fil­ing fee and the infor­ma­tion required by Sec­tion 17550.21 are received. 

(2) A sell­er of trav­el may annu­al­ly renew its reg­is­tra­tion by mak­ing the fil­ing required by Sec­tion 17550.21 and pay­ing the fil­ing fees and late fees required by para­graph (1).

(3) A reg­is­tra­tion shall not be issued, approved, or renewed until the late fee, the fil­ing and late fees for each year the sell­er of trav­el oper­at­ed with­out being reg­is­tered, and any out­stand­ing assess­ments due to the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion as required by Sec­tions 17550.43 and 17550.44 have been paid. 

(4) A sell­er of trav­el shall be deemed to do busi­ness in this state if the sell­er of trav­el solic­its busi­ness from loca­tions in this state regard­less of the geo­graph­ic loca­tion of the prospec­tive pur­chas­er includ­ing per­sons locat­ed out­side of this state or the coun­try or solic­its prospec­tive pur­chasers who are locat­ed in this state. 

(b) Reg­is­tra­tion shall be valid for one year from the effec­tive date there­of shown on the reg­is­tra­tion issued by the office of the Attor­ney General. 

(c) When­ev­er, pri­or to expi­ra­tion of a sell­er of travel’s annu­al reg­is­tra­tion, there is a mate­r­i­al change in the infor­ma­tion required by Sec­tion 17550.21, the sell­er of trav­el shall, with­in 10 days, file an adden­dum updat­ing the infor­ma­tion with the Con­sumer Law Sec­tion of the office of the Attor­ney General. 

(d)(1) Not less than 10 days pri­or to the trans­fer or sale of any inter­est in a sell­er of trav­el, the sell­ing or trans­fer­ring own­er shall file with the office of the Attor­ney Gen­er­al, Sell­er of Trav­el Pro­gram, a notice of encum­brance, sale, or trans­fer of own­er­ship, using a form pro­vid­ed for that pur­pose by the office of the Attor­ney Gen­er­al. The notice shall pro­vide the infor­ma­tion required pur­suant to sub­di­vi­sion (d) of Sec­tion 17550.21 as to each transferee. 

(2) Until the time the notice of encum­brance, sale, or trans­fer of own­er­ship required in para­graph (1) is filed as required, the sell­ing, encum­ber­ing, or trans­fer­ring own­er is respon­si­ble for all acts of and oblig­a­tions imposed by law on the trans­fer­ee sell­ers of trav­el to the same extent as they would have been respon­si­ble had there been no trans­fer, sale, or encumbrance. 

(e)(1) The office of the Attor­ney Gen­er­al shall sus­pend the reg­is­tra­tion of a sell­er of trav­el who does any of the following: 

(A) Fails to make any pay­ment required pur­suant to Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35).

(B) Sub­mits a check in pay­ment of a reg­is­tra­tion fee or late fee required by this sec­tion that is not hon­ored by the insti­tu­tion on which it is drawn. 

(C) Fails to pro­vide the file num­ber assigned by the Sec­re­tary of State or the Fran­chise Tax Board to the sell­er of trav­el, as required by sub­di­vi­sion (m) of Sec­tion 17550.21.

(2) The Attor­ney Gen­er­al shall pro­vide writ­ten notice to the sell­er of trav­el by first-class mail at the sell­er of travel’s place of busi­ness set forth in the reg­is­tra­tion state­ment that the sell­er of travel’s reg­is­tra­tion has been sus­pend­ed until all fees that are due have been paid. The reg­is­tra­tion of the sell­er of trav­el shall be sus­pend­ed until all such pay­ments due have been collected. 

(f) The Attor­ney Gen­er­al may, at his or her dis­cre­tion and sub­ject to super­vi­sion by the Attor­ney Gen­er­al or his or her del­e­gate, con­tract out all or any part of the pro­cess­ing of reg­is­tra­tions required by this section. 

(g) This sec­tion does not apply to a per­son who is an indi­vid­ual, a sin­gle-mem­ber lim­it­ed lia­bil­i­ty com­pa­ny whose sole mem­ber is an indi­vid­ual, or a sin­gle-share­hold­er S” cor­po­ra­tion whose sole share­hold­er is an indi­vid­ual, that meets all of the following: 

(1) Has a writ­ten con­tract with a reg­is­tered sell­er of trav­el to act on that reg­is­tered sell­er of travel’s behalf in offer­ing or sell­ing air or sea trans­porta­tion and oth­er trav­el goods or ser­vices in con­nec­tion with the transportation. 

(2) Acts only on behalf of a reg­is­tered sell­er of trav­el with whom the per­son has a writ­ten con­tract in the offer or sale to a pas­sen­ger of air or sea trans­porta­tion and oth­er goods or ser­vices in con­nec­tion with the trans­porta­tion and sells no oth­er air or sea trans­porta­tion or trav­el ser­vices to that passenger. 

(3) Pro­vides air or sea trans­porta­tion or trav­el ser­vices that are offered or sold pur­suant to the offi­cial agency appoint­ment of the reg­is­tered sell­er of trav­el with whom the per­son has a writ­ten contract. 

(4) Does not receive any con­sid­er­a­tion for air or sea trans­porta­tion or oth­er trav­el ser­vices from the passenger. 

(5) Requires the pas­sen­ger to pay all con­sid­er­a­tion for air or sea trans­porta­tion or oth­er trav­el ser­vices direct­ly to the air car­ri­er or ocean car­ri­er or to the reg­is­tered sell­er of travel. 

(6) Dis­clos­es both of the following: 

(A) The per­son is act­ing on behalf of a reg­is­tered sell­er of travel. 

(B) The name, address, tele­phone num­ber, and reg­is­tra­tion num­ber of the reg­is­tered sell­er of trav­el on whose behalf the per­son is act­ing.

The per­son shall make the dis­clo­sures required by this para­graph in writ­ing to the pas­sen­ger at the same time the pas­sen­ger receives notice under Sec­tion 17550.13. If the per­son trans­acts busi­ness in this state on the Inter­net, the dis­clo­sures also shall appear on the home page of the person’s Inter­net Web site and shall be promi­nent­ly set forth in the first elec­tron­ic mail mes­sage sent to the pas­sen­ger that refers to the passenger’s pur­chase of air or sea trans­porta­tion or trav­el services. 

(h) When­ev­er the Attor­ney Gen­er­al deter­mines that a reg­is­tra­tion appli­ca­tion is accu­rate and com­plete, the appli­ca­tion shall be processed and a reg­is­tra­tion cer­tifi­cate shall be issued to the sell­er of trav­el with­in 21 days. 

§17550.21 - Information to be filed

Each fil­ing pur­suant to Sec­tion 17550.20 shall con­tain the fol­low­ing information: 

(a) The name or names of the sell­er of trav­el, includ­ing the name under which the sell­er of trav­el is doing or intends to do busi­ness, if dif­fer­ent from the name of the sell­er of travel.

(b) The sell­er of travel’s busi­ness form and place of orga­ni­za­tion and, if oper­at­ing under a fic­ti­tious busi­ness name, the loca­tion where the fic­ti­tious name has been reg­is­tered. If the sell­er of trav­el does busi­ness in Cal­i­for­nia from one or more loca­tions in this state but does not main­tain its prin­ci­pal place of busi­ness in this state, the sell­er of trav­el shall state whether it meets the require­ments of para­graph (16) of sub­di­vi­sion (e) of Sec­tion 17511.1.18

(c) The com­plete street address or address­es of all loca­tions from which the sell­er of trav­el will be con­duct­ing busi­ness, includ­ing, but not lim­it­ed to, loca­tions at which tele­phone calls will be received from, or made to, pas­sen­gers or oth­er sell­ers of trav­el. The state­ment shall des­ig­nate which loca­tion is the prin­ci­pal place of business.

(d) The com­plete busi­ness and res­i­den­tial address­es and tele­phone num­bers, the driver’s license num­ber and state of issuance or equiv­a­lent per­son­al iden­ti­fi­ca­tion, the social secu­ri­ty num­ber, and the date of birth of each own­er and prin­ci­pal of the sell­er of trav­el. Own­er” means a per­son who owns or con­trols 10 per­cent or more of the equi­ty of, or oth­er­wise has claim to 10 per­cent or more of the net income of, a sell­er of trav­el. Prin­ci­pal” means an own­er, an offi­cer of a cor­po­ra­tion, a gen­er­al part­ner of a part­ner­ship, or a sole pro­pri­etor of a sole proprietorship.

(e) A state­ment as to whether the sell­er of trav­el, any own­er, or prin­ci­pal, or any oth­er sell­er of trav­el owned or man­aged by any own­er or prin­ci­pal of the sell­er of trav­el, or the sell­er of trav­el itself has had entered against that per­son or enti­ty any judg­ment, includ­ing a stip­u­lat­ed judg­ment, order, made a plea of nolo con­tendere, or been con­vict­ed of any crim­i­nal vio­la­tion. The state­ment shall iden­ti­fy the per­son, the court or admin­is­tra­tive agency ren­der­ing the judg­ment, order, or con­vic­tion, the dock­et num­ber of the mat­ter, and the date of the judg­ment, order, or con­vic­tion; where the judg­ment, order, or record of con­vic­tion is filed; and the nature of the case or judg­ment. This sub­di­vi­sion does not require dis­clo­sure of mar­i­tal dis­so­lu­tion, child sup­port, or child cus­tody proceedings.

