Enrolled SB 125: Relating to certain vehicles, including trailers; and relating to motor vehicle dealer advertising, motor vehicle dealer sales of used motor vehicles, motor vehicle sales contracts, motor vehicle service contracts, and motor vehicle sales financing.
00Enrolled SB 125 01 Relating to certain vehicles, including trailers; and relating to motor vehicle dealer 02 advertising, motor vehicle dealer sales of used motor vehicles, motor vehicle sales contracts, 03 motor vehicle service contracts, and motor vehicle sales financing. 04 _______________ 05 * Section 1. AS 45.25.400(b) is amended to read: 06 (b) A motor vehicle dealer may use the term "manufacturer's suggested retail 07 price," "MSRP," or "list price" in an advertisement for the sale of a motor vehicle, 08 subject to the restriction on price comparisons in AS 45.25.450 and the following: 09 (1) the manufacturer's suggested retail price or list 10 [ADVERTISED] price must reference the final price listed by the manufacturer on the 11 Monroney sticker, including accessories and options physically attached to the vehicle 12 at the time of delivery to the dealer, plus any transportation charges [, AND MINUS 13 ALL MANUFACTURER DISCOUNTS AND SAVINGS]; 14 (2) the manufacturer's suggested retail price or the list price does not
01 include charges added by the dealer or options added to the vehicle by the dealer; and 02 (3) whenever using the term "manufacturer's suggested retail price," 03 "MSRP," or "list price," the dealer may not represent that a buyer would save money 04 by paying a price that is lower than the "manufacturer's suggested retail price," 05 "MSRP," or "list price [.]" unless the representation refers to savings from the 06 "manufacturer's suggested retail price," "MSRP," or "list price." 07 * Sec. 2. AS 45.25.440 is repealed and reenacted to read: 08 Sec. 45.25.440. Advertised price. A motor vehicle dealer's advertised price 09 for a motor vehicle must include all dealer fees and costs, except for fees, such as 10 licensing fees, registration fees, title transfer fees, and sales taxes, actually paid to a 11 government agency. In this section, "dealer fees and costs" includes dealer preparation 12 fees, document preparation fees, surcharges, and other dealer-imposed fees and costs. 13 * Sec. 3. AS 45.25.450(b) is amended to read: 14 (b) A motor vehicle dealer may advertise a price comparison for a new motor 15 vehicle with the manufacturer's suggested retail price only if 16 (1) the dealer only uses the term "manufacturer's suggested retail 17 price," "MSRP," or "list price"; 18 (2) the advertised price references the final price listed by the 19 manufacturer on the Monroney sticker; and 20 (3) the manufacturer's suggested retail price, MSRP, or list price does 21 not include charges added by the dealer or options added to the vehicle by the dealer [; 22 (4) THE DEALER CLEARLY DISCLOSES THAT THE 23 MANUFACTURER'S SUGGESTED RETAIL PRICE, MSRP, OR LIST PRICE 24 MAY NOT REFLECT THE ACTUAL SELLING PRICE FOR THE VEHICLE IN 25 THE DEALER'S TRADE AREA; AND 26 (5) THE DEALER DOES NOT MAKE A REPRESENTATION IN 27 THE ADVERTISEMENT, INCLUDING A REFERENCE TO A "SALE," 28 "REDUCTION," OR "DISCOUNT," THAT THE COMPARISON REPRESENTS A 29 SAVING TO THE CONSUMER]. 30 * Sec. 4. AS 45.25.450 is amended by adding new subsections to read: 31 (e) A motor vehicle dealer may advertise a price comparison for a used motor
01 vehicle only if the reference price is the retail value of the vehicle as specified in the 02 current edition of a nationally recognized valuation publication for used motor 03 vehicles. 04 (f) When advertising a price comparison for a used motor vehicle, the 05 advertisement must identify the source of the reference price, and the motor vehicle 06 dealer shall make this source available to a potential retail buyer on request. 07 * Sec. 5. AS 45.25.460(a) is amended to read: 08 (a) In addition to the provisions of AS 45.50.471 and regulations adopted 09 under AS 45.50.471, a motor vehicle dealer 10 (1) [SHALL INCLUDE IN AN ADVERTISEMENT OF A MOTOR 11 VEHICLE FOR SALE ALL FEES OR CHARGES, EXCEPT FEES OR CHARGES 12 TO BE PAID TO A THIRD PARTY; 13 (2)] may not represent the dealer document preparation fee as a 14 government fee; 15 (2) [(3)] may not advertise a specific motor vehicle for sale unless the 16 [WITHOUT IDENTIFYING THE VEHICLE BY EITHER ITS] vehicle identification 17 number, vehicle stocking number, or license number is disclosed in the 18 advertisement or made available by the dealer on request of a retail buyer; 19 (3) [(4) MAY NOT ADVERTISE THAT FREE MERCHANDISE, 20 GIFTS, OR SERVICES WILL BE PROVIDED BY THE DEALER IF A VEHICLE 21 IS PURCHASED; IN THIS PARAGRAPH, "FREE" INCLUDES