Text: SSB03011 Text: SSB03013 Text: SSB03000 - SSB03099 Text: SSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN
1 1 Section 1. Section 322.3, Code Supplement 1999, is amended
1 2 by adding the following new subsection:
1 3 NEW SUBSECTION. 14. A manufacturer, distributor,
1 4 wholesaler, or importer shall not directly or indirectly be
1 5 licensed as, own an interest in, operate, or control a motor
1 6 vehicle dealer. This subsection shall not prohibit any of the
1 7 following:
1 8 a. A manufacturer or importer from being licensed as a
1 9 motor vehicle dealer or owning an interest in, operating, or
1 10 controlling a motor vehicle dealership for a period not to
1 11 exceed one year to facilitate transfer of the motor vehicle
1 12 dealership to a new owner if both of the following apply:
1 13 (1) The prior owner transferred the motor vehicle
1 14 dealership to the manufacturer or importer.
1 15 (2) The motor vehicle dealership is continuously offered
1 16 for sale by the manufacturer or importer upon reasonable terms
1 17 and conditions.
1 18 b. A manufacturer or importer from temporarily owning an
1 19 interest in a motor vehicle dealership for the purpose of
1 20 enhancing opportunities for persons who lack the financial
1 21 resources to purchase the motor vehicle dealership without
1 22 such assistance. A manufacturer or importer may temporarily
1 23 own an interest in a motor vehicle dealership pursuant to this
1 24 paragraph only if the manufacturer or importer enters into a
1 25 contract with a person pursuant to whom all of the following
1 26 apply:
1 27 (1) The person operates the motor vehicle dealership.
1 28 (2) The person has made a significant financial investment
1 29 in the motor vehicle dealership and is subject to loss on such
1 30 investment.
1 31 (3) The person has an ownership interest in the motor
1 32 vehicle dealership.
1 33 (4) The person will acquire full ownership of the motor
1 34 vehicle dealership within a reasonable time under reasonable
1 35 conditions.
2 1 c. A manufacturer or importer from owning an interest in,
2 2 operating, or controlling a person whose primary business is
2 3 renting motor vehicles and who is licensed as a used motor
2 4 vehicle dealer.
2 5 d. A manufacturer of motor homes, as defined in section
2 6 321.1, or a manufacturer of school buses, as defined in
2 7 section 321.1, from owning an interest in, operating, or
2 8 controlling a motor vehicle dealer of the motor homes or
2 9 school buses manufactured by that manufacturer or from being
2 10 licensed as a motor vehicle dealer only of the motor homes or
2 11 school buses manufactured by that manufacturer.
2 12 e. A manufacturer from owning a minority interest in an
2 13 entity that owns and operates motor vehicle dealers, licensed
2 14 under this chapter or the laws of the jurisdiction in which
2 15 they are located, of the line-make manufactured by the
2 16 manufacturer if all of the motor vehicle dealers owned and
2 17 operated by the entity in this state are motor vehicle dealers
2 18 of only the line-make manufactured by the manufacturer and if,
2 19 on January 1, 2000, there was not less than one and not more
2 20 than three motor vehicle dealers of that line-make licensed
2 21 under this chapter.
2 22 EXPLANATION
2 23 This bill adds a new provision to Code section 322.3,
2 24 prohibiting certain acts relating to the sale of vehicles,
2 25 which prohibits a motor vehicle manufacturer, distributor,
2 26 wholesaler, or importer from directly or indirectly being
2 27 licensed as, owning an interest in, operating, or controlling
2 28 a motor vehicle dealer. The bill also provides several
2 29 exceptions to the prohibition.
2 30 The bill provides that, notwithstanding the new
2 31 prohibition, a manufacturer or importer may be licensed as a
2 32 motor vehicle dealer or own an interest in, operate, or
2 33 control a motor vehicle dealership for up to one year to
2 34 facilitate transfer of the dealership to a new owner if the
2 35 prior owner transferred the dealership to the manufacturer or
3 1 importer and the dealership is continuously offered for sale
3 2 upon reasonable terms and conditions.
3 3 The new prohibition does not prohibit a manufacturer or
3 4 importer from temporarily owning an interest in a motor
3 5 vehicle dealership to enhance opportunities for persons who
3 6 cannot financially purchase the motor vehicle dealership
3 7 without assistance. Such an arrangement must involve a
3 8 contract between the manufacturer or importer and the person
3 9 whereby the person is required to operate the dealership, has
3 10 made a significant financial investment in the dealership and
3 11 is subject to loss on such investment, has an ownership
3 12 interest in the dealership, and will acquire full ownership of
3 13 the dealership within a reasonable time under reasonable
3 14 conditions.
3 15 The bill provides that a manufacturer or importer may own
3 16 an interest in, operate, or control a person whose primary
3 17 business is renting motor vehicles and who is licensed as a
3 18 used motor vehicle dealer. A manufacturer of motor homes or
3 19 school buses may own an interest in, operate, or control a
3 20 motor vehicle dealer of the motor homes or school buses
3 21 manufactured by that manufacturer and may be licensed as a
3 22 motor vehicle dealer only of the motor homes or school buses
3 23 manufactured by that manufacturer.
3 24 Additionally, a manufacturer may own a minority interest in
3 25 an entity that owns and operates motor vehicle dealers of the
3 26 line-make manufactured by the manufacturer if all of the
3 27 dealers owned and operated by the entity in Iowa are dealers
3 28 of only the line-make manufactured by the manufacturer and if,
3 29 on January 1, 2000, there was not less than one and not more
3 30 than three dealers of that line-make licensed under Code
3 31 chapter 322.
3 32 Violations of the new prohibition are simple misdemeanors
3 33 punishable by a fine of not less than $250 nor more than
3 34 $1,500 or by imprisonment not to exceed 30 days.
3 35 LSB 5697SC 78
4 1 nh/cf/24
Text: SSB03011 Text: SSB03013 Text: SSB03000 - SSB03099 Text: SSB Index Bills and Amendments: General Index Bill History: General Index
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