AN ACT CONCERNING THE OFFERING PRICE OF A MOTOR VEHICLE AND PROVISIONS OF THE FRANCHISE ACT GOVERNING AGREEMENTS BETWEEN AUTOMOBILE MANUFACTURERS OR DISTRIBUTORS AND AUTOMOBILE DEALERS.

Senate
sSB412 / File No. 465 1

General Assembly File No. 465
February Session, 2026 Substitute Senate Bill No. 412

Senate, April 7, 2026

The Committee on Transportation reported through SEN.
COHEN of the 12th Dist., Chairperson of the Committee on the
part of the Senate, that the substitute bill ought to pass.

AN ACT CONCERNING THE OFFERING PRICE OF A MOTOR
VEHICLE AND PROVISIONS OF THE FRANCHISE ACT GOVERNING
AGREEMENTS BETWEEN AUTOMOBILE MANUFACTURERS OR
DISTRIBUTORS AND AUTOMOBILE DEALERS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:

Section 1. Section 14 -62a of the 2026 supplement to the general 1
statutes is repealed and the following is substituted in lieu thereof 2
(Effective October 1, 2026): 3
(a) No dealer licensed under the provisions of section 14 -52 shall 4
advertise the price of any motor vehicle unless the stated price in such 5
advertisement includes the federal tax, the cost of delivery, dealer 6
preparation, any fee, charge or cost imposed for any add -on consumer 7
good or consumer service, any dealer conveyance fee or processing fee 8
and any other charges of any nature and such advertisement (1) states 9
in at least eight -point bold type that any state or local tax [,] or 10
registration fees [or dealer conveyance fee or processing fee, as defined 11
in subsection (a) of section 14 -62,] are excluded from such advertised 12
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price, (2) separately states, in at least eight-point bold type, immediately 13
next to the phrase "Dealer Conveyance Fee", the amount of such dealer 14
conveyance fee or processing fee, and (3) separately states, in at least 15
eight-point bold type, immediately next to the phrase "Additional Fees, 16
Charges and Costs", the amount of any fee, charge or cost imposed for 17
any add-on consumer good or consumer service. For the purposes of 18
this subsection, (A) "dealer conveyance fee" and "processing fee" have 19
the same meanings as provided in subsection (a) of section 14 -62, (B) 20
"consumer good" has the same meaning as provided in section 42 -110r, 21
and (C) "consumer service" has the same meaning as provided in 22
subsection (a) of section 42-158ff. 23
(b) Any new or used car dealer violating the provisions of this section 24
shall be fined not more than one thousand dollars. The Commissioner 25
of Motor Vehicles may suspend or revoke, in accordance with section 26
14-64, the license of any such dealer violating the provisions of this 27
section. 28
Sec. 2. Subsection (b) of section 14 -62 of the 2026 supplement to the 29
general statutes is repealed and the following is substituted in lieu 30
thereof (Effective October 1, 2026): 31
(b) (1) The selling price quoted by any dealer to a prospective buyer 32
shall (A) include [,] any dealer conveyance fee or processing fee, and (B) 33
separately [stated,] state the amount of [the] any such dealer conveyance 34
fee or processing fee and that such fee is negotiable. [No dealer 35
conveyance fee shall be added to the selling price at the time the order 36
is signed by the buyer.] 37
(2) The selling price quoted by any dealer to a prospective buyer shall 38
both (A) include any fee, charge or cost imposed for any optional add -39
on consumer good or consumer service, and (B) separately state the 40
amount of each such fee, charge or cost and that such fee, charge or cost 41
is optional. 42
(3) No dealer shall include in the selling price a dealer preparation 43
charge for any item or service for which the dealer is reimbursed by the 44
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manufacturer or any item or service not specifically ordered by the 45
buyer and itemized on the invoice. 46
(4) The form used by a dealer for the order and invoice shall not be 47
printed in advance of discussions with a prospective buyer to include 48
the amount of any dealer conveyance fee or processing fee or any fee, 49
charge or cost imposed for any other optional add-on consumer good or 50
consumer service. 51
Sec. 3. Section 42 -133r of the general statutes is repealed and the 52
following is substituted in lieu thereof (Effective October 1, 2026): 53
As used in sections 42-133r to 42-133ee, inclusive, as amended by this 54
act, and sections 5 and 7 of this act, unless the context indicates a 55
different meaning: 56
(1) "Manufacturer" means any person who manufactures or 57
assembles new motor vehicles, or imports motor vehicles for 58
distribution to dealers or through distributors, or factory branches. 59
(2) "Distributor" means any person who offers for sale, sells or 60
distributes any new motor vehicle to dealers or who maintains factory 61
representatives or who controls any person, firm, association, joint 62
venture corporation or trust, who offers for sale, sells or distributes any 63
new motor vehicle to dealers. 64
(3) "Factory branch" means a branch office maintained by a 65
manufacturer for the purpose of selling, or offering for sale, motor 66
vehicles to a distributor or dealer, or for directing or supervising factory 67
or distributor representatives. 68
(4) "Owner" means any person holding an ownership interest in a 69
business entity operating as a dealer or under a franchise as defined in 70
this section either as a corporation, partnership or sole proprietorship. 71
To the extent that the rights of any owner under sections 42 -133r to 42-72
133ee, inclusive, as amended by this act , conflict with the rights of any 73
other owner, such rights shall accrue in priority order based on the 74
percentage of ownership interest held by each owner with the owner 75
