1     
AUTO DEALERSHIP LICENSE AMENDMENTS

2     
2018 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Kim F. Coleman

5     
Senate Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions related to the licensing of a new motor vehicle dealer.
10     Highlighted Provisions:
11          This bill:
12          ▸     defines terms;
13          ▸     creates a direct-sale manufacturer license;
14          ▸     creates a direct-sale manufacturer salesperson license;
15          ▸     permits a direct-sale manufacturer licensee to act as a dealer under certain
16     conditions;
17          ▸     permits a direct-sale manufacturer salesperson licensee to act as a salesperson for
18     one direct-sale manufacturer under certain conditions;
19          ▸     exempts a direct-sale manufacturer from the provisions of the New Automobile
20     Franchise Act; and
21          ▸     makes technical changes.
22     Money Appropriated in this Bill:
23          None
24     Other Special Clauses:
25          None
26     Utah Code Sections Affected:
27     AMENDS:

28          41-3-102, as last amended by Laws of Utah 2014, Chapter 237
29          41-3-103, as last amended by Laws of Utah 2010, Chapter 393
30          41-3-105, as last amended by Laws of Utah 2010, Chapter 393
31          41-3-201, as last amended by Laws of Utah 2017, Chapter 153
32          41-3-201.7, as last amended by Laws of Utah 2017, Chapter 153
33          41-3-202, as last amended by Laws of Utah 2009, Chapter 78
34          41-3-203, as renumbered and amended by Laws of Utah 1992, Chapter 234
35          41-3-204, as last amended by Laws of Utah 2008, Chapter 388
36          41-3-206, as last amended by Laws of Utah 2008, Chapter 388
37          41-3-209, as last amended by Laws of Utah 2012, Chapter 145
38          41-3-210, as last amended by Laws of Utah 2007, Chapter 322
39          41-3-702, as last amended by Laws of Utah 2017, Chapter 153
40     ENACTS:
41          13-14-108, Utah Code Annotated 1953
42     

43     Be it enacted by the Legislature of the state of Utah:
44          Section 1. Section 13-14-108 is enacted to read:
45          13-14-108. Applicability.
46          The provisions of this chapter do not apply to a person licensed as a direct-sale
47     manufacturer under Title 41, Chapter 3, Motor Vehicle Business Regulation Act.
48          Section 2. Section 41-3-102 is amended to read:
49          41-3-102. Definitions.
50          As used in this chapter:
51          (1) "Administrator" means the motor vehicle enforcement administrator.
52          (2) "Agent" means a person other than a holder of any dealer's or salesperson's license
53     issued under this chapter, who for salary, commission, or compensation of any kind, negotiates
54     in any way for the sale, purchase, order, or exchange of three or more motor vehicles for any
55     other person in any 12-month period.
56          (3) "Auction" means a dealer engaged in the business of auctioning motor vehicles,
57     either owned or consigned, to the general public.
58          (4) "Authorized service center" means an entity that:

59          (a) is in the business of repairing exclusively the motor vehicles of the same line-make
60     as the motor vehicles a single direct-sale manufacturer sells, displays for sale, or offers for sale
61     or exchange;
62          (b) the direct-sale manufacturer described in Subsection (4)(a) authorizes to complete
63     warranty repair work for motor vehicles that the direct-sale manufacturer sells, displays for
64     sale, or offers for sale or exchange; and
65          (c) conducts business primarily from a commercial repair facility that is permanently
66     located in the state.
67          [(4)] (5) "Board" means the advisory board created in Section 41-3-106.
68          [(5)] (6) "Body shop" means a business engaged in rebuilding, restoring, repairing, or
69     painting primarily the body of motor vehicles damaged by collision or natural disaster.
70          [(6)] (7) "Commission" means the State Tax Commission.
71          [(7)] (8) "Crusher" means a person who crushes or shreds motor vehicles subject to
72     registration under Title 41, Chapter 1a, Motor Vehicle Act, to reduce the useable materials and
73     metals to a more compact size for recycling.
74          [(8)] (9) (a) "Dealer" means a person:
75          (i) whose business in whole or in part involves selling new, used, or new and used
76     motor vehicles or off-highway vehicles; and
77          (ii) who sells, displays for sale, or offers for sale or exchange three or more new or
78     used motor vehicles or off-highway vehicles in any 12-month period.
79          (b) "Dealer" includes a representative or consignee of any dealer.
80          (10) "Direct-sale manufacturer" means a person that:
81          (a) is a manufacturer and a dealer;
82          (b) sells, displays for sale, or offers for sale or exchange only motor vehicles of the
83     person's own line-make;
84          (c) manufactures motor vehicles that are exclusively propelled through the use of
85     electricity, a hydrogen fuel cell, or another non-fossil fuel source; and
86          (d) is not a franchise holder.
87          (11) "Direct-sale manufacturer salesperson" means an individual who for a salary,
88     commission, or compensation of any kind, is employed either directly, indirectly, regularly, or
89     occasionally by a direct-sale manufacturer to sell, purchase, or exchange or to negotiate for the

90     sale, purchase, or exchange of a motor vehicle manufactured by the direct-sale manufacturer
91     who employs the individual.
92          [(9)] (12) (a) "Dismantler" means a person engaged in the business of dismantling
93     motor vehicles subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, for the
94     resale of parts or for salvage.
95          (b) "Dismantler" includes a person who dismantles three or more motor vehicles in any
96     12-month period.
97          [(10)] (13) "Distributor" means a person who has a franchise from a manufacturer of
98     motor vehicles to distribute motor vehicles within this state and who in whole or in part sells or
99     distributes new motor vehicles to dealers or who maintains distributor representatives.
100          [(11)] (14) "Distributor branch" means a branch office similarly maintained by a
101     distributor for the same purposes a factory branch is maintained.
102          [(12)] (15) "Distributor representative" means a person and each officer and employee
103     of the person engaged as a representative of a distributor or distributor branch of motor
104     vehicles to make or promote the sale of the distributor or the distributor branch's motor
105     vehicles, or for supervising or contacting dealers or prospective dealers of the distributor or the
106     distributor branch.
107          [(13)] (16) "Division" means the Motor Vehicle Enforcement Division created in
108     Section 41-3-104.
109          [(14)] (17) "Factory branch" means a branch office maintained by a person who
110     manufactures or assembles motor vehicles for sale to distributors, motor vehicle dealers, or
111     who directs or supervises the factory branch's representatives.
112          [(15)] (18) "Factory representative" means a person and each officer and employee of
113     the person engaged as a representative of a manufacturer of motor vehicles or by a factory
114     branch to make or promote the sale of the manufacturer's or factory branch's motor vehicles, or
115     for supervising or contacting the dealers or prospective dealers of the manufacturer or the
116     factory branch.
117          [(16)] (19) "Franchise" means a contract or agreement between a dealer and a
118     manufacturer of new motor vehicles or [its] a manufacturer's distributor or factory branch by
119     which the dealer is authorized to sell any specified make or makes of new motor vehicles.
120          (20) (a) "Franchise holder" means a manufacturer who:

121          (i) previously had a franchised dealer in the United States;
122          (ii) currently has a franchised dealer in the United States; or
123          (iii) is the successor owner of, under legal or practical common ownership or common
124     control with, or in a partnership, joint venture, or similar arrangement with a manufacturer who
125     previously had or currently has a franchised dealer in the United States.
126          (b) "Franchise holder" does not include a manufacturer described in Subsection
127     (20)(a)(i) or (ii), if at all times during the franchised dealer's existence, the manufacturer had
128     legal or practical common ownership or common control with the franchised dealer.
129          (21) "Line-make" means motor vehicles that are offered for sale, lease, or distribution
130     under a common name, trademark, service mark, or brand name of the manufacturer.
131          [(17)] (22) "Manufacturer" means a person engaged in the business of constructing or
132     assembling new motor vehicles, ownership of which is customarily transferred by a
133     manufacturer's statement or certificate of origin, or a person who constructs three or more new
134     motor vehicles in any 12-month period.
135          [(19)] (23) (a) "Motor vehicle" means a vehicle that is:
136          (i) self-propelled;
137          (ii) a trailer, travel trailer, or semitrailer; or
138          (iii) an off-highway vehicle or small trailer.
139          (b) "Motor vehicle" does not include:
140          (i) mobile homes as defined in Section 41-1a-102;
141          (ii) trailers of 750 pounds or less unladen weight;
142          (iii) farm tractors and other machines and tools used in the production, harvesting, and
143     care of farm products; and
144          (iv) park model recreational vehicles as defined in Section 41-1a-102.
145          [(18)] (24) "Motorcycle" has the same meaning as defined in Section 41-1a-102.
146          [(20)] (25) "New motor vehicle" means a motor vehicle that:
147          (a) has never been titled or registered; and
148          (b) for a motor vehicle that is not a trailer, travel trailer, or semitrailer, has been driven
149     less than 7,500 miles[, unless the motor vehicle is an off-highway vehicle, small trailer, trailer,
150     travel trailer, or semitrailer, in which case the mileage limit does not apply].
151          [(21)] (26) "Off-highway vehicle" has the same meaning as provided in Section

152     41-22-2.
153          [(22)] (27) "Pawnbroker" means a person whose business is to lend money on security
154     of personal property deposited with him.
155          [(23)] (28) (a) "Principal place of business" means, except as provided in Subsection
156     (28)(b), a site or location in this state:
157          [(a)] (i) devoted exclusively to the business for which the dealer, manufacturer,
158     remanufacturer, transporter, dismantler, crusher, or body shop is licensed, and businesses
159     incidental to them;
160          [(b)] (ii) sufficiently bounded by fence, chain, posts, or otherwise marked to definitely
161     indicate the boundary and to admit a definite description with space adequate to permit the
162     display of three or more new, or new and used, or used motor vehicles and sufficient parking
163     for the public; and
164          [(c)] (iii) that includes a permanent enclosed building or structure large enough to
165     accommodate the office of the establishment and to provide a safe place to keep the books and
166     other records of the business, at which the principal portion of the business is conducted and
167     the books and records kept and maintained.
168          (b) "Principal place of business" means, with respect to a direct-sale manufacturer, the
169     direct-sale manufacturer's showroom.
170          [(24)] (29) "Remanufacturer" means a person who reconstructs used motor vehicles
171     subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, to change the body style
172     and appearance of the motor vehicle or who constructs or assembles motor vehicles from used
173     or new and used motor vehicle parts, or who reconstructs, constructs, or assembles three or
174     more motor vehicles in any 12-month period.
175          [(25)] (30) "Salesperson" means an individual who for a salary, commission, or
176     compensation of any kind, is employed either directly, indirectly, regularly, or occasionally by
177     any new motor vehicle dealer or used motor vehicle dealer to sell, purchase, or exchange or to
178     negotiate for the sale, purchase, or exchange of motor vehicles.
179          [(26)] (31) "Semitrailer" has the same meaning as defined in Section 41-1a-102.
180          (32) "Showroom" means a site or location in the state at which a direct-sale
181     manufacturer conducts business as a direct-sale manufacturer in accordance with the provisions
182     of this chapter.

183          [(27)] (33) "Small trailer" means a trailer that has an unladen weight of more than 750
184     pounds, but less than 2,000 pounds.
185          [(28)] (34) "Special equipment" includes a truck mounted crane, cherry picker, material
186     lift, post hole digger, and a utility or service body.
187          [(29)] (35) "Special equipment dealer" means a new or new and used motor vehicle
188     dealer engaged in the business of buying new incomplete motor vehicles with a gross vehicle
189     weight of 12,000 or more pounds and installing special equipment on the incomplete motor
190     vehicle.
191          [(30)] (36) "Trailer" has the same meaning as defined in Section 41-1a-102.
192          [(31)] (37) "Transporter" means a person engaged in the business of transporting motor
193     vehicles as described in Section 41-3-202.
194          [(32)] (38) "Travel trailer" has the same meaning as provided in Section 41-1a-102.
195          [(33)] (39) "Used motor vehicle" means a vehicle that:
196          (a) has been titled and registered to a purchaser other than a dealer; or
197          (b) for a motor vehicle that is not a trailer, travel trailer, or semitrailer, has been driven
198     7,500 or more miles[, unless the vehicle is a trailer, or semitrailer, in which case the mileage
199     limit does not apply].
200          [(34)] (40) "Wholesale motor vehicle auction" means a dealer primarily engaged in the
201     business of auctioning consigned motor vehicles to dealers or dismantlers who are licensed by
202     this or any other jurisdiction.
203          Section 3. Section 41-3-103 is amended to read:
204          41-3-103. Exceptions to "dealer" definition -- Dealer licensed in other state --
205     Direct-sale manufacturer -- Direct-sale manufacturer salesperson.
206          Under this chapter:
207          (1) (a) An insurance company, bank, finance company, company registered as a title
208     lender under Title 7, Chapter 24, Title Lending Registration Act, company registered as a check
209     casher or deferred deposit lender under Title 7, Chapter 23, Check Cashing and Deferred
210     Deposit Lending Registration Act, public utility company, commission impound yard, federal
211     or state governmental agency, or any political subdivision of any of them or any other person
212     coming into possession of a motor vehicle as an incident to its regular business, that sells the
213     motor vehicle under contractual rights that it may have in the motor vehicle is not considered a

214     dealer.
215          (b) A person who sells or exchanges only those motor vehicles that the person has
216     owned for over 12 months is not considered a dealer.
217          (2) (a) A person engaged in leasing motor vehicles is not considered as coming into
218     possession of the motor vehicles incident to the person's regular business.
219          (b) A pawnbroker engaged in selling, exchanging, or pawning motor vehicles is
220     considered as coming into possession of the motor vehicles incident to the person's regular
221     business and must be licensed as a used motor vehicle dealer.
222          (3) A person currently licensed as a dealer or salesperson by another state or country
223     and not currently under license suspension or revocation by the administrator may only sell
224     motor vehicles in this state to licensed dealers, dismantlers, or manufacturers, and only at their
225     places of business.
226          (4) Except as otherwise expressly provided:
227          (a) a direct-sale manufacturer is subject to the same provisions under this chapter as a
228     new motor vehicle dealer; and
229          (b) a direct-sale manufacturer salesperson is subject to the same provisions under this
230     chapter as a salesperson.
231          (5) Notwithstanding any provision of this chapter to the contrary, a direct-sale
232     manufacturer may sell motor vehicles of the direct-sale manufacturer's own line-make without
233     a franchise.
234          Section 4. Section 41-3-105 is amended to read:
235          41-3-105. Administrator's powers and duties -- Administrator and investigators
236     to be law enforcement officers.
237          (1) The administrator may make rules to carry out the purposes of this chapter and
238     Sections 41-1a-1001 through 41-1a-1007 according to the procedures and requirements of Title
239     63G, Chapter 3, Utah Administrative Rulemaking Act.
240          (2) (a) The administrator may employ clerks, deputies, and assistants necessary to
241     discharge the duties under this chapter and may designate the duties of those clerks, deputies,
242     and assistants.
243          (b) The administrator, assistant administrator, and all investigators shall be law
244     enforcement officers certified by peace officer standards and training as required by Section

