Minnesota Legislature
Office of the Revisor of Statutes
Minnesota Session Laws - 2000, Regular Session
Key: (1) language to be deleted (2) new language
CHAPTER 483-H.F.No. 3505
An act relating to commerce; providing enforcement
authority to the commissioner; providing technical
changes; regulating certain disclosures; specifying
the license term and fees of a managing general agent;
regulating motor vehicle service contracts; regulating
underwriting practices; regulating insurance brokerage
business; regulating workers' compensation
self-insurance; regulating securities broker-dealers
and investment advisers; authorizing the commissioner
to withdraw certain inactive registration
applications; regulating real estate and insurance
agent continuing education; regulating the contractor
recovery fund; making collection agencies responsible
for the acts of collectors; providing standards of
conduct for notarial acts; regulating unclaimed
property; amending Minnesota Statutes 1998, sections
45.027, subdivision 7a; 60A.052, subdivision 1;
60A.129, subdivision 5; 60H.03, by adding a
subdivision; 60K.03, subdivision 4; 60K.14,
subdivision 1; 61A.092, subdivision 6; 62A.136;
62C.11, subdivision 1; 62C.142, subdivision 2a;
62E.04, subdivision 4; 62H.10, subdivision 4; 62S.02,
subdivision 1; 64B.30, subdivision 1; 65B.29,
subdivisions 2 and 3; 72A.20, subdivision 17; 72A.499,
subdivision 1; 79A.04, subdivisions 1, 2, 7, and 9;
79A.11, subdivision 2, and by adding a subdivision;
79A.22, subdivisions 3 and 11; 80A.04, subdivisions 2
and 3; 80A.07, subdivision 1; 80A.10, subdivision 2;
80C.05, subdivision 4; 80C.07; 82.22, subdivision 13;
82A.04, subdivision 4, and by adding a subdivision;
82B.14; 83.23, by adding a subdivision; 308A.711,
subdivision 1; 326.975, subdivision 1; and 345.515;
Minnesota Statutes 1999 Supplement, sections 60A.052,
subdivision 2; 60K.19, subdivision 8; 62J.535,
subdivision 2; 72A.20, subdivision 23; 79A.22,
subdivision 2; 79A.23, subdivisions 1, 2, and 3;
79A.24, subdivision 2; and 80A.15, subdivision 2; Laws
1999, chapter 177, section 89; proposing coding for
new law in Minnesota Statutes, chapters 60K; 332; and
359; repealing Minnesota Statutes 1998, sections
62A.285, subdivision 4; 62A.651; and 65B.13.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 1998, section 45.027,
subdivision 7a, is amended to read:
Subd. 7a. [AUTHORIZED DISCLOSURES OF INFORMATION AND
DATA.] (a) The commissioner may release and disclose any active
or inactive investigative information and data on licensees to
any national securities exchange or national securities
association registered under the Securities Exchange Act of 1934
when necessary for the requesting agency in initiating,
furthering, or completing an investigation.
(b) The commissioner may release any active or inactive
investigative data relating to the conduct of the business of
insurance to the Office of the Comptroller of the Currency or
the Office of Thrift Supervision in order to facilitate the
initiation, furtherance, or completion of the investigation.
Sec. 2. Minnesota Statutes 1998, section 60A.052,
subdivision 1, is amended to read:
Subdivision 1. [GROUNDS.] The commissioner may by order
take any or all of the following actions: (a) deny, suspend, or
revoke a certificate of authority; (b) censure the insurance
company; or (c) impose a civil penalty as provided for in
section 45.027, subdivision 6; or (d) under a written agreement
with the insurance company based upon the company's financial
condition, impose conditions or restrictions on the insurance
company's authority to transact business in Minnesota. In order
to take this action the commissioner must find that the order is
in the public interest, and the insurance company:
(1) has a board of directors or principal management that
is incompetent, untrustworthy, or so lacking in insurance
company managerial experience as to make its operation hazardous
to policyholders, its stockholders, or to the insurance buying
public;
(2) is controlled directly or indirectly through ownership,
management, reinsurance transactions, or other business
relations by any person or persons whose business operations are
or have been marked by manipulation of any assets, reinsurance,
or accounts as to create a hazard to the company's
policyholders, stockholders, or the insurance buying public;
(3) is in an unsound or unsafe condition;
(4) has the actual liabilities that exceed the actual funds
of the company;
(5) has filed an application for a license which is
incomplete in any material respect or contains any statement
which, in light of the circumstances under which it was made,
contained any misrepresentation or was false, misleading, or
fraudulent;
(6) has pled guilty, with or without explicitly admitting
guilt, pled nolo contendere, or been convicted of a felony,
gross misdemeanor, or misdemeanor involving moral turpitude, or
similar conduct;
(7) is permanently or temporarily enjoined by any court of
competent jurisdiction from engaging in or continuing any
conduct or practice involving any aspect of the insurance
business;
(8) has violated or failed to comply with any order of the
insurance regulator of any other state or jurisdiction;
(9) has had a certificate of authority denied, suspended,
or revoked, has been censured or reprimanded, has been the
subject of any other discipline imposed by, or has paid or has
been required to pay a monetary penalty or fine to, another
state;
(10) agents, officers, or directors refuse to submit to
examination or perform any related legal obligation; or
(11) has violated or failed to comply with, any of the
provisions of the insurance laws including chapter 45 or
chapters 60A to 72A or any rule or order under those chapters.
Sec. 3. Minnesota Statutes 1999 Supplement, section
60A.052, subdivision 2, is amended to read:
Subd. 2. [SUSPENSION OR REVOCATION OF AUTHORITY OR
CENSURE.] If the commissioner determines that one of the
conditions listed in subdivision 1 exists, the commissioner may
issue an order requiring the insurance company to show cause why
any or all of the following should not occur: (1) revocation or
suspension of any or all certificates of authority granted to
the foreign or domestic insurance company or its agent; (2)
censuring of the insurance company; (3) cancellation of all or
some of the company's insurance contracts then in force in this
state; or (4) the imposition of a civil penalty; or (5) under a
written agreement with the insurance company based upon the
company's financial condition, imposition of conditions or
restrictions on the insurance company's authority to transact
business in Minnesota. The order shall be calculated to give
reasonable notice of the time and place for hearing thereon, and
shall state the reasons for the entry of the order. All
hearings shall be conducted in accordance with chapter 14. The
insurer may waive its right to the hearing. If the insurer is
under the supervision or control of the insurance department of
the insurer's state of domicile, that insurance department,
acting on behalf of the insurer, may waive the insurer's right
to the hearing. After the hearing, the commissioner shall enter
an order disposing of the matter as the facts require. If the
insurance company fails to appear at a hearing after having been
duly notified of it, the company shall be considered in default,
and the proceeding may be determined against the company upon
consideration of the order to show cause, the allegations of
which may be considered to be true.
Sec. 4. Minnesota Statutes 1998, section 60A.129,
subdivision 5, is amended to read:
Subd. 5. [CONSOLIDATED FILING.] (a) The commissioner may
allow an insurer to file a consolidated loss reserve
certification required by subdivision 2, in lieu of separate
loss certifications and may allow an insurer to file
consolidated or combined audited financial statements required
by subdivision 3, paragraph (a), in lieu of separate annual
audited financial statements, where it can be demonstrated that
an insurer is part of a group of insurance companies that has a
pooling or 100 percent reinsurance agreement which substantially
affects the solvency and integrity of the reserves of the
insurer and the insurer cedes all of its direct and assumed
business to the pool. An affiliated insurance company not
meeting these requirements may be included in the consolidated
or combined audited financial statements, if the company's total
admitted assets are less than five percent of the consolidated
group's total admitted assets. If these circumstances exist,
then the company may file a written application to file a
consolidated loss reserve certification and/or consolidated or
combined audited financial statements. This application shall
be for a specified period.
(b) A consolidated annual audit filing shall include a
columnar consolidated or combining worksheet. Amounts shown on
the audited consolidated or combined financial statement shall
be shown on the worksheet. Amounts for each insurer shall be
stated separately. Noninsurance operations may be shown on the
worksheet on a combined or individual basis. Explanations of
consolidating or eliminating entries shall be shown on the
worksheet. A reconciliation of any differences between the
amounts shown in the individual insurer columns of the worksheet
and comparable amounts shown on the annual statement of the
insurers shall be included on the worksheet.
Sec. 5. Minnesota Statutes 1998, section 60H.03, is
amended by adding a subdivision to read:
Subd. 4. [TERM AND FEES.] The term of a managing general
agent license issued under this section and the license fees
imposed are the same as those applicable to a licensed insurance
agent under chapter 60K.
Sec. 6. Minnesota Statutes 1998, section 60K.03,
subdivision 4, is amended to read:
Subd. 4. [TERM.] All licenses issued pursuant to this
section remain in force until voluntarily terminated by the
licensee, not renewed as prescribed in section 60K.06, or until
suspended or revoked by the commissioner. A voluntary
termination occurs when the license is surrendered to the
commissioner with the request that it be terminated or when the
licensee dies, or when the licensee is dissolved or its
existence is terminated. In the case of a nonresident license,
a voluntary termination also occurs upon the happening of the
event described in subdivision 3, paragraph (c).
Every licensed agent shall notify the commissioner within
30 ten days of a change of name, address, or information
contained in the application.
Sec. 7. [60K.081] [BROKERAGE BUSINESS.]
Every insurance agent licensed to transact business in this
state may procure the insurance of risks, or parts of risks, in
the class or classes of insurance for which the agent is
licensed, from an insurer authorized to transact business in
this state, when the agent is not an appointed agent of the
insurer, but the insurance must be consummated only through an
appointed agent of the insurer.
