[§468L-22] Charter tour operator financial performance requirements. (a) The department shall not approve the initial registration or the renewal of registration of a travel agency that wishes to engage in the business of a charter tour operator and to operate not more than six charter tours during any twelve-month period of the registration period, or during the remainder of the registration period if less than twelve months, for which application is made unless the applicant provides proof that the applicant has obtained a bond, letter of credit, or other security in compliance with title 14, Code of Federal Regulations, section 380.34, as the same may be amended, or any successor or replacement federal statute or regulation thereto.
(b) The department shall not approve the initial registration or the renewal of registration of a travel agency that wishes to engage in the business of a charter tour operator and to operate seven or more charter tours during any twelve months or shorter period of the registration period for which application is made unless the applicant either:
(c) The bond or letter of credit shall be issued by a surety or federally-insured lending institution authorized to do business in the State to indemnify any consumer who may suffer loss as a result of nonperformance by a charter tour operator.
(d) A charter tour operator shall not provide the required coverage through multiple bonds or irrevocable letters of credit but shall provide either a single bond or a single irrevocable letter of credit. A charter tour operator may substitute the bond with an irrevocable letter of credit and vice versa pursuant to subsection (h), but shall not provide one in addition to the other to reach the required aggregate amount of coverage.
(e) Upon cancellation or expiration of the bond or letter of credit, the surety or insurer shall remain liable for any claims against the bond or letter of credit for a period of six months; provided that:
(f) The surety or insurer shall not be required to release any moneys or collateral to the charter tour operator during the six months after cancellation of the bond or expiration of the letter of credit.
(g) The amount of coverage of the bond or irrevocable letter of credit shall be:
(h) A bond shall be accepted as replacement for another bond or an irrevocable letter of credit and an irrevocable letter of credit shall be accepted as replacement for another irrevocable letter of credit or a bond if:
(i) A charter tour operator shall not operate more than six charter tours during any twelve-month period unless the charter tour operator has provided and maintains in effect a bond or letter of credit in accordance with subsection (b), in the amount specified in subsection (g)(1), if the charter tour operator operates between seven and fifteen charter tours, or in the amount specified in subsection (g)(2), if the charter tour operator operates more than fifteen charter tours. [L 1999, c 258, pt of §3]