Car manufacturers, dealers and franchisors; prohibit from sharing customer information with third parties.

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To: Business and Commerce
MISSISSIPPI LEGISLATURE REGULAR SESSION 2026

By: Representative Crawford

HOUSE BILL NO. 1178

AN ACT TO AMEND SECTION 63-17-73, MISSISSIPPI CODE OF 1972, 1
TO PROHIBIT MOTOR VEHICLE DEALERS, SALESMEN, MANUFACTURERS AND 2
FRANCHISORS FROM SHARING CUSTOMER LISTS OR PERSONAL INFORMATION OF 3
CUSTOMERS WITH ANY THIRD PARTY; AND FOR RELATED PURPOSES. 4
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: 5
SECTION 1. Section 63-17-73, Mississippi Code of 1972, is 6
amended as follows: 7
63-17-73. (1) It is unlawful: 8
(a) For any person, firm, association, corporation or 9
trust to engage in business as, or serve in the capacity of, or 10
act as a motor vehicle dealer, motor vehicle salesman, 11
manufacturer, distributor, wholesaler, factory branch or division, 12
distributor branch or division, wholesaler branch or division, 13
factory representative or distributor representative, as such, in 14
this state without first obtaining a license therefor as provided 15
in the Mississippi Motor Vehicle Commission Law, regardless of 16
whether or not the person, firm, association, corporation or trust 17
maintains or has a place or places of business in this state. Any 18
person, firm, association, corporation or trust engaging, acting 19
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or serving in more than one (1) of the capacities or having more 20
than one (1) place where the business is carried on or conducted 21
shall be required to obtain and hold a current license for each 22
capacity and place of business. 23
(b) For a motor vehicle dealer or a motor vehicle 24
salesman: 25
(i) To require a purchaser of a new motor vehicle, 26
as a condition of sale and delivery thereof, to also purchase 27
special features, appliances, equipment, parts or accessories not 28
desired or requested by the purchaser. However, this prohibition 29
shall not apply as to special features, appliances, equipment, 30
parts or accessories which are already installed on the car when 31
received by the dealer. 32
(ii) To represent and sell as a new motor vehicle 33
any motor vehicle which has been used and operated for 34
demonstration purposes or which is otherwise a used motor vehicle. 35
(iii) To resort to or use any false or misleading 36
advertisement in connection with his business as a motor vehicle 37
dealer or motor vehicle salesman. 38
(iv) To sell an extended service contract, 39
extended maintenance plan or similar product that is not offered, 40
endorsed or sponsored by a manufacturer or distributor without 41
disclosing to the consumer, orally and in writing, that the 42
offered product is not provided or supported by a manufacturer or 43
distributor. 44
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(v) To provide any third party with customer lists 45
or any other personal information of customers, unless necessary 46
for the sale and delivery of a new motor vehicle to a consumer, to 47
validate and pay consumer or dealer incentives, for reasonable 48
marketing purposes, for evaluation of dealer performance, for 49
analytics or for the submission to the franchisor for any services 50
supplied by the franchisee for any claim for warranty parts or 51
repairs. Nothing in this section shall limit the ability of the 52
motor vehicle dealer or salesman to require or use customer 53
information to satisfy any safety or recall notice obligation or 54
other legal obligation. 55
(c) For a manufacturer, a distributor, a wholesaler, a 56
distributor branch or division, a factory branch or division, or a 57
wholesaler branch or division, or officer, agent or other 58
representative thereof, to coerce, or attempt to coerce, any motor 59
vehicle dealer: 60
(i) To order or accept delivery of any motor 61
vehicle or vehicles, appliances, equipment, parts or accessories 62
therefor, or any other commodity or commodities which shall not 63
have been voluntarily ordered by the motor vehicle dealer. 64
(ii) To order or accept delivery of any motor 65
vehicle with special features, appliances, accessories or 66
equipment not included in the list price of the motor vehicles as 67
publicly advertised by the manufacturer thereof. 68
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(iii) To order for any person any parts, 69
accessories, equipment, machinery, tools, appliances or any 70
commodity whatsoever. 71
(iv) To contribute or pay money or anything of 72
value into any cooperative or other advertising program or fund. 73