Sec. 8. Minnesota Statutes 1998, section 60K.14,
subdivision 1, is amended to read:
Subdivision 1. [PERSONAL SOLICITATION OF INSURANCE SALES.]
(a) [DEFINITIONS.] For the purposes of this section, the
following terms have the meanings given them:
(1) "agent" means a person, copartnership, or corporation
required to be licensed pursuant to section 60K.02; and
(2) "personal solicitation" means any contact by an agent,
or any person acting on behalf of an agent, made for the purpose
of selling or attempting to sell insurance, when either the
agent or a person acting for the agent contacts the buyer by
telephone or in person, except: (i) an attempted sale in which
the buyer personally knows the identity of the agent, the name
of the general agency, if any, which the agent represents, and
the fact that the agent is an insurance agent; (ii) an attempted
sale in which the prospective purchaser of insurance initiated
the contact; or (iii) a personal contact which takes place at
the agent's place of business.
(b) [DISCLOSURE REQUIREMENT.] Before a personal
solicitation, the agent or person acting for an agent shall, at
the time of initial personal contact with the potential buyer,
clearly and expressly disclose in writing:
(1) the name and state insurance agent license number of
the person making the contact;
(2) the name of the agent, general agency, or insurer that
person represents; and
(3) the fact that the agent, agency, or insurer is in the
business of selling insurance.
If the initial personal contact is made by telephone, the
disclosures required by this subdivision need not be made in
writing.
(c) [FALSE REPRESENTATION OF GOVERNMENT AFFILIATION.] No
agent or person acting for an agent shall make any communication
to a potential buyer that indicates or gives the impression that
the agent is acting on behalf of a government agency.
Sec. 9. Minnesota Statutes 1999 Supplement, section
60K.19, subdivision 8, is amended to read:
Subd. 8. [MINIMUM EDUCATION REQUIREMENT.] Each person
subject to this section shall complete a minimum of 30 credit
hours of courses accredited by the commissioner during each
24-month licensing period, two hours of which must be devoted to
state law, regulations, and rules applicable to the line or
lines of insurance for which the agent is licensed. Any person
whose initial licensing period extends more than six months
shall complete 15 hours of courses accredited by the
commissioner during the initial license period. Any person
teaching or lecturing at an accredited course qualifies for
1-1/2 times the number of credit hours that would be granted to
a person completing the accredited course. No more than 15
credit hours per licensing period may be credited to a person
for courses sponsored by, offered by, or affiliated with an
insurance company or its agents. Courses sponsored by, offered
by, or affiliated with an insurance company or agent may
restrict its students to agents of the company or agency.
Sec. 10. Minnesota Statutes 1998, section 61A.092,
subdivision 6, is amended to read:
Subd. 6. [APPLICATION.] This section applies to a policy,
certificate of insurance, or similar evidence of coverage issued
to a Minnesota resident or issued to provide coverage to a
Minnesota resident. This section does not apply to: (1) a
certificate of insurance or similar evidence of coverage that
meets the conditions of section 61A.093, subdivision 2; or (2) a
group life insurance policy that contains a provision permitting
the certificate holder, upon termination or layoff from
employment, to retain the coverage provided under the group
policy by paying premiums directly to the insurer, provided that
the employer shall give the employee notice of the employee's
and each related certificate holder's right to continue the
insurance by paying premiums directly to the insurer. A related
certificate holder is an insured spouse or dependent child of
the employee. Upon termination of this group policy, each
covered employee, spouse, and dependent child is entitled to
have issued to them a life conversion policy as prescribed in
section 61A.09, subdivision 1, paragraph (h).
Sec. 11. Minnesota Statutes 1998, section 62A.136, is
amended to read:
62A.136 [DENTAL AND VISION PLAN COVERAGE.]
The following provisions do not apply to health plans
providing dental or vision coverage only: sections 62A.041;
62A.0411; 62A.047; 62A.149; 62A.151; 62A.152; 62A.154; 62A.155;
62A.17, subdivision 6; 62A.21, subdivision 2b; 62A.26;
62A.28; and 62A.285; 62A.30; 62A.304; 62A.3093; and 62E.16.
Sec. 12. Minnesota Statutes 1998, section 62C.11,
subdivision 1, is amended to read:
Subdivision 1. A service plan corporation shall annually
on or before the last day of March, file with the commissioner a
financial statement, in such form as the commissioner shall
prescribe, verified by not less than two of its principal
officers, showing the financial condition of the corporation as
of December 31 of the preceding year. The statement shall
include an audit report certified by an independent certified
public accountant and reconciled and adjusted to conform to the
financial statement.
Sec. 13. Minnesota Statutes 1998, section 62C.142,
subdivision 2a, is amended to read:
Subd. 2a. [CONTINUATION PRIVILEGE.] Every subscriber
contract, other than a contract whose continuance is contingent
upon continued employment or membership, shall contain a
provision which permits continuation of coverage under the
contract for the subscriber's former spouse and children upon
entry of a valid decree of dissolution of marriage, if the
decree requires the subscriber to provide continued coverage for
those persons. The coverage may be continued until the earlier
of the following dates:
(a) the date of remarriage of either the subscriber or the
subscriber's former spouse becomes covered under any other group
health plan; or
(b) the date coverage would otherwise terminate under the
subscriber contract.
The contract must require the group contract holder to,
upon request, provide the insured with written verification from
the insurer of the cost of this coverage promptly at the time of
eligibility for this coverage and at any time during the
continuation period. In no event shall the amount of premium
charged exceed 102 percent of the cost to the plan for such
period of coverage for other similarly situated spouses and
dependent children with respect to whom the marital relationship
has not dissolved, without regard to whether such cost is paid
by the employer or employee.
Sec. 14. Minnesota Statutes 1998, section 62E.04,
subdivision 4, is amended to read:
Subd. 4. [MAJOR MEDICAL COVERAGE.] Each insurer and
fraternal shall affirmatively offer coverage of major medical
expenses to every applicant who applies to the insurer or
fraternal for a new unqualified policy, which has a lifetime
benefit limit of less than $1,000,000, at the time of
application and annually to every holder of such an unqualified
policy of accident and health insurance renewed by the insurer
or fraternal. The coverage shall provide that when a covered
individual incurs out-of-pocket expenses of $5,000 or more
within a calendar year for services covered in section 62E.06,
subdivision 1, benefits shall be payable, subject to any
copayment authorized by the commissioner, up to a maximum
lifetime limit of $500,000. The offer of coverage of major
medical expenses may consist of the offer of a rider on an
existing unqualified policy or a new policy which is a qualified
plan.
Sec. 15. Minnesota Statutes 1998, section 62H.10,
subdivision 4, is amended to read:
Subd. 4. [BROKER.] "Broker" means an agent engaged in
brokerage business pursuant to section 60K.08 60K.081.
Sec. 16. Minnesota Statutes 1999 Supplement, section
62J.535, subdivision 2, is amended to read:
Subd. 2. [COMPLIANCE.] (a) Concurrent with the effective
dates date of required compliance established under United
States Code, title 42, sections 1320d to 1320d-8, as amended
from time to time, for uniform electronic billing standards, all
health care providers must conform to the uniform billing
standards developed under subdivision 1.
(b) Notwithstanding paragraph (a), the requirements for the
uniform remittance advice report shall be effective 12 months
after the date of the required compliance of the standards for
the electronic remittance advice transaction are effective under
United States Code, title 42, sections 1320d to 1320d-8, as
amended from time to time.
Sec. 17. Minnesota Statutes 1998, section 62S.02,
subdivision 1, is amended to read:
Subdivision 1. [REQUIREMENTS.] A qualified long-term care
insurance policy may not be offered, issued, delivered, or
renewed in this state unless the policy satisfies the
requirements of this chapter and the filing provisions of
section 62A.02. A qualified long-term care insurance policy
must cover qualified long-term care services.
Sec. 18. Minnesota Statutes 1998, section 64B.30,
subdivision 1, is amended to read:
Subdivision 1. [VISITATION AND EXAMINATION.] The
commissioner, or any person the commissioner may appoint, shall
have the power of visitation and examination into the affairs of
any domestic society. The commissioner shall conduct an
examination at least once in every three years as often as is
required in section 60A.031, subdivision 1. The commissioner
may:
(1) employ assistance for the purposes of examination and
the commissioner, or any person the commissioner may appoint,
shall have free access to any books, papers, and documents that
relate to the business of the association; and
(2) summon and qualify as witnesses, under oath, and
examine its officers, agents, and employees, or other persons,
in relation to the affairs, transactions, and condition of the
association.
Sec. 19. Minnesota Statutes 1998, section 65B.29,
subdivision 2, is amended to read:
Subd. 2. [INSURANCE REQUIRED.] No motor vehicle service
contract may be issued, sold, or offered for sale in this state
unless the provider of the service contract is insured under a
motor vehicle service contract reimbursement insurance policy
issued by an insurer authorized to do business in this
state. Insurers issuing such a policy are required to have
capital and surplus equal to at least $5,000,000 at the end of
the preceding year. Capital and surplus must be calculated
using the accounting standards required by section 60A.13.
Sec. 20. Minnesota Statutes 1998, section 65B.29,
subdivision 3, is amended to read:
Subd. 3. [FILING REQUIREMENTS.] No motor vehicle service
contract may be issued, sold, or offered for sale in this state
unless a true and correct copy of the service contract and the
provider's reimbursement insurance policy have been filed with
the commissioner and either (1) the commissioner has approved it
or (2) 60 days have elapsed and the commissioner has not
disapproved it as misleading or violative of public policy. The
commissioner may, by written notice to the provider, extend the
review for an additional period not to exceed 60 days.
