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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of crafted precious metal dealers and |
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dealerships; providing a criminal penalty. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter B, Chapter 1956, Occupations Code, is |
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amended by adding Section 1956.0605 to read as follows: |
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Sec. 1956.0605. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED |
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BY CERTAIN CRAFTED PRECIOUS METAL DEALERS. This subchapter does |
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not apply to: |
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(1) a person that is required to hold a dealership |
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license under Subchapter B-1; or |
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(2) crafted precious metal acquired by a person |
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described by Subdivision (1). |
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SECTION 2. Chapter 1956, Occupations Code, is amended by |
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adding Subchapter B-1 to read as follows: |
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SUBCHAPTER B-1. SALE OF CRAFTED PRECIOUS METAL TO DEALERS AND |
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DEALERSHIPS IN CERTAIN MUNICIPALITIES |
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Sec. 1956.071. DEFINITIONS. In this subchapter: |
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(1) "Commission" means the Texas Commission of |
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Licensing and Regulation. |
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(2) "Crafted precious metal" means jewelry, |
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silverware, an art object, a bar, a coin, a commemorative |
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medallion, or another object, including scrap or a broken item, |
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made in whole or in part from precious metal. |
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(3) "Dealer" means a person who engages in the |
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business of purchasing and selling crafted precious metal. |
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(4) "Dealership" means a location at which or premises |
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in which a dealer conducts business. |
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(5) "Department" means the Texas Department of |
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Licensing and Regulation. |
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(6) "Precious metal" means gold, silver, platinum, |
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palladium, iridium, rhodium, osmium, ruthenium, or an alloy of |
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those metals. |
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Sec. 1956.072. APPLICABILITY OF SUBCHAPTER. This |
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subchapter applies only to: |
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(1) a person that engages in business in a |
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municipality: |
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(A) with a population of 200,000 or more; and |
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(B) located in a county: |
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(i) with a population of 300,000 or less; |
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and |
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(ii) that is located adjacent to an |
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international border; and |
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(2) crafted precious metal that is: |
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(A) sold or used primarily for personal, family, |
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or household purposes; and |
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(B) acquired by a person described by Subdivision |
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(1) for sale. |
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Sec. 1956.073. EXCEPTION: PRECIOUS METAL EXTRACTED, |
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RECOVERED, OR SALVAGED FROM INDUSTRIAL BY-PRODUCTS OR INDUSTRIAL |
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WASTE PRODUCTS. This subchapter does not apply to a person whose |
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purchase or sale of precious metal or a product made of precious |
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metal is merely incidental to the person's business of extracting, |
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recovering, or salvaging precious metal from industrial |
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by-products or industrial waste products. |
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Sec. 1956.074. EXCEPTION: DENTAL, PHARMACEUTICAL, OR |
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MEDICAL APPLICATION OF CRAFTED PRECIOUS METAL. This subchapter |
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does not apply to a dental, pharmaceutical, or medical application |
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of crafted precious metal. |
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Sec. 1956.075. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED |
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FROM ANOTHER DEALER WHO PREVIOUSLY MADE REQUIRED REPORTS. This |
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subchapter does not apply to crafted precious metal acquired in |
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good faith in a transaction involving the stock-in-trade of another |
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dealer who previously made the reports concerning that metal as |
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required by this subchapter if: |
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(1) the selling dealer delivers to the acquiring |
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dealer a written document stating that the reports have been made; |
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(2) the acquiring dealer submits a copy of the |
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statement to the chief of police of the municipality or the sheriff |
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of the county in which the selling dealer is located; and |
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(3) each dealer involved in the transaction retains a |
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copy of the statement until the third anniversary of the date of the |
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transaction. |
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Sec. 1956.076. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED |
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IN DISSOLUTION OR LIQUIDATION SALE. This subchapter does not apply |
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to crafted precious metal acquired in a nonjudicial sale, transfer, |
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assignment, assignment for the benefit of creditors, or consignment |
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of the assets or stock-in-trade, in bulk, or a substantial part of |
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those assets, of an industrial or commercial enterprise, other than |
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a dealer, for the voluntary dissolution or liquidation of the |
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seller's business, or for disposing of an excessive quantity of |
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personal property, or property that has been acquired in a |
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nonjudicial sale or transfer from an owner other than a dealer, the |
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seller's entire household of personal property, or a substantial |
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part of that property, if the dealer: |
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(1) gives written notice to the chief of police of the |