This paragraph (c) shall not apply to manufacturers of motor 74
homes governed by the provisions of Sections 63-17-201 through 75
63-17-221. 76
(v) To provide any third party with customer lists 77
or any other personal information of customers, unless necessary 78
for the sale and delivery of a new motor vehicle to a consumer, to 79
validate and pay consumer or dealer incentives, for reasonable 80
marketing purposes, for evaluation of dealer performance, for 81
analytics or for the submission to the franchisor for any services 82
supplied by the franchisee for any claim for warranty parts or 83
repairs. Nothing in this section shall limit the ability of the 84
manufacturer, distributor or wholesaler to require or use customer 85
information to satisfy any safety or recall notice obligation or 86
other legal obligation. 87
(d) For a manufacturer, a distributor, a wholesaler, a 88
distributor branch or division, a factory branch or division, or a 89
wholesaler branch or division, or officer, agent or other 90
representative thereof: 91
(i) To refuse to deliver in reasonable quantities 92
and within a reasonable time after receipt of dealer's order to 93
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any duly licensed motor vehicle dealer having a franchise or 94
contractual arrangement for the retail sale of new motor vehicles 95
sold or distributed by such manufacturer, distributor, wholesaler, 96
distributor branch or division, factory branch or division or 97
wholesale branch or division, any motor vehicles as are covered by 98
such franchise or contract specifically publicly advertised by the 99
manufacturer, distributor, wholesaler, distributor branch or 100
division, factory branch or division or wholesale branch or 101
division, to be available for immediate delivery. However, the 102
failure to deliver any motor vehicle shall not be considered a 103
violation of this subsection if the failure is due to acts of God, 104
work stoppages or delays due to strikes or labor difficulties, 105
freight embargoes or other causes over which the manufacturer, 106
distributor or wholesaler, or any agent thereof, has no control. 107
(ii) To coerce, or attempt to coerce any motor 108
vehicle dealer to enter into any agreement, with the manufacturer, 109
distributor, wholesaler, distributor branch or division, factory 110
branch or division, or wholesaler branch or division, or officer, 111
agent or other representative thereof, or to do any other act 112
prejudicial to the dealer by threatening to cancel any franchise 113
or any contractual agreement existing between the manufacturer, 114
distributor, wholesaler, distributor branch or division, factory 115
branch or division, or wholesaler branch or division, and the 116
dealer. However, good-faith notice to any motor vehicle dealer of 117
the dealer's violation of any terms or provisions of the franchise 118
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or contractual agreement shall not constitute a violation of this 119
subsection. 120
(iii) To terminate or cancel the franchise or 121
selling agreement of any dealer without due cause. The nonrenewal 122
of a franchise or selling agreement, without due cause, shall 123
constitute an unfair termination or cancellation, regardless of 124
the terms or provisions of such franchise or selling agreement. 125
"Due cause" shall be defined as a breach by the dealer of a 126
material provision of the franchise agreement which breach has not 127
been cured within a reasonable time after the dealer has been 128
given written notice of the breach. The burden of proving that 129
due cause exists shall be upon the party attempting to terminate, 130
cancel or not renew the franchise or selling agreement. The 131
manufacturer, distributor, wholesaler, distributor branch or 132
division, factory branch or division, or wholesaler branch or 133
division, or officer, agent or other representative thereof shall 134
notify a motor vehicle dealer in writing, and forward a copy of 135
the notice to the commission, of the termination or cancellation 136
of the franchise or selling agreement of the dealer at least sixty 137
(60) days before the effective date thereof, stating the specific 138
grounds for such termination or cancellation. The manufacturer, 139
distributor, wholesaler, distributor branch or division, factory 140
branch or division, or wholesaler branch or division, or officer, 141
agent or other representative thereof shall notify a motor vehicle 142
dealer in writing, and forward a copy of the notice to the 143
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commission, at least sixty (60) days before the contractual term 144