Sec. 21. Minnesota Statutes 1998, section 72A.20,
subdivision 17, is amended to read:
Subd. 17. [RETURN OF PREMIUMS.] (a) Refusing, upon
surrender of an individual policy of life insurance in the case
of the insured's death, or in the case of a surrender prior to
death, of an individual insurance policy not covered by the
standard nonforfeiture laws under section 61A.24, to refund to
the owner all unearned premiums paid on the policy covering the
insured as of the time of the insured's death or surrender if
the unearned premium is for a period of more than one
month. The return of unearned premium must be delivered to the
insured within 30 days following receipt by the insurer of the
insured's request for cancellation.
(b) Refusing, upon termination or cancellation of a policy
of automobile insurance under section 65B.14, subdivision 2, or
a policy of homeowner's insurance under section 65A.27,
subdivision 4, or a policy of accident and sickness insurance
under section 62A.01, or a policy of comprehensive health
insurance under chapter 62E, to refund to the insured all
unearned premiums paid on the policy covering the insured as of
the time of the termination or cancellation if the unearned
premium is for a period of more than one month. The return of
unearned premium must be delivered to the insured within 30 days
following receipt by the insurer of the insured's request for
cancellation.
(c) This subdivision does not apply to policies of
insurance providing coverage only for motorcycles or other
seasonally rated or limited use vehicles where the rate is
reduced to reflect seasonal or limited use.
(d) For purposes of this section, a premium is unearned
during the period of time the insurer has not been exposed to
any risk of loss. Except for premiums for motorcycle coverage
or other seasonally rated or limited use vehicles where the rate
is reduced to reflect seasonal or limited use, the unearned
premium is determined by multiplying the premium by the fraction
that results from dividing the period of time from the date of
termination to the date the next scheduled premium is due by the
period of time for which the premium was paid.
(e) The owner may cancel a policy referred to in this
section at any time during the policy period. This provision
supersedes any inconsistent provision of law or any inconsistent
policy provision.
Sec. 22. Minnesota Statutes 1999 Supplement, section
72A.20, subdivision 23, is amended to read:
Subd. 23. [DISCRIMINATION IN AUTOMOBILE INSURANCE
POLICIES.] (a) No insurer that offers an automobile insurance
policy in this state shall:
(1) use the employment status of the applicant as an
underwriting standard or guideline; or
(2) deny coverage to a policyholder for the same reason.
(b) No insurer that offers an automobile insurance policy
in this state shall:
(1) use the applicant's status as a residential tenant, as
the term is defined in section 504B.001, subdivision 12, as an
underwriting standard or guideline; or
(2) deny coverage to a policyholder for the same reason; or
(3) make any discrimination in offering or establishing
rates, premiums, dividends, or benefits of any kind, or by way
of rebate, for the same reason.
(c) No insurer that offers an automobile insurance policy
in this state shall:
(1) use the failure of the applicant to have an automobile
policy in force during any period of time before the application
is made as an underwriting standard or guideline; or
(2) deny coverage to a policyholder for the same reason.
This provision Paragraph (c) does not apply if the
applicant was required by law to maintain automobile insurance
coverage and failed to do so.
An insurer may require reasonable proof that the applicant
did not fail to maintain this coverage. The insurer is not
required to accept the mere lack of a conviction or citation for
failure to maintain this coverage as proof of failure to
maintain coverage. The insurer must provide the applicant with
information identifying the documentation that is required to
establish reasonable proof that the applicant did not fail to
maintain the coverage.
(d) No insurer that offers an automobile insurance policy
in this state shall use an applicant's prior claims for benefits
paid under section 65B.44 as an underwriting standard or
guideline if the applicant was 50 percent or less negligent in
the accident or accidents causing the claims.
(e) No insurer shall refuse to issue any standard or
preferred policy of motor vehicle insurance or make any
discrimination in the acceptance of risks, in rates, premiums,
dividends, or benefits of any kind, or by way of rebate:
(1) between persons of the same class, or
(2) on account of race, or
(3) on account of physical handicap if the handicap is
compensated for by special training, equipment, prosthetic
device, corrective lenses, or medication and if the physically
handicapped person:
(i) is licensed by the department of public safety to
operate a motor vehicle in this state, and
(ii) operates only vehicles that are equipped with
auxiliary devices and equipment necessary for safe and effective
operation by the handicapped person, or
(4) on account of marital dissolution.
Sec. 23. Minnesota Statutes 1998, section 72A.499,
subdivision 1, is amended to read:
Subdivision 1. [NOTICE AND INFORMATION.] (a) In the event
of an adverse underwriting decision, the insurer or insurance
agent responsible for the decision shall provide in writing to
the applicant, policyholder, or individual proposed for coverage:
(1) the specific reason or reasons for the adverse
underwriting decision, a summary of the person's rights under
sections 72A.497 and 72A.498, and that upon request the person
may receive the specific items of personal information that
support those reasons and the specific sources of the
information; or
(2) the specific reason or reasons for the adverse
underwriting decision, the specific items of personal and
privileged information that support those reasons, the names and
addresses of the sources that supplied the specific items of
information specified, and a summary of the rights established
under sections 72A.497 and 72A.498.
(b) In addition to the requirements of paragraph (a), if
the adverse underwriting decision is either solely or partially
based upon a report of credit worthiness, credit standing, or
credit capacity that an insurer receives from a consumer
reporting agency, the insurer or insurance agent responsible for
the decision shall provide in writing to the applicant,
policyholder, or individual proposed for coverage the primary
reason or reasons for the credit score or other credit based
information used by the insurer in the insurer's adverse
underwriting decision.
Sec. 24. Minnesota Statutes 1998, section 79A.04,
subdivision 1, is amended to read:
Subdivision 1. [ANNUAL SECURING OF LIABILITY.] Each year
every private self-insuring employer shall secure incurred
liabilities for the payment of compensation and the performance
of the its obligations and the obligations of all self-insuring
employers imposed under chapter 176 by renewing the prior year's
security deposit or by making a new deposit of security. If a
new deposit is made, it must be posted within 60 days of the
filing of the self-insured employer's annual report with the
commissioner, but in no event later than July 1.
Sec. 25. Minnesota Statutes 1998, section 79A.04,
subdivision 2, is amended to read:
Subd. 2. [MINIMUM DEPOSIT.] The minimum deposit is 110
percent of the private self-insurer's estimated future liability.
Up to ten percent of that The deposit may be used to secure
payment of all administrative and legal costs, and unpaid
assessments required by section 79A.12, subdivision 2, relating
to or arising from the employer's its or other employers'
self-insuring. As used in this section, "private self-insurer"
includes both current and former members of the self-insurers'
security fund; and "private self-insurers' estimated future
liability" means the private self-insurers' total of estimated
future liability as determined by an Associate or Fellow of the
Casualty Actuarial Society every year for group member private
self-insurers and, for a nongroup member private self-insurer's
authority to self-insure, every year for the first five years.
After the first five years, the nongroup member's total shall be
as determined by an Associate or Fellow of the Casualty
Actuarial Society at least every two years, and each such
actuarial study shall include a projection of future losses
during the period until the next scheduled actuarial study, less
payments anticipated to be made during that time.
All data and information furnished by a private
self-insurer to an Associate or Fellow of the Casualty Actuarial
Society for purposes of determining private self-insurers'
estimated future liability must be certified by an officer of
the private self-insurer to be true and correct with respect to
payroll and paid losses, and must be certified, upon information
and belief, to be true and correct with respect to reserves.
The certification must be made by sworn affidavit. In addition
to any other remedies provided by law, the certification of
false data or information pursuant to this subdivision may
result in a fine imposed by the commissioner of commerce on the
private self-insurer up to the amount of $5,000, and termination
of the private self-insurers' authority to self-insure. The
determination of private self-insurers' estimated future
liability by an Associate or Fellow of the Casualty Actuarial
Society shall be conducted in accordance with standards and
principles for establishing loss and loss adjustment expense
reserves by the Actuarial Standards Board, an affiliate of the
American Academy of Actuaries. The commissioner may reject an
actuarial report that does not meet the standards and principles
of the Actuarial Standards Board, and may further disqualify the
actuary who prepared the report from submitting any future
actuarial reports pursuant to this chapter. Within 30 days
after the actuary has been served by the commissioner with a
notice of disqualification, an actuary who is aggrieved by the
disqualification may request a hearing to be conducted in
accordance with chapter 14. Based on a review of the actuarial
report, the commissioner of commerce may require an increase in
the minimum security deposit in an amount the commissioner
considers sufficient.
Estimated future liability is determined by first taking
the total amount of the self-insured's future liability of
workers' compensation claims and then deducting the total amount
which is estimated to be returned to the self-insurer from any
specific excess insurance coverage, aggregate excess insurance
coverage, and any supplementary benefits or second injury
benefits which are estimated to be reimbursed by the special
compensation fund. Supplementary benefits or second injury
benefits will not be reimbursed by the special compensation fund
unless the special compensation fund assessment pursuant to
section 176.129 is paid and the reports required thereunder are
filed with the special compensation fund. In the case of surety
bonds, bonds shall secure administrative and legal costs in
addition to the liability for payment of compensation reflected
on the face of the bond. In no event shall the security be less
than the last retention limit selected by the self-insurer with
the workers' compensation reinsurance association, provided that
the commissioner may allow former members to post less than the
workers' compensation reinsurance association retention level if
that amount is adequate to secure payment of the self-insurers'
estimated future liability, as defined in this subdivision,
including payment of claims, administrative and legal costs, and
unpaid assessments required by section 79A.12, subdivision 2.