MERCHANDISE 22 OR SERVICES OFFERED FOR SALE AT A PRICE LESS THAN THE DEALER'S 23 COST FOR THE MERCHANDISE OR SERVICES; 24 (5)] may not use the term "rebate," "cash back," or a similar term in 25 advertising the sale of a motor vehicle unless the rebate is expressed in a specific 26 dollar amount and is in fact a rebate offered by the vehicle manufacturer or distributor 27 directly to the retail buyer of the vehicle; 28 (4) [(6)] may not require a person, in order to receive the advertised 29 credit terms, to pay a higher price for a motor vehicle and any related goods or 30 services than the cash price the same person would have to pay to purchase the same 31 vehicle and related goods or services;
01 (5) [(7)] may not advertise a guaranteed trade-in allowance or range of 02 allowances unless the guarantee is provided by the manufacturer or distributor; 03 (6) [(8)] may not affix to a new motor vehicle a supplemental price 04 sticker containing a price that represents the dealer's asking price if the supplemental 05 price sticker exceeds the manufacturer's suggested retail price, unless the supplemental 06 sticker 07 (A) clearly and conspicuously, in the largest print appearing on 08 the sticker other than the print size used for the dealer's name, discloses that 09 the supplemental sticker price is the dealer's asking price, or words of similar 10 meaning, and is not the manufacturer's suggested retail price; 11 (B) clearly and conspicuously discloses the manufacturer's 12 suggested retail price; and 13 (C) states, if the supplemental sticker price is greater than the 14 sum of the manufacturer's suggested retail price and the price of the items 15 added by the dealer, the difference and describes it as additional dealer mark- 16 up; 17 (7) [(9)] may not advertise or otherwise represent, or knowingly allow 18 to be advertised or represented on behalf of the dealer, that a down payment is not 19 required in connection with the sale of a motor vehicle when a down payment is in 20 fact required; 21 (8) [(10)] may not advertise an offer for the sale, lease, or purchase of 22 a motor vehicle that does not contain the name of the dealer; 23 (9) [(11)] may not represent and sell as a new motor vehicle a 24 demonstrator vehicle or a motor vehicle that is a used motor vehicle; in this paragraph, 25 "demonstrator vehicle" 26 (A) means a motor vehicle 27 (i) that has been assigned by a dealer for use by the 28 dealership as an executive vehicle for promotional purposes, including 29 being driven in the community; 30 (ii) that has not been licensed by a retail buyer; and 31 (iii) the title of which has not been transferred to a retail
01 buyer; 02 (B) does not include a motor vehicle that has only been driven 03 to demonstrate the motor vehicle to a prospective buyer; 04 (10) [(12)] may not advertise that the dealer finances any person or 05 does not reject any person's credit, or make similar claims; 06 (11) [(13)] may not advertise or make a statement, declaration, or 07 representation in an advertisement that cannot be substantiated in fact; the burden of 08 proof of the factual basis for the statement, declaration, or representation is on the 09 dealer. 10 * Sec. 6. AS 45.25.465(a) is amended to read: 11 (a) Before the sale of a used motor vehicle, a motor vehicle dealer shall, 12 (1) when obtaining a used motor vehicle from an individual consumer, 13 make a reasonable inquiry of the seller into the condition of the vehicle, including the 14 accident and repair history of the vehicle; the information shall be recorded in writing 15 and signed [VERIFIED] by the seller; the dealer shall provide this information to a 16 prospective purchaser of the vehicle; 17 (2) when a motor vehicle dealer obtains a used motor vehicle from 18 another motor vehicle dealer, a wholesaler, or an auction, disclose to a prospective 19 purchaser of the vehicle that the vehicle was purchased from another dealer, a 20 wholesaler, or an auction. 21 * Sec. 7. AS 45.25.490 is amended to read: 22 Sec. 45.25.490. Required documentation. A motor vehicle dealer may not 23 enter into a contract to sell [OR OFFER TO SELL] a motor vehicle unless the motor 24 vehicle dealer holds a manufacturer's statement of origin, a title, or another properly 25 executed document reasonably necessary to obtain the statement of origin or title for 26 transfer of the vehicle to the buyer. 27 * Sec. 8. AS 45.25.520 is amended to read: 28 Sec. 45.25.520. Form of disclosures. Except as provided in 29 AS 45.25.460(a)(6)(A) [AS 45.25.460(a)(8)(A)], if a disclosure is required by this 30 chapter with respect to a motor vehicle advertisement, the disclosure must be made in 31 a clear and conspicuous manner.