of his franchise or selling agreement expires that the franchise 145
or selling agreement will not be renewed, stating the specific 146
grounds for the nonrenewal, in those cases where there is no 147
intention to renew the franchise or selling agreement. In no 148
event shall the contractual term of any franchise or selling 149
agreement expire, without the written consent of the motor vehicle 150
dealer involved, prior to the expiration of at least sixty (60) 151
days following such written notice. Any motor vehicle dealer who 152
receives written notice that his franchise or selling agreement is 153
being terminated or cancelled or who receives written notice that 154
his franchise or selling agreement will not be renewed, may, 155
within the sixty-day notice period, file with the commission a 156
verified complaint for its determination as to whether the 157
termination or cancellation or nonrenewal is unfair within the 158
purview of the Mississippi Motor Vehicle Commission Law, and the 159
franchise agreement shall continue in effect until final 160
determination of the issues raised in the complaint 161
notwithstanding anything to the contrary contained in the law or 162
in the franchise or selling agreement. 163
(iv) To require, attempt to require, coerce or 164
attempt to coerce a dealer, by franchise agreement or otherwise, 165
or as a condition to the renewal or continuation of a franchise 166
agreement, to materially change the dealer's method of conducting 167
business, not including its facilities, if the change would impose 168
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substantial and unreasonable financial hardship on the business of 169
the motor vehicle dealer in light of the business objective of the 170
proposed change, unless the change is voluntarily agreed to by the 171
dealer for separate and valuable consideration. 172
(v) To offer to sell or to sell any new motor 173
vehicle to any motor vehicle dealer at a lower actual price 174
therefor than the actual price charged to any other motor vehicle 175
dealer for the same model vehicle similarly equipped or to utilize 176
any device, including, but not limited to, sales promotion plans 177
or programs which result in such lesser actual price. The 178
provisions of this subparagraph shall not apply so long as a 179
manufacturer, distributor or wholesaler, or any agent thereof, 180
offers to sell or sells new motor vehicles to all motor vehicle 181
dealers at the same price. This subparagraph shall not be 182
construed to prevent the offering of volume discounts if such 183
discounts are equally available to all franchised motor vehicle 184
dealers of the same line or make in this state. 185
The provisions of this subsection shall not apply to sales to 186
a motor vehicle dealer of any motor vehicle ultimately sold, 187
donated or used by such dealer in a driver education program, to 188
sales to a motor vehicle dealer for resale to any unit of 189
government, federal, state or local, or to bona fide fleet sales. 190
(vi) To offer to sell or to sell parts and/or 191
accessories to any new motor vehicle dealer for use in his own 192
business for the purpose of repairing or replacing the same or a 193
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comparable part or accessory, at a lower actual price therefor 194
than the actual price charged to any other new motor vehicle 195
dealer for similar parts and/or accessories for use in his own 196
business. However, it is recognized that certain motor vehicle 197
dealers operate and serve as wholesalers of parts and accessories 198
to retail outlets, and nothing herein contained shall be construed 199
to prevent a manufacturer, distributor or wholesaler, or any agent 200
thereof, from selling to a motor vehicle dealer who operates and 201
serves as a wholesaler of parts and accessories, the parts and 202
accessories as may be ordered by such motor vehicle dealer for 203
resale to retail outlets, at a lower actual price than the actual 204
price charged a motor vehicle dealer who does not operate or serve 205
as a wholesaler of parts and accessories. 206
(vii) To prevent or attempt to prevent by contract 207
or otherwise any motor vehicle dealer from changing the capital 208
structure of his dealership or the means by or through which he 209
finances the operation of his dealership, provided the motor 210
vehicle dealer at all times meets any capital standards agreed to 211
between the dealership and the manufacturer, distributor or 212
wholesaler, provided such standards are deemed reasonable by the 213
commission. 214
