Connecticut 2021 Regular Session

Connecticut Senate Bill SB00127 Compare Versions

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Version 2 (New)

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7	6		General Assembly Committee Bill No. 127
8	7		January Session, 2021
9	8		LCO No. 5774
10	9
11	10
12	11		Referred to Committee on TRANSPORTATION
13	12
14	13
15	14		Introduced by:
16	15		(TRA)
17	16
18	17
19	18
20	19		AN ACT CONCERNING TH E SALE OF ELECTRIC VEHICLES IN THE
21	20		STATE.
22	21		Be it enacted by the Senate and House of Representatives in General
23	22		Assembly convened:
24	23
25	24		Section 1. Section 14-52b of the general statutes is repealed and the 1
26	25		following is substituted in lieu thereof (Effective October 1, 2021): 2
27	26		(a) In the event a manufacturer licensed in accordance with the 3
28	27		provisions of section 14-67a, as amended by this act, cancels, terminates 4
29	28		or fails to renew any franchise, as defined in section 42-133r, as amended 5
30	29		by this act, with a new car dealer, as defined in section 14-51, as 6
31	30		amended by this act, the Commissioner of Motor Vehicles, upon receipt 7
32	31		of written notice of such action by the manufacturer, shall, unless the 8
33	32		dealer holds one or more additional franchises, demand that such new 9
34	33		car dealer surrender such license to the commissioner. If such action is 10
35	34		contested by such dealer in accordance with the provisions of sections 11
36	35		42-133r to 42-133ee, inclusive, as amended by this act, the commissioner 12
37	36		shall not demand surrender of such license, and no replacement motor 13
38	37		vehicle dealer shall be named for the dealer's point or location, except in 14
39		-	accordance with subdivision (10) of section 42-133cc, until the 15 Committee Bill No. 127
	38	+	accordance with subdivision (10) of section 42-133cc, until the 15
	39	+	proceedings to contest such action by the manufacturer are finally 16
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46		-	proceedings to contest such action by the manufacturer are finally 16
47	42		determined after all means of administrative, judicial and appellate 17
48	43		review have been exhausted and the decision is adverse to the dealer. 18
49	44		(b) Except as provided in subsections (c) [and (d)] to (e), inclusive, of 19
50	45		this section, no person, firm or corporation licensed as a manufacturer 20
51	46		in accordance with the provisions of section 14-67a, as amended by this 21
52	47		act, may be the holder of a new or used car dealer's license issued in 22
53	48		accordance with the provisions of section 14-52, except a manufacturer 23
54	49		may operate as a dealer on a temporary basis in accordance with the 24
55	50		provisions of subdivision (8) of section 42-133cc. The provisions of this 25
56	51		subsection shall apply to any firm or corporation that is owned or 26
57	52		controlled by a manufacturer, as determined by the commissioner. Any 27
58	53		applicant for a new or used car dealer license that is denied a license 28
59	54		under the provisions of this subsection shall be entitled to a hearing in 29
60	55		accordance with the provisions of chapter 54. 30
61	56		(c) [Notwithstanding the provisions of subsection (b) of this section, 31
62	57		the] The commissioner may issue a used car dealer's license to a person, 32
63	58		firm or corporation, owned or controlled by a manufacturer, engaged 33
64	59		primarily in the business of rental of motor vehicles and industrial and 34
65	60		construction equipment, provided: (1) Motor vehicles offered for sale by 35
66	61		any such person, firm or corporation are limited to motor vehicles that 36
67	62		have been previously used exclusively and regularly in the conduct of 37
68	63		the business or motor vehicles traded in by purchasers of such 38
69	64		previously used motor vehicles, (2) any warranty repairs performed by 39
70	65		such person, firm or corporation are limited to motor vehicles that such 40
71	66		person, firm or corporation owns, has previously owned, or has taken 41
72	67		in trade, and (3) any retail financing provided or arranged by such 42
73	68		person, firm or corporation is limited to vehicles sold by such person, 43
74	69		firm or corporation. 44
75	70		(d) The commissioner may extend the period of a license issued to a 45
76	71		manufacturer to operate a dealership on a temporary basis, in 46
77	72		accordance with the provisions of subsection (b) of this section and 47
78		-	subdivision (8) of section 42-133cc, for not more than one additional 48 Committee Bill No. 127
	73	+	subdivision (8) of section 42-133cc, for not more than one additional 48
	74	+	year, up to a maximum period of two years, if the commissioner is 49
