By: Brown S.B. No. 1446
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the regulation of certain motor vehicle dealers and to
1-2 the sale, titling, and registration of certain motor vehicles.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Article 6686(a)(1-A)(ii), Revised Statutes, is
1-5 amended to read as follows:
1-6 (ii) In this Article <subsection> "dealer"
1-7 means a person regularly and actively engaged in the business of
1-8 buying, selling, or exchanging (1) motor vehicles, (2) motorcycles,
1-9 (3) house trailers, or (4) trailers or semitrailers.
1-10 SECTION 2. Article 6686(a)(1-A), Revised Statutes, is
1-11 amended by inserting new Subdivisions (iii), (iv) and (v) to read
1-12 as follows and by renumbering all subsequent subdivisions of
1-13 Subsection (1-A) accordingly:
1-14 (iii) In this Article "franchised motor
1-15 vehicle dealer" means a dealer who holds a dealer license issued by
1-16 the Motor Vehicle Board of the Department.
1-17 (iv) In this Article "independent motor
1-18 vehicle dealer" means a dealer other than a franchised dealer or a
1-19 wholesale dealer.
1-20 (v) In this Article "wholesale motor
1-21 vehicle dealer" means a dealer who sells motor vehicles to no
1-22 person except:
1-23 (A) the holder of a valid dealer's general
2-1 distinguishing number; or
2-2 (B) a foreign dealer authorized by Texas law or
2-3 interstate reciprocity agreement to purchase a vehicle in Texas
2-4 without remitting the motor vehicle sales tax.
2-5 SECTION 2. Article 6686(a)(1-A)(iii), Revised Statutes, is
2-6 amended to read as follows:
2-7 (iii) No person may engage in business as
2-8 a dealer in (1) motor vehicles, (2) motorcycles, (3) house
2-9 trailers, or (4) trailers or semitrailers, either directly or
2-10 indirectly or by consignment, unless that person has a currently
2-11 valid general distinguishing number assigned by the Department for
2-12 each location from which the person engages in business. If a
2-13 dealer consigns more than five vehicles in a calendar year for sale
2-14 from a location other than the location for which the dealer holds
2-15 a general distinguishing number, the dealer must also hold a
2-16 general distinguishing number for the consignment location, unless
2-17 the consignment location is a wholesale motor vehicle auction.
2-18 SECTION 3. Section (a)(1-a)(v), Article 6686, Revised
2-19 Statutes, is amended to read as follows:
2-20 (v) A person who engages in business as a
2-21 dealer in this State shall make application to the Department for a
2-22 general distinguishing number authorizing him to reassign
2-23 manufacturer's certificates of origin, certificates of title, or
2-24 other basic evidences of ownership for the vehicles he sells. No
2-25 person may reassign a manufacturer's certificate of origin,
3-1 certificate of title, or other basic evidence of ownership until he
3-2 has been issued a general distinguishing number hereunder in one of
3-3 the six categories provided by this subdivision. An applicant
3-4 shall specify whether he proposes to be a (1) franchised motor
3-5 vehicle dealer, (2) independent motor vehicle dealer, (3) wholesale
3-6 motor vehicle dealer, (4) motorcycle dealer, (5) house trailer
3-7 dealer, or (6) trailer or semitrailer dealer <dealer in (1) motor
3-8 vehicles, (2) motorcycles, (3) house trailers, or (4) trailers or
3-9 semitrailers>. If the applicant proposes to secure the issuance of
3-10 dealer's license plates under Subsection (1) of this section for
3-11 attachment to more than one type of such vehicles, a separate
3-12 general distinguishing number is required for each. A dealer shall
3-13 obtain a separate and distinct general distinguishing number for
3-14 each location at which he engages in the business of buying,
3-15 selling, or exchanging motor vehicles, except that a dealer holding
3-16 a general distinguishing number for a particular type of vehicle
3-17 may buy, sell, or exchange vehicles of that type from more than one
3-18 location within the limits of a city if each location within the
3-19 limits of that city meets all requirements of an established and
3-20 permanent place of business set forth in this article and rules
3-21 promulgated by the Department, and if the dealer is not otherwise
3-22 prohibited by law from doing business at more than one location. A
3-23 dealer holding a general distinguishing number may reassign a
3-24 manufacturer's certificate of origin, certificate of title, or
3-25 other basic evidence of ownership of any type of vehicle owned by
4-1 him and which he is not otherwise prohibited by law from selling;
4-2 provided, however, that such dealer may reassign a manufacturer's
4-3 certificate of origin, certificate of title, or other basic
4-4 evidence of ownership of a motor vehicle owned by him and which he
4-5 is not otherwise prohibited by law from selling only if he has
4-6 complied with Subdivision (vii) of this subsection or is licensed
4-7 by the Motor Vehicle Board of the Department <Texas Motor Vehicle
4-8 Commission>.