245     53-13-103.
246          (3) (a) The administrator may investigate any suspected or alleged violation of:
247          (i) this chapter;
248          (ii) Title 41, Chapter 1a, Motor Vehicle Act;
249          (iii) any law concerning motor vehicle fraud; or
250          (iv) any rule made by the administrator.
251          (b) The administrator may bring an action in the name of the state against any person to
252     enjoin a violation found under Subsection (3)(a).
253          (4) (a) The administrator may prescribe forms to be used for applications for licenses.
254          (b) The administrator may require information from the applicant concerning the
255     applicant's fitness to be licensed.
256          (c) Each application for a license shall contain:
257          (i) if the applicant is an individual, the name and residence address of the applicant and
258     the trade name, if any, under which the applicant intends to conduct business;
259          (ii) if the applicant is a partnership, the name and residence address of each partner,
260     whether limited or general, and the name under which the partnership business will be
261     conducted;
262          (iii) if the applicant is a corporation, the name of the corporation, and the name and
263     residence address of each of its principal officers and directors;
264          (iv) a complete description of the principal place of business, including:
265          (A) the municipality, with the street and number, if any;
266          (B) if located outside of any municipality, a general description so that the location can
267     be determined; and
268          (C) any other places of business operated and maintained by the applicant in
269     conjunction with the principal place of business;
270          (v) if the application is for a new motor vehicle dealer's license, the name of each
271     motor vehicle the applicant has been enfranchised to sell or exchange, the name and address of
272     the manufacturer or distributor who has enfranchised the applicant, and the [names and
273     addresses of the individuals] name and address of each individual who will act as
274     [salespersons] a salesperson under authority of the license;
275          (vi) at least five years of business history;

276          (vii) the federal tax identification number issued to the dealer; [and]
277          (viii) the sales and use tax license number issued to the dealer under Title 59, Chapter
278     12, Sales and Use Tax Act[.]; and
279          (ix) if the application is for a direct-sale manufacturer's license:
280          (A) the name of each motor vehicle the applicant will sell, display for sale, or offer for
281     sale or exchange;
282          (B) the name and address of each individual who will act as a direct-sale manufacturer
283     salesperson under authority of the license;
284          (C) a complete description of the direct-sale manufacturer's authorized service center,
285     including the address and any other place of business the applicant operates and maintains in
286     conjunction with the authorized service center;
287          (D) a sworn statement that the applicant complies with each qualification for a
288     direct-sale manufacturer under this chapter;
289          (E) a sworn statement that if at any time the applicant fails to comply with a
290     qualification for a direct-sale manufacturer under this chapter, the applicant will inform the
291     division in writing within 10 business days after the day on which the noncompliance occurs;
292     and
293          (F) an acknowledgment that if the applicant fails to comply with a qualification for a
294     direct-sale manufacturer under this chapter, the administrator will revoke the applicant's
295     direct-sale manufacturer license in accordance with Subsection 41-3-209(4)(b).
296          (5) The administrator may adopt a seal with the words "Motor Vehicle Enforcement
297     Administrator, State of Utah," to authenticate the acts of the administrator's office.
298          (6) (a) The administrator may require that [the] a licensee erect or post signs or devices
299     on the licensee's principal place of business and any other sites, equipment, or locations
300     operated and maintained by the licensee in conjunction with the licensee's business.
301          (b) The signs or devices shall state the licensee's name, principal place of business,
302     type and number of licenses, and any other information that the administrator considers
303     necessary to identify the licensee.
304          (c) The administrator may make rules in accordance with Title 63G, Chapter 3, Utah
305     Administrative Rulemaking Act, determining allowable size and shape of signs or devices,
306     [their] lettering and other details of signs or devices, and [their] location of signs or devices.

307          (7) (a) The administrator shall provide for quarterly meetings of the advisory board and
308     may call special meetings.
309          (b) Notices of all meetings shall be sent to each member not fewer than five days [prior
310     to] before the meeting.
311          (8) The administrator, the officers and inspectors of the division designated by the
312     commission, and peace officers shall:
313          (a) make arrests upon view and without warrant for any violation committed in their
314     presence of any of the provisions of this chapter, or Title 41, Chapter 1a, Motor Vehicle Act;
315          (b) when on duty, upon reasonable belief that a motor vehicle, trailer, or semitrailer is
316     being operated in violation of any provision of Title 41, Chapter 1a, Motor Vehicle Act, require
317     the driver of the vehicle to stop, exhibit the person's driver license and the registration card
318     issued for the vehicle, and submit to an inspection of the vehicle, the license plates, and
319     registration card;
320          (c) serve all warrants relating to the enforcement of the laws regulating the operation of
321     motor vehicles, trailers, and semitrailers;
322          (d) investigate traffic accidents and secure testimony of any witnesses or persons
323     involved; and
324          (e) investigate reported thefts of motor vehicles, trailers, and semitrailers.
325          (9) The administrator may contract with a public prosecutor to provide additional
326     prosecution of this chapter.
327          Section 5. Section 41-3-201 is amended to read:
328          41-3-201. Licenses required -- Restitution -- Education.
329          (1) As used in this section, "new applicant" means a person who is applying for a
330     license that the person has not been issued during the previous licensing year.
331          (2) A person may not act as any of the following without having procured a license
332     issued by the administrator:
333          (a) a dealer;
334          (b) salvage vehicle buyer;
335          (c) salesperson;
336          (d) manufacturer;
337          (e) transporter;

338          (f) dismantler;
339          (g) distributor;
340          (h) factory branch and representative;
341          (i) distributor branch and representative;
342          (j) crusher;
343          (k) remanufacturer; or
344          (l) body shop.
345          (3) (a) Except as provided in Subsection (3)(c), a person may not bid on or purchase a
346     vehicle with a nonrepairable or salvage certificate as defined in Section 41-1a-1001 at or
347     through a motor vehicle auction unless the person is a licensed salvage vehicle buyer.
348          (b) Except as provided in Subsection (3)(c), a person may not offer for sale, sell, or
349     exchange a vehicle with a nonrepairable or salvage certificate as defined in Section 41-1a-1001
350     at or through a motor vehicle auction except to a licensed salvage vehicle buyer.
351          (c) A person may offer for sale, sell, or exchange a vehicle with a nonrepairable or
352     salvage certificate as defined in Section 41-1a-1001 at or through a motor vehicle auction:
353          (i) to an out-of-state or out-of-country purchaser not licensed under this section, but
354     that is authorized to do business in the domestic or foreign jurisdiction in which the person is
355     domiciled or registered to do business;
356          (ii) subject to the restrictions in Subsection (3)(d), to an in-state purchaser not licensed
357     under this section that:
358          (A) has a valid business license in Utah; and
359          (B) has a Utah sales tax license; and
360          (iii) to a crusher.
361          (d) (i) An operator of a motor vehicle auction shall verify that an in-state purchaser not
362     licensed under this section has the licenses required in Subsection (3)(c)(ii).
363          (ii) An operator of a motor vehicle auction may only offer for sale, sell, or exchange
364     five vehicles with a salvage certificate as defined in Section 41-1a-1001 at or through a motor
365     vehicle auction in any 12-month period to an in-state purchaser that does not have a salvage
366     vehicle buyer license issued in accordance with Subsection 41-3-202[(15)](17).
367          (iii) The five vehicle limitation under this Subsection (3)(d) applies to each Utah sales
368     tax license and not to each person with the authority to use a sales tax license.

369          (iv) An operator of a motor vehicle auction may not sell a vehicle with a nonrepairable
370     certificate as defined in Section 41-1a-1001 to a purchaser otherwise allowed to purchase a
371     vehicle under Subsection (3)(c)(ii).
372          (e) For a vehicle with a salvage certificate purchased under Subsection (3)(c)(ii), an
373     operator of a motor vehicle auction shall:
374          (i) (A) until Subsection (3)(e)(i)(B) applies, make application for a salvage certificate
375     of title on behalf of the Utah purchaser within seven days of the purchase if the purchaser does
376     not have a salvage vehicle buyer license, dealer license, body shop license, or dismantler
377     license issued in accordance with Section 41-3-202; or
378          (B) beginning on or after the date that the Motor Vehicle Division has implemented the
379     Motor Vehicle Division's GenTax system, make application electronically, in a form and time
380     period approved by the Motor Vehicle Division, for a salvage certificate of title to be issued in
381     the name of the purchaser;
382          (ii) give to the purchaser a disclosure printed on a separate piece of paper that states:
383          "THIS DISCLOSURE STATEMENT MUST BE GIVEN BY THE SELLER TO THE
384     BUYER EVERY TIME THIS VEHICLE IS RESOLD WITH A SALVAGE CERTIFICATE
385          Vehicle Identification Number (VIN)
386          Year:          Make:          Model:
387          SALVAGE VEHICLE--NOT FOR RESALE WITHOUT DISCLOSURE
388          WARNING: THIS SALVAGE VEHICLE MAY NOT BE SAFE FOR OPERATION
389     UNLESS PROPERLY REPAIRED. SOME STATES MAY REQUIRE AN INSPECTION
390     BEFORE THIS VEHICLE MAY BE REGISTERED. THE STATE OF UTAH MAY
391     REQUIRE THIS VEHICLE TO BE PERMANENTLY BRANDED AS A REBUILT
392     SALVAGE VEHICLE. OTHER STATES MAY ALSO PERMANENTLY BRAND THE
393     CERTIFICATE OF TITLE.
394          _________________________________________________________________
395          Signature of Purchaser                                   Date"; and
396          (iii) if applicable, provide evidence to the Motor Vehicle Division of:
397          (A) payment of sales taxes on taxable sales in accordance with Section 41-1a-510;
398          (B) the identification number inspection required under Section 41-1a-511; and
399          (C) the odometer disclosure statement required under Section 41-1a-902.