(f) A copy of the trav­el cer­tifi­cates, if any, that are or will be sold, mar­ket­ed, or dis­trib­uted to any per­son or enti­ty by the sell­er of travel.

(g) The sell­er of trav­el shall file with the Attor­ney Gen­er­al a signed and dat­ed state­ment pro­vid­ing the following:

(1) The account num­ber of each trust account required by this article.

(2) The name and address of each finan­cial insti­tu­tion at which the sell­er of trav­el main­tains a trust account required by this article.

(3) Any reg­is­tra­tion num­ber issued to the sell­er of trav­el by the Air­line Report­ing Cor­po­ra­tion or the Inter­na­tion­al Asso­ci­a­tion of Trav­el Agents Network.

(4) A con­sent form con­sent­ing to the Attor­ney Gen­er­al, a dis­trict attor­ney, or their rep­re­sen­ta­tives obtain­ing direct­ly from the Air­lines Report­ing Cor­po­ra­tion, Inter­na­tion­al Asso­ci­a­tion of Trav­el Agents Net­work, a sell­er of trans­porta­tion, provider of trans­porta­tion, provider of trav­el ser­vices, and any finan­cial insti­tu­tion where pas­sen­ger funds have been deposit­ed, any infor­ma­tion relat­ed to an inves­ti­ga­tion of a sell­er of travel’s com­pli­ance with this sec­tion. The con­sent form shall be pro­vid­ed by the Attor­ney Gen­er­al. If a bond is main­tained in lieu of the trust account, a copy of that bond shall be filed with the Attor­ney General.

(h) A state­ment signed by each own­er and prin­ci­pal grant­i­ng per­mis­sion to the office of the Attor­ney Gen­er­al to obtain from any finan­cial insti­tu­tion or cred­it union at which any trust account required by Sec­tion 17550.15 is main­tained, infor­ma­tion relat­ing to that trust account, as set forth in para­graph (2) of sub­di­vi­sion (f) of Sec­tion 17550.15.19

(i) The name, address, and tele­phone num­ber of each per­son described in sub­di­vi­sion (g) of Sec­tion 17550.20 with whom the sell­er of trav­el contracts.

(j) The name, address, and tele­phone num­ber of the sole mem­ber or the sole share­hold­er of a lim­it­ed lia­bil­i­ty com­pa­ny or S” cor­po­ra­tion described in sub­di­vi­sion (g) of Sec­tion 17550.20 with which the sell­er of trav­el contracts.

(k) If at the time of reg­is­tra­tion renew­al, no change has occurred to the infor­ma­tion pro­vid­ed in the last filed com­plete reg­is­tra­tion state­ment and the per­mis­sion described in sub­di­vi­sion (h) has not expired, the sell­er of trav­el may, instead of fil­ing a reg­is­tra­tion state­ment con­tain­ing the infor­ma­tion required by sub­di­vi­sions (a) to (j), inclu­sive, file a state­ment attest­ing to the con­tin­ued accu­ra­cy of the infor­ma­tion in the last filed com­plete reg­is­tra­tion state­ment. The attes­ta­tion shall be in a form spec­i­fied by the Attor­ney Gen­er­al and ver­i­fied as described in sub­di­vi­sion (l).

(l) The infor­ma­tion required by this sec­tion shall be ver­i­fied by a dec­la­ra­tion signed and dat­ed by each own­er and prin­ci­pal of the sell­er of trav­el, or in the case of a reg­is­tered sell­er of trav­el that does busi­ness in Cal­i­for­nia, from one or more loca­tions in Cal­i­for­nia, and that meets the require­ments of para­graph (16) of sub­di­vi­sion (e) of Sec­tion 17511.1, by a duly autho­rized offi­cer of the cor­po­ra­tion, under penal­ty of per­jury pur­suant to the laws of the State of Cal­i­for­nia. The dec­la­ra­tion shall spec­i­fy the date and loca­tion of sign­ing. Upon rereg­is­tra­tion by a pre­vi­ous­ly reg­is­tered sell­er of trav­el, the infor­ma­tion required by this sec­tion may be ver­i­fied by the chief exec­u­tive offi­cer of a cor­po­ra­tion, man­ag­ing part­ner of a part­ner­ship, or man­ag­er of a lim­it­ed lia­bil­i­ty company.

(m) The file num­ber assigned by the Sec­re­tary of State or the Fran­chise Tax Board to the sell­er of travel.

§17550.23 - Certification of restitution

(a) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall noti­fy the office of the Attor­ney Gen­er­al when­ev­er a sell­er of trav­el with its prin­ci­pal place of busi­ness in Cal­i­for­nia, which does busi­ness with per­sons locat­ed in Cal­i­for­nia, is in com­pli­ance with Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35).

(b) A reg­is­tra­tion appli­ca­tion for a sell­er of trav­el who does not or intends not to com­ply with the require­ments of Sec­tion 17550.15 because the sell­er of trav­el claims to meet the require­ments of sub­di­vi­sion (b) of Sec­tion 17550.16 shall be accom­pa­nied by evi­dence that the sell­er of trav­el is a par­tic­i­pant in a Con­sumer Pro­tec­tion Deposit Plan that meets the cri­te­ria set forth in sub­di­vi­sion (b) of Sec­tion 17550.16.

(c) A reg­is­tra­tion appli­ca­tion for a sell­er of trav­el who does not or intends not to com­ply with the require­ments of Sec­tion 17550.15 because the sell­er of trav­el claims to meet the require­ments of sub­di­vi­sion (c) of Sec­tion 17550.16 shall be accom­pa­nied by evi­dence that the sell­er of trav­el is a par­tic­i­pant in a Con­sumer Pro­tec­tion Escrow Plan that meets the cri­te­ria set forth in sub­di­vi­sion (c) of Sec­tion 17550.16.

§17550.24 - Issuance of registration

(a) The Attor­ney Gen­er­al or his or her del­e­gate shall issue a sep­a­rate reg­is­tra­tion num­ber to each reg­is­trant whose reg­is­tra­tion is accept­ed. That reg­is­tra­tion num­ber shall be valid for the peri­od spec­i­fied in sub­di­vi­sion (b) of Sec­tion 17550.20, unless revoked or sus­pend­ed by the Attor­ney Gen­er­al or his or her del­e­gate. Grounds for sus­pen­sion or revo­ca­tion include mate­r­i­al mis­rep­re­sen­ta­tion in a reg­is­tra­tion appli­ca­tion, or a fail­ure to amend a reg­is­tra­tion as pro­vid­ed in sub­di­vi­sion (c) of Sec­tion 17550.20.

(b) Any reg­is­tra­tion issued to a sell­er of trav­el who is required to com­ply with the pro­vi­sions of Sec­tion 17550.15 shall set forth the num­ber and loca­tion of the required trust account.

(c) Any reg­is­tra­tion issued to a sell­er of trav­el who has com­plied with the require­ments of sub­di­vi­sion (b) of Sec­tion 17550.23 shall state that the sell­er of trav­el claims an exemp­tion from the require­ments of Sec­tion 17550.15 pur­suant to sub­di­vi­sion (b) of Sec­tion 17550.16.

(d) Any reg­is­tra­tion issued to a sell­er of trav­el who has com­plied with the require­ments of sub­di­vi­sion (c) of Sec­tion 17550.23 shall state that the sell­er of trav­el claims an exemp­tion from the require­ments of Sec­tion 17550.15 pur­suant to sub­di­vi­sion (c) of Sec­tion 17550.16.

(e) A reg­is­tered sell­er of trav­el shall dis­play a copy of its cur­rent reg­is­tra­tion cer­tifi­cate in a man­ner and place eas­i­ly acces­si­ble to the pub­lic, in each loca­tion in which the sell­er of trav­el con­ducts its busi­ness, and shall pro­vide a copy of its cur­rent reg­is­tra­tion upon request to any oth­er reg­is­tered sell­er of trav­el from whom it receives pas­sen­ger funds in pay­ment for trans­porta­tion or trav­el services.

(f) The reg­is­tra­tion num­ber of the sell­er of trav­el shall be clear­ly and con­spic­u­ous­ly dis­played on all adver­tis­ing mate­ri­als offer­ing for sale or solic­it­ing the pur­chase of any air or sea trans­porta­tion or trav­el ser­vices, includ­ing, but not lim­it­ed to, any writ­ings, or pro­mo­tion­al mate­ri­als of any kind which are adver­tised, dis­played, or dis­sem­i­nat­ed in any man­ner to any per­sons in Cal­i­for­nia, or from Cal­i­for­nia to any per­son else­where. A reg­is­tered sell­er of trav­el that does busi­ness in Cal­i­for­nia from one or more loca­tions in Cal­i­for­nia and that meets the require­ments of para­graph (16) of sub­di­vi­sion (e) of Sec­tion 17511.1 shall dis­play its reg­is­tra­tion num­ber only on adver­tis­ing mate­ri­als that are pro­duced or placed by its busi­ness loca­tions with­in Cal­i­for­nia or that make ref­er­ence to spe­cif­ic busi­ness loca­tions offer­ing air or sea trans­porta­tion or trav­el ser­vices. Wher­ev­er sell­er of trav­el, reg­is­tered sell­er of trav­el, or sim­i­lar terms are used in any adver­tis­ing mate­ri­als, they shall be accom­pa­nied by a state­ment which dis­clos­es, at least as promi­nent­ly, that reg­is­tra­tion as a sell­er of trav­el does not con­sti­tute approval by the State of California.”

