North Carolina Administrative Code on Auctioneer Licensing Board

Administrative Regulations adopted in North Carolina dealing with Auctioneer Licensing Board. 

NORTH CAROLINA ADMINISTRATIVE CODE
Title 21. OCCUPATIONAL LICENSING BOARDS AND COMMISSIONS
Chapter 04. AUCTIONEERS
Subchapter B. AUCTIONEER LICENSING BOARD

§ 04B .0101. PURPOSE

It is the responsibility of the Board to license auctioneers, apprentice auctioneers, and auction firms and to see that the qualifications and activities of those engaged in auctioneering activities are in accord with law and in the best interests of the public.
The Board is not a board of arbitration and has no jurisdiction to settle disputes between parties concerning such matters of contract as the rate of commissions, the division of commissions, pay of assistants, and similar matters.

§ 04B .0102. BOARD OFFICE

The administrative offices of the Board are located at:
602 Stellata Drive
Fuquay-Varina, North Carolina 27526
Telephone: (919) 567-2844
Office hours are 8:30 a.m. until 5:00 p.m., Monday through Friday, except holidays.

§ 04B .0103. DEFINITIONS

Whenever used in this Chapter:
(1) "Auctioneers Law" or "licensing law" shall refer to G.S. 85B;
(2) "Buyer's Premium" shall mean any additional charge owed by a buyer to the auctioneer, auction firm, or directly to the seller above and beyond the highest accepted bid amount;
(3) "Board" shall mean the North Carolina Auctioneers Commission;
(4) "Minimum Bid" as used in auctions shall mean minimum opening bids;
(5) "Principal(s)" as it pertains to auction firms shall mean director(s), officer(s) and partner(s);
(6) "Non-Auction Firm Business" shall mean a sole licensed auctioneer whose business is not defined as an "Auction Firm" as set forth in G.S. 85B-1(6);
(7) "Auction house," "auction barn," or "auction gallery" shall mean an auction business that conducts auctions at a single location and where consignments are brought to the location by either the auctioneer/auction firm or the public to be sold at auction.

§ 04B .0104. ADMINISTRATIVE LAW PROCEDURES

(a) Contested Cases. Administrative hearings in contested cases conducted by the Board or an administrative law judge (as authorized in G.S. 150B-40 ) shall be governed by:
(1) procedures set out in Article 3A of G.S. 150B;
(2) insofar as relevant, the Rules of Civil Procedure as contained in G.S. 1A-1;
(3) insofar as relevant, the General Rules of Practice for the Superior and District Courts as authorized by G.S. 7A-34 and found in the Rules Volume of the North Carolina General Statutes.
The rules of Civil Procedure and the General Rules of Practice for the Superior and District Courts are hereby incorporated by reference for contested cases for which the Board has authority to adopt rules under G.S. 150B-38(h). Such incorporations by reference shall automatically include any later amendments and editions of the incorporated matter.
(b) Declaratory Rulings. In addition to the procedures set out in G.S. 150B-4, petitions for declaratory rulings shall be submitted to the Board and shall contain:
(1) petitioner's name, address and telephone number;
(2) the statute, rule, or both to which the request relates;
(3) all facts and information which are relevant to the request;
(4) a concise statement of the manner in which petitioner has been aggrieved;
(5) a draft of the declaratory ruling sought by petitioner, if a specified outcome is sought by petitioner;
(6) practices likely to be affected by the declaratory ruling;
(7) a list or description of persons likely to be affected by the declaratory ruling; and
(8) a statement as to whether the petitioner desires to present oral argument, not to exceed 30 minutes, to the Board prior to its decision.
The Board shall ordinarily refuse to issue a declaratory ruling when:
(A) the petition does not comply with this subdivision;
(B) the Board has previously issued a declaratory ruling on substantially similar facts;
(C) the Board has previously issued a final agency decision in a contested case on substantially similar facts;
(D) the facts underlying the request for a declaratory ruling were specifically considered at the time of the adoption of the rule in question; or
(E) the subject matter of the request is involved in pending litigation.
(c) Petitions For Rule-Making. In addition to the procedures set out in G.S. 150B-20, petitions for rule-making shall be submitted to the Board and shall contain:
(1) petitioner's name, address and telephone number;
(2) a draft of the proposed rule or rule change;
(3) the reason for its proposal;
(4) the effect of the proposal on existing rules or decisions;
(5) data supporting the proposal;
(6) practices likely to be affected by the proposal; and
(7) a list or description of persons likely to be affected by the proposal.

