CHAPTER 2301. SALE OR LEASE OF MOTOR VEHICLES
OCCUPATIONS CODETITLE 14. REGULATION OF MOTOR VEHICLES AND TRANSPORTATIONSUBTITLE A. REGULATIONS RELATED TO MOTOR VEHICLESCHAPTER 2301. SALE OR LEASE OF MOTOR VEHICLESSUBCHAPTER A. GENERAL PROVISIONSSec. 2301.001. CONSTRUCTION; PURPOSE. The distribution and sale of motor vehicles in this state vitally affects the general economy of the state and the public interest and welfare of its citizens. This chapter shall be liberally construed to accomplish its purposes, including the exercise of the state's police power to ensure a sound system of distributing and selling motor vehicles through:(1) licensing and regulating manufacturers, distributors, converters, and dealers of motor vehicles; and(2) enforcing this chapter as to other persons to provide for compliance with manufacturer's warranties and to prevent fraud, unfair practices, discrimination, impositions, or other abuse of the people of this state.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.002. DEFINITIONS. In this chapter:(1) "Ambulance" means a vehicle that is used exclusively to transport or to provide emergency medical care to an injured or ill person and that includes:(A) a driver's compartment;(B) a compartment to accommodate an emergency medical care technician or paramedic and two injured or ill persons in a position that permits one of the injured or ill persons to be given intensive life-support during transit;(C) equipment and supplies for emergency care of an injured or ill person at the location of the person or at the scene of an injury-producing incident as well as in transit;(D) two-way radio communication capability; and(E) equipment for light rescue or extrication procedures.(2) "Board" has the meaning assigned by Section 2301.005.(3) "Broker" means a person who, for a fee, commission, or other valuable consideration, arranges or offers to arrange a transaction involving the sale of a new motor vehicle, other than a person who is:(A) a franchised dealer or a bona fide employee of a franchised dealer acting for the franchised dealer;(B) a representative or a bona fide employee of a representative acting for the representative;(C) a distributor or a bona fide employee of a distributor acting for the distributor; or(D) the owner of the vehicle at any point in the transaction.(4) "Chassis manufacturer" means a person who manufactures and produces the frame on which the body of a motor vehicle is mounted.(5) "Conversion" means a motor vehicle, other than a motor home, ambulance, or fire-fighting vehicle, that:(A) has been substantially modified by a person other than the manufacturer or distributor of the chassis of the motor vehicle; and(B) has not been the subject of a retail sale.(6) "Converter" means a person who before the retail sale of a motor vehicle:(A) assembles, installs, or affixes a body, cab, or special equipment to a chassis; or(B) substantially adds, subtracts from, or modifies a previously assembled or manufactured motor vehicle other than a motor home, ambulance, or fire-fighting vehicle.(7) "Dealer" means a person who holds a general distinguishing number issued by the board under Chapter 503, Transportation Code.(8) "Dealership" means the physical premises and business facilities on which a franchised dealer operates the dealer's business, including the sale and repair of motor vehicles. The term includes premises or facilities at which a person engages only in the repair of a motor vehicle if the repair is performed under a franchise and a motor vehicle manufacturer's warranty.(9) "Department" means the Texas Department of Motor Vehicles.(10) "Director" means the director of the division.(11) "Distributor" means a person, other than a manufacturer, who distributes or sells new motor vehicles to a franchised dealer.(12) "Division" means the Motor Vehicle Division of the department.(13) "Executive director" means the executive director of the department.(14) "Fire-fighting vehicle" means a motor vehicle the only purposes of which are to transport firefighters to the scene of a fire and to provide equipment to fight the fire, and that is built on a truck chassis with a gross carrying capacity of at least 10,000 pounds, to which the following have been permanently affixed or mounted:(A) a water tank with a combined capacity of at least 500 gallons; and(B) a centrifugal water pump with a capacity of at least 750 gallons per minute at 150 pounds per square inch net pump pressure.(15) "Franchise" means one or more contracts between a franchised dealer as franchisee and a manufacturer or a distributor as franchisor, including a written communication from a franchisor to a franchisee in which a duty is imposed on the franchisee, under which:(A) the franchisee is granted the right to sell and service new motor vehicles manufactured or distributed by the franchisor or only to service motor vehicles under the contract and a manufacturer's warranty;(B) the franchisee is a component of the franchisor's distribution system as an independent business;(C) the franchisee is substantially associated with the franchisor's trademark, tradename, and commercial symbol;(D) the franchisee's business substantially relies on the franchisor for a continued supply of motor vehicles, parts, and accessories; or(E) any right, duty, or obligation granted or imposed by this chapter is affected.(16) "Franchised dealer" means a person who:(A) holds a franchised motor vehicle dealer's license issued by the board under Chapter 503, Transportation Code; and(B) is engaged in the business of buying, selling, or exchanging new motor vehicles and servicing or repairing motor vehicles under a manufacturer's warranty at an established and permanent place of business under a franchise in effect with a manufacturer or distributor.(17) "General distinguishing number" means a dealer license issued by the board under Chapter 503, Transportation Code.(17-a) "Independent mobility motor vehicle dealer" means a nonfranchised dealer who:(A) holds a general distinguishing number issued by the board under Chapter 503, Transportation Code;(B) holds a converter's license issued under this chapter;(C) is engaged in the business of buying, selling, or exchanging mobility motor vehicles and servicing or repairing the devices installed on mobility motor vehicles at an established and permanent place of business in this state; and(D) is certified by the manufacturer of each mobility device that the dealer installs, if the manufacturer offers that certification.(18) "License holder" means a person who holds a license or general distinguishing number issued by the board under this chapter or Chapter 503, Transportation Code.(19) "Manufacturer" means a person who manufactures or assembles new motor vehicles.(20) "Manufacturer's statement of origin" means a certificate on a form prescribed by the department showing the original transfer of a new motor vehicle from the manufacturer to the original purchaser.