§17550.25 - Compliance with restitution fund

(a) All sell­ers of trav­el who are par­tic­i­pants shall com­ply with Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35) pri­or to engag­ing in those sales.

(b) Any sell­er of trav­el that is not a par­tic­i­pant who is doing busi­ness with per­sons locat­ed in Cal­i­for­nia shall make a clear and con­spic­u­ous dis­clo­sure, both oral­ly and in writ­ing, that the sell­er of trav­el is not a par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund. Any sell­er of trav­el doing busi­ness from any loca­tion in Cal­i­for­nia with per­sons locat­ed out­side Cal­i­for­nia shall make a clear and con­spic­u­ous dis­clo­sure, both oral­ly and in writ­ing, that the trans­ac­tion is not cov­ered by the Trav­el Con­sumer Resti­tu­tion Fund. Any sell­er of trav­el required by the pro­vi­sions of this arti­cle to have a trust account or bond shall make a clear and con­spic­u­ous dis­clo­sure of the exis­tence of the trust account or of the issuer and amount of the bond.

§17550.26 - Travel business discount program

(a) For the pur­pos­es of this sec­tion, trav­el busi­ness dis­count pro­gram” means a mem­ber­ship, ben­e­fit pro­gram, iden­ti­fi­ca­tion card, iden­ti­fy­ing num­ber, or oth­er arrange­ment that iden­ti­fies the pur­chas­er of the trav­el busi­ness dis­count pro­gram as engaged in the trav­el busi­ness or oth­er­wise qual­i­fied to receive dis­counts or reduced prices made avail­able to per­sons involved in the trav­el busi­ness for trans­porta­tion or any trav­el services.

(b) A per­son may sell a trav­el busi­ness dis­count pro­gram if the fol­low­ing con­di­tions are satisfied:

(1) The rep­re­sent­ed dis­counts or reduced prices offered under the trav­el busi­ness dis­count pro­gram are not made gen­er­al­ly avail­able to the public.

(2) The ben­e­fits and lim­i­ta­tions of the trav­el busi­ness dis­count pro­gram are clear­ly and con­spic­u­ous­ly dis­closed to the pur­chas­er, in writ­ing, before any con­sid­er­a­tion is paid by the purchaser.

(3) The sale is made only to a pur­chas­er who is any of the following:

(A) A duly reg­is­tered sell­er of travel.

(B) An own­er or prin­ci­pal of a sell­er of trav­el list­ed on the sell­er of trav­el’s reg­is­tra­tion form.

(C) An employ­ee of a sell­er of trav­el who was paid at least five thou­sand dol­lars ($5,000) in com­pen­sa­tion in the pri­or 12 months by that sell­er of travel.

(D) A per­son described in sub­di­vi­sion (g) of Sec­tion 17550.20 who is list­ed on a sell­er of trav­el’s reg­is­tra­tion form and who was paid at least five thou­sand dol­lars ($5,000) in com­pen­sa­tion in the pri­or 12 months by that sell­er of travel.

(c) A sell­er of a trav­el busi­ness dis­count pro­gram shall main­tain records in this state estab­lish­ing that each pur­chas­er sat­is­fies one of the cri­te­ria described in para­graph (3) of sub­di­vi­sion (b) and shall pro­duce those records for inspec­tion and copy­ing with­out charge at an office of the Attor­ney Gen­er­al with­in 10 cal­en­dar days of a writ­ten request by the Attor­ney General.

(d) A sell­er of a trav­el busi­ness dis­count pro­gram shall com­ply with the require­ments for dis­count buy­ing ser­vices pur­suant to Title 2.6 (com­menc­ing with Sec­tion 1812.100) of Part 4 of Divi­sion 3 of the Civ­il Code.

§17550.27 - Seller of travel discount program

(a) For the pur­pos­es of this sec­tion, the fol­low­ing terms shall have the fol­low­ing meanings:

(1) Sell­er of trav­el dis­count pro­gram” means a mem­ber­ship, ben­e­fit pro­gram, or oth­er arrange­ment that pur­ports to enti­tle the pur­chas­er of the sell­er of trav­el dis­count pro­gram to future trans­porta­tion or any trav­el ser­vices at a dis­count or reduced price or pref­er­en­tial treat­ment not made gen­er­al­ly avail­able to the pub­lic. Sell­er of trav­el dis­count pro­gram does not include a trav­el busi­ness dis­count pro­gram” as defined in Sec­tion 17550.26.

(2) Sell­er” means any per­son who sells or offers for sale a sell­er of trav­el dis­count pro­gram but does not include any of the following:

(A) Any per­son exclud­ed from the def­i­n­i­tion of sell­er of trav­el” under sub­di­vi­sion (b) of Sec­tion 17550.1.

(B) An own­er, devel­op­er, or oper­a­tor of a time-share inter­est or time-share plan as described in sub­di­vi­sions (x) and (z) of Sec­tion 11212 in con­nec­tion with an offer as described in sub­di­vi­sion (o) of Sec­tion 11212 that com­plies with the Vaca­tion Own­er­ship and Time-Share Act of 2004 pro­vid­ing lodg­ing at a time-share unit, includ­ing arrang­ing trans­porta­tion to the time-share unit.

(C) An exchange com­pa­ny as described in sub­di­vi­sion (k) of Sec­tion 11212 in con­nec­tion with arrang­ing lodg­ing at a time-share unit, includ­ing arrang­ing trans­porta­tion to the time-share unit.

(D) A motor club sub­ject to Part 5 (com­menc­ing with Sec­tion 12140) of Divi­sion 2 of the Insur­ance Code.

(E) A non­prof­it orga­ni­za­tion described in Sec­tion 501(c)(3) of the Inter­nal Rev­enue Code that, accord­ing to a final rul­ing or deter­mi­na­tion by the Inter­nal Rev­enue Ser­vice, is both exempt from tax­a­tion under Sec­tion 501(a) of the Inter­nal Rev­enue Code and not a pri­vate foun­da­tion as defined in Sec­tion 509 of the Inter­nal Rev­enue Code. An advance rul­ing or deter­mi­na­tion of tax-exempt or foun­da­tion sta­tus by the Inter­nal Rev­enue Ser­vice does not meet the require­ments of this paragraph.

(F) An enti­ty or a whol­ly owned sub­sidiary of an enti­ty that main­tains a tan­gi­ble net equi­ty exceed­ing five mil­lion dol­lars ($5,000,000) as reflect­ed in an audit­ed finan­cial state­ment, pre­pared in accor­dance with gen­er­al­ly accept­ed account­ing prin­ci­ples, for the enti­ty’s most recent fis­cal year.

(b) A sell­er may sell a sell­er of trav­el dis­count pro­gram if the fol­low­ing con­di­tions are satisfied:

(1) The sell­er is a duly reg­is­tered sell­er of travel.

(2) The annu­al charge for the sell­er of trav­el dis­count pro­gram does not exceed one hun­dred fifty dol­lars ($150).

(3) The term of the sell­er of trav­el dis­count pro­gram does not exceed one year. The pur­chas­er may renew par­tic­i­pa­tion in the pro­gram at the end of each term for a peri­od not to exceed one year by affir­ma­tive­ly pro­vid­ing the sell­er with a writ­ten express request to renew. The sell­er may not seek or accept the pur­chaser’s autho­riza­tion for an auto­mat­ic renew­al or the pur­chaser’s renew­al request more than 60 days before the expi­ra­tion of an annu­al term or more than 15 days before the expi­ra­tion of a short­er term program.

(4) The rep­re­sent­ed dis­counts or reduced prices offered under the sell­er of trav­el dis­count pro­gram are not made gen­er­al­ly avail­able to the public.

(5) The pur­chas­er has the right to can­cel the pur­chaser’s par­tic­i­pa­tion in the sell­er of trav­el dis­count pro­gram and receive a full refund of all con­sid­er­a­tion paid for the pend­ing term of the pro­gram at either of the fol­low­ing times:

(A) With­in five busi­ness days of pur­chas­ing or renew­ing the sell­er of trav­el dis­count pro­gram or receiv­ing the dis­clo­sure required by para­graph (6), whichev­er is later.

(B) At any time based on the sell­er’s mis­rep­re­sen­ta­tion or vio­la­tion of this article.

(6) The ben­e­fits and lim­i­ta­tions of the sell­er of trav­el dis­count pro­gram and the pur­chaser’s can­cel­la­tion rights described in para­graph (5) are clear­ly and con­spic­u­ous­ly dis­closed, in writ­ing, before any con­sid­er­a­tion is paid by the purchaser.

