North Carolina ticket resale moves ahead

The North Carolina State Senate today, July 3, approved a bill that would allow ticket resale over the internet, which moves the state a step closer to lifting its prohibition of ticket reselling.

On Wednesday, the measure was approved by the Senate Finance Committee, which led to today's action. Earlier in the year, the State House of Representatives considered similar legislation. North Carolina is one of the last states to still outlaw ticket resale, so the Senate approval could clear the way for the General Assembly to fully adopt the measure. With Massachusetts, another state that still prohibits ticket resale, North Carolina is a potentially lucrative market for ticket brokers because of the state's popular college and professional sports teams, and because it has long been a major concert drawing region.

The proposed bill, SB1407, reads in part, "A person may resell an admission ticket under this section on the Internet at a price greater than the price on the face of the ticket unless the venue where the event will occur prohibits the Internet ticket resale as provided under subsection (b) of this section. To resell an admission ticket under this section, the person reselling the ticket must offer the ticket for resale on a Web site with a ticket guarantee that meets the requirements of subsection (c) of this section. A prospective purchaser must be directed to the guarantee before completion of the resale transaction. A person who resells an admission ticket under this section acknowledges liability for the tax under G.S. 105 37.1."

Two potential sticking points for brokers are the venue approval component, under which a venue could block the resale of tickets to events it hosts, and the collection of state taxes on resold tickets. According to The Insider, a government news publication in North Carolina, a lobbyist reprenting eBay and its StubHub division unsuccessfully complained to senators that requiring the collection of sales tax for every resold ticket to a North Carolina event would be a logistical nightmare for the company.

The bill's sponsor, Sen. Fletcher Hartsell, Jr., and others believe the sales tax issue is no different for internet resellers than what other retail or consignment businesses have to go through. The venue approval component was designed to help avoid similar situations to last year's Hannah Montana ticketing controversy, according to Hartsell.