The posting or depositing of security pursuant to this section
shall release all previously posted or deposited security from
any obligations under the posting or depositing and any surety
bond so released shall be returned to the surety. Any other
security shall be returned to the depositor or the person
posting the bond.
As a condition for the granting or renewing of a
certificate to self-insure, the commissioner may require a
private self-insurer to furnish any additional security the
commissioner considers sufficient to insure payment of all
claims under chapter 176.
Sec. 26. Minnesota Statutes 1998, section 79A.04,
subdivision 7, is amended to read:
Subd. 7. [PERFECTION OF SECURITY.] Upon the commissioner
sending a request to renew, request to post, or request to
increase a security deposit, a perfected security interest is
created in the private self-insured's assets in favor of the
commissioner to the extent of any then unsecured portion of the
self-insured's incurred liabilities. That perfected security
interest is transferred to any cash or securities thereafter
posted by the private self-insured with the state treasurer and
is released only upon either of the following:
(1) the acceptance by the commissioner of a surety bond or
irrevocable letter of credit for the full amount of the incurred
liabilities for the payment of compensation; or
(2) the return of cash or securities by the commissioner.
The private self-insured employer loses all right, title,
and interest in and any right to control all assets or
obligations posted or left on deposit as security. In the event
of a declaration of bankruptcy or insolvency by a court of
competent jurisdiction that a private self-insurer is the
subject of a voluntary or involuntary petition under the United
States Bankruptcy Code, title 11, or a court of competent
jurisdiction has declared the private self-insurer to be
bankrupt or insolvent, or in the event of the issuance of a
certificate of default by the commissioner, the commissioner
shall liquidate the deposit as provided in this chapter, and
transfer it to the self-insurer's security fund for application
to the self-insured employer's incurred liability and other
current or future obligations of the self-insurers' security
fund. In the event that a private self-insurer is the subject
of a voluntary or involuntary petition under the United States
Bankruptcy Code, title 11, or a court of competent jurisdiction
has declared the private self-insurer to be bankrupt or
insolvent, or in the event of the issuance of a certificate of
default by the commissioner, all right, title, and interest in
and any right to control all assets or obligations which have
been posted or deposited as security must be transferred to the
self-insurers' security fund.
Sec. 27. Minnesota Statutes 1998, section 79A.04,
subdivision 9, is amended to read:
Subd. 9. [INSOLVENCY, BANKRUPTCY, OR DEFAULT; UTILIZATION
OF SECURITY DEPOSIT.] The commissioner of labor and industry
shall notify the commissioner and the security fund if the
commissioner of labor and industry has knowledge that any
private self-insurer has failed to pay workers' compensation
benefits as required by chapter 176. If the commissioner
determines that a private self-insurer is the subject of a
voluntary or involuntary petition under the United States
Bankruptcy Code, title 11, or the commissioner determines that a
court of competent jurisdiction has declared the private
self-insurer to be bankrupt or insolvent, and the private
self-insurer has failed to pay workers' compensation as required
by chapter 176 or, if the commissioner issues a certificate of
default against a private self-insurer for failure to pay
workers' compensation as required by chapter 176, or failure to
pay an assessment to the self-insurers' security fund when due,
then the security deposit shall be utilized to administer and
pay the private self-insurers' workers' compensation or
assessment obligations or any other current or future
obligations of the self-insurers' security fund.
Sec. 28. Minnesota Statutes 1998, section 79A.11,
subdivision 2, is amended to read:
Subd. 2. [SECURITY DEPOSITS.] The security fund shall have
the right and obligation to obtain from and retain the security
deposit of an insolvent private self-insurer the amount of to
apply to the private self-insurer's current or future
compensation obligations, including reasonable administrative
and legal costs, paid or assumed by the security fund and to
other current or future obligations of the security fund.
Reimbursement of administrative costs, including legal costs,
shall be subject to approval by a majority of the security
fund's voting trustees. The security fund shall be a party in
interest in any action to obtain the security deposit for the
payment of compensation obligations of an insolvent self-insurer.
Sec. 29. Minnesota Statutes 1998, section 79A.11, is
amended by adding a subdivision to read:
Subd. 2a. [REPLACEMENT INSURANCE POLICY.] The insolvent
self-insurer may obtain an insurance policy as described in
section 79A.06, subdivision 5, to discharge further workers'
compensation obligations assumed by the self-insurers' security
fund on behalf of the insolvent insurer. At the self-insurers'
security fund's option and in its sole discretion, any part of
the insolvent self-insurer's security deposit may be used to
fund the acquisition of this policy. After the security deposit
has been used to: (1) fund the acquisition of this policy; (2)
pay all direct and indirect administrative and professional
expenses of the fund related to the insolvent self-insurer; and
(3) to the extent not covered by the insurance policy, pay the
insolvent self-insurer's losses, allocated loss expense and
unallocated loss expense, any part of the insolvent
self-insurer's security deposit that remains must be promptly
returned to the insolvent self-insurer.
Sec. 30. Minnesota Statutes 1999 Supplement, section
79A.22, subdivision 2, is amended to read:
Subd. 2. [FINANCIAL STANDARDS.] Commercial self-insurance
groups shall have and maintain:
(1) combined net worth of all of the members in an amount
at least equal to 12 ten times the group's selected retention
level of the workers' compensation reinsurance association. For
purposes of this clause, the amount of any retained surplus by
the group is considered part of the combined net worth of all
the members;
(2) sufficient assets and liquidity in the group's common
claims fund to promptly and completely meet all obligations of
its members under this chapter and chapter 176.
Sec. 31. Minnesota Statutes 1998, section 79A.22,
subdivision 3, is amended to read:
Subd. 3. [NEW MEMBERSHIP.] The commercial self-insurance
group shall file with the commissioner the name of any new
employer that has been accepted in the group prior to the
initiation date of membership along with the member's signed
indemnity agreement and evidence the member has deposited
sufficient premiums with the group as required by the commercial
self-insurance group's bylaws or plan of operation. The
security deposit of the group will shall be increased quarterly
to an amount equal to 50 percent of the new member's premium
members' premiums for that quarter. If the total increase of
new members' premiums for the first quarter is less than five
percent of the total annual premium of the group, no quarterly
increase is necessary until the cumulative quarterly increases
for that calendar year exceed five percent of the total premium
of the group. The department of commerce commissioner may, at
its the commissioner's option, review the financial statement of
any applicant whose premium equals 25 percent or more of the
group's total premium.
Sec. 32. Minnesota Statutes 1998, section 79A.22,
subdivision 11, is amended to read:
Subd. 11. [DISBURSEMENT OF FUND SURPLUS.] (a) One hundred
percent of any surplus money for a fund year in excess of 125
percent of the amount necessary to fulfill all obligations under
the Workers' Compensation Act, chapter 176, for that fund year
may be declared refundable to a member at any time. The date
shall be no earlier than 18 months following the end of such
fund year. The first disbursement of fund surplus may not be
made prior to the completion of an operational audit by the
commissioner written approval of the commissioner. There can be
no more than one refund made in any 12-month period. When all
the claims of any one fund year have been fully paid, as
certified by an actuary, all surplus money from that fund year
may be declared refundable.
(b) The commercial self-insurance group shall give notice
to the commissioner of any refund. Said notice shall be
accompanied by a statement from the commercial self-insurer
group's certified public accountant certifying that the proposed
refund is in compliance with paragraph (a).
Sec. 33. Minnesota Statutes 1999 Supplement, section
79A.23, subdivision 1, is amended to read:
Subdivision 1. [REQUIRED REPORTS TO COMMISSIONER.] Each
commercial self-insurance group shall submit the following
documents to the commissioner.
(a) An annual report shall be submitted by April 1 showing
the incurred losses, paid and unpaid, specifying indemnity and
medical losses by classification, payroll by classification, and
current estimated outstanding liability for workers'
compensation on a calendar year basis, in a manner and on forms
available from the commissioner. In addition each group will
submit a quarterly interim loss report showing incurred losses
for all its membership.
(b) Each commercial self-insurance group shall submit
within 45 days of the end of each quarter:
(1) a schedule showing all the members who participate in
the group, their date of inception, and date of withdrawal, if
applicable;
(2) a separate section identifying which members were added
or withdrawn during that quarter; and
(3) an internal financial statement and copies of the
fiscal agent's statements supporting the balances in the common
claims fund.
(c) The commercial self-insurance group shall submit an
annual certified financial audit report of the commercial
self-insurance group fund by April 1 of the following year. The
report must be accompanied by an expense schedule showing the
commercial self-insurance group's operational costs for the same
year including service company charges, accounting and actuarial
fees, fund administration charges, reinsurance premiums,
commissions, and any other costs associated with the
administration of the group program.
(d) An officer of the commercial self-insurance group
shall, under oath, attest to the accuracy of each report
submitted under paragraphs (a), (b), and (c). Upon sufficient
cause, the commissioner shall require the commercial
self-insurance group to submit a certified audit of payroll and
claim records conducted by an independent auditor approved by
the commissioner, based on generally accepted accounting
principles and generally accepted auditing standards, and
supported by an actuarial review and opinion of the future
contingent liabilities. The basis for sufficient cause shall
include the following factors:
(1) where the losses reported appear significantly
different from similar types of groups;
(2) where major changes in the reports exist from year to
year, which are not solely attributable to economic factors; or
(3) where the commissioner has reason to believe that the
losses and payroll in the report do not accurately reflect the
losses and payroll of the commercial self-insurance group.
If any discrepancy is found, the commissioner shall require
changes in the commercial self-insurance group's business plan
or service company recordkeeping practices.
(e) Each commercial self-insurance group shall submit by
September 15 a copy of the group's annual federal and state
income tax returns or provide proof that it has received an
exemption from these filings.