(7) The dis­count­ed or reduced price for any tour pack­age, includ­ing trans­porta­tion or any trav­el ser­vices, offered under the sell­er of trav­el dis­count pro­gram shall be at least 5 per­cent below the price that would have been paid by a pur­chas­er with­out par­tic­i­pa­tion in the sell­er of trav­el dis­count program.

(8) The sell­er may not offer to arrange trans­porta­tion or any trav­el ser­vices for a spec­i­fied price, time, or loca­tion unless the sell­er has writ­ten evi­dence of the com­mit­ment of the provider of trans­porta­tion, lodg­ing, or any trav­el ser­vices to pro­vide those ser­vices at the price, time, and loca­tion specified.

(9) The sell­er shall main­tain a sure­ty bond of one hun­dred thou­sand dol­lars ($100,000) issued by a sure­ty com­pa­ny admit­ted to do busi­ness in this state. A copy of the bond shall be filed with the Sec­re­tary of State, with a copy pro­vid­ed to the Attor­ney Gen­er­al. The bond shall be in favor of the State of Cal­i­for­nia for the ben­e­fit of pur­chasers of the sell­er of trav­el dis­count pro­gram harmed by a vio­la­tion of this sec­tion, the sell­er’s mis­rep­re­sen­ta­tion or mis­ap­pli­ca­tion of funds, or the fail­ure of the sell­er to com­ply with the terms of the sell­er of trav­el dis­count program.

(10) The sell­er shall com­ply with the require­ments for dis­count buy­ing ser­vices pur­suant to Title 2.6 (com­menc­ing with Sec­tion 1812.100) of Part 4 of Divi­sion 3 of the Civ­il Code.

§17550.30 - Creation of Travel Seller Fund

(a) The Trav­el Sell­er Fund is here­by cre­at­ed in the State Trea­sury. All fines, penal­ties, and fees, includ­ing late fees, col­lect­ed pur­suant to this arti­cle, and any mon­eys col­lect­ed for a vio­la­tion of this arti­cle or Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35), shall be deposit­ed in the fund, and the mon­eys in the fund may be expend­ed only for the pur­pos­es spec­i­fied in this article.

(b) All mon­eys paid into the State Trea­sury and cred­it­ed to the Trav­el Sell­er Fund shall be used by the Depart­ment of Jus­tice in car­ry­ing out and enforc­ing the pro­vi­sions of this arti­cle, includ­ing, but not lim­it­ed to, the pay­ment of salaries of Depart­ment of Jus­tice per­son­nel, con­trac­tors, or con­sul­tants, and the dis­sem­i­na­tion of infor­ma­tion, includ­ing con­sumer edu­ca­tion regard­ing this arti­cle and Arti­cle 2.7 (com­menc­ing with Sec­tion 17550.35).

(c) The sum of three hun­dred nine­ty-five thou­sand dol­lars ($395,000) is here­by appro­pri­at­ed from the Trav­el Sell­er Fund to the Depart­ment of Jus­tice for pur­pos­es of the Sell­ers of Trav­el Pro­gram estab­lished pur­suant to Arti­cle 2.6 (com­menc­ing with Sec­tion 17550).

§17550.37 - “Person aggrieved”

(a) Per­son aggriev­ed,” as used in this arti­cle, means a pas­sen­ger, as defined in Sec­tion 17550.3, locat­ed in Cal­i­for­nia at the time of sale, or a per­son locat­ed in Cal­i­for­nia at the time of sale who made any pay­ment on behalf of the pas­sen­ger for air or sea trans­porta­tion or trav­el ser­vices, who has sus­tained a loss as a result of the fail­ure of a sell­er of trav­el to refund pay­ments made by or on behalf of a pas­sen­ger as pay­ment for air or sea trans­porta­tion or trav­el ser­vices, where a refund is due as a result of the bank­rupt­cy, insol­ven­cy, ces­sa­tion of oper­a­tions, or mate­r­i­al fail­ure to pro­vide the trans­porta­tion or trav­el ser­vices pur­chased by the pas­sen­ger, regard­less of whether the pas­sen­ger or a per­son mak­ing pay­ment on behalf of the pas­sen­ger ini­tial­ly con­tract­ed with that sell­er of trav­el. Loss,” as used here­in, shall be lim­it­ed to loss­es that are incurred in a trans­ac­tion with a sell­er of trav­el who, at the time of sale, was a paid-up par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund and was reg­is­tered pur­suant to Sec­tion 17550.20. Per­son aggriev­ed” shall not mean or include a pas­sen­ger, or per­son mak­ing pay­ment on behalf of a pas­sen­ger, in a trans­ac­tion where the air or sea trans­porta­tion or trav­el ser­vices are fur­nished by a busi­ness enti­ty that is locat­ed and pro­vid­ing trans­porta­tion or trav­el ser­vices out­side of the Unit­ed States and is not in com­pli­ance with Arti­cle 2.6 (com­menc­ing with Sec­tion 17550).

(b) Any per­son aggriev­ed who files a claim for pay­ment from the Trav­el Con­sumer Resti­tu­tion Fund there­by waives his or her right to bring any action at law or equi­ty that is against the sell­er of trav­el as to whom the claim is made and aris­es from the trans­ac­tion that is the sub­ject of the claim against the resti­tu­tion fund. The claim form required by Sec­tion 17550.46 shall include a clear and con­spic­u­ous notice of the waiver.

(c) The waiv­er of rights pro­vid­ed for by sub­di­vi­sion (b) shall not apply to any claimant whose claim is denied on any of the fol­low­ing grounds, as set forth in the state­ment of deci­sion required by sub­di­vi­sion (d) of Sec­tion 17550.47:

(1) The sell­er of trav­el was not, at the time of sale, a paid-up par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund, as required by sub­di­vi­sion (a).

(2) The sell­er of trav­el was not, at the time of sale, reg­is­tered pur­suant to Sec­tion 17550.20.

(3) The claimant was not locat­ed in Cal­i­for­nia at the time of sale, as required by sub­di­vi­sion (a).

§17550.38 - Purpose of restitution corporation

(a) It is the pur­pose of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion to pro­vide resti­tu­tion to a per­son aggriev­ed, sub­ject to the lim­i­ta­tions set forth in this arti­cle. The resti­tu­tion is sec­ondary only to any relief, com­pen­sa­tion, or reim­burse­ment to which a per­son aggriev­ed may be enti­tled under any of the following:

(1) A Con­sumer Pro­tec­tion Deposit Plan, as described in sub­di­vi­sion (b) of Sec­tion 17550.16.

(2) A Con­sumer Pro­tec­tion Escrow Plan, as described in sub­di­vi­sion (c) of Sec­tion 17550.16.

(3) Trav­el insurance.

(4) The suc­cess­ful asser­tion by the per­son aggriev­ed of that per­son­’s rights under Sec­tion 1747.50 or 1747.90 of the Civ­il Code or under Sec­tion 226.12 or 226.13 of Title 12 of the Code of Fed­er­al Regulations.

(b) Noth­ing in this sec­tion shall be con­strued to require a per­son aggriev­ed to bring a civ­il action to obtain any relief, com­pen­sa­tion, or reim­burse­ment or to file a crime report with law enforce­ment in order to obtain pay­ment from the resti­tu­tion fund.

(c) The resti­tu­tion shall be paid from the Trav­el Con­sumer Resti­tu­tion Fund estab­lished by the Trav­el Con­sumer Resti­tu­tion Corporation.

(d) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion may request legal coun­sel, rep­re­sen­ta­tion, and advice from the office of the Attor­ney General.

§17550.39 - Nonprofit status of corporation; Liability of state for acts of officers or employees

(a) Par­tic­i­pants shall main­tain a cor­po­ra­tion under the Non­prof­it Mutu­al Ben­e­fit Cor­po­ra­tion Law (Part 3 (com­menc­ing with Sec­tion 7110) of Divi­sion 2 of Title 1 of the Cor­po­ra­tions Code) oper­at­ing under the name Trav­el Con­sumer Resti­tu­tion Corporation.”

(b) The State of Cal­i­for­nia and any of its offi­cers, agents, or employ­ees shall not be liable in any man­ner for any act or omis­sion of Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion, its direc­tors, offi­cers, agents, or employees.

§17550.40 - Compliance with provisions and rules

Each par­tic­i­pant is required to com­ply with the pro­vi­sions of this arti­cle and shall abide by the rules and deci­sions of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion adopt­ed in accor­dance with this article.

§17550.41 - Composition of board

(a) The Board of Direc­tors of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall be com­posed of six direc­tors, as follows:

(1) One pub­lic con­sumer rep­re­sen­ta­tive mem­ber appoint­ed by the Direc­tor of Con­sumer Affairs.

(2) One employ­ee of the Depart­ment of Jus­tice, assigned by the office of the Attor­ney Gen­er­al, who shall serve as an ex offi­cio, non­vot­ing member.

(3) Four direc­tors who are par­tic­i­pants in the Trav­el Con­sumer Resti­tu­tion Fund.