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municipality or the sheriff of the county in which the dealer's |
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business is located that a reporting exemption is being claimed |
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under this section; |
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(2) retains in the dealer's place of business, until |
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the third anniversary of the date of the transaction, a copy of the |
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bill of sale, receipt, inventory list, or other transfer document; |
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and |
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(3) makes the record retained available for inspection |
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by a peace officer. |
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Sec. 1956.077. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED |
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IN JUDICIAL SALE. This subchapter does not apply to crafted |
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precious metal acquired in a sale made: |
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(1) by any public officer in the officer's official |
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capacity as a trustee in bankruptcy, executor, administrator, |
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receiver, or public official acting under judicial process or |
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authority; or |
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(2) on the execution of, or by virtue of, any process |
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issued by a court. |
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Sec. 1956.078. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED |
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AS PAYMENT FOR OTHER CRAFTED PRECIOUS METAL BY PERSON IN BUSINESS OF |
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SELLING TO CONSUMERS. This subchapter does not apply to crafted |
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precious metal acquired in good faith as partial or complete |
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payment for other crafted precious metal by a person whose |
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principal business is primarily that of selling directly to the |
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consumer crafted precious metal that has not been subject to a prior |
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sale. |
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Sec. 1956.079. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED |
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FROM OR REPORTED TO GOVERNMENTAL AGENCY. This subchapter does not |
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apply to crafted precious metal: |
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(1) acquired as surplus property from the United |
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States, a state, a subdivision of a state, or a municipal |
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corporation; or |
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(2) reported by a dealer as an acquisition or a |
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purchase, or reported as destroyed or otherwise disposed of, to: |
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(A) a state agency under another law of this |
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state; or |
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(B) a municipal or county office or agency under |
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another law of this state or a municipal ordinance. |
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Sec. 1956.080. EXCEPTION: CRAFTED PRECIOUS METAL ACQUIRED |
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BY PERSON LICENSED UNDER TEXAS PAWNSHOP ACT. This subchapter does |
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not apply to crafted precious metal acquired by a person licensed |
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under Chapter 371, Finance Code. |
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Sec. 1956.081. EFFECT ON OTHER LAWS AND ORDINANCES. This |
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subchapter does not: |
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(1) excuse noncompliance with another state law or |
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municipal ordinance covering the reporting, holding, or releasing |
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of crafted precious metal; |
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(2) prohibit a municipality from enacting, amending, |
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or enforcing an ordinance relating to a dealer; or |
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(3) supersede a municipal ordinance except to the |
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extent the ordinance does not require reporting for transactions |
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involving crafted precious metal. |
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Sec. 1956.082. RULEMAKING. The commission may adopt rules |
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necessary to implement and enforce this subchapter. |
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Sec. 1956.083. DEALERSHIP LICENSE REQUIRED. A person may |
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not engage in business as a crafted precious metal dealer unless the |
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person holds a dealership license. |
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Sec. 1956.084. MULTIPLE PLACES OF BUSINESS. (a) A |
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separate dealership license is required for each place of business |
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operated under this subchapter. |
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(b) The department may issue more than one dealership |
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license to a person if the person complies with this subchapter for |
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each license. |
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Sec. 1956.085. APPLICATION REQUIREMENTS. (a) An |
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application for a dealership license must be made to the department |
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and must: |
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(1) be under oath; |
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(2) state: |
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(A) the full name and address of the applicant; |
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(B) the type of business entity formed by the |
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applicant, if the applicant is not an individual; |
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(C) the full name and address of each general |
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partner and the type of partnership, if the applicant is a |
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partnership; |
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(D) the full name and address of each officer and |
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owner, if the applicant is an unincorporated association; |
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(E) except as provided by Subsection (b), the |
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full name of each officer and shareholder, if the applicant is a |
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corporation; |
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(F) the full name and address of each manager and |
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operator of the dealership; |
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(G) the location where the dealership's business |
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is to be conducted and a copy of the certificate of occupancy for |
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the location; |
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(H) the intended hours of operation of the |
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dealership; and |
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(I) other relevant information required by the |