400          (f) The Motor Vehicle Division shall include a link to the disclosure statement
401     described in Subsection (3)(e)(ii) on its website.
402          (g) The commission may impose an administrative entrance fee established in
403     accordance with the procedures and requirements of Section 63J-1-504 not to exceed $10 on a
404     person not holding a license described in Subsection (3)(e)(i) that enters the physical premises
405     of a motor vehicle auction for the purpose of viewing available salvage vehicles prior to an
406     auction.
407          (h) A vehicle sold at or through a motor vehicle auction to an out-of-state purchaser
408     with a nonrepairable or salvage certificate may not be certificated in Utah until the vehicle has
409     been certificated out-of-state.
410          (4) (a) An operator of a motor vehicle auction shall keep a record of the sale of each
411     salvage vehicle.
412          (b) A record described under Subsection (4)(a) shall contain:
413          (i) the purchaser's name and address; and
414          (ii) the year, make, and vehicle identification number for each salvage vehicle sold.
415          (c) An operator of a motor vehicle auction shall:
416          (i) provide the record described in Subsection (4)(a) electronically in a method
417     approved by the division to the division within two business days of the completion of the
418     motor vehicle auction;
419          (ii) retain the record described in this Subsection (4) for five years from the date of
420     sale; and
421          (iii) make a record described in this Subsection (4) available for inspection by the
422     division at the location of the motor vehicle auction during normal business hours.
423          (5) (a) An operator of a motor vehicle auction shall store a salvage vehicle sold at
424     auction in a secure facility until the salvage vehicle is claimed as provided in this section.
425          (b) Beginning at the time of purchase and until the salvage vehicle is claimed, the
426     motor vehicle auction operator may collect a daily storage fee for the secure storage of each
427     salvage vehicle sold at auction.
428          (c) Except as provided in Subsection (5)(d), before releasing possession of a salvage
429     vehicle purchased at a motor vehicle auction to a person not licensed under this part or certified
430     as a tow truck operator under Title 72, Chapter 9, Part 6, Tow Truck Provisions, and if the

431     person claiming the vehicle is a person other than the purchaser of the vehicle, the motor
432     vehicle auction operator shall create a record that shall contain:
433          (i) the name and address, as verified by government issued identification, of the person
434     claiming the vehicle;
435          (ii) the year, make, and vehicle identification number of the claimed vehicle;
436          (iii) a written statement from the person claiming the vehicle indicating the location
437     where the salvage vehicle will be delivered; and
438          (iv) verification that the claimant has authorization from the purchaser to claim the
439     vehicle.
440          (d) If the salvage vehicle is claimed by a transporter or a tow truck operator, the
441     transporter or the tow truck operator shall submit to the motor vehicle auction operator a
442     written record on any release forms indicating the location where the salvage vehicle will be
443     delivered if delivered within the state.
444          (e) An operator of a motor vehicle auction shall:
445          (i) retain the record described in Subsection (5)(c) for five years from the date of sale;
446     and
447          (ii) make the record available for inspection by the division at the location of the motor
448     vehicle auction during normal business hours.
449          (6) (a) If applicable, an operator of a motor vehicle auction shall comply with the
450     reporting requirements of the National Motor Vehicle Title Information System overseen by
451     the United States Department of Justice if the person sells a vehicle with a salvage certificate to
452     an in-state purchaser under Subsection (3)(c)(ii).
453          (b) The Motor Vehicle Division shall include a link to the National Motor Vehicle
454     Title Information System on its website.
455          (7) (a) An operator of a motor vehicle auction that sells a salvage vehicle to a person
456     that is an out-of-country buyer shall:
457          (i) stamp on the face of the title so as not to obscure the name, date, or mileage
458     statement the words "FOR EXPORT ONLY" in all capital, black letters; and
459          (ii) stamp in each unused reassignment space on the back of the title the words "FOR
460     EXPORT ONLY."
461          (b) The words "FOR EXPORT ONLY" shall be:

462          (i) at least two inches wide; and
463          (ii) clearly legible.
464          (8) A [supplemental license shall be secured by a] dealer, manufacturer,
465     remanufacturer, transporter, dismantler, crusher, or body shop shall obtain a supplemental
466     license, in accordance with Section 41-3-201.7 for each additional place of business maintained
467     by the licensee.
468          (9) (a) A person who has been convicted of any law relating to motor vehicle
469     commerce or motor vehicle fraud may not be issued a license or purchase a vehicle with a
470     salvage or nonrepairable certificate unless full restitution regarding those convictions has been
471     made.
472          (b) An operator of a motor vehicle auction, a dealer, or a consignor may not sell a
473     vehicle with a nonrepairable or salvage certificate to a buyer described in Subsection (9)(a) if
474     the division has informed the operator of the motor vehicle auction, the dealer, or the consignor
475     in writing that the buyer is prohibited from purchasing a vehicle with a nonrepairable or
476     salvage certificate under Subsection (9)(a).
477          (10) (a) The division may not issue a license to a new applicant for a new or used
478     motor vehicle dealer license, a direct-sale manufacturer license, a new or used motorcycle
479     dealer license, or a small trailer dealer license unless the new applicant completes an eight-hour
480     orientation class approved by the division that includes education on motor vehicle laws and
481     rules.
482          (b) The approved costs of the orientation class shall be paid by the new applicant.
483          (c) The class shall be completed by the new applicant and the applicant's partners,
484     corporate officers, bond indemnitors, and managers.
485          (d) (i) The division shall approve:
486          (A) providers of the orientation class; and
487          (B) costs of the orientation class.
488          (ii) A provider of an orientation class shall submit the orientation class curriculum to
489     the division for approval prior to teaching the orientation class.
490          (iii) A provider of an orientation class shall include in the orientation materials:
491          (A) ethics training;
492          (B) motor vehicle title and registration processes;

493          (C) provisions of Title 13, Chapter 5, Unfair Practices Act, relating to motor vehicles;
494          (D) Department of Insurance requirements relating to motor vehicles;
495          (E) Department of Public Safety requirements relating to motor vehicles;
496          (F) federal requirements related to motor vehicles as determined by the division; and
497          (G) any required disclosure compliance forms as determined by the division.
498          (11) A person or purchaser described in Subsection (3)(c)(ii):
499          (a) may not purchase more than five salvage vehicles with a nonrepairable or salvage
500     certificate as defined in Section 41-1a-1001 in any 12-month period;
501          (b) may not, without first complying with Section 41-1a-705, offer for sale, sell, or
502     exchange more than two vehicles with a salvage certificate as defined in Section 41-1a-1001 in
503     any 12-month period to a person not licensed under this section; and
504          (c) may not, without first complying with Section 41-1a-705, offer for sale, sell, or
505     exchange a vehicle with a nonrepairable certificate as defined in Section 41-1a-1001 to a
506     person not licensed under this section.
507          (12) An operator of a motor vehicle auction, a dealer, or a consignor may not sell a
508     vehicle with a nonrepairable or salvage certificate to a buyer described in Subsection (11)(a) if
509     the division has informed the operator of the motor vehicle auction, the dealer, or the consignor
510     in writing that the buyer is prohibited from purchasing a vehicle with a nonrepairable or
511     salvage certificate under Subsection (11)(a).
512          Section 6. Section 41-3-201.7 is amended to read:
513          41-3-201.7. Supplemental license for additional place of business restrictions --
514     Exception.
515          (1) (a) Subject to the requirements of Subsection (2), the administrator may issue a
516     supplemental license for an additional place of business [issued pursuant to] under Subsection
517     41-3-201(8) [may only be issued] to a dealer if the dealer is:
518          (i) licensed in accordance with Section 41-3-202;
519          (ii) bonded in accordance with Section 41-3-205; and
520          (iii) in compliance with existing rules promulgated by the administrator of the division
521     under Section 41-3-105.
522          (b) [A] The administrator may issue a supplemental license for a permanent additional
523     place of business [may only be issued] to a used motor vehicle dealer if:

524          (i) the dealer independently satisfies the bond requirements under Section 41-3-205 for
525     the permanent additional place of business;
526          (ii) the dealer is in compliance with existing rules promulgated by the administrator of
527     the division under Section 41-3-105; and
528          (iii) the permanent additional place of business meets all the requirements for a
529     principal place of business.
530          (2) (a) Except as provided in Subsections (2)(c) and (3), a supplemental license for an
531     additional place of business issued pursuant to Subsection 41-3-201(8) for a new motor vehicle
532     dealer may not be issued for an additional place of business that is beyond the geographic
533     specifications outlined as the area of responsibility in the dealer's franchise agreement.
534          (b) A new motor vehicle dealer shall provide the administrator with a copy of the
535     portion of the new motor vehicle dealer's franchise agreement identifying the dealer's area of
536     responsibility before being issued a supplemental license for an additional place of business.
537          (c) The restrictions under Subsections (2)(a) and (b) do not apply to a new motor
538     vehicle dealer if:
539          (i) the license for an additional place of business is being issued for the sale of used
540     motor vehicles[.]; or
541          (ii) the dealer is a direct-sale manufacturer .
542          (3) The provisions of Subsection (2) do not apply if the additional place of business is
543     a trade show or exhibition if:
544          (a) there are five or more dealers participating in the trade show or exhibition; and
545          (b) the trade show or exhibition takes place at a location other than the principal place
546     of business of one of the dealers participating in the trade show or exhibition.
547          (4) A supplemental license for a temporary additional place of business issued to a
548     used motor vehicle dealer may not be for longer than 10 consecutive days.
549          Section 7. Section 41-3-202 is amended to read:
550          41-3-202. Licenses -- Classes and scope.
551          (1) A new motor vehicle dealer's license permits the licensee to:
552          (a) offer for sale, sell, or exchange new motor vehicles if the licensee possesses a
553     franchise from the manufacturer of the motor vehicle offered for sale, sold, or exchanged by the
554     licensee;

555          (b) offer for sale, sell, or exchange used motor vehicles;
556          (c) operate as a body shop; and
557          (d) dismantle motor vehicles.
558          (2) A used motor vehicle dealer's license permits the licensee to:
559          (a) offer for sale, sell, or exchange used motor vehicles;
560          (b) operate as a body shop; and
561          (c) dismantle motor vehicles.
562          (3) A direct-sale manufacturer's license permits the licensee to:
563          (a) offer for sale, sell, or exchange new motor vehicles of the same line-make that the
564     direct-sale manufacturer manufactures;
565          (b) offer for sale, sell, or exchange used motor vehicles;
566          (c) operate as a body shop;
567          (d) dismantle motor vehicles; and
568          (e) establish and maintain:
569          (i) a showroom; and
570          (ii) an authorized service center that performs repair work exclusively on motor
571     vehicles of the same line-make as the direct-sale manufacturer offers for sale.
572          [(3)] (4) A new motorcycle, off-highway vehicle, and small trailer dealer's license
573     permits the licensee to:
574          (a) offer for sale, sell, or exchange new motorcycles, off-highway vehicles, or small
575     trailers if the licensee possesses a franchise from the manufacturer of the motorcycle,
576     off-highway vehicle, or small trailer offered for sale, sold, or exchanged by the licensee;
577          (b) offer for sale, sell, or exchange used motorcycles, off-highway vehicles, or small
578     trailers; and
579          (c) dismantle motorcycles, off-highway vehicles, or small trailers.
580          [(4)] (5) A used motorcycle, off-highway vehicle, and small trailer dealer's license
581     permits the licensee to:
582          (a) offer for sale, sell, or exchange used motorcycles, off-highway vehicles, and small
583     trailers; and
584          (b) dismantle motorcycles, off-highway vehicles, or small trailers.
585          [(5)] (6) (a) Except as provided in Subsection [(5)] (6)(b), a salesperson's license

586     permits the licensee to act as a motor vehicle salesperson and is valid for employment with
587     only one dealer at a time.
588          (b) A licensee that has been issued a salesperson's license and that is employed by a
589     dealer that operates as a wholesale motor vehicle auction may be employed by more than one
590     dealer that operates as a wholesale motor vehicle auction at a time.
591          (7) (a) A direct-sale manufacturer salesperson's license permits the licensee to act as a
592     direct-sale manufacturer salesperson for one direct-sales manufacturer.
593          (b) A direct-sale manufacturer salesperson licensee may not simultaneously hold a
594     salesperson's license.
595          [(6)] (8) (a) A manufacturer's license permits the licensee to construct or assemble
596     motor vehicles subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, at an
597     established place of business and to remanufacture motor vehicles.
598          (b) Under rules made by the administrator, the licensee may issue and install vehicle
599     identification numbers on manufactured motor vehicles.
600          (c) The licensee may franchise and appoint dealers to sell manufactured motor vehicles
601     by notifying the division of the franchise or appointment.
602          [(7)] (9) A transporter's license permits the licensee to transport or deliver motor
603     vehicles subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, from a
604     manufacturing, assembling, or distributing point or from a dealer, to dealers, distributors, or
605     sales agents of a manufacturer or remanufacturer, to or from detail or repair shops, and to
606     financial institutions or places of storage from points of repossession.
607          [(8)] (10) A dismantler's license permits the licensee to dismantle motor vehicles
608     subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, for the purpose of
609     reselling parts or for salvage, or selling dismantled or salvage vehicles to a crusher or other
610     dismantler.
611          [(9)] (11) A distributor or factory branch and distributor branch's license permits the
612     licensee to sell and distribute new motor vehicles, parts, and accessories to their franchised
613     dealers.
614          [(10)] (12) A representative's license, for factory representatives or distributor
615     representatives permits the licensee to contact the licensee's authorized dealers for the purpose
616     of making or promoting the sale of motor vehicles, parts, and accessories.