(b) The direc­tor appoint­ed pur­suant to para­graph (1) of sub­di­vi­sion (a) shall serve until the appoint­ment is revoked or anoth­er appoint­ment is made, or until the direc­tor resigns.

(c) Par­tic­i­pant direc­tors shall be elect­ed by a bal­lot­ing of all par­tic­i­pants in the Trav­el Con­sumer Resti­tu­tion Fund in an elec­tion to be con­duct­ed by the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion in Feb­ru­ary of each year. Par­tic­i­pant direc­tors shall be elect­ed to serve two-year terms, with two of the four par­tic­i­pant direc­tors being elect­ed each year to stag­gered two-year terms.

(d) A per­son is eli­gi­ble to be nom­i­nat­ed and to serve as a par­tic­i­pant direc­tor if the per­son sat­is­fies all of the fol­low­ing conditions:

(1) The per­son­’s pri­ma­ry occu­pa­tion, at the time of nom­i­na­tion and con­tin­u­ous­ly dur­ing the pre­vi­ous three years, has been as the own­er or man­ag­er of a sell­er of trav­el that is and has been in good stand­ing both as a reg­is­tered sell­er of trav­el and as a par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund.

(2) The per­son has not been con­vict­ed of a crime, includ­ing a plea or ver­dict of guilty or a con­vic­tion fol­low­ing a plea of nolo contendere.

(3) The per­son is not sub­ject to a judg­ment or admin­is­tra­tive order, whether entered after adju­di­ca­tion or stip­u­la­tion, pred­i­cat­ed on that per­son­’s com­mis­sion of an act of dis­hon­esty, fraud, deceit, or vio­la­tion of this chap­ter or Chap­ter 5 (com­menc­ing with Sec­tion 17200) of Part 2 of Divi­sion 7.

(4) The per­son is not a defen­dant in a pend­ing crim­i­nal or civ­il law enforce­ment action brought by a pub­lic prosecutor.

(5) The per­son has not served as a par­tic­i­pant direc­tor of the Trav­el Con­sumer Resti­tu­tion Fund at any time dur­ing the pre­vi­ous 18 months.

(6) With­in five days after the end of the nom­i­na­tion peri­od, the per­son nom­i­nat­ed to be a direc­tor sub­mits an appli­ca­tion to the Trav­el Con­sumer Resti­tu­tion Fund, signed under penal­ty of per­jury, that attests to the per­son­’s sat­is­fac­tion of all of the con­di­tions spec­i­fied in para­graphs (1) to (5), inclu­sive.

(e) The Trav­el Con­sumer Resti­tu­tion Fund may not impose require­ments for nom­i­na­tion to be a par­tic­i­pant direc­tor in addi­tion to the require­ments described in sub­di­vi­sion (d).

(f) If a nom­i­nee does not sat­is­fy the require­ments of sub­di­vi­sion (d), the Trav­el Con­sumer Resti­tu­tion Fund shall noti­fy the nom­i­nee and the Attor­ney Gen­er­al in writ­ing, with­in 30 days of the nom­i­nee’s appli­ca­tion, that the per­son has been reject­ed as a nom­i­nee and the spe­cif­ic grounds for the rejection.

(g) The nom­i­na­tion peri­od shall be open for the peri­od begin­ning 90 days and end­ing 30 days before the elec­tion. Any par­tic­i­pant may nom­i­nate for elec­tion any par­tic­i­pant who is eli­gi­ble to serve as pro­vid­ed in sub­di­vi­sion (d).

(h) The Trav­el Con­sumer Resti­tu­tion Fund shall enable nom­i­nees to sub­mit, with­in 21 days before the elec­tion, writ­ten state­ments of up to 500 words in a rea­son­able for­mat con­cern­ing their can­di­da­cy and shall mail those state­ments to par­tic­i­pants in the Trav­el Con­sumer Resti­tu­tion Fund and make those state­ments pub­licly avail­able no lat­er than 14 days before the elec­tion by means that may include dis­sem­i­nat­ing the infor­ma­tion on an Inter­net Web site or pro­vid­ing the infor­ma­tion by elec­tron­ic mail to any per­son who has request­ed the infor­ma­tion and pro­vid­ed a valid elec­tron­ic mail address.

(i) A direc­tor who does not qual­i­fy to be a par­tic­i­pant or who oth­er­wise becomes unable to serve shall not con­tin­ue to serve as direc­tor. The board of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall adopt rules set­ting forth the pro­ce­dures to deter­mine that a direc­tor is no longer able to serve as a direc­tor and for the board to elect a suc­ces­sor to serve as direc­tor until the next election.

§17550.42.5 - Statement of information concerning most recently concluded fiscal year, minutes, bylaws and other information to be made publicly available; method of dissemination of information

(a) With­in 30 days of the close of the fis­cal year or oth­er rea­son­able peri­od estab­lished by the board of direc­tors, the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall make pub­licly avail­able a state­ment of the fol­low­ing infor­ma­tion con­cern­ing the most recent­ly con­clud­ed fis­cal year:

(1) The num­ber of claims and approx­i­mate dol­lar amount of the claims received.

(2) The total num­ber of claims and total dol­lar amount of claims paid.

(3) The approx­i­mate num­ber and dol­lar amount of claims denied or abandoned.

(4) The dol­lar bal­ance in the resti­tu­tion fund.

(5) The amount of assess­ments received from par­tic­i­pants and the oper­at­ing and admin­is­tra­tive costs and expens­es of the corporation.

(6) The num­ber of new par­tic­i­pants and the amount of assess­ments received from them.

(b) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall make pub­licly avail­able with­in 15 days of the board of direc­tors’ approval, or oth­er rea­son­able peri­od estab­lished by the board of direc­tors, the fol­low­ing information:

(1) The approved min­utes of meet­ings of the board of directors.

(2) The approved esti­mat­ed annu­al oper­a­tional bud­get pro­ject­ing the costs of oper­a­tions and admin­is­tra­tion for the suc­ceed­ing fis­cal year, exclud­ing the amount to be paid for claims.

(3) The approved bylaws, as amend­ed, of the Trav­el Con­sumer Resti­tu­tion Corporation.

(c) Infor­ma­tion may be made pub­licly avail­able as required by this sec­tion by dis­sem­i­nat­ing the infor­ma­tion on an Inter­net Web site or pro­vid­ing the infor­ma­tion by elec­tron­ic mail to any per­son who has request­ed the infor­ma­tion and pro­vid­ed a valid elec­tron­ic mail address.

§17550.43 - Operations fund; budget; initial assessment; restitution fund

(a) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall estab­lish and main­tain an oper­a­tions fund for the pay­ment of costs of oper­a­tions and admin­is­tra­tion. The cor­po­ra­tion shall pre­pare, pri­or to its fis­cal yearend, an esti­mat­ed annu­al oper­a­tional bud­get pro­ject­ing the costs of oper­a­tions and admin­is­tra­tion for the suc­ceed­ing fis­cal year, exclud­ing the amount paid for claims.

(b)

(1) All par­tic­i­pants mak­ing their ini­tial pay­ment of assess­ments shall pay to the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion an ini­tial, one-time sev­en­ty-five dol­lar ($75) assess­ment per loca­tion from which the par­tic­i­pant does busi­ness in the state in order to pro­vide addi­tion­al fund­ing for the oper­a­tions of the cor­po­ra­tion, as those oper­a­tions are autho­rized by the cor­po­ra­tion’s board of directors.

(2) All par­tic­i­pants mak­ing their ini­tial pay­ment of assess­ments shall pay to the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion an ini­tial, one-time two hun­dred dol­lar ($200) assess­ment per loca­tion from which the par­tic­i­pant does busi­ness in this state in order to pro­vide addi­tion­al fund­ing for the resti­tu­tion fund.

(c) All par­tic­i­pants who were sell­ers of trav­el in any year, and who did not pay a Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion assess­ment in that year shall, when mak­ing a pay­ment of assess­ment in a sub­se­quent year, pay the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion all assess­ments for the oper­a­tions of the cor­po­ra­tion and the resti­tu­tion fund for the years in which they were in busi­ness as were billed and paid by par­tic­i­pants in those years.

(d) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall estab­lish a resti­tu­tion fund for the pay­ment of claims. All claims shall be paid from the resti­tu­tion fund.

(1) The resti­tu­tion fund shall be in the form of a trust account main­tained in the State of Cal­i­for­nia with a fed­er­al­ly insured bank that shall be select­ed by the Board of Direc­tors of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion and shall be approved by the office of the Attor­ney Gen­er­al. The Board of Direc­tors of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion or its del­e­gate shall serve as trustee.

(2) The resti­tu­tion fund shall meet the fol­low­ing criteria:

(A) The trustee shall deposit all resti­tu­tion funds received into the trust account.

(B) The trustee shall main­tain a sep­a­rate account­ing for dis­burse­ments and col­lec­tions on account of claims against each par­tic­i­pant. Quar­ter­ly reports shall be pro­vid­ed to the office of the Attor­ney Gen­er­al, Con­sumer Law Section.