(20-a) "Mobility motor vehicle" means a motor vehicle that is designed and equipped to transport a person with a disability and that:(A) has a chassis that contains:(i) a permanently lowered floor or lowered frame; or(ii) a permanently raised roof and raised door;(B) contains at least one of the following:(i) an electronic or mechanical wheelchair, scooter, or platform lift that enables a person to enter or exit the vehicle while occupying a wheelchair or scooter;(ii) an electronic or mechanical wheelchair ramp; or(iii) a system to secure a wheelchair or scooter to allow for a person to be safely transported while occupying the wheelchair or scooter; and(C) is installed as an integral part or permanent attachment to the motor vehicle's chassis.(21) "Motor home" means a motor vehicle that is designed to provide temporary living quarters and that:(A) is built on a motor vehicle chassis as an integral part of or a permanent attachment to the chassis; and(B) contains at least four of the following independent life support systems that are permanently installed and designed to be removed only for repair or replacement and that meet the standards of the American National Standards Institute, Standards for Recreational Vehicles:(i) a cooking facility with an on-board fuel source;(ii) a gas or electric refrigerator;(iii) a toilet with exterior evacuation;(iv) a heating or air conditioning system with an on-board power or fuel source separate from the vehicle engine;(v) a potable water supply system that includes at least a sink, a faucet, and a water tank with an exterior service supply connection; or(vi) a 110-125 volt electric power supply.(22) "Motor home manufacturer" means a person other than the manufacturer of a motor vehicle chassis who, before the retail sale of the motor vehicle, performs modifications on the chassis that result in the finished product being classified as a motor home.(23) "Motor vehicle" means:(A) a fully self-propelled vehicle having two or more wheels that has as its primary purpose the transport of a person or persons, or property, on a public highway;(B) a fully self-propelled vehicle having two or more wheels that:(i) has as its primary purpose the transport of a person or persons or property;(ii) is not manufactured for use on public streets, roads, or highways; and(iii) has been issued a certificate of title;(C) an engine, transmission, or rear axle, regardless of whether attached to a vehicle chassis, manufactured for installation in a vehicle that has:(i) the transport of a person or persons, or property, on a public highway as its primary purpose; and(ii) a gross vehicle weight rating of more than 16,000 pounds; or(D) a towable recreational vehicle.(23-a) "New mobility motor vehicle" means a mobility motor vehicle that has not been the subject of a retail sale, regardless of the mobility motor vehicle's mileage.(24) "New motor vehicle" means a motor vehicle that has not been the subject of a retail sale regardless of the mileage of the vehicle.(25) "Nonfranchised dealer" means a person who holds an independent motor vehicle dealer's general distinguishing number, an independent mobility motor vehicle dealer's general distinguishing number, or a wholesale motor vehicle dealer's general distinguishing number issued by the board under Chapter 503, Transportation Code.(26) "Party" means a person or agency named or admitted as a party and whose legal rights, duties, or privileges are to be determined by the board after an opportunity for adjudicative hearing.(27) "Person" means a natural person, partnership, corporation, association, trust, estate, or any other legal entity.(28) "Relocate" means to transfer an existing dealership operation to facilities at a different location, including a transfer that results in a consolidation or dualing of an existing dealer's operation.(29) "Representative" means a person who:(A) is or acts as an agent or employee for a manufacturer, distributor, or converter; and(B) performs any duty in this state relating to promoting the distribution or sale of new motor vehicles or contacts dealers in this state on behalf of a manufacturer, distributor, or converter.(30) "Retail sale" means any sale of a motor vehicle other than:(A) a sale in which the purchaser acquires a vehicle for resale; or(B) a sale of a vehicle that is operated in accordance with Section 503.061, Transportation Code.(31) "Rule":(A) means a statement by the board of general applicability that:(i) implements, interprets, or prescribes law or policy; or(ii) describes the procedure or practice requirements of the board;(B) includes the amendment or repeal of a prior rule; and(C) does not include a statement regarding only the internal management or organization of the board and not affecting the rights of a person not connected with the board.(32) "Towable recreational vehicle" means a nonmotorized vehicle that:(A) was originally designed and manufactured primarily to provide temporary human habitation in conjunction with recreational, camping, or seasonal use;(B) is titled and registered with the department as a travel trailer through a county tax assessor-collector;(C) is permanently built on a single chassis;(D) contains at least one life support system; and(E) is designed to be towable by a motor vehicle.(33) Repealed by Acts 2009, 81st Leg., R.S., Ch. 933, Sec. 2U.02, eff. September 1, 2009.(34) "Vehicle lease" means a transfer of the right to possess and use a motor vehicle for a term of more than 180 days in return for consideration.(35) "Vehicle lease facilitator" means a person, other than a franchised dealer, a vehicle lessor, or a bona fide employee of a franchised dealer or vehicle lessor, who:(A) holds the person out to any other person as a "motor vehicle leasing company" or "motor vehicle leasing agent," or uses a similar title, to solicit or procure another person to enter into an agreement to become the lessee of a motor vehicle that is not, and will not be, titled in the name of or registered to the facilitator;(B) otherwise solicits another person to enter into an agreement to become a lessee of a motor vehicle that is not, and will not be, titled in the name of or registered to the facilitator; or(C) is otherwise engaged in the business of securing lessees or prospective lessees of a motor vehicle that is not, and will not be, titled in the name of or registered to the facilitator.(36) "Vehicle lessor" means a person who, under a lease, transfers to another person the right to possession and use of a motor vehicle titled in the name of the lessor.(37) "Warranty work" means parts, labor, and any other expenses incurred by a franchised dealer in complying with the terms of a manufacturer's or distributor's warranty.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.601(a), 14A.602, eff. Sept. 1, 2003.Amended by: Acts 2005, 79th Leg., Ch. 281, Sec. 7.01, eff. June 14, 2005.Acts 2007, 80th Leg., R.S., Ch. 710, Sec. 1, eff. June 15, 2007.Acts 2009, 81st Leg., R.S., Ch. 933, Sec. 2U.01, eff. September 1, 2009.Acts 2009, 81st Leg., R.S., Ch. 933, Sec. 2U.02, eff. September 1, 2009.Acts 2009, 81st Leg., R.S., Ch. 933, Sec. 3I.02, eff. September 1, 2009.Acts 2009, 81st Leg., R.S., Ch. 933, Sec. 3I.10, eff. September 1, 2009.
