Bill Text: FL S0712 | 2023 | Regular Session | Comm Sub
Bill Title: Motor Vehicle Sales
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2023-05-02 - Laid on Table, companion bill(s) passed, see CS/CS/HB 637 (Ch. 2023-233) [S0712 Detail]
Download: Florida-2023-S0712-Comm_Sub.html
Florida Senate - 2023 CS for CS for CS for SB 712
By the Committees on Rules; Commerce and Tourism; and
Transportation; and Senators Avila and Garcia
595-04202-23 2023712c3
1 A bill to be entitled
2 An act relating to motor vehicle sales; amending s.
3 320.60, F.S.; revising and providing definitions;
4 amending s. 320.605, F.S.; revising legislative
5 intent; amending s. 320.64, F.S.; prohibiting an
6 applicant or a licensee from certain actions in the
7 allocation or distribution of motor vehicles to
8 franchised motor vehicle dealers; revising the
9 definition of the term “unfair”; prohibiting
10 applicants and licensees from engaging in certain
11 activities; authorizing an applicant or a licensee, or
12 a common entity thereof, to sell or activate certain
13 motor vehicle features or improvements through remote
14 electronic transmission; providing for a payment of
15 the percentage of such sale or activation to a motor
16 vehicle dealer within a certain timeframe; providing
17 applicability; amending s. 320.642, F.S.; conforming
18 cross-references; amending s. 320.645, F.S.; revising
19 provisions prohibiting specified entities from owning,
20 operating, or controlling a motor vehicle dealership
21 in this state; specifying when certain licenses may be
22 and are prohibited from being issued; revising
23 exceptions to certain prohibitions on licensees;
24 providing applicability; making technical changes;
25 deleting the definition of the term “independent
26 person”; conforming cross-references; prohibiting a
27 distributor or affiliate thereof from receiving a
28 certain license under certain circumstances; amending
29 s. 320.67, F.S.; requiring the Department of Highway
30 Safety and Motor Vehicles to conduct an inquiry
31 relating to certain written complaints; providing
32 purposes of the department’s use of a subpoena;
33 requiring the department to commence the inquiry
34 within a certain timeframe; authorizing the department
35 to allow a written response to the complaint;
36 requiring the department to provide a certain written
37 response to the complainant within a certain date;
38 requiring the department to take certain action if the
39 department determines that a licensee violated certain
40 statutes; providing construction; amending ss. 681.102
41 and 681.113, F.S.; conforming cross-references;
42 providing an effective date.
43
44 Be It Enacted by the Legislature of the State of Florida:
45
46 Section 1. Present subsections (8), (9), (10), (11), (12),
47 (13), (14), (15), and (16) of section 320.60, Florida Statutes,
48 are redesignated as subsections (9), (11), (12), (13), (15),
49 (18), (10), (16), and (17), respectively, new subsections (8)
50 and (14) are added to that section, and subsection (2) and
51 present subsection (15) of that section are amended, to read:
52 320.60 Definitions for ss. 320.61-320.70.—Whenever used in
53 ss. 320.61-320.70, unless the context otherwise requires, the
54 following words and terms have the following meanings:
55 (2) “Common entity” means a person:
56 (a) Who is directly or indirectly either controlled by or
57 has more than 30 percent of its equity interest directly or
58 indirectly owned, beneficially or of record, through any form of
59 ownership structure, by a manufacturer, an importer, a
60 distributor, or a licensee, or an affiliate thereof; or
61 (b) Who has more than 30 percent of its equity interest
62 directly or indirectly controlled or owned, beneficially or of
63 record, through any form of ownership structure, by one or more
64 persons who also directly or indirectly control or own,
65 beneficially or of record, more than 30 40 percent of the voting
66 equity interests of a manufacturer, an importer, a distributor,
67 or a licensee, or an affiliate thereof; or
68 (b) Who shares directors or officers or partners with a
69 manufacturer.