§ 04B .0201. APPLICATION FORMS

(a) Auctioneer. Each applicant for an auctioneer license shall complete an application form provided by the Board. This form shall be submitted to the Executive Director and shall be accompanied by:
(1) one passport-type photograph for identification;
(2) statements of the results of a local criminal history records search by the clerk of superior court (or equivalent official in other states) in each county where the applicant has resided and maintained a business within the immediate preceding 60 months (five years);
(3) the completed fingerprint cards provided by the Board and the form signed by the applicant consenting to the check of the criminal history and to the use of fingerprints and other identifying information;
(4) a copy of the applicant's high school diploma or proof of equivalency;
(5) the proper fees, as required by 21 NCAC 04B .0202;
(6) documentation of required auctioneer schooling or auctioneer experience, as follows:
(A) Applicants who base their application upon their successful completion of an approved school of auctioneering shall submit a photostatic copy of their diploma or certificate of successful completion. An applicant shall have successfully completed this school within the five years preceding the date of application or if the applicant has successfully completed this school more than the five years preceding the date of his or her application, shall submit documentation verifying the applicant's active lawful participation in auctions within the two years preceding the date of application. The above referenced participation in auctions is defined as "Auctioneering" as set forth in G.S. 85B-1(8).
(B) Applicants who base their application upon their successful completion of an apprenticeship shall submit a log which was maintained and completed during the apprenticeship period which details the exact hours and dates on which they obtained apprenticeship experience, with each entry being verified and signed by their supervising auctioneer. A minimum of 100 hours of experience during the apprenticeship two-year period shall be obtained. Not less than 25 of the total hours accumulated must be attributable to bid calling and not less than 50 hours shall be attributable to working as a ring person, drafting and negotiating contracts, appraising merchandise, advertising, clerking and cashiering, with not less than five hours of accumulated experience documented for each category. An apprentice who applies for an auctioneer license under this Part shall submit his application and supporting documentation and obtain a passing score on the auctioneer exam prior to the expiration of his apprentice auctioneer license; and
(7) Non-resident applicants shall also submit a properly completed "Designation of Agent for Service of Process Form" with notarized signature and notarial seal affixed.
(b) Non-Resident Reciprocal Auctioneer. Each non-resident applicant for auctioneer license, who applies for a North Carolina license pursuant to G.S. 85B-5shall complete an application form provided by the Board. This form shall be submitted to the Executive Director and shall be accompanied by:
(1) one passport-type photograph for identification;
(2) statements of the results of a local criminal history records search by the clerk of superior court (or equivalent official) in each county where the applicant has resided and maintained a business within the immediate preceding 60 months (five years);
(3) the completed fingerprint cards provided by the Board and the form signed by the applicant consenting to the check of the criminal history and to the use of fingerprints and other identifying information;
(4) a copy of the applicant's high school diploma or proof of equivalency;
(5) the proper fees, as required by 21 NCAC 04B .0202;
(6) a statement of good standing from the licensing board or Commission of each jurisdiction where the applicant holds an auctioneer, apprentice auctioneer or auction firm license; and
(7) a properly completed "Designation of Agent for Service of Process Form" with notarized signature and notarial seal affixed.
(c) Apprentice Auctioneer. Each applicant for an apprentice auctioneer license shall complete an application form provided by the Board. This form shall be submitted to the Executive Director and shall be accompanied by:
(1) one passport-type photograph for identification;
(2) statements of the results of a local criminal history records search by the clerk of superior court (or equivalent official) in each county where the applicant has resided and maintained a business within the immediate preceding 60 months (five years);
(3) the completed fingerprint cards provided by the Board and the form signed by the applicant consenting to the check of the criminal history and to the use of fingerprints and other identifying information;
(4) a copy of the applicant's high school diploma or proof of equivalency;
(5) the proper fees, as required by 21 NCAC 04B .0202;
(6) the signature, as designated on the applicant form, of the licensed auctioneer who will be supervising the apprentice auctioneer;
(7) a written statement of the proposed supervisor's background and experience in the auction profession to include the number and types of auctions conducted or participated in annually; and
(8) if applicant is a non-resident, a properly completed "Designation of Agent for Service of Process Form" with notarized signature and notarial seal affixed.
(d) Auction Firms. An applicant for an auction firm shall be a principal within the firm. Each applicant for an auction firm license shall complete an application form provided by the Board. This form shall be submitted to the Executive Director and shall be accompanied by:
(1) statements of the results of a local criminal history records search by the clerk of superior court (or equivalent official) in each county where any principal and designated person of the auction firm has resided and maintained a business within the immediate preceding 60 months (five years);
(2) each of the principal's and designated person's of the auction firm completed fingerprint cards provided by the Board and the form signed by each consenting to the check of the criminal history and to the use of fingerprints and other identifying information;
(3) a copy of each principal's and designated person's high school diploma or proof of equivalency;
(4) the proper fees, as required by 21 NCAC 04B .0202;
(5) a certified copy of any applicable Articles of Incorporation or Partnership Agreement;
(6) a statement of good standing from the licensing board or Commission of each jurisdiction where the applicant firm and any principal and designated person of such firm holds an auctioneer license of any type; and
(7) if applicant firm is a non-resident, a properly completed "Designation of Agent for Service of Process Form" (one each for the auction firm and for each principal and designated person of the firm) with notarized signature and notarial seal affixed and, if a corporation, the corporate seal and corporate secretary's signature affixed.

§ 04B .0202. FILING AND FEES

(a) Properly completed applications must be filed (received, not postmarked) in the Board office at least seven days prior to an established Board meeting date, or in the case of an application for auctioneer examination, at least 10 days prior to a scheduled examination and must be accompanied by all required documents.
(b) License fees are as follows:
(1) New auctioneer license for an applicant who did not serve an apprenticeship $250.00
This includes a $150.00 annual license fee; $50.00 application fee; and
$50.00 examination fee.
(2) New auctioneer license for an apprentice auctioneer $200.00
This includes a $150.00 annual license fee; and $50.00 examination fee.
(3) Renewal of auctioneer license $150.00
(4) New apprentice auctioneer license $150.00
This includes a $100.00 license fee and a $50.00 application fee.
(5) Renewal of apprentice auctioneer license $100.00
(6) New auction firm license (no examination) $200.00
This includes a $150.00 annual license fee; and $50.00 application fee.
(7) New auction firm license (examination) $250.00
This includes a $150.00 annual license fee; $50.00 application fee;
and $50.00 examination fee.
(8) Renewal of an auction firm license $150.00
(9) Application and processing fee for conversion of non-resident reciprocal license to $ 50.00
in-state license
(10) Reinstatement of lapsed license or late fee $ 50.00
(11) Resident fingerprint card background check fee $ 14.00
Applicants who have been continuous residents of North Carolina for the five
years preceding the date of application shall be required to have only a State
background check.
(12) Non-resident fingerprint card background check fee $ 38.00
Applicants who have not been continuous residents of North Carolina for the five
years preceding the date of application shall be required to have both a State and
Federal background check.
(c) The renewal fee for a non-resident reciprocal licensee under G.S. 85B-5 shall be calculated in the same manner as the initial application fee pursuant to G.S.85B-6.
(d) Fees may be paid in the form of a cashier's check, certified check or money order made payable to the North Carolina Auctioneer Licensing Board. Checks drawn on escrow or trust accounts shall not be accepted. Personal checks may be accepted for payment of renewal fees.

§ 04B .0301. SUBJECT MATTER

(a) The auctioneer license examination shall test the applicant's knowledge of the following required subjects:
(1) a practical and working knowledge of the auction business including fundamentals of auctioneering, contract drafting, bid calling, basic mathematical computations and percentages, advertising, settlement statements, and laws, regulations, and rules that relate to the auctioneering profession;
(2) the provisions of the licensing law; and
(3) the Rules of the Board.
(b) The auction firm license examinations shall test the applicants knowledge of the following;
(1) the provisions of the licensing law; and
(2) the Rules of the Board.