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having the greatest ownership interest having first priority and 76
succeeding priority accruing to other owners in the descending order of 77
their percentage of ownership interest. 78
(5) "Dealership facilities" means real estate, buildings, fixtures and 79
improvements which are used in the course of business under a 80
franchise by a new motor vehicle dealer. 81
(6) "Dealer" means any person engaged in the business of selling, 82
offering to sell, soliciting or advertising the sale of new motor vehicles 83
and who holds a valid sales and service agreement, franchise or 84
contract, granted by a manufacturer or distributor for the retail sale of 85
the manufacturer's or distributor's new motor vehicles. 86
(7) "Motor vehicle" means a self-propelled vehicle intended primarily 87
for use and operation on the public highways, other than a farm tractor 88
or other machinery or tools used in the production, harvesting and care 89
of farm products. 90
(8) "New motor vehicle" means a motor vehicle which has been sold 91
to a new motor vehicle dealer and which has not been used for other 92
than demonstration purposes and on which the original title has not 93
been issued from the new motor vehicle dealer. 94
(9) "Established place of business" means a permanent, commercial 95
building easily accessible and open to the public at reasonable times and 96
at which the business of a new motor vehicle dealer, including the 97
display and repair of vehicles, may be lawfully carried on. 98
(10) "Franchise" means a written agreement or contract between a 99
manufacturer or distributor and a dealer which purports to fix the legal 100
rights and liabilities of the parties to such agreement or contract, and 101
pursuant to which the dealer purchases and resells the franchise 102
product or leases or rents the dealership premises. 103
(11) "Good faith" means honesty in fact and the observance of 104
reasonable commercial standards of fair dealing in the trade. 105
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(12) "Designated family member" means the spouse, child, 106
grandchild, parent, brother or sister of an owner who, in the case of the 107
owner's death, is entitled to inherit the ownership interest in the dealer 108
under the terms of the owner's will, or who has been nominated in any 109
other written instrument, or who, in the case of an incapacitated owner 110
of a dealer, has been appointed by a court as the legal representative of 111
the dealer's property. 112
(13) "Person" means a natural person, partnership, corporation, 113
limited liability company, association, trust, estate or any other legal 114
entity. 115
(14) "Relevant market area" means the area within a radius of 116
fourteen miles around an existing dealer or the area of responsibility 117
defined in a franchise, whichever is greater. 118
(15) "Commissioner" means the Commissioner of Motor Vehicles. 119
(16) "Substantial alteration" means an alteration that has a major 120
impact on the architectural features, characteristics, appearance or 121
integrity of a structure or lot located on a dealership facility. "Substantial 122
alteration" does not include routine maintenance, such as painting and 123
repairs reasonably necessary to maintain a dealership facility in 124
attractive condition or any changes to items protected by federal 125
intellectual property rights. 126
(17) "Consumer data" means "nonpublic personal information" as 127
such term is defined in 15 USC 6809(4), as amended from time to time, 128
that is collected by a dealer and provided by the dealer directly to a 129
manufacturer, distributor, factory branch or third party acting on behalf 130
of a manufacturer, distributor or factory branch. "Consumer data" does 131
not include the same or similar data obtained by a manufacturer from 132
any source other than the dealer or the dealer's data management 133
system. 134
(18) "Data management system" means a computer hardware or 135
software system that: (A) Is owned, leased or licensed by a dealer, 136
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including, but not limited to, a system of web -based applications, 137
computer software or computer hardware; (B) is located at the 138
dealership or hosted remotely; and (C) stores and provides access to 139
consumer data collected or stored by a dealer. 140
Sec. 4. Section 42-133cc of the general statutes is amended by adding 141
subdivisions (23) and (24) as follows (Effective October 1, 2026): 142
(NEW) (23) (A) Require a dealer to construct, renovate or make 143
substantial alterations to the dealer's facilities unless the manufacturer 144
or distributor can demonstrate that such construction, renovation or 145
alteration requirements are reasonable and justifiable based on 146
reasonable business consideration, including current and reasonably 147
foreseeable projections of economic conditions existing in the 148
automotive industry at the time such action would be required of the 149
dealer, and agrees to make a good faith effort to make available, at the 150
dealer's option, a reasonable quantity and mix of new motor vehicles, 151
which, after a reasonable analysis of market conditions, are projected to 152
meet the sales level necessary to support the increased overhead 153
incurred by the dealer as a result of the required construction, 154
renovation or alteration, provided a dealer may be required by a 155
manufacturer or distributor to make reasonable facility improvements 156
and technological upgrades necessary to support the technology of the 157
manufacturer's or distributor's vehicles. If the dealer chooses not to 158
make such facility improvements or technological upgrades, the 159
manufacturer or distributor shall not be obligated to provide the dealer 160