(C) The trustee shall dis­burse funds from the trust as direct­ed by the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion pur­suant to Sec­tion 17550.47.

(D) The trustee may only invest the oper­a­tions fund and trust funds in any of the secu­ri­ties described in sub­di­vi­sion (a) or (b) of Sec­tion 16430 of the Gov­ern­ment Code.

§17550.44 - Annual assessment

(a) In addi­tion to the assess­ments required by Sec­tion 17550.43, the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall bill and col­lect from each par­tic­i­pant an annu­al assess­ment that in the aggre­gate shall con­sist of assess­ments for the oper­a­tions fund and the resti­tu­tion fund. For each par­tic­i­pant, the due date of that annu­al assess­ment shall be 30 days pri­or to the annu­al renew­al date for reg­is­tra­tion pur­suant to Sec­tion 17550.20 or 45 days after billing, whichev­er is lat­er. For a par­tic­i­pant reg­is­ter­ing for the first time, the assess­ments required by Sec­tion 17550.43 shall be due 10 days pri­or to the sell­er of trav­el doing busi­ness in this state. A late fee of five dol­lars ($5) per day, up to a max­i­mum of five hun­dred dol­lars ($500), shall be paid for each day after the due date spec­i­fied in this sec­tion until the assess­ment is paid.

(b) The annu­al assess­ment for the oper­a­tions fund shall be deter­mined no lat­er than Jan­u­ary 15 of each year for the next fis­cal year in an amount that does not exceed the amount nec­es­sary to fund the oper­a­tions and admin­is­tra­tion of the cor­po­ra­tion, based upon the annu­al oper­a­tional bud­get required by sub­di­vi­sion (a) of Sec­tion 17550.43, and shall become effec­tive imme­di­ate­ly. The annu­al assess­ment for the oper­a­tions fund shall not exceed thir­ty-five dol­lars ($35) per year for each loca­tion in the state from which a par­tic­i­pant does business.

(c) If, as of Jan­u­ary 15 of any year, the bal­ance in the resti­tu­tion fund is less than one mil­lion six hun­dred thou­sand dol­lars ($1,600,000), the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall make an assess­ment of par­tic­i­pants, up to a max­i­mum amount of two hun­dred dol­lars ($200) for each loca­tion in the state from which a par­tic­i­pant does busi­ness, to bring the resti­tu­tion fund to an expect­ed bal­ance of one mil­lion six hun­dred thou­sand dol­lars ($1,600,000). Every par­tic­i­pan­t’s assess­ment shall be deter­mined pro rata based upon the ratio of the num­ber of loca­tions in the state from which the par­tic­i­pant does busi­ness to the total num­ber of loca­tions for all par­tic­i­pants as of the pre­ced­ing Decem­ber 15.

(d) If, on May 1 or Octo­ber 15 of any year, the bal­ance in the resti­tu­tion fund is less than nine hun­dred thou­sand dol­lars ($900,000), the cor­po­ra­tion shall make an emer­gency assess­ment of par­tic­i­pants, not more than twice per year, up to a max­i­mum amount of one hun­dred fifty dol­lars ($150) per year for each loca­tion in the state from which the par­tic­i­pant does busi­ness, for deposit in the trust account to return the lev­el of the resti­tu­tion fund to an expect­ed bal­ance of one mil­lion six hun­dred thou­sand dol­lars ($1,600,000). The cor­po­ra­tion shall esti­mate the total cost of billing, col­lect­ing, and pro­cess­ing the emer­gency resti­tu­tion fund assess­ment and shall assess and col­lect, togeth­er with the emer­gency resti­tu­tion fund assess­ment, an emer­gency oper­a­tions fund assess­ment that is in the aggre­gate suf­fi­cient to off­set the esti­mat­ed cost. Each par­tic­i­pan­t’s assess­ments shall be deter­mined pro rata based upon the ratio of the num­ber of loca­tions in the state from which the par­tic­i­pant does busi­ness to the total num­ber of loca­tions for all par­tic­i­pants as of the first day of the pre­ced­ing month. The board of direc­tors shall adopt rules for the noti­fi­ca­tion of emer­gency assessments.

(e) In addi­tion to the assess­ments required by Sec­tion 17550.43 and sub­di­vi­sion (d), if at any time dur­ing the fis­cal year the board of direc­tors of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion deter­mines that the oper­a­tions fund will be insuf­fi­cient to pay the costs of oper­a­tions and admin­is­tra­tion for the cur­rent or next fis­cal year, the cor­po­ra­tion, as deter­mined by the board of direc­tors, shall do either or both of the fol­low­ing: (A) make an emer­gency assess­ment of par­tic­i­pants, not more than once per fis­cal year, up to a max­i­mum amount of six­ty-five dol­lars ($65) per year for each loca­tion in the state from which a par­tic­i­pant does busi­ness. The emer­gency assess­ment may be billed and col­lect­ed either on an emer­gency basis from all par­tic­i­pants upon the mak­ing of the assess­ment, or in con­junc­tion with each par­tic­i­pan­t’s annu­al assess­ment pur­suant to sub­di­vi­sion (a) of Sec­tion 17550.44, (B) trans­fer any or all inter­est earned on the Resti­tu­tion Fund to the Oper­a­tions Fund, pro­vid­ed that no trans­fer results in a resti­tu­tion fund bal­ance of less than one mil­lion two hun­dred thou­sand dol­lars ($1,200,000).

(f) The assess­ment required by sub­di­vi­sion (d) or (e) shall be due 45 days from the date the bill for that assess­ment is mailed by the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion. A late fee of five dol­lars ($5) per day, up to a max­i­mum of five hun­dred dol­lars ($500), shall be paid for each day after the due date spec­i­fied in this sec­tion until the assess­ment is paid.

(g) The Trav­el Con­sumer Resti­tu­tion Fund shall report to the office of the Attor­ney Gen­er­al each levy of assess­ment with­in 10 busi­ness days after the levy.

§17550.45 - Failure to pay assessment

(a) If any assess­ment is not paid with­in 60 days of the due date, then the cor­po­ra­tion shall noti­fy the office of the Attor­ney Gen­er­al, which shall forth­with sus­pend the reg­is­tra­tion of the par­tic­i­pant who has not paid. The cor­po­ra­tion shall pro­vide a copy of this noti­fi­ca­tion to the participant.

(b) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion or any enti­ty set forth in Sec­tion 17204 may bring an action at law or in equi­ty against a par­tic­i­pant to recov­er any unpaid assessment.

(c) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall be award­ed costs and rea­son­able attor­ney’s fees if it pre­vails in any action against a par­tic­i­pant pur­suant to sub­di­vi­sion (b). Those costs and attor­ney’s fees shall be award­ed as an item of costs, as pro­vid­ed for in para­graph (10) of sub­di­vi­sion (a) and para­graph (5) of sub­di­vi­sion (c) of Sec­tion 1033.5 of the Code of Civ­il Procedure.

§17550.46 - Approval of claim form

(a) The Attor­ney Gen­er­al or his or her del­e­gate shall approve any claim form which shall be pro­vid­ed to a per­son aggriev­ed by the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion to be sub­mit­ted by a per­son aggriev­ed in order to obtain pay­ment from the resti­tu­tion fund. The claim form shall require the per­son aggriev­ed to pro­vide the cor­po­ra­tion with infor­ma­tion which is suf­fi­cient to decide whether pay­ment is to be made to that per­son. The infor­ma­tion must include all of the following:

(1) The name, address, and tele­phone num­ber of the per­son aggrieved.

(2) The date, form, and amount of each pay­ment and evi­dence thereof.

(3) The amount of the claim and spe­cif­ic basis therefor.

(4) Any writ­ten agree­ments, cor­re­spon­dence, or oth­er doc­u­men­ta­tion rel­e­vant to the trans­ac­tion and to the trans­porta­tion or trav­el ser­vices which were pur­chased and not provided.

(5) Iden­ti­fi­ca­tion of the trans­porta­tion or trav­el ser­vices which were pur­chased and not provided.

(6) Descrip­tion of any pay­ment or reim­burse­ment or alter­na­tive trans­porta­tion or trav­el ser­vices received by the per­son aggriev­ed for the trans­porta­tion or pur­chased trav­el ser­vices which were not provided.

(b) If any required infor­ma­tion is unavail­able to the per­son aggriev­ed, the per­son shall so state in the claim form, explain­ing why the infor­ma­tion is unavail­able. The cor­po­ra­tion may require any oth­er addi­tion­al infor­ma­tion as may be nec­es­sary to decide the claim. Fail­ure to pro­vide any required infor­ma­tion or doc­u­men­ta­tion or an ade­quate expla­na­tion as to why the infor­ma­tion is unavail­able shall con­sti­tute grounds for denial of a claim.

(c) The per­son aggriev­ed who sub­mits a claim form shall sign the form stat­ing, under penal­ty of per­jury pur­suant to the laws of the State of Cal­i­for­nia, that the infor­ma­tion con­tained in the form and any state­ments by the per­son mak­ing the claim sub­mit­ted there­with are true and correct.