70 (c) Notwithstanding paragraphs (a) and (b), an entity that
71 would otherwise be considered a common entity of a distributor
72 under paragraph (a) or paragraph (b) because of its relation to
73 a distributor is not considered a common entity of that
74 distributor if:
75 1. The distributor that the entity is related to was a
76 licensed distributor on March 1, 2023;
77 2. The entity is not a common entity of a manufacturer or
78 importer; and
79 3. The distributor that the entity is related to is not,
80 and has never been, a common entity of a manufacturer or
81 importer.
82 (8) “Independent person” means a person who is not an
83 agent, a parent, a subsidiary, a common entity, an officer, a
84 director, or an employed representative of a licensee,
85 manufacturer, importer, or distributor.
86 (14) “Motor vehicle dealer association” means a not-for
87 profit entity organized under the laws of this state and
88 qualified as tax-exempt under s. 501(c)(6) of the Internal
89 Revenue Code which acts as a trade association that primarily
90 represents the interests of franchised motor vehicle dealers and
91 has a membership of at least 500 franchised motor vehicle
92 dealers as defined in s. 320.27(1)(c)1.
93 (16)(15) “Sell,” “selling,” “sold,” “exchange,” “retail
94 sales,” and “leases” includes:
95 (a) Accepting a deposit or receiving a payment for the
96 retail purchase, lease, or other use of a motor vehicle, but
97 does not include facilitating a motor vehicle dealer’s
98 acceptance of a deposit or receipt of a payment from a consumer,
99 and does not include receiving payment under a retail
100 installment sale contract;
101 (b) Accepting a reservation from a retail consumer for a
102 specific motor vehicle identified by a vehicle identification
103 number or other product identifier;
104 (c) Setting the retail price for the purchase, lease, or
105 other use of a motor vehicle, but does not include setting a
106 manufacturer’s suggested retail price;
107 (d) Offering or negotiating with a retail consumer terms
108 for the purchase, lease, or other use of a motor vehicle;
109 (e) Offering or negotiating with a retail consumer a value
110 for a motor vehicle being traded in as part of the purchase,
111 lease, or other use of a motor vehicle, but does not include a
112 website or other means of electronic communication that
113 identifies to a consumer a conditional trade-in value and that
114 contains language informing the consumer that the trade-in value
115 is not binding on any motor vehicle dealer;
116 (f) Any transaction where the title of a motor vehicle or a
117 used motor vehicle is transferred to a retail consumer; or, and
118 also
119 (g) Any retail lease transaction where a retail consumer
120 customer leases a vehicle for a period of at least 12 months,
121 but does not include administering lease agreements, taking
122 assignments of leases, performing required actions pursuant to
123 such leases, or receiving payments under a lease agreement that
124 was originated by a motor vehicle dealer. Establishing a price
125 for sale pursuant to s. 320.64(24) does not constitute a sale or
126 lease.
127 Section 2. Section 320.605, Florida Statutes, is amended to
128 read:
129 320.605 Legislative intent.—It is the intent of the
130 Legislature to protect the public health, safety, and welfare of
131 the citizens of the state by regulating the licensing of motor
132 vehicle dealers and manufacturers, maintaining competition,
133 providing consumer protection and fair trade and providing
134 minorities with opportunities for full participation as motor
135 vehicle dealers. Sections 320.61-320.70 are intended to apply
136 solely to the licensing of manufacturers, factory branches,
137 distributors, and importers and do not apply to non-motor
138 vehicle-related businesses.