(f) With the annual loss report each commercial
self-insurance group shall report to the commissioner any
worker's compensation claim where the full, undiscounted value
is estimated to exceed $50,000, in a manner and on forms
prescribed by the commissioner.
(g) Each commercial self-insurance group shall submit by
May 1 a list of all members and the percentage of premium each
represents to the total group's premium for the previous
calendar year.
(h) Each commercial self-insurance group shall submit by
October 15 the following documents prepared by the group's
certified public accountant:
(1) a compiled combined financial statement of group
members and a list of members included in this statement. An
"Agreed Upon Procedures" report, as determined by the
commissioner, indicating combined net worth, total assets, cash
flow, and net income of the group members may be filed in lieu
of the compiled combined financial statement; and
(2) a report that the statements which were combined have
met the requirements of subdivision 2.
(i) If any group member comprises over 25 percent of total
group premium, that member's financial statement must be
reviewed or audited, and, at the commissioner's option, must be
filed with the department of commerce commissioner by October 15
of the following year.
(j) Each commercial self-insurance group shall submit a
copy of each member's accountant's report letter from the
reports used in compiling the combined financial
statements. This requirement does not apply to any group that
has been in existence for at least three years.
Sec. 34. Minnesota Statutes 1999 Supplement, section
79A.23, subdivision 2, is amended to read:
Subd. 2. [REQUIRED REPORTS FROM MEMBERS TO GROUP.] (a)
Each member of the commercial self-insurance group shall, by
September 15, submit to the group its most recent annual
financial statement, together with other financial information
the group may require. These financial statements submitted
must not have a fiscal year end date older than January 15 of
the group's calendar year end. Individual group members
constituting at least 25 percent of the group's annual premium
shall submit to the group reviewed or audited financial
statements. The remaining members must submit compilation level
statements.
(b) For groups that have been in existence for at least
three years, individual group members may satisfy the
requirements of paragraph (a) by submitting compiled, reviewed,
or audited statements or the most recent federal income tax
return filed by the member.
Sec. 35. Minnesota Statutes 1999 Supplement, section
79A.23, subdivision 3, is amended to read:
Subd. 3. [OPERATIONAL AUDIT.] (a) The commissioner, prior
to authorizing surplus distribution of a commercial
self-insurance group's first fund year or no later than after
the third anniversary of the group's authority to self-insure,
shall may conduct an operational audit of the commercial
self-insurance group's claim handling and reserve practices as
well as its underwriting procedures to determine if they adhere
to the group's business plan. The commissioner may select
outside consultants to assist in conducting the audit. After
completion of the audit, the commissioner shall either renew or
revoke the commercial self-insurance group's authority to
self-insure. The commissioner may also order any changes deemed
necessary in the claims handling, reserving practices, or
underwriting procedures of the group.
(b) The cost of the operational audit shall be borne by the
commercial self-insurance group.
Sec. 36. Minnesota Statutes 1999 Supplement, section
79A.24, subdivision 2, is amended to read:
Subd. 2. [MINIMUM DEPOSIT.] The minimum deposit is 125
percent of the commercial self-insurance group's estimated
future liability for the payment of compensation as determined
by an actuary. If all the members of the commercial
self-insurance group have submitted reviewed or audited
financial statements to the group's accountant has been in
existence for three years, this minimum deposit shall be 110
percent of the commercial self-insurance group's estimated
future liability for the payment of workers' compensation as
determined by an actuary. The group must file a letter with the
commissioner from the group's accountant which confirms that the
compiled combined financial statements were prepared from
members reviewed or audited financial statements only before the
lower security deposit is allowed. Each actuarial study shall
include a projection of future losses during a one-year period
until the next scheduled actuarial study, less payments
anticipated to be made during that time. Deduction should be
made for the total amount which is estimated to be returned to
the commercial self-insurance group from any specific excess
insurance coverage, aggregate excess insurance coverage, and any
supplementary benefits which are estimated to be reimbursed by
the special compensation fund. Supplementary benefits will not
be reimbursed by the special compensation fund unless the
special compensation fund assessment pursuant to section 176.129
is paid and the required reports are filed with the special
compensation fund. In the case of surety bonds, bonds shall
secure administrative and legal costs in addition to the
liability for payment of compensation reflected on the face of
the bond. In no event shall the security be less than the
group's selected retention limit of the workers' compensation
reinsurance association. The posting or depositing of security
under this section shall release all previously posted or
deposited security from any obligations under the posting or
depositing and any surety bond so released shall be returned to
the surety. Any other security shall be returned to the
depositor or the person posting the bond.
Sec. 37. Minnesota Statutes 1998, section 80A.04,
subdivision 2, is amended to read:
Subd. 2. It is unlawful for any broker-dealer or issuer to
employ an agent as a representative in this state unless the
agent is licensed. The licensing of an agent is not effective
during any period when the agent is not associated with a
specified broker-dealer licensed under this chapter or a
specified issuer. No agent shall at any time represent more
than one broker-dealer or issuer, except that where
broker-dealers affiliated by direct common control are licensed
under this chapter, an agent may represent the broker-dealer.
When an agent begins or terminates employment with a
broker-dealer or issuer, or begins or terminates those
activities which make that person an agent, the agent as well as
the broker-dealer or issuer shall promptly notify the
commissioner or the commissioner's designated representative.
A broker-dealer or investment adviser is affiliated by
direct common control when 80 percent or more of the equity of
each broker-dealer or investment adviser is beneficially owned
by the same person or group of persons.
Sec. 38. Minnesota Statutes 1998, section 80A.04,
subdivision 3, is amended to read:
Subd. 3. It is unlawful for any person to transact
business in this state as an investment adviser unless that
person is so licensed or licensed as a broker-dealer under this
chapter as described in section 80A.14, subdivision 9, clause
(3), or unless: (1) that person's only clients in this state
are investment companies as defined in the Investment Company
Act of 1940, other investment advisers, broker-dealers, banks,
trust companies, savings associations, federal covered advisers
insurance companies, corporations with a class of equity
securities registered under section 12(b) or 12(g) of the
Securities Exchange Act of 1934, small business investment
companies, and government agencies or instrumentalities, whether
acting for themselves or as trustees with investment control, or
other institutional buyers; or (2) that person has no place of
business in this state and during the preceding 12-month period
has had fewer than six clients who are residents of this state.
Sec. 39. Minnesota Statutes 1998, section 80A.07,
subdivision 1, is amended to read:
Subdivision 1. [GENERAL GROUNDS.] The commissioner may by
order deny, suspend, or revoke any license or may censure the
licensee, if the commissioner finds (a) that the order is in the
public interest and (b) that the applicant or licensee or, in
the case of a broker-dealer or investment adviser, any partner,
officer, or director, any person occupying a similar status or
performing similar functions, or any person directly or
indirectly controlling the broker-dealer or investment adviser:
(1) has filed an application for license which as of its
effective date, or as of any date after filing in the case of an
order denying effectiveness, was incomplete in any material
respect or contained any statement which was, in light of the
circumstances under which it was made, false or misleading with
respect to any material fact;
(2) has willfully violated or failed to comply with any
provision of this chapter or a predecessor law or any provision
of the Securities Act of 1933, the Securities Exchange Act of
1934, the Investment Advisers Act of 1940, the Investment
Company Act of 1940, the Commodity Exchange Act, or any rule or
order under any of these statutes, of which that person has
notice and is subject;
(3) has been convicted, within the past ten years, of any
misdemeanor involving a security or any aspect of the securities
business, or any felony;
(4) is permanently or temporarily enjoined by any court of
competent jurisdiction from engaging in or continuing any
conduct or practice involving any aspect of the securities
business;
(5) is the subject of an order of the commissioner denying,
suspending, or revoking a license as a broker-dealer, agent or
investment adviser;
(6) is the subject of an order entered within the past five
years by the securities administrator of any other state or by
the securities and exchange commission, or any national
securities exchange or national securities association
registered under the Securities Exchange Act of 1934, denying or
revoking registration or license as a broker-dealer, agent, or
investment adviser, or is the subject of an order of the
securities and exchange commission or any national securities
exchange or national securities association registered under the
Securities Exchange Act of 1934, suspending, barring, or
expelling that person from a national securities exchange or
association registered under the Securities Exchange Act of
1934, or is the subject of a United States post office fraud
order. The commissioner may not institute a revocation or
suspension proceeding under this clause more than one year from
the date of the order relied on, and may not enter an order
under this clause on the basis of an order under another state
law unless the order was based on facts which would currently
constitute a ground for an order under this section;
(7) has engaged in dishonest or fraudulent practices in the
securities business;
(8) has failed to maintain the minimum net capital or to
comply with the limitation on aggregate indebtedness which the
commissioner by rule prescribes;
(9) is not qualified on the basis of such factors as
training, experience, and knowledge of the securities business;
(10) has failed reasonably to supervise agents, investment
adviser representatives, or employees to assure their compliance
with this chapter;
(11) has failed to pay the proper filing fee, but the
commissioner shall vacate the order when the deficiency has been
corrected;
(12) has offered or sold securities in this state through
any unlicensed agent;
(13) has made any material misrepresentation to the
commissioner, or upon request reasonably made by the
commissioner, has withheld or concealed information from, or
refused to furnish information to, the commissioner;
(14) has failed to reasonably supervise agents, investment
adviser representatives, or employees if that person has assumed
or has been designated to carry out the supervisory procedures
of the broker-dealer or investment adviser; or
(15) has failed, within 20 business days after receiving
written instructions from a customer, to do any of the following:
(a) transfer or deliver securities that have been
purchased;
(b) transfer or deliver any free credit balances reflecting
completed transactions; or
(c) transfer or deliver a customer's account securities
positions and balances to another broker-dealer.