Sec. 2301.003. EFFECT ON AGREEMENTS. (a) The terms and conditions of a franchise are subject to this chapter.(b) An agreement to waive the terms of this chapter is void and unenforceable. A term or condition of a franchise inconsistent with this chapter is unenforceable.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.004. CHAPTER EXCLUSIVE. Unless otherwise specifically provided by law not in conflict with this chapter, all aspects of the distribution and sale of motor vehicles are governed exclusively by this chapter.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.005. TITLE CHANGES. (a) A reference in law, including a rule, to the Texas Motor Vehicle Commission or to the board means the board of the Texas Department of Motor Vehicles.(b) A reference in law, including a rule, to the executive director of the Texas Motor Vehicle Commission means the executive director of the Texas Department of Motor Vehicles.(c) A reference in law, including a rule, to the Texas Motor Vehicle Commission Code means this chapter.(d) A reference in law other than this chapter to a dealer licensed by the Texas Motor Vehicle Commission or a dealer licensed by the Motor Vehicle Board of the Texas Department of Transportation means a franchised dealer.(e) A reference in this chapter to a rule or to a board rule means a rule adopted by the commission, except that all board rules that were in effect on June 1, 2005, remain in effect until amended or repealed by the commission.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2005, 79th Leg., Ch. 281, Sec. 7.02, eff. June 14, 2005.Acts 2009, 81st Leg., R.S., Ch. 933, Sec. 3I.03, eff. September 1, 2009.
Sec. 2301.006. BROKERS PROHIBITED. A person may not act as, offer to act as, or claim to be a broker.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.007. TOWING VEHICLE BY LICENSE HOLDER. Notwithstanding any other law, a person licensed under this chapter does not commit an offense by employing a person to tow a disabled vehicle to or from the premises for which the person is licensed regardless of whether the person employed to tow the vehicle:(1) holds a certificate issued by a state agency authorizing the person to engage in the business of towing vehicles for hire; or(2) commits an offense by towing the vehicle.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
SUBCHAPTER C. DIRECTOR AND OTHER DIVISION PERSONNELSec. 2301.101. DIRECTOR. (a) The director is the division's chief executive and administrative officer and shall administer and enforce this chapter.(b) The director must be licensed to practice law in this state.(c) The director serves at the will of the executive director.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2005, 79th Leg., Ch. 281, Sec. 7.03, eff. June 14, 2005.
Sec. 2301.103. PERSONNEL. A division employee is subject to dismissal if the employee has an interest in or is related within the first degree by consanguinity or affinity, as determined under Chapter 573, Government Code, to a person who has an interest in a business that manufactures, distributes, converts, sells, or leases motor vehicles.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2005, 79th Leg., Ch. 281, Sec. 7.04, eff. June 14, 2005.
Sec. 2301.105. CAREER LADDER PROGRAM; PERFORMANCE EVALUATIONS. (a) The director or the director's designee shall develop an intra-agency career ladder program that addresses opportunities for mobility and advancement of employees in the division. The program must require intra-agency postings of all positions concurrently with any public posting.(b) The director or the director's designee shall develop a system of annual performance evaluations based on documented employee performance. All merit pay for employees of the division must be based on the system established under this subsection.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.106. EQUAL OPPORTUNITY POLICY; REPORT. (a) The director or the director's designee shall prepare and maintain a written policy statement to ensure implementation of an equal employment opportunity program under which all personnel transactions are made without regard to race, color, disability, sex, religion, age, or national origin. The policy statement must include:(1) personnel policies, including policies relating to recruitment, evaluation, selection, appointment, training, and promotion of personnel that comply with Chapter 21, Labor Code;(2) a comprehensive analysis of the division workforce that meets federal and state laws, rules, and regulations and instructions adopted directly under those laws, rules, or regulations;(3) procedures by which a determination can be made of significant underuse in the division workforce of all persons for whom federal or state laws, rules, and regulations and instructions adopted directly under those laws, rules, or regulations encourage a more equitable balance; and(4) reasonable methods to appropriately address those areas of significant underuse.(b) A policy statement prepared under Subsection (a) must be:(1) prepared to cover an annual period;(2) updated at least annually;(3) reviewed by the Commission on Human Rights for compliance with Subsection (a)(1); and(4) filed with the governor.(c) The governor shall deliver a biennial report to the legislature based on the information received under Subsection (b). The report may be made separately or as a part of other biennial reports made to the legislature.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
SUBCHAPTER D. BOARD POWERS AND DUTIESSec. 2301.151. GENERAL JURISDICTION OF BOARD. (a) The board has the exclusive original jurisdiction to regulate those aspects of the distribution, sale, or lease of motor vehicles that are governed by this chapter, including the original jurisdiction to determine its own jurisdiction.(b) The board may take any action that is specifically designated or implied under this chapter or that is necessary or convenient to the exercise of the power and jurisdiction granted under Subsection (a).
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.605(a), eff. Sept. 1, 2003.
Sec. 2301.152. GENERAL DUTIES OF BOARD. (a) In accordance with this chapter, the board shall:(1) administer this chapter;(2) establish the qualifications of license holders;(3) ensure that the distribution, sale, and lease of motor vehicles is conducted as required by this chapter and board rules;(4) provide for compliance with warranties; and(5) prevent fraud, unfair practices, discrimination, impositions, and other abuses in connection with the distribution and sale of motor vehicles.(b) In addition to the duties delegated to the board under this chapter, the board shall enforce and administer Chapter 503, Transportation Code.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.153. GENERAL POWERS OF BOARD. (a) Notwithstanding any other provision of law, the board has all powers necessary, incidental, or convenient to perform a power or duty expressly granted under this chapter, including the power to:(1) initiate and conduct proceedings, investigations, or hearings;(2) administer oaths;(3) receive evidence and pleadings;(4) issue subpoenas to compel the attendance of any person;(5) order the production of any tangible property, including papers, records, or other documents;(6) make findings of fact on all factual issues arising out of a proceeding initiated under this chapter;(7) specify and govern appearance, practice, and procedures before the board;(8) adopt rules and issue conclusions of law and decisions, including declaratory decisions or orders;(9) enter into contracts;(10) execute instruments;(11) retain counsel;(12) use the services of the attorney general and institute and direct the conduct of legal proceedings in any forum;(13) obtain other professional services as necessary and convenient;(14) impose a sanction for contempt;(15) assess and collect fees and costs, including attorney's fees;(16) issue, suspend, or revoke licenses;(17) prohibit and regulate acts and practices in connection with the distribution and sale of motor vehicles or warranty performance obligations;(18) issue cease and desist orders in the nature of temporary or permanent injunctions;(19) impose a civil penalty;(20) enter an order requiring a person to:(A) pay costs and expenses of a party in connection with an order entered under Section 2301.465;(B) perform an act other than the payment of money; or(C) refrain from performing an act; and(21) enforce a board order.(b) The board may inspect the books and records of a license holder in connection with the performance of its duties under this chapter.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.606(a), eff. Sept. 1, 2003.
