Current through Register Vol. 50, No. 9, March 1, 2024
RELATES TO:
KRS
365.447
NECESSITY, FUNCTION, AND CONFORMITY:
KRS
365.447 requires in pertinent part the Office
of the Attorney General to promulgate administrative regulations pertaining to
applications by any party for more than two (2) going-out-of-business sale
permits during a four (4) year period. This administrative regulation sets
forth the procedures for applying for a subsequent permit, the investigation to
be initiated and conducted by the Attorney General, and charges to the
applicant, pursuant to
KRS
365.447.
Section
1. Application Procedure for Excess Permits. When any individual,
partnership, corporation or other firm seeks a permit to conduct more than two
(2) going-out-of-business sales within a four (4) year period, such party shall
obtain, complete, and submit to the Office of the Attorney General, Division of
Consumer Protection, an application form to obtain such permit.
Section 2. Investigation to Determine
Legitimate Business Purpose.
(1) Upon receipt
of such application, the Office of the Attorney General, Division of Consumer
Protection, shall initiate and conduct an investigation to determine if there
is a legitimate business reason to conduct more than two (2)
going-out-of-business sales within a four (4) year period. The Division of
Consumer Protection shall investigate the circumstances of all previous
going-out-of-business sales conducted by the applicant within the previous four
(4) years and consider all relevant information in reaching its decision.
Relevant business records and information shall include information relating to
activities and going-out-of-business sales conducted in other jurisdictions.
The Attorney General may request additional information and relevant business
records from the applicant in determining the legitimacy of the business reason
for the application.
(2) The
Attorney General shall determine if there is a legitimate business reason for
the applicant's request for any excess permits and deny or grant the permit
within thirty (30) days of receiving the application.
(3) Valid business reasons for conducting
more than two (2) going-out-of-business sales within a four (4) year period
shall include:
(a) Insolvency of the business
or owner(s);
(b) Unprofitability or
inadequate profitability of the business;
(c) Retirement of the owner(s);
(d) Intent of the owner(s) to engage in other
enterprises or endeavors;
(e)
Termination of the business to free assets to pay any judgment of any
court;
(f) Death of the owner(s),
and the representatives of the estate(s), or their heirs, distributees,
devisees, legatees, or their successors and assigns seek to terminate the
business;
(g) Where the business is
required or compelled to be discontinued because:
1. The premises upon which it is being
conducted have been taken by eminent domain; or
2. The premises upon which it is being
conducted must be vacated pursuant to court order pursuant to a legal or
judicial proceeding; or
3. The
business's lease on the premises upon which it is operating has been terminated
by the landlord, or the landlord will not renew the lease.
(4) Business reasons which are not
legitimate for the purposes of
KRS
365.447 shall include, but not be limited to:
(a) Opening the business with intent to
conduct a going-out-of-business sale with inventory brought in for that
purpose, whether such inventory is owned by the business owner(s) or not, more
than ninety (90) days prior to the application for the permit;
(b) Buying into an existing business with the
intent to conduct a going-out-of-business sale, and bringing in large
quantities of goods for that purpose, whether such inventory is owned by the
business owner(s) or not, more than ninety (90) days prior to the application
for the permit.
Section
3. The applicant may be charged the costs of the investigation.
The Attorney General may charge the applicant for the costs of the
investigation. The actual costs shall be assessed the applicant by the Attorney
General, however the minimum charge shall be twenty-five (25) dollars, and the
maximum charge $250.
Section 4. Any
applicant whose application is denied by the Attorney General following
investigation may seek appeal of the denial pursuant to
40
KAR 2:230 and
40
KAR 2:240.
STATUTORY AUTHORITY:
KRS
15.180,
365.447