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department; and |
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(3) state that the applicant and, if applicable, any |
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business partner or officer of the corporation has not had a license |
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revoked under this subchapter or Chapter 371, Finance Code. |
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(b) The full name of each shareholder is not required if the |
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applicant is a corporation with five or more shareholders. |
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Sec. 1956.086. FEES. (a) Except as provided by Subsection |
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(b), an applicant must submit with the application: |
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(1) an application fee of: |
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(A) $500, if the applicant does not hold a |
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license under this subchapter; or |
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(B) $200, if the application is for an additional |
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dealership license for a separate location; and |
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(2) an annual license fee in an amount determined by |
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the commission by rule. |
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(b) An applicant that is exempt from taxation under Section |
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501(c)(3), Internal Revenue Code of 1986, is exempt from the fees |
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required under Subsection (a). |
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Sec. 1956.087. LICENSE TERM; RENEWAL. A license expires on |
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the first anniversary of the date of issuance and may be renewed |
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annually on payment of the required annual license fee. |
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Sec. 1956.088. INVESTIGATION; NOTICE OF APPLICATION. |
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(a) On receipt of an application and the required fees, the |
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department shall: |
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(1) conduct an investigation to determine whether to |
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issue the license; and |
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(2) give notice of the application to: |
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(A) the Department of Public Safety; and |
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(B) each local law enforcement agency in the |
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county in which the dealership is to conduct business. |
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(b) The notice under Subsection (a) must state the name and |
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address of each person required by Section 1956.085 to be listed on |
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the license application. |
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(c) The department shall give the Department of Public |
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Safety and local law enforcement agencies a reasonable period to |
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respond to the notice with information concerning the listed |
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persons or any other relevant information. |
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Sec. 1956.089. NOTICE OF DENIAL; HEARING. (a) If the |
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department determines not to issue a license, the department shall |
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deliver to the applicant at the address provided in the application |
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a written notice by personal delivery or certified mail, return |
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receipt requested. The notice must include the department's reason |
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for denying the license. |
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(b) Not later than the 30th day after the date of receipt of |
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a notice under Subsection (a), an applicant may request a hearing on |
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the application denial. The department shall set the hearing not |
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later than the 60th day after the date of the request. A hearing |
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under this section is subject to Section 51.354. |
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(c) If the department denies the application, the |
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department shall retain the application fee and shall return to the |
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applicant the annual license fee submitted with the application. |
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Sec. 1956.090. CONTENTS AND DISPLAY OF LICENSE. (a) A |
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license must state: |
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(1) the name of the dealer; |
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(2) the address at which the dealership conducts |
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business; and |
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(3) that the dealership is authorized to deal in |
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crafted precious metals. |
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(b) A dealer shall display a license in a conspicuous |
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location at the place of business provided on the license. |
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Sec. 1956.091. APPLICATION FOR RELOCATION. A dealer who |
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wishes to move a dealership from the location authorized by a |
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license must file a relocation application with the department not |
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later than the 30th day before the date the dealer moves and pay an |
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application fee of $20. |
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Sec. 1956.092. CRIMINAL BACKGROUND CHECK REQUIRED. (a) A |
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dealer shall conduct a criminal background check on an applicant |
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for employment with the dealer. |
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(b) A dealer may not employ a person who has been convicted |
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of an offense under Section 31.03, Penal Code. |
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Sec. 1956.093. REPORT OF PURCHASE OR EXCHANGE REQUIRED. |
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(a) A dealer shall, as required by Section 1956.094, report all |
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identifiable crafted precious metal that the dealer purchases, |
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takes in trade, accepts for sale on consignment, or accepts for |
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auction. |
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(b) Before crafted precious metal is offered for sale or |
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exchange, a dealer must notify each person intending to sell or |
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exchange the metal that, before the dealer may accept any of the |
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person's property, the person must file with the dealer a list |
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describing all of the person's crafted precious metal to be |
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accepted by the dealer. The list must contain: |
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(1) the proposed seller's or transferor's name and |
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address; |
