Collection Registration 

Exempts persons collecting debts for out-of-state clients by
means of interstate communication, from collection agency
registration and bonding requirements.  (HB2017 HD1)

HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



 1 SECTION 1.  Chapter 443B, Hawaii Revised Statutes, is amended by
 2 adding a new section to be appropriately designated and to read
 3 as follows:
 4      "443B-       Exempt out-of-state collection agency.  (a)
 5 An out-of-state collection agency may be designated as an exempt
 6 out-of-state collection agency; provided the applicant shall
 7 submit the following:
 8      (1)  An application for out-of-state collection agency
 9           exemption;
10      (2)  Verification that the out-of-state collection agency
11           holds a current license, permit, or registration to
12           conduct business as a collection agency, which is in
13           good standing in compliance with the laws of the home
14           state, including the maintenance of a bond in the
15           amount as required by the home state, and that such
16           state of licensure does not require Hawaii collection
17           agencies to obtain a license to collect debts in their
18           state;

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                                     H.B. NO.           H.D. 1

 1      (3)  Agree in writing to comply with the requirements of
 2           sections 443B-15, 443B-16, 443B-17, 443B-18, and 443B-
 3           19; and
 4      (4)  Pay the following nonrefundable fees:
 5           (A)  With the application, an application fee of $25;
 6           (B)  Upon approval to grant an out-of-state collection
 7                agency exemption, the compliance resolution fund
 8                fee for collection agencies.
 9      (b)  An exempt out-of-state collection agency may renew the
10 exemption biennially by June 30 of each even-numbered year;
11 provided the applicant satisfies the provision of subsection
12 (a)(1),(2),(3), and (4).
13      (c)  An out-of-state collection agency shall not collect or
14 attempt to collect any money or any other forms of indebtedness
15 alleged to be due and owing from any person who resides or does
16 business in this State without first registering under this
17 chapter or receiving an exemption, pursuant to this section."
18      SECTION 2.  Section 443B-1, Hawaii Revised Statutes, is
19 amended by amending the definition of "collection agency" to read
20 as follows:
21      ""Collection agency" means any person, whether located
22 within or outside this State, who by oneself or through others
23 offers to undertake or holds oneself out as being able to

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                                     H.B. NO.           H.D. 1

 1 undertake or does undertake to collect for another person, claims
 2 or money due on accounts or other forms of indebtedness for a
 3 commission, fixed fee, or a portion of the sums so collected.
 4      "Collection agency" includes:
 5      (1)  Any person using any name other than the person's own
 6           in collecting the person's own claims with the
 7           intention of conveying, or which tends to convey the
 8           impression that a third party has been employed;
 9      (2)  Any person who, in the conduct of the person's business
10           for a fee, regularly repossesses any merchandise or
11           chattels for another; and
12      (3)  Any person who regularly accepts the assignment of
13           claims or money due on accounts or other forms of
14           indebtedness and brings suits upon the assigned claims
15           or money due on accounts or other forms of indebtedness
16           in the person's own name; provided that any suits shall
17           be initiated and prosecuted by an attorney who shall
18           have been appointed by the assignee[.]; and
19      (4)  Any person who files for and is granted an out-of-state
20           collection agency exemption, pursuant to section 443B-
21           ; provided that:
22           (A)  The out-of-state collection agency is licensed or
23                registered as a collection agency in a state that

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                                     H.B. NO.           H.D. 1

 1                regulates and licenses collection agencies and
 2                does not require Hawaii collection agencies to
 3                obtain a license to collect debts in their state
 4                if such agencies' collection activities is limited
 5                to the provisions in subparagraphs (B), (C), and
 6                (D);
 7           (B)  The out-of-state collection agency is collecting
 8                debts on behalf of an out-of-state creditor;
 9           (C)  The out-of-state collection agency does not
10                solicit or engage in collection activities for any
11                clients in this State; and
12           (D)  The out-of-state collection agency only collects
13                debts using interstate communication methods,
14                including telephone, facsimile, or mail."
15      SECTION 3.  Statutory material to be repealed is bracketed.
16 New statutory material is underscored.
17      SECTION 4.  This Act shall take effect upon its approval.