This clause shall not serve as a basis for denial, suspension,
or revocation of a broker-dealer's or agent's license if: (i)
the transfer or delivery is between broker-dealers and meets the
rules and requirements established by the New York Stock
Exchange with regard to the transfer or delivery; or (ii) the
delivery of securities to a customer cannot be accomplished
within 20 business days, and the broker-dealer or agent has
notified the customer in writing of the inability to deliver the
securities and the reasons for the nondelivery within 20
business days of receiving the customer's written instructions.
Sec. 40. Minnesota Statutes 1998, section 80A.10,
subdivision 2, is amended to read:
Subd. 2. A registration statement under this section shall
contain the following information and be accompanied by the
following documents in addition to the information specified in
section 80A.12 and the consent to service of process required by
section 80A.27, subdivision 7;
(a) Two copies One copy of the latest form of prospectus
filed under the Securities Act of 1933;
(b) If the commissioner by rule or otherwise requires, a
copy of the articles of incorporation and bylaws (or their
substantial equivalent) currently in effect, a copy of any
agreements with or among underwriters, a copy of any indenture
or other instrument governing the issuance of the security to be
registered, and a specimen or copy of the security;
(c) If the commissioner requests, any other information, or
copies of any other documents, filed under the Securities Act of
1933; and
(d) An undertaking to forward all amendments to the federal
prospectus, other than an amendment which merely delays the
effective date of the registration statement, not later than the
first business day after the day they are forwarded to or filed
with the securities and exchange commission or such longer
period as the commissioner permits.
Sec. 41. Minnesota Statutes 1999 Supplement, section
80A.15, subdivision 2, is amended to read:
Subd. 2. The following transactions are exempted from
sections 80A.08 and 80A.16:
(a) Any sales, whether or not effected through a
broker-dealer, provided that:
(1) no person shall make more than ten sales of
securities in Minnesota of the same issuer pursuant to this
exemption, exclusive of sales according to clause (2), during
any period of 12 consecutive months; provided further, that in
the case of sales by an issuer, except sales of securities
registered under the Securities Act of 1933 or exempted by
section 3(b) of that act, (i) the seller reasonably believes
that all buyers are purchasing for investment, and (ii) the
securities are not advertised for sale to the general public in
newspapers or other publications of general circulation or
otherwise, or by radio, television, electronic means or similar
communications media, or through a program of general
solicitation by means of mail or telephone; and or
(2) no issuer shall make more than 25 sales of its
securities in Minnesota according to this exemption, exclusive
of sales pursuant to clause (1), during any period of 12
consecutive months; provided further, that the issuer meets the
conditions in clause (1) and, in addition meets the following
additional conditions: (i) files with the commissioner, ten
days before a sale according to this clause, a statement of
issuer on a form prescribed by the commissioner; and (ii) no
commission or other remuneration is paid or given directly or
indirectly for soliciting any prospective buyers in this state
in connection with a sale according to this clause except
reasonable and customary commissions paid by the issuer to a
broker-dealer licensed under this chapter.
(b) Any nonissuer distribution of an outstanding security
if (1) either Moody's, Fitch's, or Standard & Poor's Securities
Manuals, or other recognized manuals approved by the
commissioner contains the names of the issuer's officers and
directors, a balance sheet of the issuer as of a date not more
than 18 months prior to the date of the sale, and a profit and
loss statement for the fiscal year preceding the date of the
balance sheet, and (2) the issuer or its predecessor has been in
active, continuous business operation for the five-year period
next preceding the date of sale, and (3) if the security has a
fixed maturity or fixed interest or dividend provision, the
issuer has not, within the three preceding fiscal years,
defaulted in payment of principal, interest, or dividends on the
securities.
(c) The execution of any orders by a licensed broker-dealer
for the purchase or sale of any security, pursuant to an
unsolicited offer to purchase or sell; provided that the
broker-dealer acts as agent for the purchaser or seller, and has
no direct material interest in the sale or distribution of the
security, receives no commission, profit, or other compensation
from any source other than the purchaser and seller and delivers
to the purchaser and seller written confirmation of the
transaction which clearly itemizes the commission, or other
compensation.
(d) Any nonissuer sale of notes or bonds secured by a
mortgage lien if the entire mortgage, together with all notes or
bonds secured thereby, is sold to a single purchaser at a single
sale.
(e) Any judicial sale, exchange, or issuance of securities
made pursuant to an order of a court of competent jurisdiction.
(f) The sale, by a pledge holder, of a security pledged in
good faith as collateral for a bona fide debt.
(g) Any offer or sale to a bank, savings institution, trust
company, insurance company, investment company as defined in the
Investment Company Act of 1940, or other financial institution
or institutional buyer, or to a broker-dealer, whether the
purchaser is acting for itself or in some fiduciary capacity.
(h) An offer or sale of securities by an issuer made in
reliance on the exemptions provided by Rule 505 or 506 of
Regulation D promulgated by the Securities and Exchange
Commission, Code of Federal Regulations, title 17, sections
230.501 to 230.508, subject to the conditions and definitions
provided by Rules 501 to 503 of Regulation D, if the offer and
sale also satisfies the conditions and limitations in clauses
(1) to (10).
(1) The exemption under this paragraph is not available for
the securities of an issuer if any of the persons described in
Rule 252(c) to (f) of Regulation A promulgated by the Securities
and Exchange Commission, Code of Federal Regulations, title 17,
sections 230.251 to 230.263:
(i) has filed a registration statement that is the subject
of a currently effective order entered against the issuer, its
officers, directors, general partners, controlling persons, or
affiliates, according to any state's law within five years
before the filing of the notice required under clause (5),
denying effectiveness to, or suspending or revoking the
effectiveness of, the registration statement;
(ii) has been convicted, within five years before the
filing of the notice required under clause (5), of a felony or
misdemeanor in connection with the offer, sale, or purchase of a
security or franchise, or a felony involving fraud or deceit,
including but not limited to forgery, embezzlement, obtaining
money under false pretenses, larceny, or conspiracy to defraud;
(iii) is subject to an effective administrative order or
judgment entered by a state securities administrator within five
years before the filing of the notice required under clause (5),
that prohibits, denies, or revokes the use of an exemption from
securities registration, that prohibits the transaction of
business by the person as a broker-dealer or agent, or that is
based on fraud, deceit, an untrue statement of a material fact,
or an omission to state a material fact; or
(iv) is subject to an order, judgment, or decree of a court
entered within five years before the filing of the notice
required under clause (5), temporarily, preliminarily, or
permanently restraining or enjoining the person from engaging in
or continuing any conduct or practice in connection with the
offer, sale, or purchase of a security, or the making of a false
filing with a state.
A disqualification under paragraph (h) involving a
broker-dealer or agent is waived if the broker-dealer or agent
is or continues to be licensed in the state in which the
administrative order or judgment was entered against the person
or if the broker-dealer or agent is or continues to be licensed
in this state as a broker-dealer or agent after notifying the
commissioner of the act or event causing disqualification.
The commissioner may waive a disqualification under
paragraph (h) upon a showing of good cause that it is not
necessary under the circumstances that use of the exemption be
denied.
A disqualification under paragraph (h) may be waived if the
state securities administrator or agency of the state that
created the basis for disqualification has determined, upon a
showing of good cause, that it is not necessary under the
circumstances that an exemption from registration of securities
under the state's laws be denied.
It is a defense to a violation of paragraph (h) based upon
a disqualification if the issuer sustains the burden of proof to
establish that the issuer did not know, and in the exercise of
reasonable care could not have known, that a disqualification
under paragraph (h) existed.
(2) This exemption must not be available to an issuer with
respect to a transaction that, although in technical compliance
with this exemption, is part of a plan or scheme to evade
registration or the conditions or limitations explicitly stated
in paragraph (h).
(3) No commission, finder's fee, or other remuneration
shall be paid or given, directly or indirectly, for soliciting a
prospective purchaser, unless the recipient is appropriately
licensed, or exempt from licensure, in this state as a
broker-dealer.
(4) Nothing in this exemption is intended to or should be
in any way construed as relieving issuers or persons acting on
behalf of issuers from providing disclosure to prospective
investors adequate to satisfy the antifraud provisions of the
securities law of Minnesota.
(5) The issuer shall file with the commissioner a notice on
form D as adopted by the Securities and Exchange Commission
according to Regulation D, Code of Federal Regulations, title
17, section 230.502. The notice must be filed not later than 15
days after the first sale in this state of securities in an
offering under this exemption. Every notice on form D must be
manually signed by a person duly authorized by the issuer and
must be accompanied by a consent to service of process on a form
prescribed by the commissioner.
(6) A failure to comply with a term, condition, or
requirement of paragraph (h) will not result in loss of the
exemption for an offer or sale to a particular individual or
entity if the person relying on the exemption shows that: (i)
the failure to comply did not pertain to a term, condition, or
requirement directly intended to protect that particular
individual or entity, and the failure to comply was
insignificant with respect to the offering as a whole; and (ii)
a good faith and reasonable attempt was made to comply with all
applicable terms, conditions, and requirements of paragraph (h),
except that, where an exemption is established only through
reliance upon this provision, the failure to comply shall
nonetheless constitute a violation of section 80A.08 and be
actionable by the commissioner.
(7) The issuer, upon request by the commissioner, shall,
within ten days of the request, furnish to the commissioner a
copy of any and all information, documents, or materials
furnished to investors or offerees in connection with the offer
and sale according to paragraph (h).