4-9 SECTION 4. Section (a)(1-A)(vi), Article 6686, Revised
4-10 Statutes, is amended to read as follows:
4-11 (vi) The Department may not issue a
4-12 general distinguishing number to a person until the person has
4-13 filed with he Department a sworn application showing and swearing
4-14 to the truth of the following:
4-15 (A) that the location for which the applicant
4-16 seeks the issuance of a general distinguishing number is an
4-17 established and permanent place of business situated on real
4-18 property owned, or leased by him under a written lease for a term
4-19 of not less than one year, on which the applicant maintains a
4-20 permanent furnished office for the sale of vehicles of the type
4-21 specified in his application and equipped as required by the
4-22 Department, a conspicuous sign with letters at least six inches in
4-23 height showing the name of the applicant's business, and on which
4-24 the applicant has sufficient space to display at least five (5)
4-25 vehicles of the type specified in his application, except that a
5-1 wholesale motor vehicle dealer <who buys, sells, or exchanges
5-2 vehicles with no person other than another dealer holding a general
5-3 distinguishing number> is not required to maintain display space;
5-4 (B) that the applicant intends to remain
5-5 regularly and actively engaged in business as a dealer of the type
5-6 of vehicle for which he seeks a general distinguishing number for
5-7 at least one year at the specified location and that the applicant
5-8 or his bona fide employee will be on the location for the purpose
5-9 of buying, selling, leasing, or exchanging vehicles and will be
5-10 available to the public or the Department at that location during
5-11 reasonable and lawful business hours;
5-12 (C) that the applicant has complied with all
5-13 applicable state laws and municipal ordinances; and
5-14 (D) other information required by the
5-15 Department.
5-16 SECTION 5. Article 6686, Revised Statutes, is amended by
5-17 adding Section (2-B) to read as follows:
5-18 Sec. (2-B) Motor Vehicle Dealers. (i) The holder of a
5-19 franchised motor vehicle dealer's general distinguishing number may
5-20 buy, sell, or exchange new or used motor vehicles, and reassign a
5-21 manufacturer's certificate of origin, certificate of title, or
5-22 other basic evidence of ownership of any type of vehicle owned by
5-23 him if the holder is not otherwise prohibited by law from selling
5-24 or offering the vehicle for sale.
5-25 (ii) The holder of an independent motor
6-1 vehicle dealer's general distinguishing number may reassign a
6-2 certificate of title or other basic evidence of ownership of any
6-3 type of vehicle owned by the dealer which the dealer is not
6-4 otherwise prohibited by law from selling or offering for sale.
6-5 (iii) The holder of a wholesale motor
6-6 vehicle dealer's general distinguishing number may sell or offer to
6-7 sell motor vehicles to no person except a dealer holding a general
6-8 distinguishing number, or a foreign dealer otherwise authorized by
6-9 Texas law or interstate reciprocity agreement to purchase a vehicle
6-10 in Texas without remitting the motor vehicle sales tax.