139 Section 3. Subsections (18), (23), and (24) of section
140 320.64, Florida Statutes, are amended to read:
141 320.64 Denial, suspension, or revocation of license;
142 grounds.—A license of a licensee under s. 320.61 may be denied,
143 suspended, or revoked within the entire state or at any specific
144 location or locations within the state at which the applicant or
145 licensee engages or proposes to engage in business, upon proof
146 that the section was violated with sufficient frequency to
147 establish a pattern of wrongdoing, and a licensee or applicant
148 shall be liable for claims and remedies provided in ss. 320.695
149 and 320.697 for any violation of any of the following
150 provisions. A licensee is prohibited from committing the
151 following acts:
152 (18) The applicant or licensee has established a system of
153 motor vehicle allocation or distribution or has implemented a
154 system of allocation or distribution of motor vehicles to one or
155 more of its franchised motor vehicle dealers which:
156 (a) Reduces or alters allocations or supplies of new motor
157 vehicles to the dealer to achieve, directly or indirectly, a
158 purpose that is prohibited by ss. 320.60-320.70;
159 (b) Conditionally or unconditionally reserves a specific
160 motor vehicle identified by vehicle identification number or
161 other unique identifier for a specifically named person, except
162 for purposes of replacing a consumer’s vehicle pursuant to
163 chapter 681;
164 (c) Requires or incentivizes motor vehicle dealers to sell
165 or lease, or to negotiate the sale or lease of, a specific motor
166 vehicle identified by vehicle identification number or other
167 unique identifier to a specifically named person;
168 (d) Requires or incentivizes motor vehicle dealers to sell
169 or lease a motor vehicle at a specified price or profit margin
170 or restricts the price at which a motor vehicle dealer may sell
171 or lease a motor vehicle; or
172 (e) Is, or which otherwise is unfair, inequitable,
173 unreasonably discriminatory, or not supportable by reason and
174 good cause after considering the equities of the affected motor
175 vehicles dealer or dealers. As used in this paragraph, the term
176 “unfair” includes, but is not limited to, refusing or failing to
177 offer to any dealer an equitable supply of new vehicles under
178 its franchise, by model, mix, or color, as the licensee offers
179 or allocates to its other same line-make dealers in this state
180 or using the number of motor vehicles preordered or reserved by
181 consumers as a factor in determining the allocation of motor
182 vehicles to motor vehicle dealers.
183
184 An applicant or licensee shall maintain for 3 years records that
185 describe its methods or formula of allocation and distribution
186 of its motor vehicles and records of its actual allocation and
187 distribution of motor vehicles to its motor vehicle dealers in
188 this state. As used in this subsection, “unfair” includes,
189 without limitation, the refusal or failure to offer to any
190 dealer an equitable supply of new vehicles under its franchise,
191 by model, mix, or colors as the licensee offers or allocates to
192 its other same line-make dealers in the state.
193 (23) The applicant or licensee has engaged in any of the
194 activities of a motor vehicle dealer as defined in s.
195 320.60(13)(a) or any activities described in s. 320.60(16) or
196 has competed or is competing with respect to any activity
197 covered by the franchise agreement with a motor vehicle dealer
198 of the same line-make located in this state with whom the
199 applicant or licensee has entered into a franchise agreement,
200 except as permitted in s. 320.645 or in subsection (24) with
201 respect to the remote electronic transmission of a permanent or
202 temporary feature or improvement of a motor vehicle.
203 (24) The applicant or licensee, or common entity thereof,
204 has sold or leased a motor vehicle to any retail consumer in
205 this state, or has sold or activated for a fee to any retail
206 consumer in the state any permanent or temporary motor vehicle
207 feature or improvement that functions through hardware or
208 components installed on the motor vehicle, except through a
209 motor vehicle dealer properly licensed pursuant to s. 320.27 and
210 holding a franchise agreement for the line-make that includes
211 the motor vehicle. Notwithstanding this subsection, an applicant
212 or a licensee, or a common entity thereof, may sell or activate
213 for a fee a permanent or temporary motor vehicle feature or
214 improvement to a retail consumer in this state only if the
215 feature or improvement is provided directly to the motor vehicle
216 through remote electronic transmission, provided that if such
217 motor vehicle was sold or leased as new by a motor vehicle
218 dealer in this state within the 2-year period preceding such
219 remote electronic transmission, and the ownership of the vehicle
220 has not changed, the applicant or licensee must pay such motor
221 vehicle dealer a minimum of 8 percent of the payment received by
222 the applicant, licensee, or common entity from the sale of the
223 feature or improvement. As used in this subsection, the term
224 “feature or improvement” includes the activation or use of motor
225 vehicle components or hardware, but does not include services
226 that require the transmission of data or information to or from
227 the motor vehicle while the service is being used. Payments
228 required under this subsection must be made within 60 days after
229 the date of sale of the feature or improvement. This subsection
230 section does not apply to sales by the applicant or licensee of
231 motor vehicles to its current employees, employees of companies
232 affiliated by common ownership, charitable not-for-profit
233 organizations, and the Federal Government.