(viii) To prevent or attempt to prevent by 215
contract or otherwise any motor vehicle dealer or any officer, 216
partner or stockholder of any motor vehicle dealer from selling or 217
transferring any part of the interest of any of them to any other 218
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person or persons or party or parties. However, no motor vehicle 219
dealer, officer, partner or stockholder shall have the right to 220
sell, transfer or assign the franchise or any right thereunder 221
without the consent of the manufacturer, distributor or wholesaler 222
which consent shall not be unreasonably withheld. 223
(ix) To condition unreasonably the renewal or 224
extension of a franchise on a motor vehicle dealer's substantial 225
renovation of the motor vehicle dealer's place of business or on 226
the construction, purchase, acquisition or rental of a new place 227
of business by the motor vehicle dealer. The manufacturer shall 228
notify the motor vehicle dealer in writing of its intent to impose 229
such a condition within a reasonable time prior to the effective 230
date of the proposed renewal or extension, but in no case less 231
than one hundred eighty (180) days prior to the renewal or 232
extension. Upon receipt of written notification, a motor vehicle 233
dealer shall have sixty (60) days to file a protest with the 234
commission, and the manufacturer shall demonstrate to the 235
commission the need for the demand in view of the need to service 236
the public and the economic conditions existing in the motor 237
vehicle industry and the market area served by the motor vehicle 238
dealer at the time the action would be required of the motor 239
vehicle dealer. As part of any such condition the manufacturer 240
shall offer the motor vehicle dealer a reasonable initial supply 241
and model mix of motor vehicles to meet the sales levels necessary 242
to support the increased overhead incurred by the motor vehicle 243
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dealer by reason of the renovation, construction, purchase or 244
rental of a new place of business consistent with nationally 245
applied standards. 246
(x) To require, coerce or attempt to coerce a 247
motor vehicle dealer to refrain from participation in the 248
management of, investment in, the acquisition of, or the current 249
operation of any other line of motor vehicles or related products, 250
as long as the motor vehicle dealer maintains a reasonable line of 251
credit for each dealership and the motor vehicle dealer remains in 252
substantial compliance with reasonable facilities' requirements of 253
the manufacturer or distributor. The reasonable facilities' 254
requirements may not include any requirement that a motor vehicle 255
dealer establish or maintain exclusive facilities, personnel or 256
display space when the requirements are unreasonable considering 257
current economic conditions in the market area and not otherwise 258
justified by reasonable business considerations. The burden of 259
proving by a preponderance of the evidence that the current 260
economic conditions and reasonable business considerations justify 261
exclusive facilities is on the manufacturer. Voluntary and 262
noncoerced acceptance of such conditions by the motor vehicle 263
dealer in writing for separate and valuable consideration shall 264
not constitute a violation. 265
(xi) To fail or refuse to sell or offer to sell to 266
all motor vehicle dealers in a line or make, every motor vehicle 267
sold or offered for sale under the franchise agreement to any 268
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motor vehicle dealer of the same line or make; or to unreasonably 269
require a motor vehicle dealer to pay an extra fee, purchase 270
unreasonable advertising displays or any other materials, or to 271
unreasonably require the dealer-operator to remodel, renovate or 272
recondition its existing facilities as a prerequisite to receiving 273
a certain model or series of vehicles. However, the failure to 274
deliver any such motor vehicle shall not be considered a violation 275
of this section if the failure is not arbitrary and is due to a 276
lack of manufacturing capacity or to a strike or labor difficulty, 277
a shortage of materials, a freight embargo or other cause of which 278
the manufacturer or distributor has no control. This provision 279
shall not apply to manufacturers of recreational vehicles. 280
(xii) To condition the sale, transfer, relocation 281
or renewal of a franchise or dealer agreement or to condition 282
sales, services, parts or finance incentives upon site-control 283
agreement; however, voluntary and noncoerced acceptance of such 284