with the vehicles that require the improvements or upgrades or any 161
corresponding incentives or benefits. A manufacturer or distributor 162
may not require a dealer to construct, renovate or make substantial 163
alterations to the dealer's facility if the dealer has completed a 164
construction, renovation or substantial alteration to the same 165
component of the facility that was required and approved by the 166
manufacturer or distributor within the previous ten years. If a dealer has 167
completed facility construction, renovation or substantial alteration 168
under and in compliance with an incentive program, the manufacturer 169
or distributor may not deny a dealer payment or benefits according to 170
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the terms of the program in place when the dealer began to perform 171
under the program. If the incentive program under which the dealer 172
completed a facility construction, renovation or substantial alteration on 173
or after October 1, 2026, does not contain a specific time period during 174
which the manufacturer or distributor shall provide payments or 175
benefits to a dealer, the manufacturer or distributor may not deny the 176
dealer payment or benefits under the terms of that incentive program, 177
as it existed when the dealer began to perform under the program for 178
the balance of ten years after the manufacturer or distributor made the 179
program available to the dealer, regardless of whether the 180
manufacturer's or distributor's facility program has been changed or 181
cancelled. Nothing in this subdivision shall be construed to require a 182
manufacturer or distributor to provide payment or benefits if changes 183
have been made to the facility since the manufacturer's or distributor's 184
approval that would render the facility not in compliance with the 185
manufacturer's or distributor's standards or plans, regardless of 186
whether the manufacturer's or distributor's image program has 187
changed. Facility changes that are necessitated due to damage sustained 188
from a natural disaster or as a result of necessary safety upgrades shall 189
not be considered a change to the facility that renders the facility not in 190
compliance with the manufacturer's or distributor's standards or plans, 191
provided such facility changes substantially restore the facility to the 192
previous or current compliant state. Eligibility for facility -related 193
incentives under this subdivision shall not apply to: (i) Lump sum 194
payments for the cost of the facility upgrade; (ii) payments on a per 195
vehicle basis; and (iii) any facility -related incentive program in effect 196
with one or more dealers in the state on October 1, 2026; 197
(B) Nothing in this subdivision shall be construed to allow a dealer 198
to: (i) Impair or eliminate a manufacturer's or distributor's intellectual 199
property or trademark rights or impair other intellectual property 200
interests owned or controlled by the manufacturer or distributor, 201
including the design and use of signs; or (ii) refuse to change the design 202
or branding of any signage or other branded items required by a 203
manufacturer or distributor at any time, provided the manufacturer or 204
distributor requires such changes of all of its franchised dealers 205
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nationally; 206
(NEW) (24) Require a dealer who is constructing, renovating or 207
substantially altering its dealership facility to purchase goods, building 208
materials or services for the dealership facility, including, but not 209
limited to, office furniture, design features, flooring and wall coverings, 210
from a vendor chosen by the manufacturer or distributor if goods, 211
building materials or services of a substantially similar appearance, 212
function, design and quality are available from other sources and the 213
dealer has received the manufacturer's or distributor's approval, 214
provided such approval shall not be unreasonably withheld or delayed. 215
In the event that a manufacturer or distributor does not approve the 216
dealer's use of substantially similar goods, building materials or 217
services, the manufacturer or distributor shall provide the dealer, in 218
writing at the time of disapproval, a detailed list of reasons why the 219
proposed substantially similar items are not acceptable. Nothing in this 220
subdivision shall be construed to allow a dealer to impair or eliminate a 221
manufacturer's or distributor's intellectual property or trademark rights 222
and brand image standards, or impair other intellectual property 223
interests owned or controlled by the manufacturer or distributor, 224
including the design and use of signs. 225
Sec. 5. (NEW) (Effective October 1, 2026) (a) As used in this subsection, 226
(1) "stop-sale order" means a notification issued by a manufacturer to its 227
dealers stating that a used vehicle in inventory shall not be sold or leased 228
because of a federal safety recall for a defect or noncompliance or 229
because of a federal emissions recall, (2) "do -not-drive order" means a 230
notification issued by a manufacturer to its dealers or to the registered 231
owner of a used vehicle, or by the National Highway Traffic Safety 232
Administration to the registered owner of a used vehicle, stating that 233
the vehicle is subject to a federal safety recall for a defect or 234
noncompliance and including an unconditional instruction to the 235
recipient of the notification to not drive the vehicle until the remedy for 236
the recall is complete, and (3) "value of the used motor vehicle" means 237
the average trade -in value of the year, make and model of the used 238
motor vehicle determined using nationally recognized industry data or 239