617          [(11)] (13) (a) (i) A remanufacturer's license permits the licensee to construct,
618     reconstruct, assemble, or reassemble motor vehicles subject to registration under Title 41,
619     Chapter 1a, Motor Vehicle Act, from used or new motor vehicles or parts.
620          (ii) Evidence of ownership of parts and motor vehicles used in remanufacture shall be
621     available to the division upon demand.
622          (b) Under rules made by the administrator, the licensee may issue and install vehicle
623     identification numbers on remanufactured motor vehicles.
624          [(12)] (14) A crusher's license permits the licensee to engage in the business of
625     crushing or shredding motor vehicles subject to registration under Title 41, Chapter 1a, Motor
626     Vehicle Act, for the purpose of reducing the useable materials and metals to a more compact
627     size for recycling.
628          [(13)] (15) A body shop's license permits the licensee to rebuild, restore, repair, or
629     paint primarily the body of motor vehicles damaged by collision or natural disaster, and to
630     dismantle motor vehicles.
631          [(14)] (16) A special equipment dealer's license permits the licensee to:
632          (a) buy incomplete new motor vehicles with a gross vehicle weight of 12,000 or more
633     pounds from a new motor vehicle dealer and sell the new vehicle with the special equipment
634     installed without a franchise from the manufacturer;
635          (b) offer for sale, sell, or exchange used motor vehicles;
636          (c) operate as a body shop; and
637          (d) dismantle motor vehicles.
638          [(15)] (17) (a) A salvage vehicle buyer license permits the licensee to bid on or
639     purchase a vehicle with a salvage certificate as defined in Section 41-1a-1001 at any motor
640     vehicle auction.
641          (b) A salvage vehicle buyer license may only be issued to a motor vehicle dealer,
642     dismantler, or body shop who qualifies under rules made by the division and is licensed in any
643     state as a motor vehicle dealer, dismantler, or body shop.
644          (c) The division may not issue more than two salvage vehicle buyer licenses to any one
645     dealer, dismantler, or body shop.
646          (d) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
647     administrator shall make rules establishing qualifications of an applicant for a salvage vehicle

648     buyer license. The criteria shall include:
649          (i) business history;
650          (ii) salvage vehicle qualifications;
651          (iii) ability to properly handle and dispose of environmental hazardous materials
652     associated with salvage vehicles; and
653          (iv) record in demonstrating compliance with the provisions of this chapter.
654          Section 8. Section 41-3-203 is amended to read:
655          41-3-203. Licenses -- Form -- Seal -- Custody of salesperson's license -- Display of
656     salesperson and dealer licenses -- Licensee's pocket card.
657          (1) (a) The administrator shall prescribe the form of each license and the seal of [his]
658     the administrator's office shall be imprinted on each license.
659          (b) The administrator shall deliver or mail the license of each salesperson [shall be
660     delivered or mailed] to the dealer employing the salesperson and [it shall be kept in the custody
661     and control of the dealer and conspicuously displayed] the dealer shall keep the license in the
662     dealer's custody and control and conspicuously display the license in the dealer's place of
663     business.
664          (c) Each licensee shall display conspicuously [his] the licensee's own license in [his]
665     the licensee's place of business.
666          (d) In addition to the other provisions of this section, each direct-sale manufacturer
667     licensee shall display conspicuously the licensee's own license in each of the licensee's:
668          (i) showrooms; and
669          (ii) authorized service centers.
670          (2) (a) The administrator shall prepare and deliver a pocket card, certifying that the
671     person whose name is on the card is licensed under this chapter.
672          (b) Each salesperson's card shall also contain the name and address of the dealer
673     employing [him] the salesperson.
674          (c) Each salesperson shall on request display [his] the salesperson's pocket card.
675          Section 9. Section 41-3-204 is amended to read:
676          41-3-204. Licenses -- Principal place of business as prerequisite -- Change of
677     location -- Relinquishment on loss of principal place of business.
678          (1) (a) The following licensees must maintain a principal place of business:

679          (i) dealers;
680          (ii) special equipment dealers;
681          (iii) manufacturers;
682          (iv) transporters;
683          (v) remanufacturers;
684          (vi) dismantlers;
685          (vii) crushers;
686          (viii) body shops; and
687          (ix) distributors who:
688          (A) are located within the state; or
689          (B) have a branch office within the state.
690          (b) The administrator may not issue a license under Subsection (1)(a) to an applicant
691     who does not have a principal place of business.
692          (c) If a licensee changes the location of [his] the licensee's principal place of business,
693     [he] the licensee shall immediately notify the administrator and the administrator shall issue a
694     new license [shall be granted] for the unexpired portion of the term of the original license at no
695     additional fee.
696           (d) In addition to the other requirements of this section, if a direct-sale manufacturer
697     licensee changes the location of an authorized service center of the licensee, the licensee shall
698     immediately notify the administrator and the administrator shall issue a new license for the
699     unexpired portion of the term of the original license at no additional fee.
700          (2) (a) If a licensee loses possession of a principal place of business, the license is
701     automatically suspended and he shall immediately notify the administrator and upon demand
702     by the administrator deliver the license, pocket cards, special plates, and temporary permits to
703     the administrator.
704          (b) The administrator shall hold the licenses, cards, plates, and permits until the
705     licensee obtains:
706          (i) a principal place of business[.]; and
707           (ii) if the licensee is a direct-sale manufacturer, an authorized service center .
708          Section 10. Section 41-3-206 is amended to read:
709          41-3-206. Duration of licenses -- Expiration date -- Renewal.

710          (1) Except as provided in Subsection (2), each license issued under this chapter expires
711     on June 30 of each year and may be renewed upon application and payment of a fee required
712     under Section 41-3-601, if the license has not been suspended or revoked.
713          (2) A motor vehicle salesperson's license expires as provided under Subsection (1) or
714     when the salesperson terminates employment with the dealer with whom he is licensed,
715     whichever comes first.
716          (3) (a) [Beginning July 1, 1999, the] The division may not renew a license for a new or
717     used motor vehicle dealer's license, a direct-sale manufacturer's license, a new or used
718     motorcycle dealer's license, or a small trailer dealer's license unless the renewal applicant
719     completes a three-hour class approved by the division that includes education on new motor
720     vehicle laws and rules.
721          (b) The approved costs of the class shall be paid by the renewal applicant.
722          (c) The class shall be completed by the renewal applicant or any designated
723     representative of the renewal applicant dealer.
724          (d) The division shall approve:
725          (i) the class providers; and
726          (ii) costs of the class.
727          Section 11. Section 41-3-209 is amended to read:
728          41-3-209. Administrator's findings -- Suspension and revocation of license.
729          (1) If the administrator finds that an applicant is not qualified to receive a license, a
730     license may not be granted.
731          [(2) (a) On December 1, 2010, the administrator shall suspend the license of a
732     salesperson who fails to submit to the division fingerprints as required under Subsection
733     41-3-205.5(1)(b) on or before November 30, 2010.]
734          [(b) If] (2) (a) Subject to Subsection (4)(b), if the administrator finds that there is
735     reasonable cause to deny, suspend, or revoke a license issued under this chapter, the
736     administrator shall deny, suspend, or revoke the license.
737          [(c)] (b) Reasonable cause for denial, suspension, or revocation of a license includes, in
738     relation to the applicant or license holder or any of [its] the applicant or license holder's
739     partners, officers, or directors:
740          (i) lack of a principal place of business or authorized service center as required by this

741     chapter ;
742          (ii) lack of a sales tax license required under Title 59, Chapter 12, Sales and Use Tax
743     Act;
744          (iii) lack of a bond in effect as required by this chapter;
745          (iv) current revocation or suspension of a dealer, dismantler, auction, or salesperson
746     license issued in another state;
747          (v) nonpayment of required fees;
748          (vi) making a false statement on any application for a license under this chapter or for
749     special license plates;
750          (vii) a violation of any state or federal law involving motor vehicles;
751          (viii) a violation of any state or federal law involving controlled substances;
752          (ix) charges filed with any county attorney, district attorney, or U.S. attorney in any
753     court of competent jurisdiction for a violation of any state or federal law involving motor
754     vehicles;
755          (x) a violation of any state or federal law involving fraud;
756          (xi) a violation of any state or federal law involving a registerable sex offense under
757     Section 77-41-106; or
758          (xii) having had a license issued under this chapter revoked within five years from the
759     date of application.
760          [(d)] (c) Any action taken by the administrator under Subsection (2)(c)(ix) shall remain
761     in effect until a final resolution is reached by the court involved or the charges are dropped.
762          (3) If the administrator finds that an applicant is not qualified to receive a license under
763     this section, the administrator shall provide the applicant written notice of the reason for the
764     denial.
765          (4) (a) If the administrator finds that the license holder has been convicted by a court of
766     competent jurisdiction of violating any of the provisions of this chapter or any rules made by
767     the administrator, or finds other reasonable cause, the administrator may, by complying with
768     the emergency procedures of Title 63G, Chapter 4, Administrative Procedures Act:
769          [(a)] (i) suspend the license on terms and for a period of time the administrator finds
770     reasonable; or
771          [(b)] (ii) revoke the license.