§17550.47 - Filing a claim; Decision; Reconsideration; Appeal

(a)(1) Any per­son aggriev­ed who suf­fers a loss of more than fifty dol­lars ($50) of amounts paid for air or sea trans­porta­tion or trav­el ser­vices may file a claim with the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion by fil­ing a claim form as required by Sec­tion 17550.46 and pay­ing, by check or mon­ey order, a pro­cess­ing fee to the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion in the amount of thir­ty-five dol­lars ($35). Any check for the pro­cess­ing fee that is returned unpaid to the cor­po­ra­tion by the finan­cial insti­tu­tion upon which it is drawn shall be returned to the claimant and the claim shall be reject­ed for fil­ing. Any claimant whose claim is reject­ed may resub­mit his or her claim upon pay­ment of a pro­cess­ing fee of fifty dol­lars ($50).

(2) Any pro­cess­ing fee required by para­graph (1) shall be non­re­fund­able except where (A) a claim is denied on the basis as set forth in the state­ment of deci­sion that either the sell­er of trav­el, at the time of sale, was not a par­tic­i­pant in the Trav­el Con­sumer Resti­tu­tion Fund or the sell­er of trav­el was not reg­is­tered, or (B) the claim is grant­ed in whole or in part. In either case, the pro­cess­ing fee shall be refund­ed to the per­son aggriev­ed upon denial or upon pay­ment of the claim, whichev­er is applicable.

(3) In no event shall a per­son aggriev­ed have more than one year after the sched­uled date of com­ple­tion of trav­el with­in which to file a claim with the Trav­el Con­sumer Resti­tu­tion Fund.

(b) A per­son aggriev­ed may recov­er from the Trav­el Con­sumer Resti­tu­tion Fund an amount not to exceed fif­teen thou­sand dol­lars ($15,000) per per­son aggriev­ed, not to exceed the amount paid to the par­tic­i­pant by or on behalf of the per­son aggriev­ed for the trans­porta­tion or trav­el ser­vices. Pay­ments from the resti­tu­tion fund shall be lim­it­ed to resti­tu­tion for sums paid for trans­porta­tion or trav­el ser­vices and shall not include any oth­er amounts, includ­ing, but not lim­it­ed to, pay­ment for lost wages, pain and suf­fer­ing, emo­tion­al dis­tress, trav­el insur­ance, lost lug­gage, or any con­se­quen­tial dam­ages. The per­son aggriev­ed shall not be enti­tled to receive attor­ney’s fees in con­nec­tion with a filed claim or on appeal.

(c) All claims are to be decid­ed on the writ­ten record before the cor­po­ra­tion, with no hear­ing to be held. The record shall con­sist of a ful­ly exe­cut­ed and com­plete claim form, any oth­er doc­u­men­ta­tion sub­mit­ted by the claimant or the par­tic­i­pant, and any doc­u­ments or reports sub­mit­ted by staff or the des­ig­nat­ed rep­re­sen­ta­tive of the office of the Attor­ney Gen­er­al. Claims are to be decid­ed with­in 45 days of receipt unless (1) the des­ig­nat­ed rep­re­sen­ta­tive of the office of the Attor­ney Gen­er­al requests a con­tin­u­ance to obtain and sub­mit infor­ma­tion, or (2) the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion deter­mines that addi­tion­al infor­ma­tion or doc­u­men­ta­tion is required to decide the claim. In either case, the claim shall be decid­ed with­in 45 days of receipt of all addi­tion­al infor­ma­tion or doc­u­men­ta­tion. A claim not decid­ed time­ly shall be deemed granted.

(d) When­ev­er the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion denies a claim in whole or in part, it shall pro­vide to the claimant a writ­ten state­ment of deci­sion set­ting forth the fac­tu­al and legal basis for the denial.

(e) A claimant may request recon­sid­er­a­tion of an adverse deci­sion of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion by mail­ing a writ­ten request, accom­pa­nied by a pro­cess­ing fee of fifty dol­lars ($50) paid by check or mon­ey order, with­in 20 days of the date a notice of denial and state­ment of deci­sion was mailed to the claimant. Any check for the pro­cess­ing fee that is returned unpaid to the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion by the finan­cial insti­tu­tion upon which it is drawn shall be returned to the claimant and the request for recon­sid­er­a­tion shall not be deter­mined until the claimant has paid the fifty dol­lar ($50) pro­cess­ing fee.

(f) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall, with­in 60 days of receipt of the request, either decide the request or advise the claimant that addi­tion­al infor­ma­tion or doc­u­men­ta­tion is need­ed, and, if the deci­sion is a denial in whole or in part, it shall pro­vide to the claimant and sell­er of trav­el a writ­ten state­ment of deci­sion set­ting forth the fac­tu­al and legal basis for the deci­sion. No appeal may be tak­en pur­suant to sub­di­vi­sion (g) until recon­sid­er­a­tion has been request­ed and decid­ed. The claimant shall not be enti­tled to any attor­ney’s fees incurred in con­nec­tion with pre­sen­ta­tion of a claim or request for reconsideration.

(g) No deci­sion of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion grant­i­ng or deny­ing a claim in whole or part shall be sub­ject to review or appeal except as pro­vid­ed in this sec­tion. A claimant may seek review of the denial, in whole or part, of a claim by fil­ing a notice of appeal after hav­ing served the notice by mail on the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion. The notice of appeal shall be filed and served on the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion not lat­er than 30 days after a writ­ten state­ment of deci­sion on a request for recon­sid­er­a­tion has been mailed to the claimant. The notice of appeal from a deci­sion of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall be filed with the clerk of the supe­ri­or court either in the coun­ty in which the prin­ci­pal place of busi­ness of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion is locat­ed, or in the coun­ty in which the claimant was a res­i­dent at the time the claimant pur­chased the trans­porta­tion or trav­el ser­vices in dispute.

(h) The claimant shall pay the same fil­ing fee as is required for appeals from small claims court. The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall file its response and the record of the claim before the cor­po­ra­tion with the clerk of the supe­ri­or court with­in 30 days of the day the notice of appeal was served on the Trav­el Con­sumer Resti­tu­tion Corporation.

(i) Upon the fil­ing of the record the clerk of the court shall sched­ule a hear­ing for the ear­li­est avail­able time and shall mail writ­ten notice of the hear­ing at least 14 days pri­or to the time set for the hearing.

(j) The hear­ing on appeal shall be lim­it­ed to the record before the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion and any rel­e­vant evi­dence that could not have been with rea­son­able dili­gence sub­mit­ted pre­vi­ous­ly to the cor­po­ra­tion. The review­ing court shall affirm the deci­sion if it is sup­port­ed by sub­stan­tial evi­dence in light of the entire record. The pre­tri­al dis­cov­ery pro­ce­dures described in Sec­tion 2019.010 of the Code of Civ­il Pro­ce­dure are not per­mit­ted, there is no right to tri­al by jury, and the deci­sion of the supe­ri­or court shall be appeal­able by either par­ty. No mon­ey may be claimed from or paid by the Trav­el Con­sumer Resti­tu­tion Fund except in accor­dance with the pro­vi­sions and pro­ce­dures set forth in this arti­cle. No pro­vi­sion here­in shall lim­it or oth­er­wise affect those reme­dies as may be avail­able against per­sons or enti­ties oth­er than the Trav­el Con­sumer Resti­tu­tion Corporation.

(k) If the claimant pre­vails in whole or in part on an appeal, the claimant shall not be enti­tled to an award in excess of the amount of the orig­i­nal claim.

(l) Any claim award­ed by the cor­po­ra­tion shall be paid prompt­ly by the trustee of the resti­tu­tion fund when the time for appeal has passed. Any judg­ment on appeal shall be paid prompt­ly by the trustee of the resti­tu­tion fund when­ev­er the judg­ment becomes final. If there should be insuf­fi­cient funds to pay a claim when oth­er­wise due, claims shall be paid in the order received. If the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion ceas­es to oper­ate pur­suant to the terms of Sec­tion 17550.52, any remain­ing trust funds shall be allo­cat­ed on a pro rata basis to claims accru­ing pri­or to the cor­po­ra­tion ceas­ing to oper­ate, after pay­ment of out­stand­ing debts and lia­bil­i­ties as pro­vid­ed in Sec­tion 17550.57.

(m) A claim shall require a major­i­ty of at least three affir­ma­tive votes for denial, oth­er­wise it shall be deemed granted.

(n)(1) A direc­tor shall not par­tic­i­pate in the deci­sion of a claim if the direc­tor has a finan­cial inter­est in the out­come of the deci­sion, has a finan­cial inter­est in or is employed by the sell­er of trav­el that is the sub­ject of the claim, or has any famil­ial rela­tion­ship or close per­son­al friend­ship with either the claimant or any own­er, offi­cer, direc­tor, or man­ag­er of the sell­er of trav­el that is the sub­ject of the claim.

(2) The direc­tor shall dis­close to the oth­er direc­tors before a claim is con­sid­ered all mat­ters that dis­qual­i­fy the direc­tor from par­tic­i­pat­ing in the deci­sion of the claim as described in para­graph (1).