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pricing guides that reflect current national and regional used motor 240
vehicle market conditions. 241
(b) If a manufacturer issues a recall and either a stop -sale order or a 242
do-not-drive order on a used vehicle and the parts or a remedy are not 243
available to perform a recall service or repair on the used vehicle not 244
later than thirty days after issuing the recall, a new vehicle dealer that is 245
franchised to sell and service new vehicles of the manufacturer is 246
entitled to compensation from the manufacturer and may file a claim 247
with the manufacturer for each used vehicle subject to the recall which 248
the dealer (1) has in its used vehicle inventory on the date on which the 249
stop-sale order or do-not-drive order is issued, or (2) takes into its used 250
car inventory as a consumer trade-in related to the sale of a new vehicle 251
after the date on which the stop -sale order or do -not-drive order is 252
issued or as a return of a leased motor vehicle. 253
(c) Any such claim for compensation shall be in a form as prescribed 254
by the manufacturer. The manufacturer may prescribe the manner in 255
which a dealer shall demonstrate eligibility for such compensation, 256
including, but not limited to, the documentation required to show the 257
inventory status of a used vehicle, provided such demonstration of 258
eligibility or documentation is not unduly burdensome. 259
(d) Except as provided in subsections (e) and (f) of this section, 260
compensation for a used motor vehicle pursuant to this section shall be 261
calculated at a rate of not less than one per cent of the value of the used 262
motor vehicle per month, beginning thirty days after the date on which 263
the stop -sale order or do -not-drive order is issued to the dealer and 264
continuing until the earlier of the date: (1) The parts or a remedy for the 265
recall service or repair are made available to the dealer; or (2) the dealer 266
sells, trades or otherwise disposes of the used vehicle. 267
(e) Compensation due to a new vehicle dealer is limited to the amount 268
equal to the value of the used motor vehicle for which the compensation 269
is paid. 270
(f) A manufacturer may, in lieu of compensating a new vehicle dealer 271
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pursuant to the provisions of subsection (d) of this section: (1) 272
Compensate the dealer pursuant to a national recall compensation 273
program, if the amount of compensation owed to the dealer under the 274
program is not less than the amount of compensation owed to the dealer 275
pursuant to the provisions of subsection (d) of this section; or (2) enter 276
into an agreement with the dealer for an alternative form or amount of 277
compensation. 278
(g) A manufacturer may not take any action to offset or reduce the 279
amount of compensation owed to a new vehicle dealer pursuant to this 280
section, including, without limitation, through a charge -back program, 281
any reduction in an amount owed to the new vehicle dealer under an 282
incentive program or the removal of the new vehicle dealer from an 283
incentive program, if such action is taken, in whole or in part, because 284
the new vehicle dealer filed a claim for compensation pursuant to this 285
section. The provisions of this subsection do not apply to any action 286
taken by a manufacturer that is applied uniformly to all new vehicle 287
dealers of the same line and make of vehicles in this state. 288
(h) Except as provided in subsection (f) of this section, any 289
compensation provided to a new vehicle dealer pursuant to this section 290
is exclusive and may not be combined with any other state or federal 291
recall compensation remedy. 292
Sec. 6. Subsection (j) of section 42 -133s of the general statutes is 293
repealed and the following is substituted in lieu thereof (Effective October 294
1, 2026): 295
(j) All claims by dealers under this section for such labor and parts , 296
[and] all claims for compensation relative to any sales incentive, 297
marketing and advertising programs and all claims for compensation 298
pursuant to the provisions of section 5 of this act shall be paid not later 299
than thirty days after approval by the manufacturer or distributor, 300
provided manufacturers or distributors retain the right to audit such 301
claims and to charge-back the dealer for false or unsubstantiated claims 302
for a period of one year following payment. A manufacturer or 303
distributor shall not deny a claim submitted under this subsection or 304
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charge-back such a claim or payment following a timely audit based 305
solely on the dealer's failure to comply with a claim processing 306
procedure, a clerical error or other administrative technicality, provided 307
such failure does not call into question the legitimacy of the claim. The 308
manufacturer or distributor shall allow the dealer to resubmit such 309
claim according to reasonable manufacturer or distributor guidelines 310
not later than thirty days after the initial claim denial or charge -back. If 311
there is evidence of fraud, the provisions of this subsection shall not 312
limit the right of a manufacturer or distributor to audit a dealer for 313
longer periods of time and charge -back the dealer for any fraudulent 314
claim. Dealers shall be required to maintain defective parts for a period 315
of not longer than ninety days following submission of claims. All such 316
claims shall be either approved or disapproved not later than thirty days 317
after their receipt on forms, and in the manner specified by, the 318
manufacturer or distributor. Any claim not disapproved in writing or 319
by means of electronic transmission not later than thirty days after 320