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(2) the date and time of the purchase or exchange; |
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(3) a complete and accurate description of the crafted |
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precious metal, including: |
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(A) a serial number, if available; and |
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(B) the size, weight, material, length, number of |
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items, capacity, or other identifying characteristics; and |
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(4) the proposed seller's or transferor's |
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certification that the information is true and complete. |
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(c) The dealer shall record the proposed seller's or |
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transferor's driver's license number or Department of Public Safety |
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personal identification certificate number on physical |
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presentation of the license or personal identification certificate |
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by the seller or transferor. The record must accompany the list. |
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(d) All lists and records required by this section must be |
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legible. |
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(e) The dealer shall: |
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(1) provide to a peace officer or the department, on |
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demand, the list required by Subsection (b); and |
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(2) mail or deliver a complete copy of the list to the |
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chief of police or the sheriff as provided by Section 1956.094 not |
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later than 48 hours after the list is filed with the dealer. |
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Sec. 1956.094. FORM OF REPORT; FILING. (a) A report |
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required by this subchapter must comply with this section unless a |
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similar report is required by another state law or a municipal |
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ordinance, in which event the required report must comply with the |
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applicable law or ordinance. |
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(b) If a transaction regulated by this subchapter occurs in |
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a municipality that maintains a police department, the original and |
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a copy of the report required by this subchapter shall be submitted |
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to the municipality's chief of police. If the transaction does not |
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occur in such a municipality, the original and a copy of the report |
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shall be submitted to the sheriff of the county in which the |
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transaction occurs. |
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(c) The dealer shall submit the report on a form prescribed |
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by the district attorney or person performing the duties of |
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district attorney of the county in which the transaction occurs. |
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(d) The dealer shall retain a copy of the report until the |
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third anniversary of the date the report is filed. |
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Sec. 1956.095. RECEIPT REQUIRED. (a) A dealer, at the |
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time of the sale or exchange of crafted precious metal, shall |
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deliver a receipt to the seller or transferor. Each receipt |
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delivered by the dealer must: |
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(1) be numbered sequentially; |
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(2) contain the date of the transaction or |
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acquisition; and |
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(3) itemize the crafted precious metal purchased or |
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exchanged. |
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(b) An accurate copy or record of the receipt shall be: |
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(1) maintained until the third anniversary of the date |
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of the sale or exchange; and |
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(2) available on request for inspection during |
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business hours by a peace officer or the department. |
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Sec. 1956.096. REQUIRED RETENTION OF CRAFTED PRECIOUS |
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METAL. (a) A dealer may not melt, deface, alter, or dispose of |
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crafted precious metal that is the subject of a report required by |
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this subchapter before the 22nd day after the date the report is |
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filed unless: |
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(1) the peace officer to whom the report is submitted, |
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for good cause, authorizes disposition of the metal; or |
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(2) the dealer is a pawnbroker and the disposition is |
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the redemption of pledged property by the pledgor. |
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(b) During the hold period required by Subsection (a), the |
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crafted precious metal shall be stored or displayed: |
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(1) in the exact form received; |
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(2) in a manner as to be identifiable from the |
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description provided under Section 1956.093; and |
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(3) in a manner as to not impede or prevent the crafted |
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precious metal's examination by a peace officer or the department. |
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Sec. 1956.0965. STOLEN CRAFTED PRECIOUS METAL. (a) A |
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dealer or an agent or employee of a dealership shall: |
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(1) monitor the purchase of crafted precious metal to |
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identify or prevent transactions involving stolen crafted precious |
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metal; |
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(2) make reasonable efforts to avoid accepting or |
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purchasing stolen crafted precious metal; and |
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(3) immediately report to a local law enforcement |
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agency: |
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(A) an offer to sell to the dealership crafted |
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precious metal actually known or reasonably suspected to be stolen; |
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(B) the identity, if known, and the description |
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of the person offering to sell the metal described by Paragraph (A); |
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and |
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(C) the purchase of crafted precious metal |
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subsequently determined or reasonably suspected to be stolen. |
