Senate Study Bill 3067 - Introduced SENATE FILE _____ BY (PROPOSED COMMITTEE ON COMMERCE BILL BY CHAIRPERSON BOUSSELOT) A BILL FOR An Act authorizing certain manufacturers of battery electric 1 motor vehicles to be licensed as motor vehicle dealers. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5575XC (4) 91 th/ns

S.F. _____ Section 1. Section 322.3, subsection 15, Code 2026, is 1 amended by adding the following new paragraph: 2 NEW PARAGRAPH . g. A manufacturer of battery electric motor 3 vehicles, as defined in section 321.116, from being licensed 4 as a motor vehicle dealer of only new or used battery electric 5 motor vehicles manufactured by that manufacturer. 6 (1) A manufacturer licensed as a motor vehicle dealer in 7 accordance with this paragraph may do all of the following: 8 (a) Own, operate, or control not more than five motor 9 vehicle dealerships. 10 (b) Own, operate, control, or contract with an entity 11 that provides financing, leasing, service, or maintenance for 12 vehicles manufactured by the manufacturer. 13 (c) Provide service or maintenance for vehicles 14 manufactured by the manufacturer. 15 (2) This paragraph does not apply if the manufacturer or a 16 common entity of the manufacturer previously offered or entered 17 into a franchise agreement with a licensed motor vehicle dealer 18 in this state for the sale of new motor vehicles. For purposes 19 of this subparagraph, “common entity” includes any of the 20 following: 21 (a) A person who, through any form of agreement, is 22 directly or indirectly controlled by a manufacturer, importer, 23 distributor, licensee, or an affiliate thereof. 24 (b) A person whose equity interest is controlled directly or 25 indirectly by a manufacturer, importer, distributor, licensee, 26 or an affiliate thereof, if the equity interest is more than 27 thirty percent. 28 (c) A person whose equity interest is controlled directly 29 or indirectly by one or more other persons, if the equity 30 interest is more than thirty percent, and the other persons 31 also directly or indirectly control or own more than thirty 32 percent of the equity interests of a manufacturer or importer, 33 or any affiliate thereof. 34 EXPLANATION 35 -1- LSB 5575XC (4) 91 th/ns 1/ 3

S.F. _____ The inclusion of this explanation does not constitute agreement with 1 the explanation’s substance by the members of the general assembly. 2 Under current law, a person is prohibited from engaging 3 in the business of selling at retail motor vehicles unless 4 the person is licensed by the department of transportation 5 (DOT) as a motor vehicle dealer. For new vehicles, a licensed 6 dealer must also be contractually authorized by a motor 7 vehicle manufacturer or distributor to sell the specific 8 make of vehicle. A motor vehicle manufacturer or importer 9 is prohibited from directly or indirectly being licensed as, 10 owning an interest in, operating, or controlling a motor 11 vehicle dealer. There are limited exceptions provided, 12 including temporarily to facilitate transfer of the motor 13 vehicle dealership to a new owner; for the purpose of enhancing 14 opportunities for persons who lack the financial resources 15 to purchase the dealership without such assistance; where 16 the dealer’s primary business is renting motor vehicles; for 17 dealers of motor homes manufactured by that manufacturer; for 18 dealers of the line-make manufactured by that manufacturer 19 under certain circumstances; and for final-stage manufacturers 20 of multi-stage manufactured vehicles under certain 21 circumstances. 22 This bill provides an additional exception that authorizes a 23 manufacturer of battery electric motor vehicles (manufacturer) 24 to be licensed as a motor vehicle dealer of only battery 25 electric motor vehicles manufactured by that manufacturer. A 26 manufacturer licensed as a motor vehicle dealer in accordance 27 with the bill is authorized to own, operate, or control 28 not more than five motor vehicle dealerships; own, operate, 29 control, or contract with an entity that provides financing, 30 leasing, service, or maintenance for vehicles manufactured 31 by the manufacturer; and provide service or maintenance for 32 vehicles manufactured by the manufacturer. 33 For purposes of the bill, “battery electric motor vehicle” 34 means a motor vehicle equipped with electrical drivetrain 35 -2- LSB 5575XC (4) 91 th/ns 2/ 3

S.F. _____ components and not equipped with an internal combustion engine, 1 that is propelled exclusively by one or more electrical motors 2 using electrical energy stored in a battery or other energy 3 storage device that can be recharged by plugging into an 4 electrical outlet or electric vehicle charging station. 5 The exception under the bill does not apply if the 6 manufacturer or a common entity of the manufacturer, as defined 7 by the bill, previously entered into or offered a franchise 8 agreement with a licensed motor vehicle dealer in this state 9 for the sale of new motor vehicles. 10 A person who engages in the business of selling motor 11 vehicles and who was not issued a dealer license by the DOT 12 commits a simple misdemeanor punishable by a fine of not less 13 than $250 nor more than $1,500 or by imprisonment not to exceed 14 30 days. A person who sells at retail more than six motor 15 vehicles during a 12-month period is presumed to be engaged in 16 the business of selling motor vehicles. 17 -3- LSB 5575XC (4) 91 th/ns 3/ 3