01 * Sec. 9. AS 45.25.610(c) is amended to read: 02 (c) If a motor vehicle dealer arranges financing for a buyer, the motor vehicle 03 dealer may deliver the motor vehicle to the buyer before final approval by the 04 financing entity if 05 (1) the buyer and seller sign an agreement separate from the motor 06 vehicle installment contract on an 8 1/2 x 11 inch sheet of paper that clearly and 07 conspicuously informs the buyer that final financing arrangements have not yet been 08 approved and that clearly sets out the amount that will be financed, the annual 09 percentage rate of the finance charge, the amount of the finance charge, the number 10 and frequency of payments, and the amount of each payment; 11 (2) the separate agreement clearly and conspicuously informs the 12 buyer that accepting delivery of the vehicle before final financing approval obligates 13 the buyer to terms of the motor vehicle sales contract if the terms on the separate 14 agreement are identical to the terms finally approved by the financing entity; and 15 (3) the separate agreement provides that the [SEPARATE 16 AGREEMENT, THE] motor vehicle sales contract [, AND ANY AND ALL OTHER 17 CONDITIONS OF THE PURCHASE] will be void if any of the terms contained in 18 the separate agreement are changed by either the motor vehicle dealer or the financing 19 institution as a condition of sale or final financing approval. 20 * Sec. 10. AS 45.25.610(d) is amended to read: 21 (d) If a buyer's final financing is not approved and, as a result, the transaction 22 is not completed, and if the motor vehicle dealer has delivered the motor vehicle to 23 the buyer, the buyer shall deliver the motor vehicle to the motor vehicle dealer, 24 the motor vehicle dealer shall return the buyer's entire down payment less any 25 amount owed to the motor vehicle dealer under (f) and (g) of this section, and the 26 buyer's trade-in, if any, shall be returned to the buyer in the same condition and with 27 not more than 100 miles accumulated on the odometer from when the trade-in motor 28 vehicle was delivered to the motor vehicle dealer. 29 * Sec. 11. AS 45.25.610 is amended by adding new subsections to read: 30 (f) If a buyer's final financing is not approved and the buyer has made an 31 intentional misrepresentation in a credit application or other financial statement
01 provided by the buyer to the motor vehicle dealer or to a financing institution, the 02 buyer shall reimburse the motor vehicle dealer for the buyer's use of the motor vehicle 03 that exceeds 100 miles over the odometer reading on the motor vehicle on the date of 04 the initial delivery, at a rate that is the greater of 05 (1) the business use mileage rate that is applied by the federal Internal 06 Revenue Service at the time the motor vehicle is returned to the motor vehicle dealer; 07 or 08 (2) $.45 a mile. 09 (g) If a buyer's financing is not approved and the buyer has made an 10 intentional misrepresentation as described in (f) of this section, the buyer is 11 responsible for damage to the motor vehicle that occurred while the motor vehicle was 12 in the buyer's possession and for parking tickets, towing fees, storage fees, impound 13 fees, and other similar charges incurred by the buyer for the motor vehicle while the 14 motor vehicle was in the buyer's possession. 15 * Sec. 12. AS 45.25.620(a) is amended to read: 16 (a) A motor vehicle service contract must be in writing and contain all 17 essential provisions regarding the administration of the contract. [IF A MOTOR 18 VEHICLE DEALER PRESENTS A SERVICE CONTRACT TO THE CUSTOMER 19 AS AN "APPLICATION" FOR A CONTRACT, IT MUST BE CLEARLY AND 20 CONSPICUOUSLY MARKED AS AN APPLICATION AND MUST DISCLOSE 21 THE APPLICABLE RULES FOR OBTAINING A FINAL SERVICE CONTRACT.] 22 * Sec. 13. The uncodified law of the State of Alaska is amended by adding a new section to 23 read: 24 APPLICABILITY. (a) AS 45.25.490, as amended by sec. 7 of this Act, applies to 25 motor vehicle contracts entered into on or after the effective date of this Act. In this 26 subsection, "motor vehicle" has the meaning given in AS 45.25.590. 27 (b) AS 45.25.610(c), as amended by sec. 9 of this Act, AS 45.25.610(d), as amended 28 by sec. 10 of this Act, and AS 45.25.610(f) and (g), added by sec. 11 of this Act, apply to a 29 motor vehicle sales contract or an agreement that is entered into on or after the effective date 30 of this Act. In this subsection, 31 (1) "agreement" means a separate agreement required by AS 45.25.610(c), as
01 amended by sec. 9 of this Act; 02 (2) "sales contract" has the meaning given in AS 45.25.610. 03 (c) AS 45.25.620(a), as amended by sec. 12 of this Act, applies to a motor vehicle 04 service contract entered into on or after the effective date of this Act. In this subsection, 05 "service contract" has the meaning given in AS 45.25.990. 06 (d) In (b) and (c) of this section, "motor vehicle" has the meaning given in 07 AS 45.25.990.