conditions by the motor vehicle dealer in writing, shall not 285
constitute a violation. 286
(xiii) To assign or change a motor vehicle 287
dealer's market area under the franchise or motor vehicle dealer's 288
agreement arbitrarily or without due regard to the present or 289
projected future pattern of motor vehicle sales and registrations 290
within the motor vehicle dealer's market area, and without first 291
having provided the motor vehicle dealer's with written notice of 292
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the change in the motor vehicle dealer's market area and a 293
detailed description of the change and reasons therefor. 294
(xiv) To attempt to coerce, or coerce, a motor 295
vehicle dealer to adhere to performance standards that are not 296
applied uniformly to other similarly situated motor vehicle 297
dealers. 298
(xv) To establish any performance standard or 299
program for measuring motor vehicle dealer's performance that may 300
have a material impact on a motor vehicle dealer that is not fair, 301
reasonable and equitable, or applying any such standard or program 302
to a motor vehicle dealer in a manner that is not fair, reasonable 303
and equitable. If dealership performance standards are based on a 304
survey, the manufacturer or distributor shall establish the 305
objectivity of the survey process and provide this information to 306
any motor vehicle dealer covered by the survey request. Within 307
fifteen (15) business days of a request by the motor vehicle 308
dealer, a manufacturer shall disclose in writing to the motor 309
vehicle dealer a description of the performance standard or 310
program and all relevant information used in the application of 311
the performance standard or program to that motor vehicle dealer 312
unless the manufacturer has already provided the information. 313
(xvi) To increase prices of new motor vehicles 314
which the new motor vehicle dealer had ordered for the ultimate 315
purchasers prior to the motor vehicle dealer's receipt of written 316
official price increase notification. A sales contract signed by 317
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the ultimate purchaser that includes model and firm price shall 318
constitute evidence of each such order provided that the vehicle 319
is in fact delivered to that purchaser. 320
(xvii) To attempt to require, coerce or attempt to 321
coerce any new motor vehicle dealer to sell, offer to sell or sell 322
exclusively an extended service contract, extended maintenance 323
plan or similar product, including, without limitation, GAP 324
products, offered, endorsed or sponsored by the manufacturer or 325
distributor by any of the following means: 326
1. By an act or statement made by the 327
manufacturer or distributor that will adversely impact the motor 328
vehicle dealer whether it is express or implied; or 329
2. By a provision in a franchise agreement 330
that the motor vehicle dealer shall sell, offer to sell or sell 331
exclusively an extended service contract, extended warranty plan 332
or similar product offered, endorsed or sponsored by the 333
manufacturer or distributor; or 334
3. By measuring the motor vehicle dealer's 335
performance under the franchise agreement based on the sale of 336
extended service contracts, extended maintenance plans or similar 337
products offered, endorsed or sponsored by the manufacturer or 338
distributor; or 339
4. By requiring the motor vehicle dealer to 340
actively promote the sale or extended service contracts, extended 341
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maintenance plans or similar products offered, endorsed or 342
sponsored by the manufacturer or distributor. 343
Nothing in this subparagraph shall prohibit a manufacturer or 344
distributor from providing incentive programs to a new motor 345
vehicle dealer who makes the voluntary decision to offer to sell, 346
sell or sell exclusively an extended service contract, extended 347
maintenance plan or similar product offered, endorsed or sponsored 348
by the manufacturer or distributor. 349
(xviii) To require a motor vehicle dealer to 350
provide its customer lists or service files to the manufacturer or 351
distributor, unless necessary for the sale and delivery of a new 352
motor vehicle to a consumer, to validate and pay consumer or 353
dealer incentives, for reasonable marketing purposes, for 354
evaluation of dealer performance, for analytics or for the 355
submission to the franchisor for any services supplied by the 356
franchisee for any claim for warranty parts or repairs. Nothing 357