receipt shall be deemed approved and payment shall be made within 321
thirty days. 322
Sec. 7. (NEW) (Effective October 1, 2026) (a) With respect to consumer 323
data, a manufacturer, distributor or a third party acting on behalf of a 324
manufacturer or distributor: 325
(1) Shall comply with, and shall not cause a dealer to violate, any 326
applicable restrictions on reuse or disclosure of the consumer data 327
established by federal or state law; 328
(2) Shall, upon the request of the dealer, provide a written statement 329
to the dealer describing the established procedures adopted by such 330
manufacturer, distributor or third party acting on behalf of the 331
manufacturer or distributor that meet or exceed any federal or state 332
requirements to safeguard the consumer data, including, but not limited 333
to, the requirements in the Gramm -Leach-Bliley Act, 15 USC 6801 et 334
seq., as amended from time to time; 335
(3) Shall, upon the written request of the dealer, provide a written list 336
of the consumer data obtained from the dealer and all persons to whom 337
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any consumer data has been provided by the manufacturer, distributor 338
or a third party acting on behalf of the manufacturer or distributor 339
during the preceding six months. The dealer may make such a request 340
not more than once every six months. The list shall indicate the specific 341
fields of consumer data that were provided to each person, except such 342
list shall not be required to include: (A) A person to whom consumer 343
data was provided, or the specific consumer data provided to such 344
person, if the person was, at the time such consumer data was provided, 345
a service provider, subcontractor or consultant acting in the course of 346
performance of services on behalf of or for the benefit of the 347
manufacturer, distributor, third party or dealer, provided the 348
manufacturer, distributor, third party or dealer has entered into an 349
agreement with such person requiring that such person comply with the 350
safeguard requirements of applicable state and federal law, including, 351
but not limited to, the requirements in the Gramm -Leach-Bliley Act, 15 352
USC 6801 et seq., as amended from time to time; and (B) a person to 353
whom consumer data was provided, or the specific consumer data 354
provided to such person, if the dealer has previously consented in 355
writing to such person receiving such consumer data and the dealer has 356
not withdrawn such consent in writing; 357
(4) May not require that a dealer grant the manufacturer, distributor 358
or third party acting on behalf of the manufacturer or distributor direct 359
or indirect access to such dealer's data management system to obtain 360
consumer data. A manufacturer, distributor or a third party acting on 361
behalf of the manufacturer or distributor shall permit a dealer to furnish 362
consumer data in a widely accepted file format, such as comma 363
delimited, and through a third -party vendor selected by the dealer. A 364
manufacturer, distributor or a third party acting on behalf of the 365
manufacturer or distributor may access or obtain consumer data 366
directly from a dealer's data management system with the express 367
consent of the dealer. The consent shall be in the form of a written 368
document that (A) is separate from the franchise agreement, (B) is 369
executed by the dealer, and (C) may be withdrawn by the dealer upon 370
thirty days' written notice to the manufacturer or distributor. For 371
incentive programs beginning on or after October 1, 2026, such consent 372
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shall not be required as a condition to a motor vehicle dealer's 373
participation in an incentive program unless such consent is necessary 374
to obtain consumer data to implement the program; and 375
(5) Shall indemnify the dealer for any third -party claims asserted 376
against or damages incurred by the dealer to the extent caused by access 377
to, use of or disclosure of consumer data in violation of the provisions 378
of this section by the manufacturer, distributor or a third party to whom 379
the manufacturer or distributor has provided consumer data. 380
(b) Nothing is this section shall be construed to limit the ability of the 381
manufacturer or distributor to require that the dealer provide, or use in 382
accordance with the law, such customer information related solely to 383
such manufacturer's or distributor's own vehicle makes to the extent 384
necessary to do any of the following: 385
(1) Satisfy any safety or recall notice obligations or other legal notice 386
obligations on the part of the manufacturer; 387
(2) Complete the sale and delivery of a new motor vehicle to a 388
customer; 389
(3) Validate and pay customer or dealer incentives; 390
(4) Submit to the manufacturer or distributor claims for any services 391
supplied by the dealer for any claim for warranty parts or repairs; 392
(5) Market analysis; 393
(6) Evaluate sales and service customer satisfaction with the dealer, 394
including surveys; or 395
(7) Reasonable marketing purposes that benefit the dealer. 396
(c) In any cause of action against a manufacturer or distributor for a 397
violation of the provisions of this section, the party bringing the action 398
shall have the burden of proof. 399
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This act shall take effect as follows and shall amend the following
sections:

Section 1 October 1, 2026 14-62a
Sec. 2 October 1, 2026 14-62(b)
Sec. 3 October 1, 2026 42-133r
Sec. 4 October 1, 2026 42-133cc(23) and (24)
Sec. 5 October 1, 2026 New section
Sec. 6 October 1, 2026 42-133s(j)
Sec. 7 October 1, 2026 New section

TRA Joint Favorable Subst.