§17550.48 - Assignment of right of recovery

Any per­son aggriev­ed who recov­ers from the fund shall assign to the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion all rights of recov­ery, to a max­i­mum of the amount received from the Trav­el Con­sumer Resti­tu­tion Fund, against any per­son or orga­ni­za­tion from which the per­son aggriev­ed received any pay­ment as com­pen­sa­tion for any loss for which resti­tu­tion was paid from the Trav­el Con­sumer Resti­tu­tion Fund. The per­son aggriev­ed shall exe­cute and deliv­er to the cor­po­ra­tion instru­ments and papers and per­form any oth­er acts nec­es­sary to car­ry out this sec­tion. The cor­po­ra­tion shall have the author­i­ty and dis­cre­tion to deter­mine whether or not to seek recovery.

§17550.49 - Revocation of registration

If the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion directs that pay­ment be made from the resti­tu­tion fund in any amount in response to a claim against a par­tic­i­pant, the cor­po­ra­tion shall inform the office of the Attor­ney Gen­er­al and shall main­tain a record of all claims paid from the fund. A list of those sell­ers of trav­el on whose account pay­ment has been made from the fund shall be pro­vid­ed upon writ­ten request. The cor­po­ra­tion shall have the author­i­ty and dis­cre­tion to deter­mine whether or not to seek recov­ery from a sell­er of trav­el of any amounts paid from the fund. The cor­po­ra­tion may seek that recov­ery by any law­ful means, includ­ing, but not lim­it­ed to, debt col­lec­tion or civ­il lit­i­ga­tion. If the cor­po­ra­tion seeks recov­ery, it shall be enti­tled to col­lect from any sell­er of trav­el against which action is tak­en all rea­son­able expens­es incurred in tak­ing the action, includ­ing attor­ney’s fees. The cor­po­ra­tion shall also be enti­tled to inter­est at the rate of 9 per­cent per year on the amount paid from the fund, togeth­er with all expens­es and costs incurred by the cor­po­ra­tion in con­nec­tion with the claim.

§17550.50 - Immunity of officers and employees

There shall be no per­son­al lia­bil­i­ty on the part of and no cause of action of any nature shall arise against the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion or the direc­tors, offi­cers, employ­ees, or agents of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion on any deci­sion to deny a claim for pay­ment from the resti­tu­tion fund.

§17550.51 - Corporation not liable for damages

The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall not be liable for any con­se­quen­tial dam­ages, or for any puni­tive dam­ages, in con­nec­tion with the per­for­mance of its resti­tu­tion function.

§17550.52 - Failure or cessation of corporation

The Attor­ney Gen­er­al or his or her del­e­gate may deter­mine that the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion has failed or ceased to oper­ate upon a find­ing that any one of the fol­low­ing has occurred with respect to the corporation:

(a) Was not created.

(b) Has been dissolved.

(c) Has ceased to operate.

(d) Is insol­vent or bankrupt.

(e) Has failed to pay its oper­at­ing costs.

(f) Has failed to pay any claim or judg­ment in a time­ly manner.

(g) Has vio­lat­ed its arti­cles of incor­po­ra­tion or any law of this state.

(h) Has invest­ed its funds in vio­la­tion of this article.

(i) Has not levied assess­ments as required by this article.

(j) Has not dili­gent­ly decid­ed upon a claim made by a per­son aggrieved.

(k) Has vio­lat­ed any sec­tion of this article.

(l) Has neglect­ed or refused to sub­mit its books, papers, and affairs to the inspec­tion of the office of the Attor­ney General.

§17550.53 - Authority to investigate claims; Examination of books and records

(a) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall have inde­pen­dent author­i­ty to inves­ti­gate claims filed by per­sons aggriev­ed pur­suant to Sec­tion 17550.47.

(b) The cor­po­ra­tion, upon the request of the office of the Attor­ney Gen­er­al, may par­tic­i­pate in an exam­i­na­tion or inves­ti­ga­tion of the books and records of a par­tic­i­pant for the pur­pose of eval­u­at­ing a claim relat­ed to that sell­er of trav­el. There shall be no lia­bil­i­ty on the part of, and no cause of action of any nature shall arise against, the State of Cal­i­for­nia or any of its employ­ees, agents, or rep­re­sen­ta­tives for the release of any infor­ma­tion fur­nished to the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion pur­suant to this sub­di­vi­sion or in con­nec­tion with the inves­ti­ga­tion or review of any claim.

(c) With the con­sent of a major­i­ty of its direc­tors, the cor­po­ra­tion, in order to ful­fill its oblig­a­tions under this arti­cle, may appoint an inde­pen­dent cer­ti­fied pub­lic accoun­tant or pub­lic accoun­tant or hire or appoint a spe­cial­ized com­mit­tee or employ­ees to con­duct an exam­i­na­tion or inves­ti­ga­tion autho­rized by this sec­tion. Any reports as a result there­of shall be fur­nished to the office of the Attor­ney General.

(d) To assist the cor­po­ra­tion in eval­u­at­ing a claim relat­ed to a par­tic­i­pant, the par­tic­i­pant shall pro­vide or make avail­able for inspec­tion by the cor­po­ra­tion those books, accounts, bank account records, and files which are nec­es­sary for the cor­po­ra­tion to eval­u­ate the claim.

(e) The cor­po­ra­tion, any par­tic­i­pant, an agent of the cor­po­ra­tion or any per­son oth­er than a law enforce­ment agency who uses infor­ma­tion obtained under this sec­tion for any pur­pose not autho­rized in this arti­cle or Arti­cle 2.6 (com­menc­ing with Sec­tion 17550) is guilty of a misdemeanor.

(f) Costs and expens­es for any exam­i­na­tion under this sec­tion shall be paid for by the par­tic­i­pant if a claim direct­ly relat­ed to that sell­er of trav­el has been approved and pay­ment has been made to a per­son aggriev­ed. The cor­po­ra­tion may main­tain an action for recov­ery of these exam­i­na­tion costs and expens­es in any court of com­pe­tent juris­dic­tion, and shall recov­er its rea­son­able costs and attor­ney’s fees as an item of costs, as pro­vid­ed for in para­graph (10) of sub­di­vi­sion (a) and para­graph (5) of sub­di­vi­sion (c) of Sec­tion 1033.5 of the Code of Civ­il Procedure.

§17550.54 - Approval of articles of incorporation, bylaws or amendments

(a) The Sec­re­tary of State shall not file arti­cles for the incor­po­ra­tion of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion or an amend­ment to the arti­cles unless the office of the Attor­ney Gen­er­al has issued writ­ten approval of the arti­cles or amendment.

(b) The Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall not adopt any bylaws or amend­ments there­to with­out the writ­ten con­sent of the office of the Attor­ney Gen­er­al. If the office of the Attor­ney Gen­er­al does not approve or dis­ap­prove any bylaws or amend­ments with­in 60 days of receipt, such bylaws or amend­ments shall be deemed to be approved.

§17550.56 - Examination and review by Attorney General

The oper­a­tion of the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion shall at all times be sub­ject to the exam­i­na­tion and review of the office of the Attor­ney Gen­er­al and its duly des­ig­nat­ed rep­re­sen­ta­tives. The office of the Attor­ney Gen­er­al and its duly des­ig­nat­ed rep­re­sen­ta­tives may at any time inves­ti­gate the affairs and exam­ine the books, accounts, record, and files used by the cor­po­ra­tion. The office of the Attor­ney Gen­er­al and its duly des­ig­nat­ed rep­re­sen­ta­tives shall have free access to the offices, books, accounts, papers, records, files, safes, and vaults of the corporation.

§17550.57 - Dissolution of corporation

If the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion is dis­solved or ceas­es to exist, or if the Attor­ney Gen­er­al or his or her del­e­gate makes a deter­mi­na­tion pur­suant to Sec­tion 17550.52 that the cor­po­ra­tion has failed or ceased to oper­ate, all out­stand­ing debts, oblig­a­tions of the cor­po­ra­tion, and amounts due for ser­vices ren­dered shall first be paid from the remain­ing assets, includ­ing the resti­tu­tion fund. The assets remain­ing after set­tling all those lia­bil­i­ties shall be dis­trib­uted to the par­tic­i­pants, less the costs of that dis­tri­b­u­tion. The dis­tri­b­u­tion to par­tic­i­pants shall be pro rata based upon the ratio of the num­ber of loca­tions in the state from which the par­tic­i­pant does busi­ness to the total num­ber of loca­tions for all reg­is­tered par­tic­i­pants at the time the cor­po­ra­tion is dis­solved or ceas­es to exist.

§17550.58 - Administrative costs and expenses

All costs and expens­es incurred by the Depart­ment of Jus­tice in the admin­is­tra­tion of this arti­cle, includ­ing those incurred pur­suant to Sec­tion 17550.38, shall be paid to the depart­ment by the Trav­el Con­sumer Resti­tu­tion Cor­po­ra­tion. The depart­ment may insti­tute an action for the recov­ery of costs and expens­es incurred in the admin­is­tra­tion of this arti­cle in any court of com­pe­tent jurisdiction.