§ 04B .0302. RE-EXAMINATION/REFUND OF FEES

If the applicant does not appear at the initial examination for which he has been scheduled or fails to pass such examination, he will be re-scheduled for the next scheduled examination. If the applicant again does not appear or fails to pass this examination, a refund of the annual auctioneer or apprentice license fee will be made. No refund of the application or examination fee is allowed. A complete new application and proper fees are required if the person wishes to reapply.

§ 04B .0303. EXAM: REVIEW: PAPERS AND CONTENTS

(a) Any applicant who fails to obtain a passing score (75 percent or better) on an examination may request and receive an appointment with the Executive Director to review their examination.
(b) All examination papers shall remain the property of the Board. The contents thereof shall not be divulged, except by express written authorization of the Board.

§ 04B .0401. LICENSE NUMBER: DISPLAY OF LICENSE AND POCKET CARD

(a) When being licensed each individual or firm shall be issued a license number which remains solely his. Should that number be retired for any reason (such as death, failure to continue in the auction business, failure to renew his license, or any other reason) that number shall not be reissued back to the individual or the firm or to any other individual or firm.
(b) A pocket card shall be issued by the Executive Director giving the auctioneer, apprentice auctioneer or auction firm's name, license number and date of expiration. The pocket card must be carried by the licensee, and in the case of auction firms each of the designated person(s), at all times when auctioneering activities are being conducted and shall be available for inspection by the Executive Director or designated agent of the Board. An auction firm shall display its license in a prominent place upon its premises, so as to be visible for inspection by patrons of the firm.

§ 04B .0402. LICENSE RENEWAL

(a) Any licensee desiring the renewal of a license which is in good standing shall apply for same and shall submit the required fees and such records or documentation requested by the Executive Director to verify the licensee's compliance with G.S. 85B and the rules promulgated in this Chapter. All licenses expire on June 30 each year.
(b) Applications for renewal of licenses will only be processed by the Board upon receipt of the required fee and any records, documents, or information, requested pursuant to Paragraph (a) of this Rule.
(c) Any person or entity who engages in any auctioneering activities governed by the auctioneers law while the license is lapsed will be subject to the penalties pursuant to G.S. 85B-9.
(d) Licenses lapsed or suspended in excess of 24 months shall not be renewable. Persons or firms whose license has been lapsed or suspended in excess of 24 months and who desire to be licensed shall apply for a new license and shall meet all the requirements then existing. Persons or firms whose license has been lapsed or suspended in excess of 24 months and who desire to be licensed are exempt from the auctioneer school or the apprenticeship requirements should the continuing education requirements be met for all lapsed, suspended and inactive years.

§ 04B .0403. APPRENTICE AUCTIONEER LICENSE

(a) An apprentice auctioneer's license is valid only while he is associated with and supervised by a licensed auctioneer assigned by the Board. In order to be assigned by the Board as a supervisor, the Board must receive a written notice, signed by the prospective supervisor and the apprentice, requesting that the licensed auctioneer be assigned as a supervisor for the apprentice. Upon receipt of such a request, the Board shall evaluate the requested assignment and such requested assignment may be denied by the Board if the prospective supervisor fails to possess a minimum of five years of active experience in the auctioneering profession or an equivalent combination of training and experience or has committed any act which constitutes grounds for license suspension or revocation under the rules of this Subchapter or under G.S. 85B. Upon termination of the association between the supervisor and the apprentice, the supervisor shall immediately notify the Board in writing, showing the date and cause of termination.
(b) The supervising auctioneer shall be on the premises of the sale location and supervise the apprentice auctioneer at any and all times that an apprentice auctioneer is engaged in bid calling. Additionally, the supervising auctioneer shall supervise the apprentice on a regular basis and ensure that the apprentice auctioneer conforms with the auctioneer law and Rules adopted by the Board.
(c) Any licensed auctioneer who undertakes the sponsorship of an apprentice auctioneer shall ensure that the apprentice receives training, supervision, and guidance in the following:
(1) A practical and working knowledge of the auction business including fundamentals of auctioneering, contract drafting, bid calling, basic mathematical computations, advertising, and settlement statements;
(2) The provisions of the licensing law;
(3) The Rules of the Board; and
(4) The preparation and maintenance of written agreements, record books, and other sales records as required by law.
(d) Apprentices are prohibited from conducting or contracting to conduct any auction without the prior express written consent of the sponsor. No sponsor shall authorize an apprentice to conduct or contract to conduct an auction, to act as principal auctioneer or handle any funds related to an auction unless the sponsor has determined that the apprentice has received adequate training to do so. An apprentice auctioneer may work under more than one Board approved licensed auctioneer at any given time.
(e) The sponsor shall ensure that the apprentice complies with all of the laws and Rules as they apply to any auction related transaction approved by the sponsor.
(f) An apprentice auctioneer shall notify the Board, in writing, immediately upon termination of his association with his supervising auctioneer, at which time his license shall be immediately held in an invalid status. If an apprentice auctioneer's supervising auctioneer's license has been suspended, revoked, or placed on probation the apprentice auctioneer's license shall be immediately held in an invalid status. Once in an invalid status, an apprentice auctioneer shall not conduct or contract to conduct any auction. If an apprentice's license is invalid greater than 90 days due to a lack of an approved sponsor, the apprentice upon securing an approved sponsor shall be required to submit a late fee set forth in 21 NCAC 04B .0202(b)(10).

