Mark Pestronk
Q: I'm an independent contractor for a large host agency. Over the years, several colleagues have told me that in selling travel I must always disclose that I am affiliated with the host agency. Is that correct? If not, why does this erroneous view persist?
A: In making sales, you must disclose your affiliation with the host in two cases: first, where an applicable state seller of travel law requires you to do so in order to qualify for an exemption from registration with the state; second, where your contract with the host requires such disclosure.
Three states -- California, Florida and Washington -- allow independent contractors (ICs) to be exempt from registration under seller of travel laws if they meet certain criteria, including such disclosure.
California actually has seven criteria for exemption from registration. The last one states that the IC can be exempt if the IC "discloses both of the following: (a) The person is acting on behalf of a registered seller of travel [and] (b) the name, address, telephone number and registration number of the registered seller of travel on whose behalf the person is acting.... If the person transacts business in this state on the internet, the disclosures also shall appear on the homepage of the person's website and shall be prominently set forth in the first [email] message sent to the passenger."
The California law applies to solicitations and sales to residents of California, even if the IC is located outside the state. It also applies to ICs located in California who solicit in other states.
If an IC registers as a seller of travel, then the disclosure requirements quoted above don't apply and the IC can solicit and sell in the IC's name only.
Florida's law exempts from registration an "independent agent" who "represents a [registered] seller of travel by soliciting persons on its behalf" and who meets other criteria.
Since you cannot sell on behalf of someone without disclosing who that someone is, the law appears to require such disclose in all solicitations, offers and sales.
In Washington state, an IC does not have to register if: (a) [the IC] is conducting business ... in the name of and under the registration of the registered seller of travel; and (b) all money received for travel services ... is collected in the name of the registered seller of travel."
Even if you are not subject to the laws of the three states, you could be required to disclose your host if your contract with the host requires it. Some host contracts impose such a requirement to protect against fraud and ensure that the host gets supplier credit for all of the IC's sales.
On the other hand, some hosts prefer no such disclosure, on the theory that involving the host in a sale makes it more likely that the host will get sued, even if it is not held liable for the IC's acts or omissions.
If you are not located in or selling to residents of the three states, and if your host contract does not require it, I could find no federal or state statute, regulation, or judicial precedent requiring you to identify your host.