(8) Neither compliance nor attempted compliance with the
exemption provided by paragraph (h), nor the absence of an
objection or order by the commissioner with respect to an offer
or sale of securities undertaken according to this exemption,
shall be considered to be a waiver of a condition of the
exemption or considered to be a confirmation by the commissioner
of the availability of this exemption.
(9) The commissioner may, by rule or order, increase the
number of purchasers or waive any other condition of this
exemption.
(10) The determination whether offers and sales made in
reliance on the exemption set forth in paragraph (h) shall be
integrated with offers and sales according to other paragraphs
of this subdivision shall be made according to the integration
standard set forth in Rule 502 of Regulation D promulgated by
the Securities and Exchange Commission, Code of Federal
Regulations, title 17, section 230.502. If not subject to
integration according to that rule, offers and sales according
to paragraph (h) shall not otherwise be integrated with offers
and sales according to other exemptions set forth in this
subdivision.
(i) Any offer (but not a sale) of a security for which a
registration statement has been filed under sections 80A.01 to
80A.31, if no stop order or refusal order is in effect and no
public proceeding or examination looking toward an order is
pending; and any offer of a security if the sale of the security
is or would be exempt under this section. The commissioner may
by rule exempt offers (but not sales) of securities for which a
registration statement has been filed as the commissioner deems
appropriate, consistent with the purposes of sections 80A.01 to
80A.31.
(j) The offer and sale by a cooperative organized under
chapter 308A or under the laws of another state, of its
securities when the securities are offered and sold only to its
members, or when the purchase of the securities is necessary or
incidental to establishing membership in the cooperative, or
when such securities are issued as patronage dividends. This
paragraph applies to a cooperative organized under the laws of
another state only if the cooperative has filed with the
commissioner a consent to service of process under section
80A.27, subdivision 7, and has, not less than ten days prior to
the issuance or delivery, furnished the commissioner with a
written general description of the transaction and any other
information that the commissioner requires by rule or otherwise.
This exemption only applies when the issuing cooperative is
seeking to raise up to $1,000,000.
(l) The issuance and delivery of any securities of one
corporation to another corporation or its security holders in
connection with a merger, exchange of shares, or transfer of
assets whereby the approval of stockholders of the other
corporation is required to be obtained, provided, that the
commissioner has been furnished with a general description of
the transaction and with other information as the commissioner
by rule prescribes not less than ten days prior to the issuance
and delivery.
(m) Any transaction between the issuer or other person on
whose behalf the offering is made and an underwriter or among
underwriters.
(n) The distribution by a corporation of its or other
securities to its own security holders as a stock dividend or as
a dividend from earnings or surplus or as a liquidating
distribution; or upon conversion of an outstanding convertible
security; or pursuant to a stock split or reverse stock split.
(o) Any offer or sale of securities by an affiliate of the
issuer thereof if: (1) a registration statement is in effect
with respect to securities of the same class of the issuer and
(2) the offer or sale has been exempted from registration by
rule or order of the commissioner.
(p) Any transaction pursuant to an offer to existing
security holders of the issuer, including persons who at the
time of the transaction are holders of convertible securities,
nontransferable warrants, or transferable warrants exercisable
within not more than 90 days of their issuance, if: (1) no
commission or other remuneration (other than a standby
commission) is paid or given directly or indirectly for
soliciting any security holder in this state; and (2) the
commissioner has been furnished with a general description of
the transaction and with other information as the commissioner
may by rule prescribe no less than ten days prior to the
transaction.
(q) Any nonissuer sales of any security, including a
revenue obligation, issued by the state of Minnesota or any of
its political or governmental subdivisions, municipalities,
governmental agencies, or instrumentalities.
(r) Any transaction as to which the commissioner by rule or
order finds that registration is not necessary in the public
interest and for the protection of investors.
(s) An offer or sale of a security issued in connection
with an employee's stock purchase, savings, option, profit
sharing, pension, or similar employee benefit plan, if the
following conditions are met:
(1) the issuer, its parent corporation or any of its
majority-owned subsidiaries offers or sells the security
according to a written benefit plan or written contract relating
to the compensation of the purchaser; and
(2) the class of securities offered according to the plan
or contract, or if an option or right to purchase a security,
the class of securities to be issued upon the exercise of the
option or right, is registered under section 12 of the
Securities Exchange Act of 1934, or is a class of securities
with respect to which the issuer files reports according to
section 15(d) of the Securities Exchange Act of 1934; or
(3) the issuer fully complies with the provisions of Rule
701 as adopted by the Securities and Exchange Commission, Code
of Federal Regulations, title 12, section 230.701.
The issuer shall file not less than ten days before the
transaction, a general description of the transaction and any
other information that the commissioner requires by rule or
otherwise or, if applicable, a Securities and Exchange Form S-8.
Annually, within 90 days after the end of the issuer's fiscal
year, the issuer shall file a notice as provided with the
commissioner.
(t) Any sale of a security of an issuer that is a pooled
income fund, a charitable remainder trust, or a charitable lead
trust that has a qualified charity as the only charitable
beneficiary.
(u) Any sale by a qualified charity of a security that is a
charitable gift annuity if the issuer has a net worth, otherwise
defined as unrestricted fund balance, of not less than $300,000
and either: (1) has been in continuous operation for not less
than three years; or (2) is a successor or affiliate of a
qualified charity that has been in continuous operation for not
less than three years.
Sec. 42. Minnesota Statutes 1998, section 80C.05,
subdivision 4, is amended to read:
Subd. 4. An application for registration that has not
become effective will be considered withdrawn If no activity
occurs with respect to the an application for registration for a
period of 120 days, the commissioner may by order declare the
application withdrawn.
Sec. 43. Minnesota Statutes 1998, section 80C.07, is
amended to read:
80C.07 [AMENDMENT OF REGISTRATION.]
A person with a registration in effect shall, within 30
days after the occurrence of any material change in the
information on file with the commissioner, notify the
commissioner in writing of the change by an application to amend
the registration accompanied by a fee of $100. The commissioner
may by rule define what shall be considered a material change
for such purposes, and may determine the circumstances under
which a revised public offering statement must accompany the
application. If the amendment is approved by the commissioner,
it shall become effective upon the issuance by the commissioner
of an order amending the registration.
The commissioner may withdraw an amendment application that
has not become effective. If no activity occurs with respect to
the application for a period of 120 days, the commissioner may
by order declare the application withdrawn.
Sec. 44. Minnesota Statutes 1998, section 82.22,
subdivision 13, is amended to read:
Subd. 13. [CONTINUING EDUCATION.] (a) After their first
renewal date, all real estate salespersons and all real estate
brokers shall be required to successfully complete 30 hours of
real estate continuing education, either as a student or a
lecturer, in courses of study approved by the commissioner,
during each 24-month license period. At least 15 of the 30
credit hours must be completed during the first 12 months of the
24-month licensing period. Salespersons and brokers whose
initial license period extends more than 12 months are required
to complete 15 hours of real estate continuing education during
the initial license period. Those licensees who will receive a
12-month license on July 1, 1995, because of the staggered
implementation schedule must complete 15 hours of real estate
continuing education as a requirement for renewal on July 1,
1996. Licensees may not claim credit for continuing education
not actually completed as of the date their report of continuing
education compliance is filed.
(b) The commissioner shall adopt rules defining the
standards for course and instructor approval, and may adopt
rules for the proper administration of this subdivision. The
commissioner may not approve a course which can be completed by
the student at home or outside the classroom without the
supervision of an instructor approved by the department of
commerce. The commissioner has discretion to establish a pilot
program to explore delivery of accredited courses using new
delivery technology, including interactive technology. This
pilot program expires on August 1, 2000 2001.
(c) Any program approved by Minnesota continuing legal
education shall be approved by the commissioner of commerce for
continuing education for real estate brokers and salespeople if
the program or any part thereof relates to real estate.
(d) As part of the continuing education requirements of
this section, the commissioner shall require that all real
estate brokers and salespersons receive:
(1) at least two hours of training during each license
period in courses in laws or regulations on agency
representation and disclosure; and
(2) at least two hours of training during each license
period in courses in state and federal fair housing laws,
regulations, and rules, or other antidiscrimination laws.
Clause (1) does not apply to real estate salespersons and
real estate brokers engaged solely in the commercial real estate
business who file with the commissioner a verification of this
status along with the continuing education report required under
paragraph (a).
(e) The commissioner is authorized to establish a procedure
for renewal of course accreditation.
Sec. 45. Minnesota Statutes 1998, section 82A.04,
subdivision 4, is amended to read:
Subd. 4. [EFFECTIVE DATE.] Unless an order denying
registration under section 82A.12 is in effect, or unless
declared effective by order of the commissioner prior thereto,
the application for registration shall automatically become
effective upon the expiration of 15 business days following
filing with the commissioner, but an applicant may consent in
writing to the delay of registration until the time the
commissioner may issue an order of registration. If the
commissioner requests additional information with respect to the
application, the application shall become effective upon the
expiration of 15 business days following the filing with the
commissioner of the additional information unless an order
denying registration under section 82A.12 is in effect or unless
declared effective by order of the commissioner prior thereto.
The registration is effective on the date the commissioner
declares by order.
Sec. 46. Minnesota Statutes 1998, section 82A.04, is
amended by adding a subdivision to read:
Subd. 5. [WITHDRAWAL OF APPLICATION.] If no activity
occurs with respect to an application for a period of 120 days,
the commissioner may by order declare the application
withdrawn. No part of the filing fee will be returned by the
commissioner if a registration application is withdrawn
according to this subdivision.
Sec. 47. Minnesota Statutes 1998, section 82B.14, is
amended to read:
82B.14 [EXPERIENCE REQUIREMENT.]