§ 04B .0404. GROUNDS FOR LICENSE DENIAL OR DISCIPLINE

(a) The Board may assess a civil penalty in accordance with G.S. 85B-3.1(b) or deny, suspend, or revoke a license, or issue a letter of reprimand to a licensee, upon any of the following grounds:
(1) violation of any provision of G.S. 85B;
(2) violation of any provision of the rules under 21 NCAC, 04B;
(3) a check given to the Board in payment of required fees which is returned unpaid;
(4) allowing an unlicensed person (auctioneer) to call a bid at a sale;
(5) auctioneering at an unlicensed auction firm sale;
(6) failure to properly, completely and fully complete an application or making any false statement or giving any false information in connection with an application for a license, renewal or reinstatement of a license including:
(A) failure to completely cooperate with any investigation; or
(B) making any false statement or giving any false information in connection with any investigation by the Board or the Board's designee;
(7) being adjudicated mentally incompetent by a court;
(8) committing a crime the circumstances of which substantially relate to the auctioneering profession;
(9) violating any federal or state statute or rule which relates to the auctioneering profession;
(10) practicing the profession for which the holder has a license while the holder's ability to practice was impaired by alcohol or other drugs or physical or mental disability or disease;
(11) being incompetent in practice. A licensee has been incompetent in practice if the licensee engaged in conduct which evidences a lack of ability, fitness or knowledge to apply principles or skills of the auctioneering profession;
(12) engaging in unprofessional conduct. In this Paragraph "unprofessional conduct" means the violation of any standard of professional behavior which through professional experience has become established in the auctioneering profession;
(13) obtaining or attempting to obtain compensation by fraud or deceit;
(14) violating any order of the Auctioneer Licensing Board requiring a licensee to comply with any provision of the Board's law or administrative rules;
(15) failure to possess truth, honesty and integrity sufficient to be entitled to the high regard and confidence of the public. In this paragraph a lack of truth, honesty and integrity shall be evidenced by proof that the applicant or licensee is in violation of other provisions of the Board's law and administrative rules which demonstrate that the applicant or licensee fails to meet this standard; or
(16) failure to properly make the disclosures required by 21 NCAC 04B .0405.
(b) When applying the requirements of Rule .0404(a) to auction firms or their applications, the requirements shall apply to the firm, all the principals, and all of the designated persons of the firm.

§ 04B .0405. INVOLVEMENT IN COURT ACTION OR ADMINISTRATIVE HEARING

(a) All auctioneers, apprentice auctioneers and auction firms, including their principals and designated person(s), shall report to the Board any and all criminal arrests for, charges of or convictions of a misdemeanor that has as an essential element dishonesty, deceit, fraud or misrepresentations, or any arrests, charges or convictions of any felony. Convictions include findings of guilt, guilty pleas, and pleas of nolo contendere. The Board must receive written notice of any such arrest, charge or criminal conviction within 30 days of the occurrence of any or all of these events.
(b) All auctioneers, apprentice auctioneers and auction firms, including their principals and designated person(s), shall report to the Board any and all civil suits involving them that are based upon any allegation of gross negligence, dishonesty, fraud, misrepresentation or incompetency, or that in any way involve an auction sale or a transaction related to an auction matter or auctioneering. The Board must receive written notice of any such civil suit within 30 days of the date the complaint in the suit is served on the defendant in the action, or the date a pleading containing one or more of these allegations is served on a party.
(c) All auctioneers, apprentice auctioneers and auction firms, including their principals and designated person(s), shall report to the Board any and all administrative proceedings which are commenced against them which involve any potential revocation or suspension of, or other disciplinary action against, any auction license or auctioneer license that they hold in another state. The Board must receive written notice of any such administrative proceeding within 30 days of the date the auctioneer, apprentice auctioneer or auction firm, including its principals and designated person(s), is notified of the administrative proceeding.

§ 04B .0501. APPLICATION FOR COURSE APPROVAL

(a) Schools of auctioneering seeking accreditation by the Board shall complete a Board approved application form.
(b) The school shall notify the Board within 30 days of any change in the information required by the above application form. This requirement shall continue as long as the school remains approved by the Board.

§ 04B .0502. REQUIREMENTS FOR APPROVAL/MINIMUM STANDARDS

(a) In order to be accepted as an approved school, and in order to remain approved, the course curriculum must contain classroom instruction in the following subjects for the minimum number of hours shown:
(1) Essential Core Curriculum (minimum 50 hours);
16 Hours - Bid Calling, Voice Control, Proper Breathing Techniques,
and Use and Sequence of Numbers;
4 Hours - Advertising;
8 Hours - Auctioneers Law and Rules and Regulations;
2 Hours - Uniform Commercial Code and Bulk Transfers;
2 Hours - Drafting and Negotiating Contracts;
2 Hours - Closing Statements and Settlements;
8 Hours - Accounting and Mathematics;
1 Hour - Auctioneering Ethics;
2 Hours - Handling Sale Proceeds and Escrow Accounts;
2 Hours - Auction Preparation and Setup;
3 Hours - Review and Testing (End of Course).
(2) Supplemental Instruction Areas (minimum 30 hours):
Antiques Heavy Equipment
Real Estate Automobiles
Technology Cattle and Livestock
Environmental Issues Public Speaking
Computers Estate Sales
Firearms Appraising
Foreclosure and Bankruptcy Sales Sales Tax Requirements
Art, Rugs, Jewelry Hygiene and Personal Appearance
Body Language Ring Work
Farm Machinery Consignment Auctions
Minimum hours are not required in individual supplemental subjects, however, all topics must be addressed in the school.
(3) Courses that include students that will become North Carolina applicants must provide a minimum of 2 hours of instruction on the North Carolina Auctioneers Law and Rules, G.S. 85B and 21 NCAC 04B. This instruction shall be included within the minimum required 8 hours instruction of Auctioneers Law and Rules and Regulations.
(b) Students attending an approved course must attend and successfully complete a minimum of 80 hours of classroom instruction according to the list of subjects and minimum hours of instruction in each subject specified in Paragraph (a) of this Rule. An hour of creditable instruction is defined as 50 minutes of classroom instruction or practical exercise accompanied by a 10 minute break.
(c) Each course offered must include instruction by a minimum of five different instructors, at least two of whom must be professional auctioneers. Regardless of the total number of hours taught by any given instructor, no more than 20 hours of an individual's instruction may be counted to satisfy the requirements of Paragraph (a) of this Rule.
(d) The school shall establish standards for all persons who instruct in an approved school with minimum training or experience, or a combination thereof, in the particular field in which they are instructing.
(e) The school shall provide or make available suitable facilities, equipment, materials and supplies necessary for the course, specifically including:
(1) a comfortable, well-lighted and ventilated classroom with a seating capacity sufficient to accommodate all students; and
(2) audio-visual equipment and other instructional devices and aids necessary and beneficial to the delivery of effective training.