Sec. 2301.154. DELEGATION OF POWERS. The director may delegate any of the director's powers to one or more of the division's employees.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2005, 79th Leg., Ch. 281, Sec. 7.05, eff. June 14, 2005.
Sec. 2301.155. RULES. The authority to adopt rules under this chapter is vested in the board. In accordance with this chapter and the rules, decisions, and orders of the board, the board shall adopt rules as necessary or convenient to administer this chapter and to govern practice and procedure before the board.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.156. DEPOSIT OF REVENUE. Notwithstanding any other law to the contrary, all money collected by the board under this chapter shall be deposited in the state treasury to the credit of the state highway fund.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.157. IMMUNITY FROM LIABILITY. (a) Notwithstanding any other law, the director or a board member, hearings examiner, or division employee is not personally liable for damages resulting from an official act or omission unless the act or omission constitutes intentional or malicious malfeasance.(b) The attorney general shall defend a person described by Subsection (a) in an action brought in connection with the act or omission by the person regardless of whether the person serves the board or division in any capacity at the time the action is brought.(c) The state shall indemnify a person for a judgment in an action described by Subsection (a), but the state may seek contribution from the person if liability is otherwise permitted by this section.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.160. TOLLING OF TIME LIMIT DURING MEDIATION. A time limit relating to a board proceeding that is imposed by this chapter on the board or on a dealer is tolled during the pendency of mediation required by this chapter or by a franchise agreement.
Added by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.607(a), eff. Sept. 1, 2003.
SUBCHAPTER E. PUBLIC INTEREST INFORMATION AND COMPLAINT PROCEDURESSec. 2301.201. PUBLIC INTEREST INFORMATION. (a) The director or the director's designee shall prepare information describing the functions of the board and the procedures by which complaints or protests are filed with and resolved by the board.(b) The board shall make the information available to the public and appropriate state agencies.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.202. COMPLAINTS; RECORDS. (a) The board shall provide to a person who files a complaint, and to each person that is the subject of the complaint, information about the board's policies and procedures relating to complaint investigation and resolution.(b) The board shall keep an information file about each complaint filed with the board that the board has authority to resolve. The board shall keep the following information for each complaint filed by the board for the purpose of enforcing this chapter:(1) the date the complaint is filed;(2) the name of the person filing the complaint;(3) the subject matter of the complaint;(4) each person contacted in relation to the complaint;(5) a summary of the results of the review or investigation of the complaint; and(6) if the board does not take action on the complaint, an explanation of the reasons that action was not taken.(c) If a written complaint is filed with the board that the board has authority to resolve, the board, at least quarterly and until final disposition of the complaint, shall notify the parties to the complaint of the status of the complaint unless the notice would jeopardize an ongoing board investigation.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.608(a), eff. Sept. 1, 2003.
Sec. 2301.203. COMPLAINT INVESTIGATION AND DISPOSITION. (a) If the board has reason to believe, through receipt of a complaint or otherwise, that a violation of this chapter or a rule, order, or decision of the board has occurred or is likely to occur, the board shall conduct an investigation unless it determines that the complaint is frivolous or for the purpose of harassment.(b) If the investigation establishes that a violation of this chapter or a rule, order, or decision of the board has occurred or is likely to occur, the board shall initiate proceedings as it determines appropriate to enforce this chapter or its rules, orders, and decisions.(c) The board may not file a complaint alleging a violation of this chapter or a board rule relating to advertising until the board has notified the license holder involved of the alleged violation and given the license holder an opportunity to cure the violation without further proceedings or liability.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.204. COMPLAINT CONCERNING VEHICLE DEFECT. (a) The owner of a motor vehicle or the owner's designated agent may make a complaint concerning a defect in a motor vehicle that is covered by a manufacturer's, converter's, or distributor's warranty agreement applicable to the vehicle.(b) The complaint must be made in writing to the applicable dealer, manufacturer, converter, or distributor and must specify each defect in the vehicle that is covered by the warranty.(c) The owner may also invoke the board's jurisdiction by sending a copy of the complaint to the board.(d) A hearing may be scheduled on any complaint made under this section that is not privately resolved between the owner and the dealer, manufacturer, converter, or distributor.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.205. NOTICE OF COMPLAINT PROCEDURE. (a) A franchised dealer shall provide notice of the complaint procedures provided by Section 2301.204 and Subchapter M to each person to whom the dealer sells a new motor vehicle.(b) The board may require its approval of the contents of the notice required by Subsection (a) or may prescribe the contents of the notice.(c) The failure to provide notice as required by this section is a violation of this chapter.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.206. PUBLIC PARTICIPATION. (a) The board shall develop and implement policies that provide the public with a reasonable opportunity to appear before the board and to speak on any issue under the board's jurisdiction.(b) The board shall prepare and maintain a written plan that describes how a person who does not speak English or who has a physical, mental, or developmental disability may be provided reasonable access to the board's programs.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
SUBCHAPTER F. LICENSE REQUIREMENTSSec. 2301.251. LICENSE REQUIRED: GENERALLY. (a) Unless a person holds a license issued under this chapter authorizing the activity, the person may not:(1) engage in business as, serve in the capacity of, or act as a dealer, manufacturer, distributor, converter, representative, vehicle lessor, or vehicle lease facilitator in this state; or(2) perform or offer to perform repair services on a motor vehicle under a franchise and a motor vehicle manufacturer's warranty, regardless of whether the person sells or offers to sell motor vehicles at the same location.(b) A franchised dealer must have both a franchised motor vehicle dealer's general distinguishing number issued under Chapter 503, Transportation Code, and a license issued under this chapter.(c) A manufacturer or distributor that directly or indirectly reimburses another person to perform warranty repair services on a vehicle is engaged in business in this state regardless of whether the manufacturer sells or offers for sale new motor vehicles in this state.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.252. LICENSE REQUIRED: SALE OF NEW MOTOR VEHICLES. (a) A person may not engage in the business of buying, selling, or exchanging new motor vehicles unless the person:(1) holds a franchised dealer's license issued under this chapter for the make of new motor vehicle being bought, sold, or exchanged; or(2) is a bona fide employee of the holder of a franchised dealer's license.(b) For purposes of this section:(1) the make of a conversion, ambulance, or fire-fighting vehicle is that of the chassis manufacturer; and(2) the make of a motor home is that of the motor home manufacturer.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.609(a), eff. Sept. 1, 2003.
