For-Profit Legal Service Contracts

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RULE REVIEW─ADOPTION JUSTIFICATION

Chapter 57. For-Profit Legal Service Contract Companies program
(effective March 15, 2017)

The Texas Department of Licensing and Regulation (Department) filed a Notice of Intent to Review and consider for re-adoption, revision, or repeal, Title 16, Texas Administrative Code (TAC), Chapter 57, relating to the For-Profit Legal Service Contract Companies program. The Notice of Intent to Review was published in the November 18, 2016, issue of the Texas Register (41 TexReg 9165). The public comment period closed on December 19, 2016.

Texas Government Code, §2001.039 requires state agencies to review their rules every four years to determine if the reasons for initially adopting the rules continue to exist. The rules implementing the For-Profit Legal Service Contract Companies program under Texas Occupations Code, Chapter 953, are scheduled for this four-year review.

The Department has reviewed these rules and has determined that the rules are still essential in implementing the statutory provisions of Occupations Code, Chapter 953, Regulation of For-Profit Legal Service Contract Companies. The rules provide details that are not found in the program statute but are necessary for implementation and operation of this program. For example, the rules detail the registration and renewal requirements, the registrant’s responsibilities, and the required fees that are specific to this program.

The Department received five public comments from four individuals and a representative of a registered legal service contract company. Two of the commenters recommended that the For-Profit Legal Service Contract Companies program be readopted. The third commenter, the registered legal service contract company, recommended readoption of the For-Profit Legal Service Contract Companies rules. The fourth commenter stated that these types of companies should not be allowed to do business in Texas. The fifth commenter stated that the license requirement is not needed and should be discontinued. The fourth and fifth comments would require statutory changes and cannot be addressed through rulemaking.

At its meeting on March 1, 2017, the Texas Commission of Licensing and Regulation (Commission), the Department’s governing body, readopted the rules at 16 TAC Chapter 57 For-Profit Legal Service Contract Companies, in their current form. As a result of this review process, the Department may propose amendments in the future that may further clarify or supplement the existing rules. Any future proposed changes to the rules will be published in the Proposed Rules section of the Texas Register and will be open for public comment prior to final adoption by the Commission in accordance with the requirements of the Administrative Procedure Act, Texas Government Code, Chapter 2001.

The rules are re-adopted by the Commission in accordance with Texas Government Code §2001.039. This concludes the review of 16 TAC Chapter 57, For-Profit Legal Service Contract Companies.

Issued in Austin, Texas, on March 15, 2017.

Brian E. Francis 
Executive Director 
Texas Department of Licensing and Regulation


TDLR recently updated the For-Profit Legal Service Contracts program's forms. Please be sure to use the updated forms. View and download the updated forms

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TDLR is now accepting online payment for administrative penalties.

Legal Service Contract Online License Application

Do you know someone who wants to become a Legal Service Contract Salesperson registrant? TDLR announces a new online service that allows people to fill out an application and pay the registration fee with a credit card.  It is fast and easy and most registration cards will print the next day.

TDLR wants to spread the word that new applications and registration renewals can be accomplished online at a time and place convenient to you. Help us spread the news; tell your friends, co-workers and industry associates! For further assistance call 800-803-9202 or email your questions to CS.Legal.Service.Contracts@tdlr.texas.gov.