Utah Code 34-44-102. Definitions

34-44-102. Definitions.
As used in this chapter:

(1)	“Business relationship” means an agreement that governs the relationship of principal and sales representative.

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Terms Used In Utah Code 34-44-102

Business relationship: means an agreement that governs the relationship of principal and sales representative. See Utah Code 34-44-102
Commission: means :

(a)

compensation:

(i)	that accrues to a sales representative;

(ii)	for payment by a principal; and

(iii)

at a rate expressed as a percentage of the dollar amount of sales, orders, or profits; or

(b)

any other method of compensation agreed to between a sales representative and a principal including:

(i)	fees for services; and

(ii)

a retainer. See Utah Code 34-44-102

Direct sales company: means a person that:

(i)

sells, distributes, or supplies for consideration a good or service through participants:

(A)	at different levels of distribution; or

(B)

in accordance with a formula for compensating participants in whole or in part based on:

(I)	the sale of a good or service; and

(II)	the recruitment of or the performance or action of another participant; and

(ii)

(A)	permits participants to recruit other participants to sell, distribute, or supply for consideration the person's good or service; or

(B)

provides for commission, cross-commissions, override commissions, bonuses, refunds, dividends, or other consideration that is or may be paid as a result of:

(I)	the sale of a good or service; or

(II)

the recruitment of or the performance or action of another participant. See Utah Code 34-44-102

participant: means an independent agent, contractor, or distributor. See Utah Code 34-44-102

Person: means :Utah Code 68-3-12.5

Principal: means a person who:

(a)

engages in any of the following activities with regard to a product or service:

(i)	manufactures;

(ii)

produces;

(iii)

imports;

(iv)

sells; or

(v)	distributes;

(b)	establishes a business relationship with a sales representative to solicit orders for a product or a service described in Subsection (4)(a); and

(c)

agrees to compensate a sales representative, in whole or in part, by commission. See Utah Code 34-44-102

sales representative: means a person who enters into a business relationship with a principal:

(i)	to solicit orders for a product or a service described in Subsection (4)(a); and

(ii)

under which the person is compensated, in whole or in part, by commission. See Utah Code 34-44-102

termination: means the end of a business relationship between a sales representative and a principal, whether by:

(a)	agreement;

(b)	expiration of a time period; or

(c)

exercise of a right of termination by either the principal or the sales representative. See Utah Code 34-44-102

(2)

“Commission” means:

(a)

compensation:

(i)	that accrues to a sales representative;

(ii)	for payment by a principal; and

(iii)

at a rate expressed as a percentage of the dollar amount of sales, orders, or profits; or

(b)

any other method of compensation agreed to between a sales representative and a principal including:

(i)	fees for services; and

(ii)	a retainer.

(3)

(a)

“Direct sales company” means a person that:

(i)

sells, distributes, or supplies for consideration a good or service through participants:

(A)	at different levels of distribution; or

(B)

in accordance with a formula for compensating participants in whole or in part based on:

(I)	the sale of a good or service; and

(II)	the recruitment of or the performance or action of another participant; and

(ii)

(A)	permits participants to recruit other participants to sell, distribute, or supply for consideration the person’s good or service; or

(B)

provides for commission, cross-commissions, override commissions, bonuses, refunds, dividends, or other consideration that is or may be paid as a result of:

(I)	the sale of a good or service; or

(II)	the recruitment of or the performance or action of another participant.

(b)	As used in this Subsection (3), “participant” means an independent agent, contractor, or distributor.

(4)

“Principal” means a person who:

(a)

engages in any of the following activities with regard to a product or service:

(i)	manufactures;

(ii)

produces;

(iii)

imports;

(iv)

sells; or

(v)	distributes;

(b)	establishes a business relationship with a sales representative to solicit orders for a product or a service described in Subsection (4)(a); and

(c)	agrees to compensate a sales representative, in whole or in part, by commission.

(5)

(a)

Except as provided in Subsection (5)(b), “sales representative” means a person who enters into a business relationship with a principal:

(i)	to solicit orders for a product or a service described in Subsection (4)(a); and

(ii)	under which the person is compensated, in whole or in part, by commission.

(b)

“Sales representative” does not include:

(i)	an employee of a principal;

(ii)	a person licensed under Title 31A, Insurance Code;

(iii)

a person licensed under 2;

(iv)	a person licensed under Title 61, Chapter 2f, Real Estate Licensing and Practices Act;

(v)	a person who provides a product or service under a business relationship with a principal that is incident to the purchase or sale of real property;

(vi)	a person who places an order or purchases a product or service for that person’s own account for resale; or

(vii)

an independent agent, contractor, or distributor through whom a direct sales company supplies for consideration a good or service.

(6)

“Terminates” or “termination” means the end of a business relationship between a sales representative and a principal, whether by:

(a)	agreement;

(b)	expiration of a time period; or

(c)	exercise of a right of termination by either the principal or the sales representative.

Amended by Chapter 438, 2019 General Session

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