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(b) A dealer shall cooperate with a local law enforcement |
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agency regarding any matter relating to stolen crafted precious |
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metal and assist in the prompt resolution of an official |
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investigation. |
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Sec. 1956.0966. INSPECTION OF CRAFTED PRECIOUS METAL. |
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(a) A dealer shall make crafted precious metal purchased by the |
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dealer available for inspection by a peace officer or the |
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department during regular business hours while in the dealer's |
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possession. |
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(b) Information obtained under this section is confidential |
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except for use in a criminal investigation or prosecution or a civil |
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court proceeding. |
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Sec. 1956.0967. PURCHASE FROM MINOR. (a) A dealer may not |
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purchase crafted precious metal from a person younger than 18 years |
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of age unless the seller delivers to the dealer before the purchase |
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a written statement from the seller's parent or legal guardian |
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consenting to the transaction. |
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(b) The dealer shall retain the statement with the records |
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required to be kept under this subchapter. The dealer may destroy |
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the statement after the later of: |
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(1) the date the item is sold; or |
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(2) the first anniversary of the date the dealer |
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purchased the item. |
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Sec. 1956.097. PURCHASE AT TEMPORARY LOCATION OF DEALER. |
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(a) A dealer who conducts business at a temporary location for a |
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period of less than 90 days may not engage in the business of buying |
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precious metal or used items made of precious metal unless, within a |
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12-month period at least 30 days before the date on which each |
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purchase is made, the person has filed: |
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(1) a registration statement with the department; and |
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(2) a copy of the registration statement with the |
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local law enforcement agency of: |
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(A) the municipality in which the temporary |
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location is located; or |
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(B) if the temporary location is not located in a |
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municipality, the county in which the temporary location is |
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located. |
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(b) The registration statement must contain: |
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(1) the name and address of the dealer; |
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(2) the location where business is to be conducted; |
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(3) if the dealer is an association, the name and |
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address of each member of the association; |
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(4) if the dealer is a corporation, the name and |
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address of each officer and director of the corporation; and |
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(5) other relevant information required by the |
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department. |
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Sec. 1956.098. PURCHASE OF MELTED ITEMS. A dealer, in the |
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course of business, may not purchase from a person other than a |
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manufacturer of or a regular dealer in crafted precious metal an |
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object formed as the result of the melting of crafted precious |
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metal. |
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Sec. 1956.0985. GROUNDS FOR DENIAL, REVOCATION, OR |
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SUSPENSION OF LICENSE. The department may deny, revoke, or suspend |
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a dealership license if the dealer: |
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(1) violates this subchapter or a rule adopted or an |
|
order issued under this subchapter; |
|
(2) falsifies information on a license application; or |
|
(3) is convicted of an offense under Section 31.03, |
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37.09, or 37.10, Penal Code. |
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Sec. 1956.0986. NOTICE OF HEARING. (a) The department |
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shall send written notice to the dealer of a dealership license |
|
revocation or suspension hearing that includes the cause or |
|
allegations of the revocation or suspension hearing. |
|
(b) A hearing under this section is subject to Subchapter G, |
|
Chapter 51. |
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Sec. 1956.099. CRIMINAL PENALTY. (a) A person commits an |
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offense if the person violates this subchapter. |
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(b) An offense under this section is a Class B misdemeanor. |
|
SECTION 3. Section 215.031, Local Government Code, is |
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amended to read as follows: |
|
Sec. 215.031. HAWKERS; PEDDLERS; PAWNBROKERS; CRAFTED |
|
PRECIOUS METAL DEALERS. The governing body of the municipality may |
|
license, tax, suppress, prevent, or otherwise regulate: |
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(1) hawkers; |
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(2) peddlers; [and] |
|
(3) pawnbrokers; and |
|
(4) crafted precious metal dealers licensed under |
|
Subchapter B-1, Chapter 1956, Occupations Code. |
|
SECTION 4. (a) As soon as practicable after the effective |
|
date of this Act, the Texas Commission of Licensing and Regulation |
|
shall adopt the rules and procedures necessary to implement |
|
Subchapter B-1, Chapter 1956, Occupations Code, as added by this |
|
Act. |
|
(b) A crafted precious metal dealer is not required to hold |
|
a license under Subchapter B-1, Chapter 1956, Occupations Code, as |
|
added by this Act, before March 1, 2012. |
|
(c) Subsection (a), Section 1956.096, Occupations Code, as |
|
added by this Act, applies only to crafted precious metal that is |
|
the subject of a report filed on or after the effective date of this |
|
Act. Crafted precious metal that is the subject of a report filed |
|
before the effective date of this Act is governed by the law in |
|
effect when the report was filed, and the former law is continued in |
|
effect for that purpose. |
|
(d) Section 1956.099, Occupations Code, as added by this |
|
Act, applies only to an offense committed on or after the effective |
|
date of this Act. An offense committed before the effective date of |
|
this Act is governed by the law in effect on the date the offense was |
|
committed, and the former law is continued in effect for that |
|
purpose. For purposes of this subsection, an offense was committed |
|
before the effective date of this Act if any element of the offense |
|
occurred before that date. |
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SECTION 5. This Act takes effect September 1, 2011. |