§ 04B .0503. CERTIFICATION OF COURSE COMPLETION

Schools shall furnish each student who successfully completes their course an official certification of graduation or diploma containing the student's name, the date the course was completed and the total number of hours attended and successfully completed by that student. For successful completion of a course, students must successfully complete a written final examination administered by the school.

§ 04B .0504. RECORDS MUST BE MAINTAINED

Each school shall maintain, and make available upon request of the Board, or its designee, records containing the following information:
(1) dates, times of instruction, and location of every course offered;
(2) names and addresses, number of hours attended and successfully completed, and grade on the final written examination of each student;
(3) a list of all instructors used by the school, the qualifications of each, and their addresses;
(4) for each course offered, the names of all instructors used, the subject(s) taught, the number of hours that each instructor devoted to each subject, and the dates and times of such instruction.

§ 04B .0505. GROUNDS FOR APPROVAL: SUSPENSION OR REVOCATION

(a) The approval of a school by the Board shall be valid for a period of two years. Each approved school shall be evaluated for reapproval prior to the expiration of the two year period.
(b) The Board may deny, suspend or revoke the approval of any school when it finds that the school has failed to meet or to continuously maintain any requirement, standard or procedure of this Section. Additionally, the Board may deny, suspend or revoke the approval of any school upon a finding that any information required under this Section was knowingly falsified or misrepresented.

§ 04B .0506. ALLOWING UNLICENSED BID CALLERS: EXCEPTION

The only exception to allowing an unlicensed bid caller in the State of North Carolina will be in the case of a person enrolled in a class at an approved school of auctioneering who, for the purpose of training and receiving instruction, may do so under the direct supervision of a licensed auctioneer who is also an instructor in the school and who further assumes full and complete responsibility for the activities of the student in the matter involving bid calling.

§ 04B .0601. CHANGE OF ADDRESS OR BUSINESS NAME OR OWNERSHIP

(a) All licensees shall notify the Board in writing of each change or addition of residence or business address (including mailing address) and change of trade name, assumed name, or combination of names under which the licensee conducts business related to auctions.
(b) In the case of a corporate license, said licensee shall immediately notify the Executive Director of any change in the directors or officers of the corporation and such new director(s) or officer(s) shall comply with the provisions of 21 NCAC 04B .0201(d)(1), (2), (3), (5), (6) and (7). If the new directors or officers have a 51% or greater controlling interest in the corporation, the firm license shall be retired and the firm shall apply for a new license.
(c) In the case of a partnership license, said licensee shall immediately notify the Executive Director of any change in partners and such new partners shall comply with the provisions of 21 NCAC 04B .0201(d)(1), (2), (3), (5), (6) and (7).
(d) In the case of an auction firm license, the licensee shall immediately notify the Executive Director of any change in a designated person(s). If the designated person is a currently licensed auctioneer under G.S 85B, the designated person shall be required to comply with the provisions of 21 NCAC 04B .0201(d)(1), (6) and (7). If the designated person is not a currently licensed auctioneer under G.S. 85B, the designated person shall be required to comply with the provisions of 21 NCAC 04B .0201(d)(1), (2), (3), (6) and (7).
(e) Any change in address, business name or ownership required by these Rules shall be reported within 10 days of the occurrence of such change.

§ 04B .0602. ADVERTISING

(a) In all advertisements relating to an auction, the auctioneer's, apprentice auctioneer's or auction firm's name and license number shall be conspicuously given. If an auctioneer is working for or in conjunction with an auction firm, such relationships shall be disclosed and both license numbers shall be conspicuously given. A general advertisement which does not concern a specific sale(s) and which does not list sale dates, times or locations, generally referred to as trolling or holding advertisements, shall not be subject to any identification requirement. A licensee may advertise under a name, assumed name, trade name, or combination of names, only if written notice has been previously filed with the Board.
(b) Any licensee who advertises an "Estate Sale" shall specifically disclose, in all advertisement materials, whether it is the estate of a living or deceased person. Before conducting an auction as an "estate sale," the majority of items in the sale shall come from the estate of the living or deceased person(s). Other items not related to or in an estate may be sold with an estate if specifically disclosed at or before the time of the auction.
(c) It shall be a violation of these Rules to advertise a "Bankruptcy Sale" unless the item(s) offered for sale, whether real or personal, are from an active bankruptcy action. Before conducting an auction as a "bankruptcy sale," the majority of the items in the sale shall come from the bankruptcy of one or more parties. Other items not related to or from a bankruptcy action may be sold with items from a bankruptcy action if specifically disclosed at or before the time of the auction.
(d) It shall be a violation of these Rules to advertise an item, either real or personal, as "Absolute" or "Without Reserve" if the item is subject to confirmation, minimum bid, or any other condition of sale. Before advertising an auction as absolute or without reserve, the majority of items in the sale shall be offered for sale absolute or without reserve. Items that are not absolute may be included in the auction provided they are specifically designated as such in all announcements or advertisements.
(e) It shall be a violation of these Rules to advertise any auction using such descriptive words as "Urgent," "Emergency," "Distress" or any other word which connotates liquidation of assets or that the buyers will, for some extraordinary reason, be in a position to reap some unusual bargain without specifically disclosing, in the written advertisement in a print size equal to the descriptive word, the reason that the sale is "urgent," the nature of the "emergency" or the cause of the "distress," etc.
(f) It shall be a violation of these Rules to advertise any auction using such descriptive words as "Seized," "Confiscated," "Forfeited" or any other word which connotes a governmental action whereby items are seized or taken by a government department, agency or commission and released or sold or that the buyers will, for some governmental reason, be in a position to reap some unusual bargain without specifically disclosing, in the written advertisement in a print size equal to the descriptive word, the exact nature of the government action.
(g) It shall be a violation of these Rules to advertise any items as being from an "estate" or a "bankruptcy," or from an "urgent," "emergency," "distress," "seized," "confiscated," "forfeited" or similar sale, unless the consignor of the item(s) to be sold is the original owner of the item(s), the designated representative of the owner, or a federal, state or local department, agency or commission charged with disposing of the item(s), and consigned the item(s) directly to the advertised sale.
(h) It shall be a violation of these Rules to:
(1) Reference the U.C.C. or any other uniform act or federal or state law in any advertisement unless such act or law is required, by law, to be referenced;
(2) Reference or mention any federal, state or local department, agency or commission in any advertisement unless specifically required by law to do so or unless prior written approval is received from such department, agency or commission; or
(3) Otherwise connote in any advertisement that the auction is under the auspices of, at the direction of or required by federal or state law or act or a federal, state or local agency or commission and that the buyers will, for some legal or governmental reason, be in a position to reap some unusual bargain.
(i) It shall be a violation of these Rules to advertise for sale items which the auctioneer/firm does not intend to offer for sale at the advertised auction.
(j) It shall be a violation of these Rules for an auctioneer or auction firm to permit its name or license number to appear on any advertisement for an auction without reviewing the contents of the advertisement prior to its publication to ascertain its compliance with applicable law and Rules.
(k) It shall be a violation of these Rules to advertise any auction using such descriptive words as "Contents," "Stock," "Inventory," "Liquidation" or any other word which connotes that the items to be auctioned are present on the premises of a residence, business, building or establishment unless the items were physically present continuously for 30 days prior to the signing of the contract or written agreement. Before conducting an auction using any of the descriptive words, the majority of the items in the sale shall be from the premises. Other items not related to or from the contents of the residence or business may be included in the auction provided they are specifically designated as such in all advertisements previous to the sale. The 30 day requirement shall not apply to items used in direct conjunction with the residence or business and brought to the site solely for the purpose of sale at auction.
(l) At all auctions that include a buyer's premium, the amount of the buyer's premium shall be announced at the beginning of the auction and a written notice of this information shall be conspicuously displayed or distributed to the public at the auction site.

