telephone solicitations; telephone calls

HB2246 - 572R - I Ver

REFERENCE TITLE:
telephone solicitations; telephone calls

State of Arizona

House of Representatives

Fifty-seventh Legislature

Second Regular Session

2026

HB 2246

Introduced by

Representative
Blackman

AN
ACT

amending sections 44-1271 and 44-1278,
arizona revised statutes; relating to telephone solicitations.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 44-1271, Arizona Revised
Statutes, is amended to read:

START_STATUTE
44-1271.

Definitions

In this article, unless the context otherwise requires:

1. "Business opportunity":

(a) Means the sale or lease, or offer for sale or
lease, of any goods or services to a consumer for an initial payment of five
hundred dollars or greater for the purpose of enabling the consumer to start or
operate a business, which sale or lease is not limited to sales initiated or
made by the telephone.

(b) Includes a solicitation of consumers in which
the seller represents one or more of the following:

(i) That the consumer may or will earn an amount in
excess of the initial payment as a result of the purchase.

(ii) That a market exists for any goods to be made
or sold or services to be rendered by the consumer.

(iii) That the seller will provide locations or
assist the consumer in finding locations for the use or operation of vending
machines, racks, display cases or other similar devices or currency-operated
amusement machines or devices or any other devices.

(iv) That the seller may purchase from the consumer
goods to be made or services to be rendered by the consumer.

(v) That the seller guarantees, either conditionally
or unconditionally, that the consumer will derive income from the business
opportunity or that the seller will refund all or part of the price paid for
the business opportunity or repurchase any of the goods supplied by the seller
if the consumer is unsatisfied with the business opportunity.

(vi) That the seller or an entity associated with
the seller will provide a sales program or marketing program to the consumer
unless the marketing program is offered in conjunction with the licensing of a
registered trademark or service mark, if the trademark or service mark has been
effectively registered under federal law.

(c) Does not include:

(i) The sale of all or substantially all of the
assets of an ongoing business where the owner of that business sells and
intends to sell only that one business opportunity.

(ii) The not-for-profit sale of sales demonstration
equipment, materials or samples for a total price of five hundred dollars or
less.

(iii) The sale of a franchise as defined by the
federal trade commission regulations as set forth in 16 Code of Federal
Regulations section 436.1.

2. "Consumer" means a person who is
solicited by a seller or solicitor.

3. "Goods" means any merchandise,
equipment, products, supplies or materials.

4. "Initial payment" means the total
amount the purchaser becomes obligated to pay to the seller and to any third
party for goods, services or merchandise related to a previously purchased
business opportunity, either prior to or at the time of the delivery of any
goods, services or merchandise within six months after the commencement of the
operation of the business opportunity by the purchaser.

5. "Licensed associated person of a securities,
commodities or investments broker" means any associated person registered
or licensed by the national association of securities dealers, a self-regulatory
organization as defined in the securities exchange act of 1934 (15 United
States Code section 78c) or an official or agency of this state or of any other
state of the United States.

6. "Licensed securities commodities or
investments broker, dealer or investment advisor" means a person licensed
or registered as a securities commodities or investments broker, dealer or
investment advisor by the securities and exchange commission, the national
association of securities dealers, a self-regulatory organization as
defined in the securities exchange act of 1934 (15 United States Code section
78c) or an official or agency of this state or of any other state of the United
States.

7. "Manager" means a person who supervises
the work of a solicitor.

8. "Merchandise" means objects, wares,
goods, commodities, intangibles, real estate, securities or services.

9. "Person" means:

(a) A natural person or the person's legal
representative.

(b) A partnership, a limited liability company, a
limited liability partnership or a domestic or foreign corporation.

(c) A company, trust, business entity or
association.

(d) An agent, employee, salesman, partner, officer,
director, member, stockholder, associate or trustee.

(e) Any other legal entity or any group associated
in fact although not a legal entity.

10. "Premium" means any gift, bonus,
prize, award or other incentive or inducement to purchase merchandise.

11. "Principal" means an owner or an
officer of a corporation or limited liability company, a general partner of a
partnership, a sole proprietor of a sole proprietorship, a partner of a limited
liability partnership, a trustee of a trust and any other individual who
controls, manages or supervises a telephone sales operation.

12. "Prize" means anything offered or
purportedly offered and given or purportedly given to a person by
chance. Chance exists if a person is guaranteed to receive an item
and at the time of the offer or purported offer the seller or solicitor does
not identify the specific item that the person will receive.

13. "Prize promotion" means a sweepstakes
or other game of chance or an oral or written express or implied representation
that a person has won, has been selected to receive or may be eligible to
receive a prize or purported prize.

14. "Recovery service" means any business
or other practice in which a person represents or implies that the person will
recover or assist in recovering for a fee any amount of money that a consumer
has provided to a seller pursuant to a telephone solicitation.

15. "Seller" means a person who, directly
or through a solicitor, does any of the following:

(a) Initiates telephone calls to provide or arrange
to provide merchandise to consumers in exchange for payment.

(b) Solicits by telephone in response to inquiries
from a consumer generated by a notification or communication sent or delivered
to the consumer that represents or implies that:

(i) The consumer has been specially selected in any
manner to receive the notification or communication or the offer contained in
the notification or communication.