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85		-	year, up to a maximum period of two years, if the commissioner is 49
86	77		satisfied that such manufacturer has made and is continuing to make 50
87	78		bona fide efforts to sell and transfer the dealership to a person, firm or 51
88	79		corporation that is qualified to hold a new or used dealer's license. 52
89	80		(e) (1) For the purposes of this subsection, "manufacturer" means a 53
90	81		person, firm or corporation licensed as a manufacturer in accordance 54
91	82		with the provisions of section 14-67a, as amended by this act, and any 55
92	83		subsidiary, affiliate or entity owned or controlled by such manufacturer. 56
93	84		(2) The commissioner may issue a new or used car dealer's license to 57
94	85		a manufacturer, provided such manufacturer: (A) Does not have a 58
95	86		franchise agreement with any new car dealer in the state; (B) 59
96	87		manufactures only electric vehicles; (C) sells at retail only motor vehicles 60
97	88		manufactured by such manufacturer; (D) does not hold a controlling 61
98	89		interest in another manufacturer, or a subsidiary, affiliate or entity 62
99	90		owned or controlled by such other manufacturer, that is licensed as a 63
100	91		dealer under this subsection; and (E) is not owned or controlled by 64
101	92		another manufacturer, or a subsidiary, affiliate or entity owned or 65
102	93		controlled by such other manufacturer, that is licensed as a dealer under 66
103	94		this subsection. 67
104	95		Sec. 2. Subdivisions (1) and (2) of subsection (a) of section 14-51 of the 68
105	96		general statutes are repealed and the following is substituted in lieu 69
106	97		thereof (Effective October 1, 2021): 70
107	98		(1) "New car dealer" includes (A) any person, firm or corporation 71
108	99		engaged in the business of merchandising new motor vehicles under a 72
109	100		manufacturer's or importer's contract for each such make of vehicle, 73
110	101		[who] and (B) any person, firm or corporation licensed as a 74
111	102		manufacturer, as defined in subsection (e) of section 14-52b, as amended 75
112	103		by this act, that is engaged in the business of merchandising new motor 76
113	104		vehicles and licensed as a new car dealer as provided in said subsection. 77
114	105		Such person, firm or corporation may, incidental to such business, sell 78
115	106		used motor vehicles and repair motor vehicles, [. Such person] and shall 79
116		-	be qualified to conduct such business in accordance with the 80 Committee Bill No. 127
	107	+	be qualified to conduct such business in accordance with the 80
	108	+	requirements of section 14-52a. 81
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123		-	requirements of section 14-52a. 81
124	111		(2) "Used car dealer" includes (A) any person, firm or corporation 82
125	112		engaged in the business of merchandising motor vehicles other than 83
126	113		new, [who] and (B) any person, firm or corporation licensed as a 84
127	114		manufacturer, as defined in subsection (e) of section 14-52b, as amended 85
128	115		by this act, that is engaged in the business of merchandising motor 86
129	116		vehicles other than new and licensed as a used car dealer as provided in 87
130	117		said subsection. Such person, firm or corporation may, incidental to 88
131	118		such business, repair motor vehicles. A used car dealer does not include 89
132	119		any person, firm or corporation engaged in the business of leasing or 90
133	120		renting motor vehicles that offers for sale or sells used motor vehicles 91
134	121		incidental to its primary business, if [(A)] such person, firm or 92
135	122		corporation is licensed in accordance with the provisions of section 14-93
136	123		15, and [(B)] the motor vehicles that it offers for sale were formerly the 94
137	124		subject of one or more lease agreements to which it was a party and the 95
138	125		actual or prospective purchaser is the original lessee pursuant to a 96
139	126		purchase option specified in a lease agreement. Such person, firm or 97
140	127		corporation shall be qualified to conduct such business in accordance 98
141	128		with the requirements of section 14-52a. 99
142	129		Sec. 3. Section 14-67a of the general statutes is repealed and the 100
143	130		following is substituted in lieu thereof (Effective October 1, 2021): 101
144	131		(a) No person, firm or corporation shall engage in the business of 102
145	132		manufacturing motor vehicles for sale in this state without having been 103
146	133		issued a manufacturer's license, which license shall expire biennially on 104
147	134		the last day of June. Application for such license or renewal thereof may 105
148	135		be made to the Commissioner of Motor Vehicles in such form as the 106