234
235 A motor vehicle dealer who can demonstrate that a violation of,
236 or failure to comply with, any of the preceding provisions by an
237 applicant or licensee will or may adversely and pecuniarily
238 affect the complaining dealer, shall be entitled to pursue all
239 of the remedies, procedures, and rights of recovery available
240 under ss. 320.695 and 320.697.
241 Section 4. Subsection (6) of section 320.642, Florida
242 Statutes, is amended to read:
243 320.642 Dealer licenses in areas previously served;
244 procedure.—
245 (6) When a proposed addition or relocation concerns a
246 dealership that performs or is to perform only service, as
247 defined in s. 320.60 s. 320.60(16), and will not or does not
248 sell or lease new motor vehicles, as defined in s. 320.60 s.
249 320.60(15), the proposal shall be subject to notice and protest
250 pursuant to the provisions of this section.
251 (a) Standing to protest the addition or relocation of a
252 service-only dealership shall be limited to those instances in
253 which the applicable mileage requirement established in
254 subparagraphs (3)(a)2. and (3)(b)1. is met.
255 (b) The addition or relocation of a service-only dealership
256 shall not be subject to protest if:
257 1. The applicant for the service-only dealership location
258 is an existing motor vehicle dealer of the same line-make as the
259 proposed additional or relocated service-only dealership;
260 2. There is no existing dealer of the same line-make closer
261 than the applicant to the proposed location of the additional or
262 relocated service-only dealership; and
263 3. The proposed location of the additional or relocated
264 service-only dealership is at least 7 miles from all existing
265 motor vehicle dealerships of the same line-make, other than
266 motor vehicle dealerships owned by the applicant.
267 (c) In determining whether existing franchised motor
268 vehicle dealers are providing adequate representations in the
269 community or territory for the line-make in question in a
270 protest of the proposed addition or relocation of a service-only
271 dealership, the department may consider the elements set forth
272 in paragraph (2)(b), provided:
273 1. With respect to subparagraph (2)(b)1., only the impact
274 as it relates to service may be considered;
275 2. Subparagraph (2)(b)3. shall not be considered;
276 3. With respect to subparagraph (2)(b)9., only service
277 facilities shall be considered; and
278 4. With respect to subparagraph (2)(b)11., only the volume
279 of service business transacted shall be considered.
280 (d) If an application for a service-only dealership is
281 granted, the department must shall issue a license which permits
282 only service, as defined in s. 320.60 s. 320.60(16), and does
283 not permit the selling or leasing of new motor vehicles, as
284 defined in s. 320.60 s. 320.60(15). If a service-only dealership
285 subsequently seeks to sell new motor vehicles at its location,
286 the notice and protest provisions of this section shall apply.
