Bill Text: NY S05380 | 2017-2018 | General Assembly | Amended
Bill Title: Relates to requiring automobile brokers to be licensed and bonded.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2017-06-21 - SUBSTITUTED BY A6884B [S05380 Detail]
Download: New_York-2017-S05380-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 5380--B Cal. No. 1056 2017-2018 Regular Sessions IN SENATE March 23, 2017 ___________ Introduced by Sen. GOLDEN -- read twice and ordered printed, and when printed to be committed to the Committee on Consumer Protection -- reported favorably from said committee and committed to the Committee on Finance -- reported favorably from said committee, ordered to first and second report, ordered to a third reading, amended and ordered reprinted, retaining its place in the order of third reading -- again amended and ordered reprinted, retaining its place in the order of third reading AN ACT to amend the general business law and the vehicle and traffic law, in relation to requiring automobile brokers to be licensed The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subdivision 1 of section 736 of the general business law, 2 as added by chapter 616 of the laws of 1988, is amended to read as 3 follows: 4 1. "Automobile broker business" means any person who, for a fee, 5 commission or other valuable consideration, regardless of whether such 6 fee, commission, or consideration is paid directly by a consumer, offers 7 to provide, provides, or represents that he or she will provide a 8 service of purchasing, arranging, assisting, facilitating or effecting 9 the purchase or lease of an automobile as agent, broker, or intermediary 10 for a consumer. "Automobile broker business" does not include any person 11 registered as a dealer pursuant to article sixteen of the vehicle and 12 traffic law, or any person who sells, offers for sale or lease or acts 13 as agent, broker or intermediary in effecting the purchase or lease of 14 three or [less] fewer automobiles in any calendar year, or any motor 15 vehicle franchisor, manufacturer, or distributor registered under arti- 16 cle sixteen of the vehicle and traffic law who sells or leases new motor 17 vehicles to employees, immediate family members of employees, retirees, 18 or immediate family members of retirees as authorized by paragraph (y) EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD10395-07-7S. 5380--B 2 1 of subdivision two of section four hundred sixty-three of the vehicle 2 and traffic law. 3 § 2. The general business law is amended by adding a new section 736-a 4 to read as follows: 5 § 736-a. Registration required. 1. No person shall engage in business 6 as an automobile broker business, as defined in section seven hundred 7 thirty-six of this article, without first having been issued a certif- 8 icate of registration for an automobile broker business pursuant to 9 paragraph c of subdivision seven of section four hundred fifteen of the 10 vehicle and traffic law. 11 2. A certificate of registration for an automobile broker business 12 shall not permit the registrant to display for sale or lease any new or 13 used motor vehicles without registration as a dealer under section four 14 hundred fifteen of the vehicle and traffic law. 15 § 3. Paragraphs (e), (f) and (g) of subdivision 1 and subdivision 3 of 16 section 738 of the general business law, as added by chapter 616 of the 17 laws of 1988, paragraph (e) of subdivision 1 as amended by chapter 579 18 of the laws of 2011, are amended to read as follows: 19 (e) A description of any other services and an itemization of the 20 charges for each. Such description shall include disclosure of the auto- 21 mobile dealer from which the automobile was purchased or leased, as well 22 as all fees, commissions or other valuable considerations paid by an 23 automobile dealer to the automobile broker business for [selling,] 24 arranging, assisting or effecting the sale or lease of an automobile as 25 agent, broker, or intermediary between the consumer and the automobile 26 dealer. 27 (f) If a consumer elects to cancel the contract pursuant to paragraph 28 (b) or (c) of this subdivision, he or she shall notify in writing the 29 automobile broker business at the address specified in the contract. The 30 automobile broker business shall make a full refund to the consumer 31 within ten business days following receipt of the request for a refund. 32 The contract shall contain a statement, setting forth the consumer's 33 right to cancel the contract under paragraphs (b) and (c) of this subdi- 34 vision and the refund obligations of the automobile broker business. 