A proposed rule in Tennessee will require beauty pageant operators to post a $10,000 surety bond when it takes effect on November 10, 2016. Proposed on August 12, the rule’s comment period ended on September 26.
Rule 0780-05-15 provides registration guidelines for beauty pageant operators as well as requiring the surety bond. Operators register with the Tennessee Department of Insurance and Commerce. Listed is some of the information required on the registration application:
- Nonrefundable $50 application fee
- Operator applicant’s name, phone number and address
- Names of pageants operator generally promotes
- Name, phone number and address of financial institution where entrants’ fees are held
- Operator’s sales tax registration number or exemption certificate number from the tax imposed by Tennessee Code Title 67, Chapter 6
- If the applying company is a corporation, LLC or other entity, submit proof of registration with the Tennessee Secretary of State
- List of Controlling Members of applying company and the percentage of their ownership of the operator
- Controlling Members are sole proprietors, general partners or anyone who has a 10% or more share of an applying entity
- $10,000 surety bond
Beauty pageant operators’ registration expires annually on December 31. The surety bond protects pageant contestants’ entry fees—if the pageant does not take place, operators must refund the entry fees within 30 days. The bond’s term is continuous and it can be cancelled with 30 days’ written notice to the Consumer Affairs division of the Department.
Failing to refund entry fees is a violation that could result in suspension or revocation of registration. Other violations include the following:
- Failure to maintain a surety bond
- Conducting a pageant without proper registration and bonding
- Making a false statement(s) on registration application
Fines range from $500-$5,000 and are often assessed for each day the violation continues.