in this section shall limit the franchisor's ability to require or 358
use customer information to satisfy any safety or recall notice 359
obligation or other legal obligation. 360
(xix) To release or cause to be released a motor 361
vehicle dealer's nonpublic customer information to another motor 362
vehicle dealer unless the franchise has been terminated, the 363
customer has relocated to an address that is outside of the motor 364
vehicle dealer's market area, the customer has transacted business 365
with another motor vehicle dealer of the same brand, a customer 366
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has not transacted with the dealer from which a vehicle was 367
purchased for a period of nine (9) months, or the motor vehicle 368
dealer consents to the sharing of customer information with other 369
dealers. 370
(xx) To coerce, attempt to coerce, require or 371
attempt to require any motor vehicle dealer to provide installment 372
financing with a specified financial institution. 373
(xxi) To require, coerce or attempt to coerce a 374
motor vehicle dealer or successor dealer to construct or 375
substantially alter a facility or premises if such construction or 376
alteration would be unreasonable under the circumstances. 377
(xxii) To require, coerce or attempt to coerce a 378
motor vehicle dealer or successor dealer to construct or 379
substantially alter a facility or premises if the same area of the 380
facility or premises has been constructed or substantially altered 381
within the last ten (10) years and the construction or alteration 382
was required and approved by the manufacturer as a part of a 383
program, standard or policy, except for improvements made to 384
comply with health or safety laws, or to accommodate the 385
technology requirements necessary to sell or to service a motor 386
vehicle. As used in this subsection, "substantially alter" means 387
an alteration that substantially impacts the architectural 388
features, characteristics, or integrity of a structure or lot. 389
The term does not include routine maintenance reasonably necessary 390
to maintain a dealership in attractive condition, or items 391
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directly protected by federal intellectual property rights of the 392
manufacturer. If, during such ten-year period, the manufacturer 393
revises an existing, or establishes a new program, standard, 394
policy, bonus, incentive, rebate, or other benefit for the 395
construction or substantial alteration of a dealership facility or 396
premises, a motor vehicle dealer who completed a facility as a 397
part of a prior program, standard, or policy within the ten-year 398
period and elects not to comply with the applicant's or 399
manufacturer's requirements under the revised or new program, 400
standard, or facility-related policy will not be eligible for any 401
bonus, incentive, rebate, or other benefit under the revised or 402
new program but shall remain entitled to all benefits under the 403
prior program according to the terms of the prior program in place 404
when the dealer began to perform under the program. If the prior 405
program under which the dealer completed a facility construction 406
or substantial alteration does not contain a specific time period 407
during which the manufacturer or distributor must provide payments 408
or benefits to a dealer, then the manufacturer or distributor may 409
not deny the dealer payment or benefits under the terms of that 410
prior program, as it existed when the dealer began to perform 411
under the prior program, for the balance of the ten-year period, 412
regardless of whether the manufacturer's or distributor's facility 413
program has been changed or canceled. 414
(xxiii) To require, coerce, or attempt to coerce a 415
motor vehicle dealer located in this state to purchase goods or 416
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facility construction or maintenance services for items not 417
trademarked or otherwise directly protected by federal 418
intellectual property rights of the manufacturer from a vendor 419
selected, identified, or designated by a manufacturer, 420
distributor, affiliate, or captive finance source when the dealer 421
may obtain goods or facility construction or maintenance services 422
for items not trademarked or otherwise directly protected by 423
federal intellectual property rights of the manufacturer of the 424
same quality, material, and design from a vendor selected by the 425
dealer, provided the dealer obtains prior approval from the 426
manufacturer, distributor or affiliate, for the use of the 427
dealer's selected vendor. Goods shall include signs or sign 428