Sec. 2301.253. LICENSE REQUIRED: VEHICLE LEASE FACILITATORS. Unless a person holds a vehicle lease facilitator license and complies with this chapter, the person may not:(1) act in the capacity of or engage in the business of a vehicle lease facilitator;(2) hold the person out to any other person as a "leasing company," "leasing agent," "lease facilitator," or similar title, directly or indirectly engaged in the business of a vehicle lease facilitator; or(3) otherwise engage in the solicitation or procurement of a prospective lessee for a motor vehicle that is not titled in the name of and registered to the person.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.254. LICENSE NOT REQUIRED FOR CERTAIN VEHICLE LESSORS OR VEHICLE LEASE FACILITATORS. (a) A person is not required to obtain a license to act as a vehicle lessor or a vehicle lease facilitator if the person is:(1) a state or federally chartered financial institution or a regulated subsidiary of the financial institution; or(2) a trust or other entity that owns an interest in a vehicle lease and the vehicle that is the subject of the lease, if the lease covering the vehicle is initiated, managed, serviced, and administered by a licensed vehicle lessor.(b) A franchised dealer is not required to have a vehicle lessor or vehicle lease facilitator license to engage in any capacity in the business of leasing a motor vehicle that the dealer owns and is licensed under this chapter to sell.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.255. NONFRANCHISED DEALERS; GENERAL DISTINGUISHING NUMBER. (a) A nonfranchised dealer may not operate as a dealer unless the person holds a general distinguishing number. A nonfranchised dealer is not required to obtain an additional license under this chapter.(b) For purposes of a nonfranchised dealer, a reference to a license in this chapter means a general distinguishing number.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.256. REVIEW OF NEW APPLICATIONS. A new application for a license under this chapter shall be reviewed and may be investigated to determine compliance with this chapter.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.257. APPLICATION FOR DEALER'S LICENSE. (a) An application for a dealer's license must be on a form prescribed by the board. The application must include:(1) the information required by Chapter 503, Transportation Code; and(2) information relating to the applicant's financial resources, business integrity, business ability and experience, franchise if applicable, physical facilities, vehicle inventory, and other factors the board considers necessary to determine the applicant's qualifications to adequately serve the public.(b) If a material change occurs in the information included in an application for a dealer's license, the dealer shall notify the director of the change within a reasonable time. The director shall prescribe a form for the disclosure of the change.(c) A franchised dealer must apply for a separate license under this section for each separate and distinct dealership as determined by the board. Before changing a location, a dealer must obtain a new license for that location.(d) The act of filing an application under this section or a form prescribed under this section does not establish the applicant as a franchised dealer.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2007, 80th Leg., R.S., Ch. 732, Sec. 1, eff. September 1, 2007.Acts 2009, 81st Leg., R.S., Ch. 684, Sec. 1, eff. September 1, 2009.
Sec. 2301.2575. REQUEST FOR DEALER'S LICENSE APPLICATION CONFIDENTIAL. Notwithstanding any other law or rule, a request for an application for a dealer's license is confidential, is not an open record, and is not available for public inspection.
Added by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.610(a), eff. Sept. 1, 2003.
Sec. 2301.258. GENERAL REQUIREMENTS FOR APPLICATION FOR MANUFACTURER'S, DISTRIBUTOR'S, CONVERTER'S, OR REPRESENTATIVE'S LICENSE. An application for a manufacturer's, distributor's, converter's, or representative's license must be on a form prescribed by the board. The application must include information the board determines necessary to fully determine the qualifications of an applicant, including financial resources, business integrity and experience, facilities and personnel for serving franchised dealers, and other information the board determines pertinent to safeguard the public interest and welfare.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.259. APPLICATION FOR MANUFACTURER'S LICENSE. (a) An applicant for a manufacturer's license must provide a list of each distributor or representative acting for the applicant and each dealer franchised to sell the applicant's products in this state and their respective locations. An applicant for or holder of a manufacturer's license must inform the board of a change to the list not later than the 15th day after the date of the change. Information submitted under this subsection becomes a part of the application.(b) An application for a manufacturer's license must include a document stating the terms and conditions of each warranty agreement in effect at the time of the application on a product the manufacturer sells in this state so that the board may determine:(1) the protection provided a retail purchaser of the manufacturer's products;(2) the obligation of a franchised dealer under the agreement; and(3) the basis for compensating a franchised dealer for labor, parts, or other expenses under the agreement.(c) An application for a manufacturer's license must include a statement regarding the manufacturer's compliance with Subchapter I and Sections 2301.451-2301.476.(d) An application for a manufacturer's license must specify:(1) the preparation and delivery obligations of the manufacturer's franchised dealers before delivery of a new motor vehicle to a retail purchaser; and(2) the schedule of compensation to be paid to a franchised dealer for the work and service performed under Subdivision (1).
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.611(a), eff. Sept. 1, 2003.