287 Section 5. Subsection (1), paragraph (a) of subsection (2),
288 and subsection (4) of section 320.645, Florida Statutes, are
289 amended to read:
290 320.645 Restriction upon ownership of dealership by
291 licensee.—
292 (1) A No licensee, manufacturer, importer, or distributor,
293 manufacturer, or agent of the licensee, a manufacturer,
294 importer, or distributor, or any parent, subsidiary, common
295 entity, or officer, or employed representative of the licensee,
296 manufacturer, importer, or distributor, may not directly or
297 indirectly shall own, or operate, or control, by contract,
298 agreement, or otherwise either directly or indirectly, a motor
299 vehicle dealership for any line-make in this state if the
300 licensee, manufacturer, importer, or distributor has
301 manufactured, imported, or distributed for the sale or service
302 of motor vehicles of any line-make which have been or are
303 offered for sale under a franchise agreement with a motor
304 vehicle dealer in this state with an independent person. Any
305 person who is not prohibited by this section from owning,
306 operating, or controlling a motor vehicle dealership may be
307 issued a license pursuant to s. 320.27. Any person prohibited by
308 this section from owning, operating, or controlling a motor
309 vehicle dealership. A licensee may not be issued a motor vehicle
310 dealer license pursuant to s. 320.27. However, a no such
311 licensee subject to the prohibition in this section is not will
312 be deemed to be in violation of this section:
313 (a) When operating a motor vehicle dealership for a
314 temporary period, not to exceed 1 year, during the transition
315 from one owner of the motor vehicle dealership to another;
316 (b) When operating a motor vehicle dealership temporarily
317 for a reasonable period for the exclusive purpose of broadening
318 the diversity of its dealer body and enhancing opportunities for
319 qualified persons who are part of a group that has historically
320 been underrepresented in its dealer body, or for other qualified
321 persons who the licensee deems lack the resources to purchase or
322 capitalize the dealership outright, in a bona fide relationship
323 with an independent person, other than a licensee or its agent
324 or affiliate, who has made a significant investment that is
325 subject to loss in the dealership within the dealership’s first
326 year of operation and who can reasonably expect to acquire full
327 ownership of the dealership on reasonable terms and conditions;
328 or
329 (c) If the department determines, after a hearing on the
330 matter, pursuant to chapter 120, at the request of any person,
331 that there is no independent person available in the community
332 or territory to own and operate the motor vehicle dealership in
333 a manner consistent with the public interest. This paragraph
334 applies only if the motor vehicle dealership at issue sells
335 motor vehicles of a line-make that, at the time of the hearing,
336 is offered for sale by at least one other existing motor vehicle
337 dealership not owned, operated, or controlled by the licensee,
338 an officer or employed representative of the licensee, a parent,
339 subsidiary, or common entity of the licensee, or a manufacturer,
340 importer, or distributor.
341
342 In the any such case of a, the licensee must continue to make
343 the motor vehicle dealership owned or operated pursuant to
344 paragraph (a), paragraph (b), or paragraph (c), the dealership
345 must be continually made available for sale to an independent
346 person at a fair and reasonable price. Approval of the sale of
347 such a motor vehicle dealership to a proposed motor vehicle
348 dealer shall not be unreasonably withheld.
349 (2) As used in this section, the term:
350 (a) “Independent person” is a person who is not an officer,
351 director, or employee of the licensee.
352 (4) Nothing in this chapter shall prohibit a distributor as
353 defined in s. 320.60 s. 320.60(5) or an affiliate thereof which
354 common entity that is not a manufacturer or importer, a division
355 of a manufacturer or importer, an entity that is controlled by a
356 manufacturer or importer, or a common entity of a manufacturer
357 or importer, and that is not owned, in whole or in part,
358 directly or indirectly, by a manufacturer or importer, as
359 defined in s. 320.60 s. 320.60(9), from receiving a license or
360 licenses as defined in s. 320.27 and owning and operating a
361 motor vehicle dealership or dealerships that sell or service
362 motor vehicles other than any line-make of motor vehicles
363 distributed by the distributor. A distributor or an affiliate
364 thereof may not receive a license pursuant to s. 320.27 for a
365 motor vehicle dealership, or own or operate a motor vehicle
366 dealership, that sells or services motor vehicles of the line
367 make of motor vehicles distributed by the distributor.