components to be purchased or leased by the dealer which are not 429
trademarked or otherwise directly protected by the federal 430
intellectual property rights of the manufacturer. Such approval 431
by the manufacturer, distributor or affiliate may not be 432
unreasonably withheld. For purposes of this subparagraph (xxiii), 433
the term "goods" does not include moveable displays, brochures, 434
and promotional materials containing material subject to the 435
intellectual property rights of a manufacturer or distributor, or 436
special tools as reasonably required by the manufacturer, or parts 437
to be used in repairs under warranty or recall obligations of a 438
manufacturer or distributor. If the manufacturer, distributor or 439
affiliate claims that a vendor chosen by the dealer cannot supply 440
goods or facility construction or maintenance services for items 441
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not trademarked or otherwise directly protected by federal 442
intellectual property rights of the manufacturer which are the 443
same quality, material, and design, the dealer may file a protest 444
with the commission. When a protest is filed, the commission 445
shall promptly inform the manufacturer, distributor, affiliate, or 446
captive finance source that a protest has been filed. The 447
commission shall conduct a hearing on the merits of the protest 448
within ninety (90) days following the filing of a response to the 449
protest. The manufacturer, distributor or affiliate shall bear 450
the burden of proving that the goods or facility construction or 451
maintenance services for items not trademarked or otherwise 452
directly protected by federal intellectual property rights of the 453
manufacturer chosen by the dealer are not of the same quality, 454
material or design to those required by the manufacturer, 455
distributor or affiliate. 456
This paragraph (d) shall not apply to manufacturers of motor 457
homes governed by the provisions of Sections 63-17-201 through 458
63-17-221. 459
(xxiv) To provide any third party with customer lists, 460
any other personal information of customers or service files to 461
the manufacturer or distributor, unless necessary for the sale and 462
delivery of a new motor vehicle to a consumer, to validate and pay 463
consumer or dealer incentives, for reasonable marketing purposes, 464
for evaluation of dealer performance, for analytics or for the 465
submission to the franchisor for any services supplied by the 466
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franchisee for any claim for warranty parts or repairs. Nothing 467
in this section shall limit the franchisor's ability to require or 468
use customer information to satisfy any safety or recall notice 469
obligation or other legal obligation. 470
(2) Concerning any sale of a motor vehicle or vehicles to 471
the State of Mississippi, or to the several counties or 472
municipalities thereof, or to any other political subdivision 473
thereof, no manufacturer, distributor or wholesaler shall offer 474
any discounts, refunds, or any other similar type inducements to 475
any dealer without making the same offer or offers to all other of 476
its dealers within the state. If the inducements above mentioned 477
are made, the manufacturer, distributor or wholesaler shall give 478
simultaneous notice thereof to all of its dealers within the 479
state. 480
(3) It is unlawful to be a broker. For the purpose of this 481
subsection, "broker" means a person who, for a fee, commission or 482
other valuable consideration, arranges or offers to arrange a 483
transaction involving the sale, for purposes other than resale, of 484
a new motor vehicle, and who is not: 485
(a) A new motor vehicle dealer or agent or employee of 486
such a dealer; or 487
(b) A distributor or an agent or employee of such a 488
distributor. 489
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However, an individual shall not be deemed to be a broker if 490
he or she is the owner of the new or used motor vehicle which is 491
the object of the brokering transaction. 492
(4) (a) For purposes of this subsection, the term 493
"Stop-Sale" or "Do-Not-Drive" order means a notification issued by 494
a manufacturer to its franchised new motor vehicle dealers stating 495
that certain used vehicles in inventory shall not be sold or 496
leased, at either retail or wholesale, due to a federal safety 497
recall for a defect or noncompliance, or a federal emissions 498
recall. 499
(b) A manufacturer shall compensate its new motor 500
vehicle dealers for all labor and parts required by the 501