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The following Fiscal Impact Statement and Bill Analysis are prepared for the benefit of the members of
the General Assembly, solely for purposes of information, summarization and explanation and do not
represent the intent of the General Assembly or either chamber thereof for any purpose. In general,
fiscal impacts are based upon a variety of informational sources, including the analyst’s professional
knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final
products do not necessarily reflect an assessment from any specific department.

OFA Fiscal Note

State Impact: None
Municipal Impact: None
Explanation
The bill, which modifies statutes related to vehicle conveyance fees
and dealer franchise laws, is not anticipated to result in a fiscal impact
as these changes largely concern private parties.
The Out Years
State Impact: None
Municipal Impact: None

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OLR Bill Analysis
sSB 412

AN ACT CONCERNING THE OFFERING PRICE OF A MOTOR
VEHICLE AND PROVISIONS OF THE FRANCHISE ACT
GOVERNING AGREEMENTS BETWEEN AUTOMOBILE
MANUFACTURERS OR DISTRIBUTORS AND AUTOMOBILE
DEALERS.

SUMMARY
This bill requires car dealers to include their dealer conveyance fee or
processing fee, if any, in the price they advertise or quote for a motor
vehicle. It also prohibits them from pre -printing vehicle orders and
invoices with the dealer conveyance fee amount. In doing so, it generally
aligns dealer conveyance fee requirements with those that apply to fees
for add-on consumer goods and services under existing law (§§ 1 & 2).
The bill also modifies and expands the legal duties that motor vehicle
manufacturers (and their distributors) owe to the dealers with whom
they have franchise agreements (see BACKGROUND). Among other
things, it:
1. limits the circumstances under which manufacturers may require
car dealers to construct, renovate, or substantially alter their
dealerships (§§ 3 & 4);
2. establishes new requirements related to consumer data sharing,
including limiting when manufacturers may require dealers to
share data on their customers (§§ 3 & 7); and
3. entitles new vehicle dealers to compensation from their
manufacturer when used vehicles in their inventory are subject
to a “stop -sale order” or a “do -not-drive order” due to a recall
and the necessary parts or remedies are not available for a while
(§§ 5 & 6).
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Lastly, the bill makes several technical and conforming changes.
EFFECTIVE DATE: October 1, 2026
§§ 1 & 2 — DEALER CONVEYANCE FEES
The bill modifies requirements related to dealer conveyance fees and
motor vehicle prices. By law, a “dealer conveyance fee” or “processing
fee” is a fee dealers charge to recover reasonable costs for processing all
documentation and performing services re lated to closing a sale,
including registration and transferring vehicle ownership.
Advertisements
Under current law, dealers must (1) exclude conveyance or
processing fees from a vehicle’s advertised price and (2) separately state
the amount of the conveyance fee next to the phrase “Dealer
Conveyance Fee.” The bill instead requires dealers to include these fees
in the advertised price, but keeps the requirement to separately state the
fee amount.
By law, dealers must include fees for any add -on consumer good or
service in the advertised price of the vehicle and also separately state the
amount of these fees next to the phrase “ Additional Fees, Charges and
Costs.”
By law and under the bill, dealers who violate these laws are subject
to a fine of up to $1,000 and may have their license suspended or
revoked.
Quoted Price
In the selling price quoted to prospective buyers, current law requires
dealers to include, separately stated, the amount of any dealer
conveyance fee. The bill requires dealers to both (1) include the dealer
conveyance fee in the quoted amount and (2) sep arately state the
amount. As under existing law, it must also state that the conveyance
fee is negotiable.
By law, dealers must include fees for any optional add -on consumer
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good or service in the quoted price and also separately state the amount
of each fee and that it is optional.
Under existing law, and unchanged by the bill, a dealer must also
give a buyer a written statement and prominently display a sign
specifying (1) the conveyance fee or processing fee amount ; (2) the
included services ; (3) that the fee is negotiable ; (4) that the fee is not
payable to the state ; and (5) that the buyer may choose, where
appropriate, to submit registration and title documents to the
Department of Motor Vehicles, in which case the dealer will reduce the
fee by a proportional amount (CGS § 14-62(c)).
Pre-printed Order and Invoice Forms
For each motor vehicle sale, state law requires dealers to give buyers
an order and an invoice that contain the vehicle’s cash selling price and
other specified vehicle information and offer terms. Existing law
prohibits dealers from pre -printing the vehic le order and invoice with
fees for any optional, add -on consumer good or service before
discussions with a prospective buyer; the bill extends this prohibition to
dealer conveyance fees.