§ 04B .0603. SALE PROCEEDS, ACCOUNTING AND ESCROW ACCOUNTS

(a) Each payment made payable to the auctioneer/firm in which any portion belongs to others, and which are not disbursed to the seller on auction day, must be deposited in an escrow account for the benefit of the owner or seller of such property within three business days after receipt of same.
(b) Any licensee who disburses any funds on auction day shall prepare a receipt or settlement statement in compliance with G.S. 85B-7.1(a) and maintain records in compliance with G.S. 85B-7.1(b).
(c) Every auctioneer/firm that does not disburse all funds to the seller on auction day shall establish and maintain a separate bank account designated as "Custodial Account for Sellers Proceeds" or some similar identifying designation, to disclose that the depositor is acting as a fiduciary and that the funds in the account are trust funds.
(d) Such custodial accounts for sellers proceeds must be established and maintained in banks or savings and loan associations located in the State of North Carolina whose deposits are insured by the Federal Deposit Insurance Corporation, or comparable state recognized insurance agency or program.
(e) The Custodial Account for Sellers shall be drawn on only for payment of:
(1) the net proceeds to the seller, or to any person that the auctioneer/firm knows is entitled to payment;
(2) to pay lawful charges against the property which the auctioneer/firm shall in its capacity as agent, be required to pay; and
(3) to obtain any sums due the auctioneer/firm as compensation for its services.
(f) In the event of a dispute between the seller and buyer of goods or property or between the licensee and any person in whose name trust or escrow funds are held, the licensee shall retain said monies in his trust or escrow account until he has obtained a written release from the parties consenting to its disposition or until disbursement is ordered by a court of competent jurisdiction.
(g) Each auctioneer/firm shall keep such accounts and records as will disclose at all times the handling of funds in such Custodial Accounts for Sellers Proceeds. Accounts and records must at all times disclose the names of buyers and the amount of purchase and payment from each, also, the names of the sellers and the amount due and payable to each from funds in the Custodial Account for Sellers Proceeds. The names of the buyers and amount of purchase and payment from each related to an individual seller shall be delivered to the seller within 14 days of a written request made within 90 days of settlement of a specific auction.
(h) All trust or escrow account records and records of disbursement shall be available for inspection by the Commission or its designated agent, without advance notice, and copies shall be provided to the Commission upon request.

§ 04B .0604. CONTRACTS, CONSIGNMENT RECORDS, SALES RECORDS, AND BIDDER REGISTRATION RECORDS

(a) All written agreements for auctions and registration, sales and accounting records shall be maintained at the site during the conduct of the auction and, upon request, shall be made available to the Commission or its designated agent.
(b) An auction house, auction barn, or auction gallery business may enter into a written agreement with regular dealers or sellers for an extended period of time, not to exceed one year.
(c) The consignment records shall be kept by the licensee for a period of two years from the date of the auction.
(d) At an auction house, auction barn, or auction gallery, when consignments are brought to the location by the public during that specific auction sale, the sales records and the consignment records may be the same.
(e) The sales records shall be kept by the licensee for a period of two years from the date of the auction.
(f) The bidder registration records shall contain the bidders' names, addresses, telephone numbers, and when possible e-mail addresses. The bidder registration records shall be kept by the licensee for a period of two years from the date of the auction.
(g) All required records shall be open for inspection by the Commission or its designated agent at reasonable times, or copies of the same shall be provided to the Commission or its designated agent upon written request.

§ 04B .0605. BIDDING

(a) No auctioneer/auction firm shall bid on items in a sale he is conducting or procure such a bid without the intent to purchase the item. However, in a sale with reserve, the auctioneer/auction firm may bid on the reserve item up to, and including, the amount of the reserve price without the intent to purchase the item. In any auction where the auctioneer/auction firm bids or such auctioneer/auction firm procures such a bid, the auctioneer shall announce such bidding in advance of the auction.
(b) A minimum opening bid shall not be required in an absolute auction. Following an opening bid, the auctioneer may set reasonable minimum bid increments. Such a policy shall be stated and, if possible, posted or included in the auctioneer's/auction firm's written terms and conditions of the sale. In this Paragraph "reasonable minimum bid increments" are determined by the type and value of the property being offered at an auction.