manufacturer to perform recall repairs. Compensation for recall 502
repairs shall be reasonable. If parts or a remedy are not 503
reasonably available to perform a recall service or repair on a 504
used vehicle held for sale by a dealer authorized to sell and 505
service new vehicles of the same line-make within thirty (30) days 506
of the manufacturer issuing the initial notice of recall, and the 507
manufacturer has issued a Stop-Sale or Do-Not-Drive order on the 508
vehicle, the manufacturer shall compensate the dealer at a 509
prorated rate of at least one percent (1%) of the value of the 510
vehicle per month beginning on the date that is thirty (30) days 511
after the date on which the Stop-Sale or Do-Not-Drive order was 512
provided to the dealer until the earlier of either of the 513
following: 514
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(i) The date the recall or remedy parts are made 515
available; or 516
(ii) The date the dealer sells, trades, or 517
otherwise disposes of the affected used motor vehicle. 518
(c) The value of a used vehicle shall be the average 519
trade-in value for used vehicles as indicated in an independent 520
third party guide for the year, make, and model, of the recalled 521
vehicle. 522
(d) This subsection shall apply only to used vehicles 523
subject to safety or emissions recalls pursuant to and recalled in 524
accordance with federal law and regulations adopted thereunder and 525
where a Stop-Sale or Do-Not-Drive order has been issued and repair 526
parts or remedy remain unavailable for thirty (30) days or longer. 527
This subsection further shall apply only to new motor vehicle 528
dealers holding an affected used vehicle for sale: 529
(i) In inventory at the time the Stop-Sale or 530
Do-Not-Drive order was issued; or 531
(ii) Which was taken in the used vehicle inventory 532
of the dealer as a consumer trade-in incident to the purchase of a 533
new vehicle from the dealer after the Stop-Sale or Do-Not-Drive 534
order was issued; and 535
(iii) That are a line-make that the dealer is 536
franchised to sell or on which the dealer is authorized to perform 537
recall repairs. 538
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(e) It shall be a violation of this subsection for a 539
manufacturer to reduce the amount of compensation otherwise owed 540
to an individual new motor vehicle dealer, whether through a 541
chargeback, removal of the individual dealer from an incentive 542
program or reduction in amount owed under an incentive program 543
solely because the new motor vehicle dealer has submitted a claim 544
for reimbursement under this subsection. This subsection shall 545
not apply to an action by a manufacturer that is applied uniformly 546
among all dealers of the same line-make in the state. 547
(f) All reimbursement claims made by new motor vehicle 548
dealers pursuant to this subsection for recall remedies or 549
repairs, or for compensation where no part or repair is reasonably 550
available and the vehicle is subject to a Stop-Sale or 551
Do-Not-Drive order shall be subject to the same limitations and 552
requirements as a warranty reimbursement claim made under 553
paragraph (j) of Section 63-17-85. In the alternative, a 554
manufacturer may compensate its franchised dealers under a 555
national recall compensation program provided the compensation 556
under the program is equal to or greater than that provided under 557
paragraph (b) of this subsection (4); or the manufacturer and 558
dealer otherwise agree. 559
(g) A manufacturer may direct the manner and method in 560
which a dealer must demonstrate the inventory status of an 561
affected used motor vehicle to determine eligibility under this 562
subsection, provided that the manner and method may not be unduly 563
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ST: Car manufacturers, dealers and franchisors;
prohibit from sharing customer information with
third parties.
burdensome and may not require information that is unduly 564
burdensome to the dealer. 565
(h) Nothing in this subsection shall require a 566
manufacturer to provide total compensation to a dealer which would 567
exceed the total average trade-in value of the affected used motor 568
vehicle as originally determined under paragraph (b) of this 569
subsection (4). 570
(i) If a recall remedy for an affected use motor 571
vehicle is available under a federal statute or regulation, then a 572
dealer may opt to be compensated under either the federal statute 573
or authority of this subsection but may not combine the remedies. 574
SECTION 2. This act shall take effect and be in force from 575
and after July 1, 2026. 576