35 (g) The statements required by paragraphs (a), (b), (c), and (f) of 36 this subdivision shall be printed in at least ten point bold type. 37 3. An automobile broker business shall deliver to the consumer or mail 38 to him or her at the address shown on the contract, an executed copy 39 thereof. 40 § 4. Subdivision 1 of section 740-a of the general business law, as 41 added by chapter 579 of the laws of 2011, is amended to read as follows: 42 1. Automobile broker businesses shall obtain and continue in effect a 43 surety bond in an amount of [seventy-five] one hundred thousand dollars 44 executed by a surety company authorized to transact business in the 45 state by the [insurance] department of financial services of the state 46 or its successor. The bonds shall be approved as to form by the secre- 47 tary of state and shall be conditioned on the automobile broker busi- 48 ness' payment of all valid bank drafts, including checks, drawn for the 49 purchase of motor vehicles and safekeeping of all customer deposits 50 related to the sale of a motor vehicle between the time of receipt of 51 such customer deposit and the transfer of good title to the vehicle to 52 the customer. 53 § 5. Section 741-a of the general business law, as added by chapter 54 579 of the laws of 2011, is amended to read as follows: 55 § 741-a. Advertising. Automobile broker businesses shall clearly and 56 conspicuously disclose the following in all advertisements in any medi-S. 5380--B 3 1 um, and in any print advertisement such disclosures shall not appear in 2 any footnotes and shall be situated in the top half of any such adver- 3 tisement in an easily readable typeface: 4 (a) That the automobile broker business is not a [licensed] registered 5 new motor vehicle dealer but is a registered automobile broker business 6 as defined in section four hundred fifteen of the vehicle and traffic 7 law; 8 (b) The registration number issued to the automobile broker business 9 pursuant to section four hundred fifteen of the vehicle and traffic law; 10 (c) Whether any fees may be imposed by the automobile broker business 11 for services rendered. Details of such compensation shall be provided by 12 the automobile broker business upon request by the consumer; and 13 [(c)] (d) That no warranty repair services will be provided by the 14 automobile broker business. 15 § 6. Subdivision 1 of section 415 of the vehicle and traffic law is 16 amended by adding a new paragraph m to read as follows: 17 m. "Automobile broker business" shall have the meaning set forth in 18 subdivision one of section seven hundred thirty-six of the general busi- 19 ness law. 20 § 7. Section 415 of the vehicle and traffic law is amended by adding a 21 new subdivision 3-a to read as follows: 22 3-a. Automobile broker business registration. No person shall engage 23 in the automobile broker business or represent or advertise that he or 24 she is engaged or intends to engage in the automobile broker business in 25 this state, unless there shall have been issued to him or her a certif- 26 icate of registration as an automobile broker business by the commis- 27 sioner under this section pursuant to an application for registration 28 submitted pursuant to subdivision five of this section. 29 § 8. Subdivision 5 of section 415 of the vehicle and traffic law is 30 amended by adding a new paragraph b-3 to read as follows: 31 b-3. In the case of an application for registration as an automobile 32 broker business, the name and address of the surety company which will 33 issue the bond required by subdivision one of section seven hundred 34 forty-a of the general business law. If the bond is to be issued by an 35 authorized agent of the surety company licensed by the state, then the 36 name and address of that agent may be provided in lieu of the informa- 37 tion concerning the surety company. 38 § 9. Paragraph d of subdivision 9 of section 415 of the vehicle and 39 traffic law, as amended by chapter 254 of the laws of 2010, is amended 40 to read as follows: 41 d. Has failed to comply with any of the rules and regulations of the 42 commissioner for the enforcement of this article or with any provision 43 of this chapter or article thirty-five-B of the general business law 44 applicable thereto; or 45 § 10. This act shall take effect on the one hundred eightieth day 46 after it shall have become a law; provided, however, that the commis- 47 sioner of the department of motor vehicles shall take actions necessary 48 to provide for the issuance of registration certificates pursuant to 49 section 415 of the vehicle and traffic law, as amended by sections six, 50 seven, eight and nine of this act, prior to such date.