§ 04B .0606. AUCTION FIRMS

(a) All licensed auction firms shall have at least one Board approved designated person. If a licensed auction firm does not have at least one designated person in good standing, the status of the auction firm license shall be changed to invalid.
(b) Only designated person(s) for an auction firm have the authority to transact business under the firm license. This includes arranging, managing, soliciting, and contracting auctions; the supervision of the auction staff; the supervision of the acceptance of consignments of items for sale at auction; the supervision of the advertising of an auction; and the supervision of the acceptance of payment and disbursement of monies for items sold at auction.
(c) At least one designated person shall be on the premises of an auction firm's auction sale location while the auction sale is conducted.
(d) Any auctioneer licensed under G.S. 85B may call bids for a licensed auction firm without being a designated person.
(e) Any apprentice auctioneer licensed under G.S. 85B and supervised by the sponsor auctioneer may call bids for a licensed auction firm without being a designated person.
(f) Individuals that hold a currently valid real estate broker license are exempt from the auction firm examination if their authority to transact business under the auction firm license is only related to real estate sales at auction.

§ 04B .0607. NON-AUCTION FIRM BUSINESSES

(a) A licensed auctioneer who owns and operates a non-auction firm business has the sole responsibility for arranging, managing, soliciting, and contracting auctions; the supervision of the auction staff; the supervision of the acceptance of consignments of items for sale at auction; the supervision of the advertising of an auction; and the supervision of the acceptance of payment and disbursement of monies for items sold at auction.
(b) A licensed auctioneer or an apprentice auctioneer who is employed or contracted by another licensed auctioneer who owns and operates a non-auction firm business shall only be responsible for calling bids and performing duties that a non-auctioneer is allowed to perform.
(c) A licensed auctioneer who owns and operates a non-auction firm business shall be on the premises of his businesses' auction sale location while the auction sale is conducted.

§ 04B .0701. APPLICATIONS

All verified applications will be served upon the Commission in accordance with the procedures set forth in G.S. 1A-1, Rule 4(J).

§ 04B .0801. CONTINUING EDUCATION COURSE

(a) To renew a license on active status, an auctioneer, apprentice auctioneer, or designated person(s) in an auction firm shall complete a Board approved course(s) consisting of the hours of instruction as established as in Paragraph (d) of this Rule and shall provide documentation of completion of the above Board approved course(s) within one year preceding license expiration.
(1) "Within one year preceding license expiration time period" shall be defined as from May 16 to the following May 15 in the year that the license expires.
(2) An auctioneer, apprentice auctioneer, or designated person(s) in an auction firm shall provide documentation on required continuing education courses to the Board by the May 15 deadline of the current renewal period.
(3) If the required documentation is not received by the Board by the deadline as set forth in Subparagraph (a)(2) of this Rule, the licensee shall be assessed a late fee as set forth in Rule .0202(b)(10) of this Subchapter.
(4) The renewal shall not be processed until compliance is achieved and the required fees are received as set forth in Rule .0402(b) of this Subchapter.
(b) The Board shall approve courses that shall be conducted by sponsors approved by the Board under this Section. The subject matter of this course shall be determined by the course sponsor subject to Paragraph (h) of this Rule. The course sponsor shall produce or acquire instructor and student materials. The course must be conducted as prescribed by the rules in this Section. At the beginning of the course, sponsors must provide licensees participating in their classes a copy of the student materials developed or acquired by the sponsor.
(c) The sponsor may conduct the course at any location as frequently as is desired during the approval period. Approval of a sponsor to conduct a course authorizes the sponsor to conduct the course using an instructor who has been approved by the Board as a course instructor under Rule .0804 of this Section.
(d) The minimum classroom hours of instruction for each year shall be six unless the Board establishes at its April monthly Board meeting fewer hours for the upcoming year pursuant to G.S. 85B-4(e1). In determining whether fewer hours may be established, the Board shall analyze the disciplinary actions and complaints against its licensees and base its decision on whether the analysis shows that a reduction in hours is justified.
(e) An auctioneer, an apprentice auctioneer, or a designated person(s) in an auction firm shall complete the continuing education requirements for each renewal period that their license was lapsed or suspended.
(f) Credit hours applied to the current renewal of a license shall not be used for future renewals.
(g) Excess continuing education hours may be carried forward as credits for a maximum of one renewal year.
(h) The Board may mandate the topic(s) for all or part of an approved course as a continuing education requirement pursuant to G.S. 85B-4(e1). In determining whether to mandate the topic for all or part of an approved course as a continuing education requirement, the Board shall analyze the disciplinary actions and complaints against its licensees and base its decision on whether the analysis shows that mandating the topic for all or part of a course is justified.
(i) No part of any prelicensing course curriculum shall count as continuing education credit hours.
(j) Continuing education shall not be required until the second renewal after initial licensing pursuant to G.S. 85B-4(e).
§ 04B .0802. APPLICATION FOR ORIGINAL APPROVAL
(a) An entity seeking original approval to sponsor a course must make application on a form prescribed by the Board. An applying entity that is not a resident of North Carolina shall also file with the application a consent to service of process and pleadings.
(b) Approval to sponsor a course shall be granted to an applicant upon showing to the satisfaction of the Board that:
(1) The applicant has submitted all information required by the Board;
(2) The applicant satisfies all of the requirements of Rule .0805 of this Section relating to qualifications or eligibility of course sponsors;
(3) The applicant required by Rule .0805(e) must be truthful, honest and of high integrity as referenced in 21 NCAC 04B .0404(a)(15). In this regard, the Board may consider the reputation and character of any owner, officer or director of any corporation, association or organization applying for sponsor approval; and
(4) The applicant has at least one proposed instructor who has been approved by the Board as a course instructor under Rule .0804 of this Section.

§ 04B .0803. STUDENT FEE FOR COURSES

Sponsors of a course may establish the amount of the fee to be charged to students taking this course; provided, however, that the established fee must be an all-inclusive fee and no separate or additional fee may be charged to students for providing course materials, providing course completion certificates, reporting course completion to the Board, or for recouping similar routine administrative expenses.

