8 LONG TITLE
9 General Description:
10 This bill amends the Sales Representative Commission Payment Act.
11 Highlighted Provisions:
12 This bill:
13 ▸ defines terms;
14 ▸ excludes a participant in a multilevel marketing company from the definition of
15 "sales representative"; and
16 ▸ makes technical and conforming changes.
17 Money Appropriated in this Bill:
19 Other Special Clauses:
21 Utah Code Sections Affected:
23 34-44-102, as last amended by Laws of Utah 2010, Chapter 379
25 Be it enacted by the Legislature of the state of Utah:
26 Section 1. Section 34-44-102 is amended to read:
27 34-44-102. Definitions.
28 As used in this chapter:
29 (1) "Business relationship" means an agreement that governs the relationship of
30 principal and sales representative.
31 (2) "Commission" means:
32 (a) compensation:
33 (i) that accrues to a sales representative;
34 (ii) for payment by a principal; and
35 (iii) at a rate expressed as a percentage of the dollar amount of sales, orders, or profits;
37 (b) any other method of compensation agreed to between a sales representative and a
38 principal including:
39 (i) fees for services; and
40 (ii) a retainer.
41 (3) (a) "Multilevel marketing company" means a person that:
42 (i) sells, distributes, or supplies for consideration a good or service through
44 (A) at different levels of distribution; or
45 (B) in accordance with a formula for compensating participants in whole or in part
46 based on:
47 (I) the sale of a good or service; and
48 (II) the recruitment of or the performance or action of another participant; and
49 (ii) (A) permits participants to recruit other participants to sell, distribute, or supply for
50 consideration the person's good or service; or
51 (B) provides for commission, cross-commissions, override commissions, bonuses,
52 refunds, dividends, or other consideration that is or may be paid as a result of:
53 (I) the sale of a good or service; or
54 (II) the recruitment of or the performance or action of another participant.
55 (b) As used in this Subsection (3), "participant" means an independent agent,
56 contractor, or distributor.
58 (a) engages in any of the following activities with regard to a product or service:
59 (i) manufactures;
60 (ii) produces;
61 (iii) imports;
62 (iv) sells; or
63 (v) distributes;
64 (b) establishes a business relationship with a sales representative to solicit orders for a
65 product or a service described in Subsection [
66 (c) agrees to compensate a sales representative, in whole or in part, by commission.
68 a person who enters into a business relationship with a principal:
69 (i) to solicit orders for a product or a service described in Subsection [
70 (ii) under which the person is compensated, in whole or in part, by commission.
71 (b) "Sales representative" does not include:
72 (i) an employee of a principal;
73 (ii) a person licensed under Title 31A, Insurance Code;
74 (iii) a person licensed under Title 41, Chapter 3, Part 2, Licensing;
75 (iv) a person licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices
77 (v) a person who provides a product or service under a business relationship with a
78 principal that is incident to the purchase or sale of real property; [
79 (vi) a person who places an order or purchases a product or service for that person's
80 own account for resale[
81 (vii) an independent agent, contractor, or distributor through whom a multilevel
82 marketing company supplies for consideration a good or service.
84 between a sales representative and a principal, whether by:
85 (a) agreement;
86 (b) expiration of a time period; or
87 (c) exercise of a right of termination by either the principal or the sales representative.