772           (b) If the administrator finds reasonable cause as described in Subsection (2) to revoke
773     a direct-sale manufacturer license, the administrator shall revoke the license 90 days after the
774     day on which the noncompliance occurs, unless the licensee cures the noncompliance before
775     the license is revoked.
776          (5) (a) After suspending or revoking a license, the administrator may take reasonable
777     action to:
778          (i) notify the public that the licensee is no longer in business; and
779          (ii) prevent the former licensee from violating the law by conducting business without
780     a license.
781          (b) Action under Subsection (5)(a) may include signs, banners, barriers, locks,
782     bulletins, and notices.
783          (c) Any business being conducted incidental to the business for which the former
784     licensee was licensed may continue to operate subject to the preventive action taken under this
785     subsection.
786          Section 12. Section 41-3-210 is amended to read:
787          41-3-210. License holders -- Prohibitions and requirements.
788          (1) The holder of any license issued under this chapter may not:
789          (a) intentionally publish, display, or circulate any advertising that is misleading or
790     inaccurate in any material fact or that misrepresents any of the products sold, manufactured,
791     remanufactured, handled, or furnished by a licensee;
792          (b) intentionally publish, display, or circulate any advertising without identifying the
793     seller as the licensee by including in the advertisement the full name under which the licensee
794     is licensed or the licensee's number assigned by the division;
795          (c) violate this chapter or the rules made by the administrator;
796          (d) violate any law of the state respecting commerce in motor vehicles or any rule
797     respecting commerce in motor vehicles made by any licensing or regulating authority of the
798     state;
799          (e) engage in business as a new motor vehicle dealer, special equipment dealer, used
800     motor vehicle dealer, motor vehicle crusher, or body shop without having in effect a bond as
801     required in this chapter;
802          (f) act as a dealer, dismantler, crusher, manufacturer, transporter, remanufacturer, or

803     body shop without maintaining a principal place of business;
804          (g) unless the licensee is a special equipment dealer who sells a new special equipment
805     motor vehicle with a gross vehicle weight of 12,000 or more pounds after installing special
806     equipment on the motor vehicle:
807          [(g)] (i) engage in a business respecting the selling or exchanging of new or new and
808     used motor vehicles for which [he] the licensee is not licensed[, including selling or
809     exchanging]; and
810          (ii) unless the licensee is a direct-sale manufacturer, sell or exchange a new motor
811     vehicle for which the licensee does not have a franchise[, but this Subsection (1)(g) does not
812     apply to a special equipment dealer who sells a new special equipment motor vehicle with a
813     gross vehicle weight of 12,000 or more pounds after installing special equipment on the motor
814     vehicle];
815          (h) dismantle or transport to a crusher for crushing or other disposition any motor
816     vehicle without first obtaining a dismantling or junk permit under Section 41-1a-1009,
817     41-1a-1010, or 41-1a-1011;
818          (i) as a new motor vehicle dealer, special equipment dealer, or used motor vehicle
819     dealer fail to give notice of sales or transfers as required in Section 41-3-301;
820          (j) advertise or otherwise represent, or knowingly allow to be advertised or represented
821     on [his] the licensee's behalf or at [his] the licensee's place of business, that no down payment
822     is required in connection with the sale of a motor vehicle when a down payment is required and
823     the buyer is advised or induced to finance a down payment by a loan in addition to any other
824     loan financing the remainder of the purchase price of the motor vehicle;
825          (k) as a crusher, crush or shred a motor vehicle brought to the crusher without
826     obtaining proper evidence of ownership of the motor vehicle; proper evidence of ownership is
827     a certificate of title endorsed according to law or a dismantling or junk permit issued under
828     Section 41-1a-1009, 41-1a-1010, or 41-1a-1011;
829          (l) as a manufacturer or remanufacturer assemble a motor vehicle that does not comply
830     with construction, safety, or vehicle identification number standards fixed by law or rule of any
831     licensing or regulating authority;
832          (m) as anyone other than a salesperson or a direct-sale manufacturer salesperson
833     licensed under this chapter, be present on a dealer display space and contact prospective

834     customers to promote the sale of the dealer's vehicles;
835          (n) sell, display for sale, or offer for sale motor vehicles at any location other than the
836     principal place of business or additional places of business licensed under this chapter; this
837     provision is construed to prevent dealers, salespersons, or any other representative of a
838     dealership from selling, displaying, or offering motor vehicles for sale from their homes or
839     other unlicensed locations;
840          (o) (i) as a dealer, dismantler, body shop, or manufacturer, maintain a principal place of
841     business or additional place of business that shares any common area with a business or
842     activity not directly related to motor vehicle commerce; or
843          (ii) maintain any places of business that share any common area with another dealer,
844     dismantler, body shop, or manufacturer;
845          (p) withhold delivery of license plates obtained by the licensee on behalf of a customer
846     for any reason, including nonpayment of any portion of the vehicle purchase price or down
847     payment;
848          (q) issue a temporary permit for any vehicle that has not been sold by the licensee;
849          (r) alter a temporary permit in any manner;
850          (s) operate any principal place of business or additional place of business in a location
851     that does not comply with local ordinances, including zoning ordinances;
852          (t) sell, display for sale, offer for sale, or exchange any new motor vehicle if the
853     licensee does not:
854          (i) have a new motor vehicle dealer's license or a direct-sale manufacturer's license
855     under Section 41-3-202; and
856          (ii) unless the licensee is a direct-sale manufacturer, possess a franchise from the
857     manufacturer of the new motor vehicle sold, displayed for sale, offered for sale, or exchanged
858     by the licensee; [or]
859          (u) as a new motor vehicle dealer or used motor vehicle dealer, encourage or conspire
860     with any person who has not obtained a salesperson's or a direct-sale manufacturer
861     salesperson's license to solicit for prospective purchasers[.]; or
862           (v) as a direct-sale manufacturer, engage in business as a direct-sale manufacturer
863     without having an authorized service center.
864          (2) (a) If a new motor vehicle is constructed in more than one stage, such as a motor

865     home, ambulance, or van conversion, the licensee shall advertise, represent, sell, and exchange
866     the vehicle as the make designated by the final stage manufacturer, except in those specific
867     situations where the licensee:
868          (i) possesses a franchise from the initial or first stage manufacturer, presumably the
869     manufacturer of the motor vehicle's chassis[.]; or
870           (ii) manufactured the initial or first stage of the motor vehicle .
871          (b) Sales of multiple stage manufactured motor vehicles shall include the transfer to the
872     purchaser of a valid manufacturer's statement or certificate of origin from each manufacturer
873     under Section 41-3-301.
874          (3) Each licensee, except salespersons, shall maintain and make available for
875     inspection by peace officers and employees of the division:
876          (a) a record of every motor vehicle bought, or exchanged by the licensee or received or
877     accepted by the licensee for sale or exchange;
878          (b) a record of every used part or used accessory bought or otherwise acquired;
879          (c) a record of every motor vehicle bought or otherwise acquired and wrecked or
880     dismantled by the licensee;
881          (d) all buyers' orders, contracts, odometer statements, temporary permit records,
882     financing records, and all other documents related to the purchase, sale, or consignment of
883     motor vehicles; and
884          (e) a record of the name and address of the person to whom any motor vehicle or motor
885     vehicle body, chassis, or motor vehicle engine is sold or otherwise disposed of and a
886     description of the motor vehicle by year, make, and vehicle identification number.
887          (4) Each licensee required by this chapter to keep records shall:
888          (a) be kept by the licensee at least for five years; and
889          (b) furnish copies of those records upon request to any peace officer or employee of the
890     division during reasonable business hours.
891          (5) A manufacturer, distributor, distributor representative, or factory representative
892     may not induce or attempt to induce by means of coercion, intimidation, or discrimination any
893     dealer to:
894          (a) accept delivery of any motor vehicle, parts, or accessories or any other commodity
895     or commodities, including advertising material not ordered by the dealer;