§ 04B .0804. APPROVAL OF CONTINUING EDUCATION INSTRUCTORS

(a) Approval of course instructors shall be accomplished at the time of the approval of the course sponsor. Approval of a course instructor authorizes the instructor to teach the course only for the approved course sponsor. An approved course instructor may not independently conduct a course unless the instructor has also obtained approval as a course sponsor.
(b) An entity seeking original approval as a course sponsor must provide the name, address, and qualifications of the instructors for the course on the application form prescribed by the Board. No additional application fee is required. All required information regarding the instructor's qualifications must be submitted.
(c) The instructor(s) must be truthful, honest and of high integrity as referenced in 21 NCAC 04B .0404(a)(15).
(d) The instructor(s) must be qualified under one or more of the following standards:
(1) Possession of a baccalaureate or higher degree with a major in the field of marketing, finance, or business administration;
(2) Possession of a current North Carolina auctioneer or auction firm license, three years active full-time experience in auctioneering within the previous 10 years, and 30 classroom hours of auction education, excluding prelicensing education, within the past three years, such education covering topics which are acceptable under Board rules for continuing education credit;
(3) Possession of a current North Carolina real estate broker license, three years active full-time experience in the real estate business within the previous 10 years, and experience teaching real estate prelicensing and continuing education courses;
(4) Possession of a license to practice law in North Carolina and three years experience in law practice within the previous 10 years; or
(5) Possession of qualifications found by the Board to be equivalent to one or more of the standards set forth in this Rule.
(e) The Board may deny or withdraw approval of any course instructor upon finding that:
(1) The course sponsor or the instructor has made any false statements or presented false information in connection with an application for approval;
(2) The instructor has failed to meet the criteria for approval described in Paragraph (d) of this Rule or has refused or failed to comply with any other provisions of this Subchapter;
(3) The instructor has failed to demonstrate, during the teaching of courses, those effective teaching skills described in Rule .0815 of this Section; or
(4) The instructor has provided false or incorrect information in connection with any reports a course sponsor is required to submit to the Board.
(f) If a licensee who is an approved course instructor engages in any dishonest, fraudulent or improper conduct in connection with the licensee's activities as an instructor, the licensee shall be subject to disciplinary action pursuant to G.S. 85B-8 and G.S. 85B-9.
(g) Upon the written request of the Board, an approved course instructor must submit to the Board a videotape depicting the instructor teaching the course. The videotape must have been made within 12 months of the date of submission, must be in VHS format, must include a label which clearly identifies the instructor and the date of the videotaped presentation.
(h) An approved instructor who is a licensee of the Board shall receive continuing education credit hours for instruction at a rate of one hour for every one-half hour of approved course taught. 

§ 04B .0805. SPONSOR REQUIREMENTS

(a) Any legal entity is eligible to seek approval as a sponsor of continuing education courses, provided that the entity seeking approval is either the owner of the proprietary rights to the course or has lawfully acquired from the course owner the right to seek course approval from the Board and to conduct such course.
(b) The official name to be used by any course sponsor in connection with the offering of an approved continuing education course must clearly distinguish the sponsor from any other previously approved continuing education course sponsor. Unless the sponsor is an auction school approved pursuant to G.S. 85B-4(d)proposing to operate continuing education courses in its own name, the official name also must clearly distinguish the sponsor from any approved auction school. Sponsor applicants proposing to use a sponsor name which does not comply with this standard may be required to adopt a different name as a condition of approval.
(c) Any advertisement or promotional material utilized by an approved course sponsor must include the course sponsor's official name and shall not include any other name for the sponsor.
(d) Prospective sponsors of a course must obtain written approval from the Board to conduct such course prior to conducting the course and prior to advertising or otherwise representing that the course is or may be approved for continuing education credit in North Carolina. No retroactive approval to conduct a course shall be granted for any reason.
(e) A sponsor of a course must designate one person to serve as the continuing education coordinator for all Board-approved continuing education courses offered by the sponsor. The designated coordinator shall serve as the official contact person for the sponsor and shall be responsible for the following:
(1) Supervising the conduct of all the sponsor's Board-approved continuing education courses;
(2) Signing the course completion certificates provided by the sponsor to licensees completing courses; and
(3) Submitting to the Board all required rosters, reports and other information.

§ 04B .0806. COURSE COMPLETION REPORTING

(a) Course sponsors must prepare and submit to the Board reports verifying completion of each continuing education course conducted. Sponsors must submit these reports to the Board in a manner that will assure receipt by the Board within thirty calendar days following the course, but in no case later than May 15 for courses conducted prior to that date. Reports shall include the following:
(1) Official course name;
(2) Sponsor or coordinator name, mailing address, and telephone number;
(3) Coordinator signature certifying that the information is correct;
(4) Name, address, and North Carolina license number of each licensee who satisfactorily completes the course and who desires continuing education credit for the course;
(5) Physical location where course was conducted;
(6) Date(s), starting and ending times of course; and
(7) Number of credit hours.
(b) At the request of the Board, course sponsors must provide licensees enrolled in each continuing education course an opportunity to complete an evaluation of the course upon completion of the course.
(c) Course sponsors shall provide each licensee who satisfactorily completes an approved continuing education course a course completion certificate. Sponsors must provide the certificates to licensees within thirty calendar days following the course, but in no case later than May 15 for any course completed prior to that date. The certificate shall be retained by the licensee as secondary proof of having completed the course. Course completion certificates shall include the following:
(1) Official course name;
(2) Name of licensee who satisfactorily completes the course;
(3) Date(s) of attendance;
(4) Number of credit hours; and
(5) Coordinator signature certifying that the information is correct.
(d) When a licensee in attendance at a continuing education course does not comply with the student participation standards, the course sponsor shall advise the Board of this matter in writing at the time reports verifying completion of continuing education for the course are submitted. A sponsor who determines that a licensee failed to comply with either the Board's attendance or student participation standards shall not provide the licensee with a course completion certificate nor shall the sponsor include the licensee's name on the reports verifying completion of continuing education.

§ 04B .0807. CHANGE IN SPONSOR OWNERSHIP AND OTHER INFORMATION

(a) The approval granted to a course sponsor may be transferred to a new or different entity only with the advance approval of the Board.
(b) Course sponsors must notify the Board in writing prior to any change in business name, continuing education coordinator, address or business telephone number.
(c) Course sponsors must obtain advance approval from the Board for any changes to be made in the content or number of hours for courses; provided that changes in course content which are solely for the purpose of assuring that information provided in a course is current and accurate do not require approval during the approval period, but shall be reported at the time the sponsor requests renewal of course approval. Reques