Bill Summary for S 413 (2017-2018)

Printer-friendly: Click to view

Summary date: 

Mar 28 2017

Bill Information:

View NCGA Bill Details2017-2018 Session
Senate Bill 413 (Public) Filed Tuesday, March 28, 2017
AN ACT TO CLARIFY MOTOR VEHICLE DEALERS AND MANUFACTURERS LICENSING LAWS.
Intro. by B. Jackson.

View: All Summaries for BillTracking:

Bill summary

Amends GS 20-288(a1)(2) to extend the licensing-course exemption for used motor vehicle dealer applicants who operate a new motor vehicle showroom to include all applicants whose new motor vehicle showroom is within 30 miles (currently, 20 miles) of the proposed used motor vehicle showroom.

Amends GS 20-305 to prohibitmanufacturers, distributors, or their branches, from requiring, coercing, or attempting to coerce, any new motor vehicle dealer to change the location of its dealership, or to make any substantial alterations to their dealership premises or facilities, if the dealer has done so within the preceding 10 years at a cost of more than $100,000, and the change was made at the request of, or with the knowledge, acquiescence, or approval of, the manufacturer, distributor, or branch. Any dealer not covered by this provision is governed by specified existing subdivisions of this statute.

Amends GS 20-305.1 to further require the motor vehicle manufacturers', distributors', and branches' written notice to their dealers to also include the dealers' obligations for recall service on the products, including service under listed preparation, delivery, and warranty agreements or contracts issued by the manufacturer, distributor, or branch, and the schedule for compensation and time allowances for the expanded list of required services. Makes conforming changes. Requires a manufacturer or distributor to further compensate a dealer for parts and components provided at reduced cost (currently only at no cost) for repairs under a recall, campaign service action, or warranty repair, as specified, and clarifies that the compensation is on the basis of the dealer's average markup on the cost for the part or component, less the cost for the part or component. Makes it further unlawful for manufacturers, distributors, and branches to fail to perform their recall obligations, or to fail to fully compensate their motor vehicle dealers for qualifying used vehicles or recall parts or to recover their costs for compensating their dealers for recall parts (currently only applies to warranty obligations and parts). Eliminates the provision exempting the living facilities of recreational vehicles from this prohibition, and specifies that the prohibition applies to the living facilities of recreational vehicles. Clarifies that claims by dealers concerning compensation for qualifying used motor vehicles under new GS 20-305.1(i) shall be paid by the manufacturer within 30 days. Makes conforming and technical changes. Clarifies that the chargebacks or payments required by a manufacturer from a dealer, which are stayed during a petition to the Commissioner, include compensation for services specified by the earlier amendments.

Enacts new GS 20-305.1(i) and (j), requiring manufacturers, distributors, or branches to compensate a franchised motor vehicle dealer for any motor vehicle subject to a notice of recall and stop-sale or do-not-drive order issued by the manufacturer or the National Highway Traffic Safety Administration and whose parts to repair the underlying defect are not received by the dealer within 15 days of the notice of recall. Specifies the rate of monthly compensation (1.75% of the vehicle's value).

Makes a conforming change to GS 20-305.5.

Amends GS 20-305.2 to prohibit manufacturers, distributors, or branches with franchised motor vehicle dealers to own any interest in, operate, or control any entity that leases or rents motor vehicles to the general public in competition with any of their franchised dealers.

Amends GS 20-305.7 to clarify that the limits in subsection (b) do not apply to customers that meet any of the listed exemption qualifications (currently does not specify whether a customer must satisfy any or all of the qualifications). Clarifies that the lists of third parties to which a manufacturer and so forth provide dealers' data must include each and every such third party. Further requires the list to specify what data was provided to each party and that the lists must be specific to each dealer. Requires the list to show third parties that actually received, not that may have received, data. Prohibits third parties from charging the dealer any fee for access to the dealer's data. Provides that the rights of subsection (b) are not waivable and may not be modified by contract.

Enacts new GS 20-101.3 (Conspicuous disclosure of dealer shop and other service-related fees). Requires motor vehicle dealers to conspicuously display notices of shop fees for service work and other discretionary fees and disclose fees on a customer's invoice prior to charging such fees. Does not require dealers to charge a shop or other service-related fee. Effective January 1, 2018.

Contains a severability clause.

Except as otherwise specified, the act is effective when it becomes law, and applies to all current and future franchises and other agreements in existence between any new motor vehicle dealer in the State and a manufacturer or distributor as of the effective date of this act.