6-11 SECTION 6. Article 6686(5-A), Revised Statutes, is amended
6-12 to read as follows:
6-13 Sec. (5-A). Cancellation. The Department may cancel a
6-14 general distinguishing number if:
6-15 (A) the dealer has filed a false or forged title
6-16 or tax document, including sales tax affidavit or affidavit making
6-17 application for a certified copy of a title;
6-18 (B) the dealer has failed to take assignment of
6-19 all certificates of title, manufacturer's certificates, or other
6-20 basic evidence of ownership for vehicles acquired by the dealer or
6-21 failed to assign the certificate of title, manufacturer's
6-22 certificate, or other basic evidence of ownership for vehicles
6-23 sold;
6-24 (C) the dealer has used or permitted the use of
6-25 a metal dealer's plate of a Dealer's Temporary Cardboard Tag on a
7-1 vehicle which the dealer does not own or control or on a vehicle
7-2 which is not in stock and offered for sale;
7-3 (D) the dealer has made a material
7-4 misrepresentation in any application or other information filed
7-5 with the Department;
7-6 (E) the dealer has failed to maintain the
7-7 qualifications for a general distinguishing number;
7-8 (F) the dealer has willfully failed to comply
7-9 with this Act or any rule or regulation of the Department;
7-10 (G) the dealer has not assigned at least five
7-11 (5) vehicles in the prior twelve (12) months. This paragraph does
7-12 not apply to dealers who have been licensed less than twelve (12)
7-13 months; <or>
7-14 (H) the dealer has failed to demonstrate
7-15 compliance with the provisions of Articles 23.12, 23.12A, and
7-16 23.12B, Tax Code, or
7-17 (I) <(H)> the dealer has used or allowed the use
7-18 of his general distinguishing number, or used or allowed the use of
7-19 a location for which a general distinguishing number is held, for
7-20 the purpose of avoiding the provisions of this article.
7-21 SECTION 7. Article 6686(a)(7), Revised Statutes, is amended
7-22 to read as follows:
7-23 Sec. 7. Fees and Forms. Each applicant for an original
7-24 general distinguishing number shall pay to the Department a fee of
7-25 $500 <Two Hundred and Fifty Dollars ($250)>. Each applicant for
8-1 renewal of a general distinguishing number shall pay to the
8-2 Department an annual fee of $200 <One Hundred Dollars ($100)>.
8-3 Each applicant for a dealer's plate or plates shall pay a fee of
8-4 $20 <Ten Dollars ($10)> for each metal dealer's plate desired.
8-5 Each applicant for a manufacturer's plate or plates shall pay a fee
8-6 of $40 <Twenty Dollars ($20)> for each plate. All such fees shall
8-7 be deposited in the State Highway Fund. Applications for a
8-8 dealer's or manufacturer's license plate or general distinguishing
8-9 number, and for renewals thereof, shall be made in writing on forms
8-10 prescribed and furnished by the department, and each such
8-11 application shall contain a statement to the effect that the
8-12 applicant agrees to permit the Department to examine during working
8-13 hours the ownership papers for each vehicle, registered or
8-14 unregistered, in the possession of the applicant or under his
8-15 control. All facts stated in an application shall be sworn to
8-16 before an officer authorized to administer oaths and no dealer's
8-17 general distinguishing number shall be issued until this Act is
8-18 complied with. All such applications, accompanied by the
8-19 prescribed fee, should be made to the Department by January 15 of
8-20 each year and the license plates for those applications meeting the
8-21 provisions of this Act will be mailed to the applicants during the
8-22 succeeding months of February and March. Each general
8-23 distinguishing number and each dealer's and manufacturer's license
8-24 plate shall expire on March 31 of each year.
8-25 SECTION 8. The importance of this legislation and the
9-1 crowded of calendars in both houses create an emergency and an
9-2 imperative public necessity that the constitutional rule requiring
9-3 bills to be read on three several days in each be suspended, and
9-4 this rule is hereby suspended, and that this Act take effect and be
9-5 in force from and after its passage, and it is so enacted.