Sec. 2301.260. APPLICATION FOR DISTRIBUTOR'S LICENSE. (a) An application for a distributor's license must disclose:(1) the manufacturer for whom the distributor will act;(2) whether the manufacturer is licensed in this state;(3) the warranty covering the motor vehicles to be sold;(4) the persons in this state who will be responsible for compliance with the warranty;(5) the terms of the contract under which the distributor will act for the manufacturer; and(6) the franchised dealers with whom the distributor will do business.(b) An applicant for a distributor's license that has a responsibility under a warranty agreement must provide the same information relating to the agreement as is provided by an applicant for a manufacturer's license under Section 2301.259.(c) An applicant for or holder of a distributor's license must inform the board of a change in the information provided under this section not later than the 15th day after the date of the change. Information submitted under this subsection becomes a part of the application.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.261. APPLICATION FOR VEHICLE LESSOR'S LICENSE. (a) An application for a vehicle lessor's license must:(1) be on a form prescribed by the board;(2) contain evidence of compliance with Chapter 503, Transportation Code, if applicable; and(3) state other information required by the board.(b) This chapter does not require a separate license for each employee of a vehicle lessor.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.262. APPLICATION FOR VEHICLE LEASE FACILITATOR LICENSE. (a) An application for a vehicle lease facilitator license must be on a form prescribed by the board and contain the information required by the board.(b) This chapter does not require a separate license for each employee of a vehicle lease facilitator.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.263. LICENSE ISSUED SUBJECT TO NEW LAW AND RULES. A license issued under this chapter is subject to each provision of this chapter and board rule in effect on the date the license is issued and each provision of this chapter and board rule that takes effect during the term of the license.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.264. LICENSE FEES. (a) The annual fees for a license issued under this chapter are:(1) $900 for a manufacturer or distributor, plus $20 for each dealer franchised by the manufacturer or distributor;(2) for a franchised dealer:(A) $175, if the dealer sold fewer than 201 new motor vehicles during the preceding calendar year;(B) $275, if the dealer sold more than 200 but fewer than 401 new motor vehicles during the preceding calendar year;(C) $400, if the dealer sold more than 400 but fewer than 801 new motor vehicles during the preceding calendar year;(D) $500, if the dealer sold more than 800 but fewer than 1,201 new motor vehicles during the preceding calendar year;(E) $625, if the dealer sold more than 1,200 but fewer than 1,601 new motor vehicles during the preceding calendar year;(F) $750, if the dealer sold more than 1,600 new motor vehicles during the preceding calendar year; and(G) $100 for each location separate from the dealership at which the dealer does not offer motor vehicles for sale but performs warranty service work on vehicles the dealer is franchised and licensed to sell;(3) $100 for a representative;(4) $375 for a converter;(5) for a vehicle lessor:(A) $175, if the lessor leased 200 or fewer motor vehicles during the preceding calendar year;(B) $275, if the lessor leased more than 200 but fewer than 401 motor vehicles during the preceding calendar year;(C) $400, if the lessor leased more than 400 but fewer than 801 motor vehicles during the preceding calendar year;(D) $500, if the lessor leased more than 800 but fewer than 1,201 motor vehicles during the preceding calendar year;(E) $625, if the lessor leased more than 1,200 but fewer than 1,601 motor vehicles during the preceding calendar year; and(F) $750, if the lessor leased more than 1,600 motor vehicles during the preceding calendar year; and(6) $375 for a vehicle lease facilitator.(b) A person who fails to apply for a license required under this chapter or fails to pay a fee within the required time must pay a penalty equal to 50 percent of the amount of the fee for each 30 days after the date the license is required or the fee is due.(c) The board may prorate the fee for a representative's license to allow the representative's license and the license of the manufacturer or distributor who employs the representative to expire on the same day.(d) The board may refund from funds appropriated to the board for that purpose a fee collected under this chapter that is not due or that exceeds the amount due.(e) The fee for an amendment to a license under this chapter is $25.(f) The fee for a duplicate license under this chapter is $50.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.612(a), eff. Sept. 1, 2003.Amended by: Acts 2007, 80th Leg., R.S., Ch. 732, Sec. 2, eff. September 1, 2007.
Sec. 2301.265. SERVICE OF PROCESS ON LICENSE HOLDER. Obtaining a license under this chapter constitutes doing business in this state. A license holder who fails to designate an agent for service of process is considered to have designated the secretary of state as the agent for receipt of service of process.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.266. DUPLICATE LICENSE. The board may:(1) issue a duplicate license for any license the board issues;(2) charge a fee for the issuance of a duplicate license; and(3) adopt rules applicable to the issuance of a duplicate license.
Added by Acts 2003, 78th Leg., ch. 1276, Sec. 14A.613(a), eff. Sept. 1, 2003.
SUBCHAPTER G. LICENSE EXPIRATION AND RENEWALSec. 2301.301. LICENSE TERM AND RENEWAL. (a) Licenses issued under this chapter are valid for the period prescribed by the commission.(b) The director may issue a license for a term of less than the period prescribed under Subsection (a) to coordinate the expiration dates of licenses held by a person that is required to obtain more than one license to perform activities under this chapter.(c) The commission by rule may implement a system under which licenses expire on various dates during the year. If a license is issued or renewed for a term that is less than the period set under Subsection (a), the fee for the license shall be prorated so that the license holder pays only that portion of the fee that is allocable to the number of months during which the license is valid. On renewal of the license on the new expiration date, the entire license renewal fee is payable.(d) A license renewal may be administratively granted unless a protest is made to the board.(e) If the commission prescribes the term of a license under this chapter for a period other than one year, the commission shall prorate the applicable annual fee required under this chapter as necessary to reflect the term of the license.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2007, 80th Leg., R.S., Ch. 732, Sec. 3, eff. September 1, 2007.Acts 2007, 80th Leg., R.S., Ch. 732, Sec. 4, eff. September 1, 2007.
Sec. 2301.302. NOTICE OF LICENSE EXPIRATION. The board shall notify each person licensed under this chapter of the date of license expiration and the amount of the fee required for license renewal. The notice shall be mailed at least 30 days before the date of license expiration.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.303. RENEWAL OF DEALER'S LICENSE. A dealer shall renew the dealer's license on an application prescribed by the director. The director shall include in the renewal application a request for disclosure of material changes described by Section 2301.257.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2007, 80th Leg., R.S., Ch. 732, Sec. 5, eff. September 1, 2007.