§§ 3 & 4 — ALTERATIONS TO DEALERSHIPS
The bill limits the circumstances under which manufacturers may
require car dealers to construct, renovate, or substantially alter (alter)
their dealerships. Substantial alterations are generally those that majorly
impact a dealership’s architectural features, characteristics, appearance,
or integrity.
Under the bill, a manufacturer can only require dealers to alter their
facilities if it (1) demonstrates the alteration is reasonable and justifiable
based on a reasonable business consideration (such economic condition
projections) and (2) agrees to make a good faith effort to make new
vehicles available to the dealer, at the dealer’s option, to cover the
dealer’s alteration costs. The new vehicles must be provided in an
amount and mix that is projected, based on a reasonable market
analysis, to meet the sales level necessary to cover these costs.
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The bill also prohibits a manufacturer from requiring a dealer to alter
its dealership if it completed a manufacturer -required alteration to the
same component of the facility within the last 10 years.
Exclusions
The bill’s limitations do not apply to:
1. routine maintenance reasonably necessary to keep the dealership
in attractive condition,
2. changes to items protected by intellectual property rights, or
3. reasonable facility improvements and technological upgrades
needed to support technology in a manufacturer’s vehicles.
If a manufacturer requires improvements or upgrades to support
vehicle technology and a dealer chooses not to make them, the bill
allows the manufacturer to refuse to give the dealer any vehicles that
require them or any corresponding incentives or benefits.
The bill also specifies that it does not allow a dealer to (1) impair or
eliminate a manufacturer’s intellectual property or trademark rights or
interests, including sign design and use, or (2) refuse to change the
design or branding of any signs or other branded items, as long as the
requirement applies to all dealers nationally.
Incentive Programs
Under the bill , if a dealer alters its facility under an incentive
program, the manufacturer may not deny a dealer any payment or
benefits that were part of the program’s terms when the dealer started
participating in it. If a dealer alters its facility under an incentiv e
program on or after October 1, 2026 , and the program does not specify
a time period during which the dealer will receive payments,
manufacturers must provide payments and benefits to the dealer for 10
years after the manufacturer made the program available to the dealer,
even if the manufacturer changes or cancels the program.
The bill specifies that it does not prohibit manufacturers from
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denying payment or benefits if the dealer changes its facilities in a way
that makes it no longer compliant with the manufacturer’s standards or
plans, regardless of whether or not the program changed. Facility
changes needed because of damage from natural disasters or required
safety upgrades cannot make a dealer noncompliant with a
manufacturer’s standards or plans, as long as the changes substantially
restore the facility to compliance.
The bill’s provisions on facility-related incentives do not apply to (1)
lump sum payments for facility upgrade costs; (2) per-vehicle payments;
and (3) any facility incentive program in effect on October 1, 2026.
Purchase of Goods, Building Materials, or Services
The bill prohibits manufacturers from requiring dealers who are
altering their dealerships to buy goods, building materials, or services
(such as flooring and wall coverings) from a manufacturer -chosen
vendor if the:
1. dealer can get, from other sources, goods, materials, and services
that are substantially similar in appearance, function, design, and
quality to the ones from the manufacturer’s vendor and
2. manufacturer approves them.
The bill prohibits manufacturers from unreasonably delaying or
withholding approval. If a manufacturer denies a dealer’s request, it
must give the dealer a detailed list of the reasons it did so in writing at
the time of the denial.
§§ 3 & 7 — CONSUMER DATA
The bill establishes several requirements related to consumer data
sharing between manufacturers (including third parties acting on their
behalf) and their dealers. The bill requires manufacturers to comply
with applicable state and federal restrictions on reusing or disclosing
consumer data and prohibits them from causing a dealer to violate these
restrictions.
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Under the bill, manufacturers must indemnify the dealer for any
claims against the dealer, or damages it incurs, to the extent caused by
the manufacturer’s disclosure of dealer-provided data in violation of the
bill.
The bill also specifies that, in any cause of action against a
manufacturer for a violation of the bill’s data provisions, the party
bringing the action has the burden of proof.
Scope
The bill’s data protections apply to personally identifiable financial
information that a dealer collects and gives, directly, to a manufacturer,
factory branch, or third party acting on their behalf. It does not apply to
data the manufacturer receives from another source, even if it is the
same or similar to data the dealer has.
Statement on Procedures for Safeguarding Consumer Data
The bill requires manufacturers (or third parties acting on their
behalf) to give dealers, upon request, a written statement describing the
manufacturer’s procedures to safeguard consumer data that meet or
exceed federal or state requirements. This includes requirements under
the federal Gramm -Leach-Bliley Act, which requires companies that
offer consumers f inancial products and services (such as loans) to
explain their information -sharing practices to consumers and to
safeguard personally identifiable information.