149	136		commissioner shall require. The commissioner may require with such 107
150	137		application all of the following, which [he] the commissioner may 108
151	138		consider in determining the fitness of such applicant to engage in 109
152	139		business as a manufacturer of motor vehicles for sale in this state: 110
153	140		(1) Information relating to the applicant's solvency and [his] financial 111
154		-	standing; 112 Committee Bill No. 127
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	141	+	standing; 112
161	142		(2) A certified copy of any warranty made by the manufacturer or any 113
162	143		other party in whom title to such motor vehicle may have been vested 114
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163	146		prior to possession of such motor vehicle being transferred to a person 115
164	147		licensed under the provisions of this section; 116
165	148		(3) A copy of the applicant's standard franchise agreement and all 117
166	149		supplements thereto, together with a list of the applicant's authorized 118
167	150		dealers or distributors in this state and their [address] addresses. Such 119
168	151		applicant shall notify the commissioner immediately of the 120
169	152		appointment of any additional dealers or distributors or any revisions 121
170	153		of or additions to the basic franchise agreement on file with [him] the 122
171	154		commissioner, or of any individual dealer or distributor supplements to 123
172	155		such agreement. The provisions of this subdivision shall not apply to 124
173	156		any manufacturer licensed as a new or used car dealer pursuant to 125
174	157		subsection (e) of section 14-52b, as amended by this act; 126
175	158		(4) A certified copy of the delivery and preparation obligations of the 127
176	159		applicant's new car dealers, which obligations shall constitute such new 128
177	160		car dealers' only responsibility for product liability between the dealer 129
178	161		and the manufacturer; 130
179	162		(5) An affidavit stating the rates such applicant pays or agrees to pay 131
180	163		any authorized new car dealer for parts and labor used and expended 132
181	164		by such authorized new car dealer for the manufacturer under delivery 133
182	165		and preparation obligations under the new car warranty; 134
183	166		(6) A biennial license fee of two thousand three hundred dollars, 135
184	167		which fee shall not be subject to refund or proration; and 136
185	168		(7) Any other pertinent matter commensurate with the safeguarding 137
186	169		of the public interest. 138
187	170		(b) An application for renewal of such license filed with the 139
188	171		commissioner after the expiration date of such license shall be 140
189	172		accompanied by a late fee of two hundred fifty dollars. The 141
190	173		commissioner shall not renew any license under this section which has 142
191		-	expired for more than forty-five days. 143 Committee Bill No. 127
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	174	+	expired for more than forty-five days. 143
198	175		Sec. 4. Section 42-133r of the general statutes is repealed and the 144
199	176		following is substituted in lieu thereof (Effective October 1, 2021): 145
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200	179		As used in [sections 42-133r] this section and sections 42-133s to 42-146
201	180		133ee, inclusive, unless the context indicates a different meaning: 147
202	181		(1) "Manufacturer" means any person who manufactures or 148
203	182		assembles new motor vehicles, or imports motor vehicles for 149
204	183		distribution to dealers or through distributors, or factory branches, but 150
205	184		does not include any manufacturer licensed as a new or used car dealer 151
206	185		pursuant to subsection (e) of section 14-52b, as amended by this act. 152
207	186		(2) "Distributor" means any person who offers for sale, sells or 153
208	187		distributes any new motor vehicle to dealers or who maintains factory 154
209	188		representatives or who controls any person, firm, association, joint 155
210	189		venture corporation or trust, who offers for sale, sells or distributes any 156
211	190		new motor vehicle to dealers. 157
212	191		(3) "Factory branch" means a branch office maintained by a 158
213	192		manufacturer for the purpose of selling, or offering for sale, motor 159
214	193		vehicles to a distributor or dealer, or for directing or supervising factory 160
215	194		or distributor representatives. 161
216	195		(4) "Owner" means any person holding an ownership interest in a 162
217	196		business entity operating as a dealer or under a franchise as defined in 163
218	197		this section either as a corporation, partnership or sole proprietorship. 164
219	198		To the extent that the rights of any owner under [sections 42-133r] this 165