Sec. 2301.304. PROCEDURE FOR RENEWAL OF CERTAIN LICENSES. The holder of a manufacturer's, distributor's, converter's, or representative's license may apply for a renewal of the license by complying with the application process specified by this chapter and board rule.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
SUBCHAPTER H. DEALERSSec. 2301.351. GENERAL PROHIBITION. A dealer may not:(1) violate a board rule;(2) aid or abet a person who violates this chapter; or(3) use false, deceptive, or misleading advertising.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.352. PROHIBITION: REQUIRING ADDITIONAL EQUIPMENT AFTER RETAIL SALE. A franchised dealer may not require as a condition of the sale and delivery of a new motor vehicle a retail purchaser of the vehicle to purchase special features, equipment, parts, or accessories that the purchaser did not order or desire and that were not already installed on the vehicle at the time of sale.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.353. PROHIBITION: PERFORMANCE OF OBLIGATION UNDER AGREEMENT WITH MANUFACTURER. A franchised dealer may not fail to perform an obligation placed on:(1) the selling dealer in connection with the preparation and delivery of a new motor vehicle for retail sale as provided in the manufacturer's preparation and delivery agreements on file with the board that are applicable to the vehicle; or(2) the dealer in connection with the manufacturer's warranty agreements on file with the board.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.354. USE OF SIGNS. (a) A franchised dealer may not operate without appropriate signs that:(1) are readily and easily visible to the public; and(2) identify the dealer's place of business and the products the dealer offers for sale.(b) To the extent of a conflict between this section and another law, including an ordinance, this section prevails.(c) If a dispute arises under this section:(1) the board has exclusive jurisdiction to determine whether a sign complies with this section; and(2) the board shall uphold an ordinance of a home-rule municipality and protect a franchised dealer from retribution by a manufacturer or distributor for complying with the ordinance.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.355. USE OF MULTIPLE LOCATIONS. (a) A franchised dealer may conduct business at more than one location, except that the dealer may establish and maintain a separate location for the display and sale of new motor vehicles only if expressly authorized by the dealer's franchise and license.(b) A franchised dealer must hold a separate license for each separate and distinct dealership as required by Section 2301.257.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.356. NOTICE OF CERTAIN PROPOSED CHANGES. A licensed dealer shall promptly notify the board of any proposed change in its ownership, location, franchise, or any other matter the board by rule may require.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.357. PROHIBITED FEE. (a) A franchised dealer may not directly or indirectly pay a fee to a vehicle lessor or a vehicle lease facilitator.(b) For purposes of Subsection (a), an adjustment in the purchase price paid for the lease or leased vehicle is not a fee. This subsection does not authorize a fee for referring leases or prospective lessees.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.358. VEHICLE SHOW OR EXHIBITION. (a) A person who holds a license issued under this chapter may not participate in a new motor vehicle show or exhibition unless:(1) the person provides the board with written notice at least 30 days before the date the show or exhibition opens; and(2) the board grants written approval.(b) A person who holds a license issued under this chapter may not sell or offer for sale a new motor vehicle at a show or exhibition, but dealership personnel may be present to aid in showing and exhibiting new motor vehicles.(c) This section does not prohibit the sale of a towable recreational vehicle, motor home, ambulance, fire-fighting vehicle, or tow truck at a show or exhibition if:(1) the show or exhibition is approved by the board; and(2) the sale is not otherwise prohibited by law.(d) A rule adopted by the board regulating the off-site display or sale of towable recreational vehicles must include a provision that authorizes the display and sale of towable recreational vehicles at a private event in a trade area that would not otherwise qualify for the private event under the application of general participation requirements for organized dealer shows and exhibitions.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by Acts 2003, 78th Leg., ch. 85, Sec. 1, eff. Sept. 1, 2003.
Sec. 2301.359. TRANSFER OF OWNERSHIP BY DEALER. (a) A dealer must notify the manufacturer or distributor of a vehicle the dealer is franchised to sell of the dealer's decision to assign, sell, or otherwise transfer a franchise or a controlling interest in the dealership to another person. The notice is the application by the dealer for approval by the manufacturer or distributor of the transfer.(b) Notice under Subsection (a) must:(1) be in writing and include the prospective transferee's name, address, financial qualifications, and business experience; and(2) be sent by certified mail, return receipt requested.(c) The notice must be accompanied by:(1) a copy of pertinent agreements regarding the proposed assignment, sale, or transfer;(2) completed application forms and related information generally used by the manufacturer or distributor in reviewing prospective dealers, if the forms are on file with the board; and(3) the prospective transferee's written agreement to comply with the franchise to the extent that the franchise is not in conflict with this chapter.(d) Not later than the 60th day after the date of receipt of a notice and application under this section, a manufacturer or distributor shall determine whether a dealer's prospective transferee is qualified and shall send a letter by certified mail, return receipt requested, informing the dealer of the approval or the unacceptability of the prospective transferee. If the prospective transferee is not acceptable, the manufacturer or distributor shall include a statement setting forth the material reasons for the rejection.(e) A manufacturer or distributor may not unreasonably withhold approval of an application filed under Subsection (a). It is unreasonable for a manufacturer or distributor to reject a prospective transferee who is of good moral character and who meets the written, reasonable, and uniformly applied standards or qualifications, if any, of the manufacturer or distributor relating to the prospective transferee's business experience and financial qualifications.(f) An application filed under this section is approved unless rejected by the manufacturer or distributor in the manner provided by this section.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.360. REVIEW BY BOARD FOLLOWING DENIAL OF TRANSFER. (a) A dealer whose application is rejected under Section 2301.359 may file a protest with the board. A protest filed under this section is a contested case.(b) In a protest under this section, the board must determine whether the rejection was reasonable under the criteria described by Section 2301.359. The burden is on the manufacturer or distributor to prove that the prospective transferee is not qualified under the criteria. The board shall enter an order holding that the prospective transferee either is qualified or is not qualified.(c) If the board's order is that the prospective transferee is qualified, the dealer's franchise is amended to reflect the change in franchisee, and the manufacturer or distributor shall accept the transfer for all purposes.(d) If the board's order is that the prospective transferee is not qualified, the board may include in the order:(1) specific reasons why the prospective transferee is not qualified; and(2) specific conditions under which the prospective transferee would be qualified.(e) If the board's order that a prospective transferee is not qualified includes specific conditions under which the prospective transferee would be qualified, the board may retain jurisdiction of the dispute for a time certain to allow the dealer and prospective transferee to meet the conditions.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.Amended by: Acts 2009, 81st Leg., R.S., Ch. 684, Sec. 2, eff. September 1, 2009.
Sec. 2301.361. INDEPENDENT MOBILITY MOTOR VEHICLE DEALER. (a) Notwithstanding any other law or rule, an independent mobility motor vehicle dealer may:(1) purchase or otherwise acquire a new motor vehicle with a lowered floor or frame or a raised roof and door to fit or equip the motor vehicle for retail sale as a mobility motor vehicle;(2) display a new mobility motor vehicle to a person with a disability to fit or equip the vehicle as a mobility motor vehicle for the person; and(3) sell or arrange for the sale and delivery of a new mobility motor vehicle to a purchaser at the independent mobility motor vehicle dealer's place of business if the transaction occurs through or by a franchised dealer of the motor vehicle's chassis line make.(b) An independent mobility motor vehicle dealer who purchased or acquired a new motor vehicle from a franchised dealer to equip the vehicle as a mobility motor vehicle may not advertise the vehicle for sale until the vehicle is fitted or equipped as a mobility motor vehicle.(c) An independent mobility motor vehicle dealer may not sell or offer to sell a new motor vehicle other than a new mobility motor vehicle.
