Putting the “CA” in Cause Marketing | Verrill

CALIFORNIA FINALLY ISSUES FINAL REGULATIONS REQUIRING REGISTRATION FOR ONLINE CHARITABLE SOLICATIONS BY JUNE 12, 2024

We have previously warned you about the new California law (AB 488) concerning registration for many types of online cause marketing programs. Those blog posts can be viewed here and here.

On March 26, 2024, CA finally issued final regulations to its AB 488 (California Gov. Code Section 125599.9) which require registration for companies acting as online charitable fundraising platforms and for platform charities in California. Here is the announcement from the CA AG’s website.

Who Must Register?

1. A company that has an online platform that does any of the following activities:

• Lists or references charit(ies) to receive donations from donors who use the platform;
• Permits persons who use the platform to solicit donations;
• Permits persons who use the platform to select charities to receive donations made by the company or any third party;
• Lists or references charit(ies) to receive donations made by the company based on purchases made or other activity by the person using the platform; or
• Provides the charity with a customizable internet-based platform that allows the charity to solicit or receive donations (which does not include the charity’s own website).

This includes the following types of online activities:

• Donation At Check-Out or “Roundup” Programs: where a company invites customers to make a voluntary donation to a charity, separate from the purchase of a product or service.
• Free-Action Programs: where consumers are invited to make a cost-free action to trigger a donation by the company, such as “liking” a post, re-posting a message, or subscribing to an email list.
• Peer-to-Peer Fundraising: where a company allows people to use their website to solicit donations for a charity.
• Commercial Co-Ventures/Charitable Sales Promotions: where a company agrees to make a donation to charity from the purchase price of a product or service. *But registration under the new CA law only applies if the company conducts CCVs for the benefit of more than six charities in a calendar year.

2. A charity that (i) solicits donations online, (ii) grants funds to other charities based on a person’s online activity, or (iii) permits its name to be referenced or listed as a recipient of online solicitations.

When Must You Register?

• Registration becomes effective on June 12, 2024.
• Before this date, CA promises that its Online Filing Services will become available.
• A company must register during the calendar year when it performs online activities subject to registration.
• A charity must register prior to receiving any applicable online solicitations.

How Do You Register?

Companies:

• Go online to and submit Form PL-1.
• Pay $625 registration fee.

Charities:

• Be registered as a charitable organization in CA.
• Go online to and submit Form PL-3.

Annual Registration:

• Companies must renew registration by Jan. 15 each year with Form PL-2.
• Pay $625 registration fee.

Annual Reports

• Companies and charities must file an annual report by July 15 for fundraising activities in prior calendar year on Form PL-4.

Easy as mud!

Story originally seen here