896          (b) order or accept delivery of any motor vehicle with special features, appliances,
897     accessories, or equipment not included in the list price of the motor vehicle as publicly
898     advertised by the manufacturer;
899          (c) order from any person any parts, accessories, equipment, machinery, tools,
900     appliances, or any other commodity;
901          (d) enter into an agreement with the manufacturer, distributor, distributor
902     representative, or factory representative of any of them, or to do any other act unfair to the
903     dealer by threatening to cancel any franchise or contractual agreement between the
904     manufacturer, distributor, distributor branch, or factory branch and the dealer;
905          (e) refuse to deliver to any dealer having a franchise or contractual arrangement for the
906     retail sale of new and unused motor vehicles sold or distributed by the manufacturer,
907     distributor, distributor branch or factory branch, any motor vehicle, publicly advertised for
908     immediate delivery within 60 days after the dealer's order is received; or
909          (f) unfairly, without regard to the equities of the dealer, cancel the franchise of any
910     motor vehicle dealer; the nonrenewal of a franchise or selling agreement without cause is a
911     violation of this subsection and is an unfair cancellation.
912          (6) A dealer may not assist an unlicensed dealer or salesperson in unlawful activity
913     through active or passive participation in sales, or by allowing use of his facilities or dealer
914     license number, or by any other means.
915          (7) (a) The holder of any new motor vehicle dealer or direct-sale manufacturer license
916     issued under this chapter may not sell any new motor vehicle to:
917          (i) another dealer licensed under this chapter who does not hold a valid franchise for
918     the make of new motor vehicles sold, unless the selling dealer licenses and titles the new motor
919     vehicle to the purchasing dealer; or
920          (ii) any motor vehicle leasing or rental company located within this state, or who has
921     any branch office within this state, unless the dealer licenses and titles the new motor vehicle to
922     the purchasing, leasing, or rental company.
923          (b) Subsection (7)(a)(i) does not apply to the sale of a new incomplete motor vehicle
924     with a gross vehicle weight of 12,000 or more pounds to a special equipment dealer licensed
925     under this chapter.
926          (8) A dealer licensed under this chapter may not take on consignment any new motor

927     vehicle from anyone other than a new motor vehicle dealer, factory, or distributor who is
928     licensed and, if required, franchised to distribute or sell that make of motor vehicle in this or
929     any other state.
930          (9) A body shop licensed under this chapter may not assist an unlicensed body shop in
931     unlawful activity through active or passive means or by allowing use of its facilities, name,
932     body shop number, or by any other means.
933          (10) A used motor vehicle dealer licensed under this chapter may not advertise, offer
934     for sale, or sell a new motor vehicle that has been driven less than 7,500 miles by obtaining a
935     title only to the vehicle and representing it as a used motor vehicle.
936          (11) (a) Except as provided in Subsection (11)(c), or in cases of undue hardship or
937     emergency as provided by rule by the division, a dealer or salesperson licensed under this
938     chapter may not, on consecutive days of Saturday and Sunday, sell, offer for sale, lease, or offer
939     for lease a motor vehicle.
940          (b) Each day a motor vehicle is sold, offered for sale, leased, or offered for lease in
941     violation of Subsection (11)(a) and each motor vehicle sold, offered for sale, leased, or offered
942     for lease in violation of Subsection (11)(a) shall constitute a separate offense.
943          (c) The provisions of Subsection (11)(a) shall not apply to a dealer participating in a
944     trade show or exhibition if:
945          (i) there are five or more dealers participating in the trade show or exhibition; and
946          (ii) the trade show or exhibition takes place at a location other than the principal place
947     of business of one of the dealers participating in the trade show or exhibition.
948          (12) For purposes of imposing the sales and use tax under Title 59, Chapter 12, Sales
949     and Use Tax Act, a licensee issuing a temporary permit under Section 41-3-302 shall separately
950     identify the fees required by Title 41, Chapter 1a, Motor Vehicle Act.
951          (13) (a) A dismantler or dealer engaged in the business of dismantling motor vehicles
952     for the sale of parts or salvage shall identify any vehicles or equipment used by the dismantler
953     or dealer for transporting parts or salvage on the highways.
954          (b) The identification required under Subsection (13)(a) shall:
955          (i) include the name, address, and license number of the dismantler or dealer; and
956          (ii) be conspicuously displayed on both sides of the vehicle or equipment in clearly
957     legible letters and numerals not less than two inches in height.

958          Section 13. Section 41-3-702 is amended to read:
959          41-3-702. Civil penalty for violation.
960          (1) The following are civil violations under this chapter and are in addition to criminal
961     violations under this chapter:
962          (a) Level I:
963          (i) failing to display business license;
964          (ii) failing to surrender license of salesperson because of termination, suspension, or
965     revocation;
966          (iii) failing to maintain a separation from nonrelated motor vehicle businesses at
967     licensed locations;
968          (iv) issuing a temporary permit improperly;
969          (v) failing to maintain records;
970          (vi) selling a new motor vehicle to a nonfranchised dealer or leasing company without
971     licensing the motor vehicle;
972          (vii) special plate violation;
973          (viii) failing to maintain a sign at a principal place of business; [and] or
974          (ix) failing to store a salvage vehicle purchased at a motor vehicle auction in a secure
975     location until the purchaser or a transporter has provided the proper documentation to take
976     possession of the salvage vehicle.
977          (b) Level II:
978          (i) failing to report sale;
979          (ii) dismantling without a permit;
980          (iii) manufacturing without meeting construction or vehicle identification number
981     standards;
982          (iv) withholding customer license plates;
983          (v) selling a motor vehicle on consecutive days of Saturday and Sunday; or
984          (vi) failing to record and report the sale of a salvage vehicle at a motor vehicle auction
985     as described in Section 41-3-201.
986          (c) Level III:
987          (i) operating without a principal place of business;
988          (ii) selling a new motor vehicle as a dealer who is not a direct-sale manufacturer

989     without holding the franchise;
990          (iii) crushing a motor vehicle without proper evidence of ownership;
991          (iv) selling from an unlicensed location;
992          (v) altering a temporary permit;
993          (vi) refusal to furnish copies of records;
994          (vii) assisting an unlicensed dealer or salesperson in sales of motor vehicles;
995          (viii) advertising violation;
996          (ix) failing to separately identify the fees required by Title 41, Chapter 1a, Motor
997     Vehicle Act;
998          (x) encouraging or conspiring with unlicensed persons to solicit for prospective
999     purchasers; [and] or
1000          (xi) selling, offering for sale, or displaying for sale or exchange a vehicle, vessel, or
1001     outboard motor in violation of Section 41-1a-705.
1002          (2) (a) The schedule of civil penalties for violations of Subsection (1) is:
1003          (i) Level I: $25 for the first offense, $100 for the second offense, and $250 for the third
1004     and subsequent offenses;
1005          (ii) Level II: $100 for the first offense, $250 for the second offense, and $1,000 for the
1006     third and subsequent offenses; and
1007          (iii) Level III: $250 for the first offense, $1,000 for the second offense, and $5,000 for
1008     the third and subsequent offenses.
1009          (b) When determining under this section if an offense is a second or subsequent
1010     offense, only prior offenses committed within the 12 months [prior to] before the commission
1011     of the current offense may be considered.
1012          (3) The following are civil violations in addition to criminal violations under Section
1013     41-1a-1008:
1014          (a) knowingly selling a salvage vehicle, as defined in Section 41-1a-1001, without
1015     disclosing that the salvage vehicle has been repaired or rebuilt;
1016          (b) knowingly making a false statement on a vehicle damage disclosure statement, as
1017     defined in Section 41-1a-1001; or
1018          (c) fraudulently certifying that a damaged motor vehicle is entitled to an unbranded
1019     title, as defined in Section 41-1a-1001, when it is not.

1020          (4) The civil penalty for a violation under Subsection (3) is:
1021          (a) not less than $1,000, or treble the actual damages caused by the person, whichever
1022     is greater; and
1023          (b) reasonable attorney fees and costs of the action.
1024          (5) A civil action may be maintained by a purchaser or by the administrator.






Legislative Review Note
Office of Legislative Research and General Counsel