Added by Acts 2007, 80th Leg., R.S., Ch. 710, Sec. 2, eff. June 15, 2007.
Sec. 2301.362. OFFSITE SALES. (a) Except as provided by Subsection (b) and Sections 2301.358(c) and (d), a dealer may only sell or offer to sell a motor vehicle from an established and permanent place of business:(1) that is approved by the division; and(2) for which a general distinguishing number has been issued.(b) A dealer may sell or offer to sell a motor vehicle online through an advertisement on the Internet to a buyer who never personally appears at the dealer's established and permanent place of business.
Added by Acts 2007, 80th Leg., R.S., Ch. 1363, Sec. 1, eff. June 15, 2007.Renumbered from Occupations Code, Section 2301.361 by Acts 2009, 81st Leg., R.S., Ch. 87, Sec. 27.001(74), eff. September 1, 2009.
Sec. 2301.363. REQUIRED NOTICE. A dealer that sells or exchanges a motor home or a towable recreational vehicle subject to inspection under Chapter 548, Transportation Code, shall notify the buyer in writing at the time of the sale or exchange that the motor vehicle is subject to inspection requirements.
Added by Acts 2009, 81st Leg., R.S., Ch. 717, Sec. 1, eff. September 1, 2009.
SUBCHAPTER I. WARRANTIES: REIMBURSEMENT OF DEALERSec. 2301.401. FILING REQUIREMENTS. (a) A manufacturer or distributor shall file with the board a copy of the current requirements the manufacturer or distributor imposes on its dealers with respect to the dealer's:(1) duties under the manufacturer's or distributor's warranty; and(2) vehicle preparation and delivery obligations.(b) Warranty or preparation and delivery requirements placed on a dealer by a manufacturer are not enforceable unless the requirements are reasonable and are disclosed and filed as required by Subsection (a).
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.402. RATE OF COMPENSATION. (a) A manufacturer or distributor shall fairly and adequately compensate its dealers for warranty work.(b) A manufacturer or distributor may not pay or reimburse a dealer an amount of money for warranty work that is less than the amount the dealer charges a retail customer for similar nonwarranty work.(c) In computing the amount of money a dealer charges a retail customer under Subsection (b), the manufacturer or distributor shall use the greater of:(1) the average labor rate charged during the preceding six months by the dealer on 100 sequential nonwarranty repair orders, exclusive of routine maintenance; or(2) the average labor rate charged for 90 consecutive days during the preceding six months by the dealer for nonwarranty repairs, exclusive of routine maintenance.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.403. ADJUSTMENT OF WARRANTY LABOR RATE. (a) A dealer may request an adjustment in the dealer's warranty labor rate. The request must be sent to the manufacturer or distributor by certified mail, return receipt requested, and must state the requested rate and include information reasonably necessary to enable the manufacturer or distributor to adequately evaluate the request.(b) Not later than the 60th day after the date of receipt of a request under this section, the manufacturer or distributor shall provide written notice to the requesting dealer of the approval or disapproval of the request. If the request is disapproved, the manufacturer or distributor shall state the reasons for the disapproval.(c) A requesting dealer may file a protest with the board if the manufacturer or distributor:(1) disapproves the request; or(2) fails to respond within the time required by this section.(d) After a protest is filed, the board may uphold the manufacturer's or distributor's decision only if the manufacturer or distributor proves by a preponderance of the evidence that the disapproval of the request or failure to respond was reasonable.(e) If the board does not determine that the disapproval of the request or failure to respond was reasonable, the board shall order the requested rate into effect as of the 60th day after the receipt of the request by the manufacturer or distributor.(f) Except by agreement of the parties, a warranty labor rate established under this subchapter may not be adjusted more often than once a year.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.404. TIME FOR PAYMENT. (a) A manufacturer or distributor shall pay a dealer's claim for reimbursement for warranty work or dealer preparation and delivery work not later than the 30th day after the date of approval of the claim.(b) A claim that is not disapproved before the 31st day after the date of receipt is considered approved.(c) If a claim is disapproved, the manufacturer or distributor shall provide the dealer written notice of the reasons for the disapproval.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.405. CHARGE BACK TO DEALER. (a) A manufacturer or distributor may not charge back to a dealer money paid by the manufacturer or distributor to satisfy a claim approved and paid under this subchapter unless the manufacturer or distributor shows that:(1) the claim was false or fraudulent;(2) repair work was not properly performed or was unnecessary to correct a defective condition; or(3) the dealer who made the claim failed to substantiate the claim as provided by the manufacturer's or distributor's requirements that were enforceable under Section 2301.401 at the time the claim was filed.(b) A manufacturer or distributor may not audit a claim filed under this subchapter after the first anniversary of the date the claim is submitted unless the manufacturer or distributor has reasonable grounds to suspect that the claim was fraudulent.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.406. PROHIBITED REQUIREMENTS FOR PAYMENT. A manufacturer or distributor may not require, as a prerequisite to the payment of a claim for reimbursement, that a dealer file a statement of actual time spent in performance of labor, unless actual time is the basis for reimbursement.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
SUBCHAPTER J. MANUFACTURERS, DISTRIBUTORS, AND REPRESENTATIVESSec. 2301.451. PROHIBITION: ITEMS NOT ORDERED. A manufacturer, distributor, or representative may not require or attempt to require a franchised dealer to order, accept delivery of, or pay anything of value, directly or indirectly, for a motor vehicle or an appliance, part, accessory, or any other commodity unless the dealer voluntarily ordered or contracted for the item.
Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003.
Sec. 2301.452. DELIVERY OF MOTOR VEHICLE OR PART. (a) A manufacturer, distributor, or representative shall deliver in a reasonable quantity and within a reasonable time to a franchised dealer who holds a franchise for a motor vehicle sold or distributed by the manufacturer, distributor, or representative any new motor vehicle or part or accessory for a new motor vehicle as covered by the franchise if the vehicle, part, or accessory is publicly advertised as being available for delivery or is actually being delivered.(b) This section does not apply to a delivery prevented by:(1) an act of God;(2) a work stoppage or delay because of a strike or labor dispute;(3) a freight embargo; or(4) another cause beyond the control of the manufacturer, distributor, or representative.
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