California Issues New License Requirements for Travel Agents for 2017

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Update: After further investigation of the issue, Travel Agent has compiled a full breakdown of the changes to the Seller of Travel rules that took effect at the start of this year. You can find it here. 

California has implemented some new changes to the requirements travel agencies must meet in order to obtain a Seller of Travel license.

A representative of the California Seller of Travel Program from the state’s Department of Justice has confirmed to Travel Agent that travel agencies foreign to the state must now register as a foreign business in order to obtain the license. The new rule changes took effect at the beginning of this year.

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According to the American Society of Travel Agents (ASTA), as part of the new condition of registration the seller of travel must provide the file number assigned to it by either the California Secretary of State or the Franchise Tax Board.

“It is our understanding that obtaining a Secretary of State number is a relatively straightforward process, while a tax number is necessary only if your California sales exceed $500,000 per year or 25 percent of your total sales (whichever is lower),” ASTA said in a statement provided to Travel Agent. The organization said it plans to issue an updated fact sheet for travel agents on the new policy soon. 

The new rules change up the exemption for independent travel agents as well. The independent agent exemption to the registration requirement was broadened to include both single-member limited liability companies whose sole member is an individual and single-shareholder “S” corporations whose sole shareholder is an individual. Previously, the exemption had only been available to “individual, natural persons.”

The natural persons requirement “caused problems for a number of ASTA members in California and elsewhere,” ASTA said. “Independent agents, however, continue to have to meet the stated criteria for the exemption.”

Under the Seller of Travel Program, all sellers of travel must register with the state’s Attorney General’s Office and display the registration number on all advertising.

“While not assuring that a company is reputable, a valid registration signals that the seller of travel has at least followed the law to be registered,” the state’s Department of Justice said on its website.

More information on the program is available at https://oag.ca.gov/travel.

How do you think the new requirements will affect your business? Let us know on our Facebook page. 

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