(a) As a prerequisite for licensing as a registered real
property appraiser or licensed real property appraiser, an
applicant must present evidence satisfactory to the commissioner
that the person has obtained 2,000 hours of experience in real
property appraisal.
As a prerequisite for licensing as a certified residential
real property appraiser, an applicant must present evidence
satisfactory to the commissioner that the person has obtained
2,500 hours of experience in real property appraisal.
As a prerequisite for licensing as a certified general real
property appraiser, an applicant must present evidence
satisfactory to the commissioner that the person has obtained
3,000 hours of experience in real property appraisal. At least
50 percent, or 1,500 hours, must be in nonresidential appraisal
work.
(b) Each applicant for license under section 82B.11,
subdivision 3, 4, or 5, shall give under oath a detailed listing
of the real estate appraisal reports or file memoranda for which
experience is claimed by the applicant. Upon request, the
applicant shall make available to the commissioner for
examination, a sample of appraisal reports that the applicant
has prepared in the course of appraisal practice.
(c) Applicants may not receive credit for experience
accumulated while unlicensed, if the experience is based on
activities which required a license under this section.
Sec. 48. Minnesota Statutes 1998, section 83.23, is
amended by adding a subdivision to read:
Subd. 5. [WITHDRAWAL OF APPLICATION.] If no activity
occurs with respect to an application for a period of 120 days,
the commissioner may by order declare the application
withdrawn. No part of the filing fee will be returned by the
commissioner if a registration application is withdrawn
according to this subdivision.
Sec. 49. Minnesota Statutes 1998, section 308A.711,
subdivision 1, is amended to read:
Subdivision 1. [ALTERNATE PROCEDURE TO DISBURSE PROPERTY.]
Notwithstanding the provisions of section 345.43, a cooperative
may, in lieu of paying or delivering to the commissioner of
commerce the unclaimed property specified in its report of
unclaimed property, distribute the unclaimed property to a
corporation or organization that is exempt from taxation under
section 290.05, subdivision 1, paragraph (b), or 2. A
cooperative making the election to distribute unclaimed property
shall, within 20 days after the time specified in section 345.42
for claiming the property from the holder, 85 days following the
publication of lists of abandoned property file with the
commissioner of commerce:
(1) a verified written explanation of the proof of claim of
an owner establishing a right to receive the abandoned property;
(2) any errors in the presumption of abandonment;
(3) the name, address, and exemption number of the
corporation or organization to which the property was or is to
be distributed; and
(4) the approximate date of distribution.
Sec. 50. Minnesota Statutes 1998, section 326.975,
subdivision 1, is amended to read:
Subdivision 1. [GENERALLY.] (a) In addition to any other
fees, each applicant for a license under sections 326.83 to
326.98 shall pay a fee to the contractor's recovery fund. The
contractor's recovery fund is created in the state treasury and
must be administered by the commissioner in the manner and
subject to all the requirements and limitations provided by
section 82.34 with the following exceptions:
(1) each licensee who renews a license shall pay in
addition to the appropriate renewal fee an additional fee which
shall be credited to the contractor's recovery fund. The amount
of the fee shall be based on the licensee's gross annual
receipts for the licensee's most recent fiscal year preceding
the renewal, on the following scale:
Fee Gross Receipts
$100 under $1,000,000
$150 $1,000,000 to $5,000,000
$200 over $5,000,000
Any person who receives a new license shall pay a fee based on
the same scale;
(2) the sole purpose of this fund is to compensate any
aggrieved owner or lessee of residential property located within
this state who obtains a final judgment in any court of
competent jurisdiction against a licensee licensed under section
326.84, on grounds of fraudulent, deceptive, or dishonest
practices, conversion of funds, or failure of performance
arising directly out of any transaction when the judgment debtor
was licensed and performed any of the activities enumerated
under section 326.83, subdivision 19, on the owner's residential
property or on residential property rented by the lessee, or on
new residential construction which was never occupied prior to
purchase by the owner, or which was occupied by the licensee for
less than one year prior to purchase by the owner, and which
cause of action arose on or after April 1, 1994;
(3) nothing may obligate the fund for more than $50,000 per
claimant, nor more than $50,000 per licensee; and
(4) nothing may obligate the fund for claims based on a
cause of action that arose before the licensee paid the recovery
fund fee set in clause (1), or as provided in section 326.945,
subdivision 3.
(b) Should the commissioner pay from the contractor's
recovery fund any amount in settlement of a claim or toward
satisfaction of a judgment against a licensee, the license shall
be automatically suspended upon the effective date of an order
by the court authorizing payment from the fund. No licensee
shall be granted reinstatement until the licensee has repaid in
full, plus interest at the rate of 12 percent a year, twice the
amount paid from the fund on the licensee's account, and has
obtained a surety bond issued by an insurer authorized to
transact business in this state in the amount of at least
$40,000.
Sec. 51. [332.355] [AGENCY RESPONSIBILITY FOR COLLECTORS.]
The commissioner may take action against a collection
agency for any violations of debt collection laws by its debt
collectors. The commissioner may also take action against the
debt collectors themselves for these same violations.
Sec. 52. Minnesota Statutes 1998, section 345.515, is
amended to read:
345.515 [AGREEMENTS TO LOCATE REPORTED PROPERTY.]
It is unlawful for a person to seek or receive from another
person or contract with a person for a fee or compensation for
locating property, knowing it to have been reported or paid or
delivered to the commissioner pursuant to chapter 345 prior to
seven months after the date of published notice by the
commissioner as required by section 345.42 24 months after the
date the property is paid or delivered to the commissioner.
No agreement entered into after seven months from the date
of published notice by the 24 months after the date the property
is paid or delivered to the commissioner is valid if a person
thereby undertakes to locate property included in a report for a
fee or other compensation exceeding ten percent of the value of
the recoverable property unless the agreement is in writing and
signed by the owner and discloses the nature and value of the
property and the name and address of the holder thereof as such
facts have been reported. Nothing in this section shall be
construed to prevent an owner from asserting at any time that an
agreement to locate property is based upon an excessive or
unjust consideration.
Sec. 53. [359.085] [STANDARDS OF CONDUCT FOR NOTARIAL
ACTS.]
Subdivision 1. [ACKNOWLEDGMENTS.] In taking an
acknowledgment, the notarial officer must determine, either from
personal knowledge or from satisfactory evidence, that the
person appearing before the officer and making the
acknowledgment is the person whose true signature is on the
instrument.
Subd. 2. [VERIFICATIONS.] In taking a verification upon
oath or affirmation, the notarial officer must determine, either
from personal knowledge or from satisfactory evidence, that the
person appearing before the officer and making the verification
is the person whose true signature is on the statement verified.
Subd. 3. [WITNESSING OR ATTESTING SIGNATURES.] In
witnessing or attesting a signature the notarial officer must
determine, either from personal knowledge or from satisfactory
evidence, that the signature is that of the person appearing
before the officer and named in the document.
Subd. 4. [CERTIFYING OR ATTESTING DOCUMENTS.] In
certifying or attesting a copy of a document or other item, the
notarial officer must determine that the proffered copy is a
full, true, and accurate transcription or reproduction of that
which was copied.
Subd. 5. [MAKING OR NOTING PROTESTS OF NEGOTIABLE
INSTRUMENTS.] In making or noting a protest of a negotiable
instrument the notarial officer must determine the matters set
forth in section 336.3-505.
Subd. 6. [SATISFACTORY EVIDENCE.] A notarial officer has
satisfactory evidence that a person is the person whose true
signature is on a document if that person (i) is personally
known to the notarial officer, (ii) is identified upon the oath
or affirmation of a credible witness personally known to the
notarial officer, or (iii) is identified on the basis of
identification documents.
Subd. 7. [PROHIBITED ACTS.] A notarial officer may not
acknowledge, witness or attest to the officer's own signature,
or take a verification of the officer's own oath or affirmation.
Sec. 54. Laws 1999, chapter 177, section 89, is amended to
read:
Sec. 89. [EFFECTIVE DATES.]
(a) Sections 1, 3, 5 to 8, 20, 22 to 28, 31, 34, 35, 38,
39, 44 to 51, 54 to 56, 58 to 60, 66, 67, 69 to 87, and 88,
paragraph (b), are effective the day following final enactment.
(b) Sections 13 to 15 are effective the day following final
enactment and apply to plans of merger approved on or after that
date by the board of directors of the first of the constituent
corporations to grant such approval. Merging or consolidating
insurance corporations may, however, elect to have the changes
made by sections 13 to 15 not apply to a merger or consolidation
arising out of a joint agreement entered into prior to January
1, 2000.
(c) Section 32 is effective July 1, 2000 2001.
(d) Section 33 is effective December 1, 1999, and applies
to all license renewals on or after that date.
(e) Section 30 is effective as follows:
(1) The amendment to Minnesota Statutes, section 60K.03,
subdivision 2, paragraph (d), is effective January 1, 2000.
(2) The amendment to Minnesota Statutes, section 60K.03,
subdivision 2, paragraph (e), is effective the day following
final enactment.
Sec. 55. [REPEALER.]
Minnesota Statutes 1998, sections 62A.285, subdivision 4;
62A.651; and 65B.13, are repealed.
Sec. 56. [EFFECTIVE DATE.]
Sections 1, 2, 3, 5, 7 to 9, 11 to 13, 15 to 18, 22, 24,
36, 37, 38, 40 to 44, 47, and 50 to 55 are effective the day
following enactment. Section 19 is effective January 1, 2001.
Presented to the governor May 11, 2000
Signed by the governor May 15, 2000, 10:47 a.m.
Official Publication of the State of Minnesota
Revisor of Statutes