368 Section 6. Section 320.67, Florida Statutes, is amended to
369 read:
370 320.67 Inquiry and inspection of books or other documents
371 of licensee.—
372 (1) The department shall conduct an inquiry of a licensee
373 may inspect the pertinent books, records, letters, and contracts
374 of a licensee relating to any written complaint alleging a
375 violation of ss. 320.61-320.70 made to it against such licensee
376 made by a motor vehicle dealer with a current franchise
377 agreement issued by the licensee, or a motor vehicle dealer
378 association with at least one member with a current franchise
379 agreement issued by the licensee.
380 (2) In the exercise of its duties under this section, the
381 department is granted and authorized to exercise the power of
382 subpoena for the purposes of compelling production of and
383 inspecting pertinent books, records, letters, and contracts of a
384 licensee and compelling the attendance of witnesses at
385 deposition and the production of any documentary evidence
386 necessary to the disposition by it of any written complaint
387 under this section. The inquiry required by this section must be
388 commenced within 30 days after receipt of the written complaint.
389 The department may allow the licensee that is the subject of the
390 complaint no more than 60 days after commencement of the inquiry
391 to provide a written response. Within 30 days after the deadline
392 for a written response by the licensee, the department shall
393 provide a written response to the complainant stating whether
394 the department intends to take action against the licensee under
395 subsection (3) and, if so, what action the department intends to
396 take. Any information obtained may not be used against the
397 licensee as the basis for a criminal prosecution under the laws
398 of this state.
399 (3) If, as the result of an inquiry conducted under this
400 section, the department determines that a licensee has violated
401 ss. 320.61-320.70, the department must take appropriate action
402 against the licensee, which may include license suspension or
403 revocation; denial of a license renewal application; assessment,
404 imposition, levy, and collection of an appropriate civil fine;
405 or instituting a civil action for issuance of an injunction
406 pursuant to s. 320.695.
407 (4) This section does not alter or affect the rights of a
408 motor vehicle dealer to bring a claim or action against a
409 licensee pursuant to any other provision of ss. 320.60-320.70.
410 Section 7. Subsection (13) of section 681.102, Florida
411 Statutes, is amended to read:
412 681.102 Definitions.—As used in this chapter, the term:
413 (13) “Manufacturer” means any person, whether a resident or
414 nonresident of this state, who manufactures or assembles motor
415 vehicles, or who manufactures or assembles chassis for
416 recreational vehicles, or who manufactures or installs on
417 previously assembled truck or recreational vehicle chassis
418 special bodies or equipment which, when installed, forms an
419 integral part of the motor vehicle, or a distributor or an
420 importer as those terms are defined in s. 320.60 s. 320.60(5),
421 or an importer as defined in s. 320.60(7). A dealer as defined
422 in s. 320.60 may not s. 320.60(11)(a) shall not be deemed to be
423 a manufacturer, distributor, or importer as provided in this
424 section.
425 Section 8. Section 681.113, Florida Statutes, is amended to
426 read:
427 681.113 Dealer liability.—Except as provided in ss.
428 681.103(3) and 681.114(2), nothing in this chapter imposes any
429 liability on a dealer as defined in s. 320.60 s. 320.60(11)(a)
430 or creates a cause of action by a consumer against a dealer,
431 except for written express warranties made by the dealer apart
432 from the manufacturer’s warranties. A dealer may not be made a
433 party defendant in any action involving or relating to this
434 chapter, except as provided in this section. The manufacturer
435 shall not charge back or require reimbursement by the dealer for
436 any costs, including, but not limited to, any refunds or vehicle
437 replacements, incurred by the manufacturer arising out of this
438 chapter, in the absence of evidence that the related repairs had
439 been carried out by the dealer in a manner substantially
440 inconsistent with the manufacturer’s published instructions.
441 Section 9. This act shall take effect July 1, 2023.
