Wisconsin Independent Businesses press release: Small businesses need "consumer protection!" 12/12/2007 Contact: Wayne Corey Small Wisconsin businesses will receive real consumer protection from SB 212. The bill protects small firms from being trapped by hidden automatic renewal clauses in equipment and service contracts. The hidden clauses are used by big businesses to trick small businesses who sign contracts for credit card processing services & machines, business uniform services, waste hauling, specialized computer equipment & software services, telephone system & telephone services, cash transaction machines and industry-specific diagnostic equipment. The only reason for a hidden automatic renewal clause is to trap an unsuspecting small business owner. Small business owners in Wisconsin believe it is unfair to trick them into more years of a contract they may not want. SB 212 requires formal notification of that renewal clause. The bill has a public hearing Wednesday at 11AM before the Senate Committee on Small Business, Emergency Preparedness, Workforce Development, Technical Colleges & Consumer Protection. "A business owner is often completely unaware of the hidden automatic renewal clause. As a result, a small business may be stuck with simultaneous contracts with two companies for the same service. The unsuspecting small business buys a replacement contract believing that the original contract has expired," explained Wayne Corey, executive director of WIB. WIB has for years seen numerous examples of this problem as businesses call the WIB member HOTLINE for help in extricating themselves from contracts that were automatically extended without warning by the ruthless tactics used by out-of-state firms that prey on small Wisconsin businesses. Attorney Gary Antoniewicz of The Boardman Law Firm, corporate counsel to WIB, has said that SB 212 "does not prohibit automatic renewal but simply makes a requirement for those seeking to enforce them that they must provide a reminder notice of the automatic renewal clause." The committee has been given a copy of the fine print on page two of a credit card processing services agreement. "The merchant was told at the signing that it was a three-year agreement. What the merchant wasn't told was that it would renew for an additional two-year period unless the merchant sent notice between 90 and 120 days prior to expiration." SB 212 requires the service seller to notify the merchant that an automatic renewal clause is about to be implemented. 13 states, including Wisconsin , have adopted or are considering some type of automatic renewal clause legislation. It is an issue whose time has arrived and Wisconsin business owners are looking for relief. WIB believes SB 212 is important legislation that controls a highly questionable business tactic of firms that seek to trap small Wisconsin businesses.
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