(ii) The consumer will receive a premium if the
consumer calls the person.

(iii) If the consumer purchases merchandise from the
person, the consumer will also receive additional or other merchandise, the
same as or different from the type of merchandise purchased, without any
additional charge or for a price that the person represents or implies is less
than the regular price of the merchandise.

(iv) The person is offering for sale the services of
a recovery service.

(v) The person is offering to make a loan, to
arrange or assist in arranging a loan or to assist in providing information
that may lead to obtaining a loan unless no payment of any kind is made until
the loan proceeds are disbursed to the borrower.

(vi) The consumer will receive a credit card if the
consumer pays a fee for the card before receiving the card.

(vii) The person is offering for sale identity
protection assistance.

(c) Solicits by telephone in response to inquiries
generated by advertisements on behalf of the person that represent or imply
that:

(i) The person is offering to sell the services of a
recovery service.

(ii) The person is offering to make a loan, to
arrange or assist in arranging a loan or to assist in providing information
that may lead to obtaining a loan unless no payment of any kind is made until
the loan proceeds are disbursed to the borrower.

(iii) The consumer will receive a credit card if the
consumer pays a fee for the card before receiving the card.

(d) Solicits consumers to purchase a business
opportunity or merchandise related to a business opportunity through any means
including the telephone, internet or mail or other hard copy text or through
any electronic, wireless or other communication media.

16. "Solicitor" means a person, other than
a seller or employee of a seller, who uses a telephone to seek sales or rentals
of merchandise on behalf of a seller or uses a telephone to verify sales or
rentals for a seller.

17. "Subscriber" means a person who
subscribes to residential telephone service from a local exchange company and
any person who lives or subscribes with that person.

18. "Telephone call" means
any communication, contact or attempt to communicate with a person by using a
telephone or telephone service.

18.

19.
"Telephone
solicitation" means any voice communication from a live operator,
announcing device or otherwise
or text message transmitted to a
cellular telephone
that offers merchandise for sale or rent and that is
to or from a person located in this state.
END_STATUTE

Sec. 2. Section 44-1278, Arizona Revised
Statutes, is amended to read:

START_STATUTE
44-1278.

Unlawful practice; powers of attorney general; cumulative
remedies

A. It is an unlawful practice pursuant to section 44-1522
for a seller or solicitor or anyone acting on
their
behalf

of either a seller or solicitor
to make or authorize to
any consumer any reference to the seller's or solicitor's compliance with this
article other than on inquiry by the consumer.

B. It is an unlawful practice pursuant to section 44-1522
for any seller or solicitor or anyone acting on
their

behalf
of either a seller or solicitor
who conducts a
telephone solicitation in this state to do any of the following:

1. Use telephone equipment that blocks the caller
identification function on the telephone or telephone equipment of the
telephone number dialed so that the telephone number of the
caller

party that initiates the telephone call
is not displayed
on the telephone or telephone equipment that is capable of displaying the
telephone number of the
caller
party that
initiated the telephone call
.

2. Initiate an outbound telephone call to a person
if that person has previously stated a desire not to receive outbound telephone
calls made by or on behalf of the seller whose goods or services are being
offered. A seller or solicitor is not liable under this paragraph or
paragraph 3 if all of the following apply:

(a) The seller or solicitor has established and
implemented written procedures to comply with this paragraph.

(b) The seller or solicitor has trained the seller's
or solicitor's personnel according to the written procedures prescribed in
subdivision (a) of this paragraph.

(c) The seller or the solicitor acting on behalf of
the seller establishes and maintains a no call list comprised of all persons
who request not to be contacted and keeps all do not call requests for at least
ten years.

(d) The initial outbound
telephone
call
or any subsequent outbound
telephone
call made by the
seller or solicitor is the result of an error.

3. Intentionally make or cause to be made any
unsolicited telephone
sales call

solicitation

to any
cellular telephone,
mobile or telephone
paging device.

4. Make a telephone call to any residential
or cellular
telephone using an artificial or prerecorded voice
to deliver a message unless the
telephone
call is
initiated for emergency purposes or the
telephone
call is
made with the prior express consent of the called party.

5. Use any automatic terminal equipment that uses a
random or sequential number generator unless the equipment excludes
telephone
calls to the following telephone numbers:

(a) Emergency telephone numbers, including 911, of
any hospital, medical physician, health care facility, poison control center,
fire protection facility or law enforcement agency.

(b) Any guest room or patient room of a hospital,
health care facility, elderly care home or similar establishment.

(c) A paging service, a cellular telephone service,
a specialized mobile radio service or any service for which the called party is
charged for the
telephone
call.

(d) The telephone numbers maintained on a no call
list established pursuant to paragraph 2 of this subsection.

6. Initiate an outbound
telephone

call except as provided in 47 Code of Federal Regulations
,

section 64.1200 or 16 Code of Federal Regulations section 310.4.

C. Failure to comply with this article is an
unlawful practice pursuant to section 44-1522. The attorney
general may investigate and take appropriate action as prescribed by chapter
10, article 7 of this title.

D. The provisions of this article are in addition to
all other causes of action, remedies and penalties available to this state.

E. The attorney general may bring an action in
federal court in accordance with 15 United States Code sections 6101 through
6108.
END_STATUTE