220	199		section and sections 42-133s to 42-133ee, inclusive, conflict with the 166
221	200		rights of any other owner, such rights shall accrue in priority order 167
222	201		based on the percentage of ownership interest held by each owner with 168
223	202		the owner having the greatest ownership interest having first priority 169
224	203		and succeeding priority accruing to other owners in the descending 170
225	204		order of their percentage of ownership interest. 171
226	205		(5) "Dealership facilities" means real estate, buildings, fixtures and 172
227	206		improvements which are used in the course of business under a 173
228		-	franchise by a new motor vehicle dealer. 174 Committee Bill No. 127
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	207	+	franchise by a new motor vehicle dealer. 174
235	208		(6) "Dealer" means any person engaged in the business of selling, 175
236	209		offering to sell, soliciting or advertising the sale of new motor vehicles 176
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237	212		and who holds a valid sales and service agreement, franchise or 177
238	213		contract, granted by a manufacturer or distributor for the retail sale of 178
239	214		the manufacturer's or distributor's new motor vehicles. 179
240	215		(7) "Motor vehicle" means a self-propelled vehicle intended primarily 180
241	216		for use and operation on the public highways, other than a farm tractor 181
242	217		or other machinery or tools used in the production, harvesting and care 182
243	218		of farm products. 183
244	219		(8) "New motor vehicle" means a motor vehicle which has been sold 184
245	220		to a new motor vehicle dealer and which has not been used for other 185
246	221		than demonstration purposes and on which the original title has not 186
247	222		been issued from the new motor vehicle dealer. 187
248	223		(9) "Established place of business" means a permanent, commercial 188
249	224		building easily accessible and open to the public at reasonable times and 189
250	225		at which the business of a new motor vehicle dealer, including the 190
251	226		display and repair of vehicles, may be lawfully carried on. 191
252	227		(10) "Franchise" means a written agreement or contract between a 192
253	228		manufacturer or distributor and a dealer which purports to fix the legal 193
254	229		rights and liabilities of the parties to such agreement or contract, and 194
255	230		pursuant to which the dealer purchases and resells the franchise 195
256	231		product or leases or rents the dealership premises. 196
257	232		(11) "Good faith" means honesty in fact and the observance of 197
258	233		reasonable commercial standards of fair dealing in the trade. 198
259	234		(12) "Designated family member" means the spouse, child, 199
260	235		grandchild, parent, brother or sister of an owner who, in the case of the 200
261	236		owner's death, is entitled to inherit the ownership interest in the dealer 201
262	237		under the terms of the owner's will, or who has been nominated in any 202
263	238		other written instrument, or who, in the case of an incapacitated owner 203
264	239		of a dealer, has been appointed by a court as the legal representative of 204
265		-	the dealer's property. 205 Committee Bill No. 127
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	240	+	the dealer's property. 205
272	241		(13) "Person" means a natural person, partnership, corporation, 206
273	242		limited liability company, association, trust, estate or any other legal 207
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274	245		entity. 208
275	246		(14) "Relevant market area" means the area within a radius of 209
276	247		fourteen miles around an existing dealer or the area of responsibility 210
277	248		defined in a franchise, whichever is greater. 211
278	249		(15) "Commissioner" means the Commissioner of Motor Vehicles. 212
279	250		This act shall take effect as follows and shall amend the following
280	251		sections:
281	252
282	253		Section 1 October 1, 2021 14-52b
283	254		Sec. 2 October 1, 2021 14-51(a)(1) and (2)
284	255		Sec. 3 October 1, 2021 14-67a
285	256		Sec. 4 October 1, 2021 42-133r
286	257
287		-	TRA Joint Favorable
	258	+	Statement of Purpose:
	259	+	To permit electric vehicle manufacturers to sell electric vehicles directly
	260	+	to the consumer.
	261	+	[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
	262	+	that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
	263	+	underlined.]
	264	+
	265	+	Co-Sponsors: SEN. HASKELL, 26th Dist.; REP. STEINBERG, 136th Dist.
	266	+	REP. WOOD, 29th Dist.; REP. MICHEL, 146th Dist.
	267	+	REP. WOOD, 141st Dist.; REP. ROSARIO, 128th Dist.
	268	+	REP. ELLIOTT, 88th Dist.
	269	+
	270	+	S.B. 127
	271	+
288	272