List of Parties With Whom Manufacturer Shared Data
Under the bill, upon a dealer’s written request, a manufacturer (or a
third party acting on its behalf) must give the dealer a written list of all
the consumer data it received from the dealer and all the parties the
manufacturer gave the data to in the previous six months. Dealers may
only request this information once every six months.
The bill requires that this list indicate specific fields of consumer data
that were given to each party. But it does not have to include any party
(or the data given to that party) who:
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1. was providing services for a manufacturer or dealer and received
the data while doing so, so long as the parties had an agreement
requiring the service provider to comply with federal and state
data privacy requirements, or
2. was previously authorized by the dealer , in writing, to receive
the data, so long as the dealer has not withdrawn the
authorization in writing.
Access to Dealer’s Data Management System
The bill prohibits manufacturers from requiring dealers to allow
them direct or indirect access to the dealer’s data management system
to get consumer data. However, under the bill, manufacturers may get
consumer data from the dealer’s system if the dealer gives express
consent in a written document, separate from the franchise agreement,
that may be withdrawn with 30 days’ written notice to the
manufacturer. Manufacturers cannot require this consent as a condition
for participating in an incentive program that begins on or after October
1, 2026, unless the consent is necessary to get consumer data to
implement the program.
If a dealer does not allow a manufacturer access to its system,
manufacturers must allow dealers to give them consumer data in a
widely accepted file format and through a third-party vendor the dealer
chooses.
When Manufacturers May Require Data Sharing
Under the bill, manufacturers may require dealers to give them, or
allow them to use, customer information related solely to the
manufacturer’s vehicle makes to the extent necessary to:
1. satisfy manufacturers’ legal notice obligations, including safety
or recall notices;
2. complete vehicle sale and delivery;
3. validate and pay customer or dealer incentives;
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4. submit claims for services supplied by the dealer for any claim
for warranty parts or repairs;
5. analyze the market;
6. evaluate sales and customer satisfaction with the dealer
(including surveys); or
7. reasonable marketing purposes that benefit the dealer.
§§ 5 & 6 — COMPENSATION FOR RECALLED VEHICLES IN
INVENTORY
The bill generally entitles a new vehicle dealer to compensation from
a manufacturer when used vehicles in its inventory are subject to a
“stop-sale order” or a “do -not-drive order” because of a federal safety
or emissions recall and the necessary parts or remedies are not available
for a while.
Eligible Vehicles
Under the bill, if the necessary parts or remedies are not available
within 30 days after issuing the recall, a new vehicle dealer that is
franchised to sell and service new vehicles from the manufacturer may
file a claim for each recalled vehicle that (1) was in its used vehicle
inventory on the date the stop -sale order or do -not-drive order was
issued or (2) it took into its used car inventory as a consumer trade -in
after the date the order was issued. The claim must be filed in a way the
manufacturer sets, and the manufacturer may specify how dealers must
show eligibility for the compensation, so long as the requirements are
not overly burdensome.
Compensation Amount
Under the bill, the compensation must equal at least 1% of the used
vehicles’ value per month, starting 30 days after the recall is issued and
ending when the (1) parts are or remedy is available to the dealer or (2)
dealer sells, trades, or otherwise gets rid of the vehicle. Like other claims
by dealers under existing law, the bill requires manufacturers to pay
these claims within 30 days after approving them.
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Instead of compensation calculated as described above, a
manufacturer may (1) compensate a dealer under a national recall
compensation program, so long as the amount is higher than a dealer
would otherwise receive , or (2) enter into an agreement with a dealer
for compensation in an alternate form or amount. Compensation
provided to the dealer is otherwise exclusive and cannot be combined
with other state or federal recall remedies.
Under the bill, a dealer is not entitled to compensation higher than
the vehicle’s value. The vehicle’s value, for purposes of calculating
compensation, is the average trade -in value for the vehicle determined
with nationally recognized industry data or pricing guides.
The bill prohibits manufacturers from offsetting or reducing the
compensation they owe to dealers under the bill, including (1) through
a charge-back program; (2) any reduction in an amount owed to a dealer
through an in centive program; or (3) the removal of a dealer from an
incentive program, if it is done because the dealer applied for
compensation. These limitations do not apply to manufacturer actions
that apply uniformly to all new vehicle dealers of the same line and
make of vehicles in the state.
BACKGROUND
Motor Vehicle Franchises and Dealerships
Under the laws governing motor vehicle franchises, a motor vehicle
manufacturer makes or assembles new motor vehicles for distribution
to dealers or through distributors. A dealer sells motor vehicles and
holds a valid sales and service agreement, franchis e, or contract with a
manufacturer for retail sale of the vehicles (CGS § 42-133r).
COMMITTEE ACTION
Transportation Committee
Joint Favorable Substitute
Yea 27 Nay 9 (03/16/2026)