VA MVDB Adds its Support for Dealer Bills

VA MVDB Adds its Support for Dealer Bills

In its regular committee and board meetings held last week, the Virginia Motor Vehicle Dealer Board reviewed and added its support for several key bills pending before the Virginia House of Delegates. (See above article for more information on the bills).

The MVDB determined to support HB 1521, Salvage bill, but voted to oppose HB 1659, which provides that vehicles will only be permanently branded to show they are rebuilt vehicles if they have been damaged in excess of 75% of fair market value, believing that HB 1521 provides better protection for consumers and other vehicle buyers.

The board also agreed to support HB 2604, Dealer Bond; HB 1443, Sale or Transfer of Motor Vehicle Dealerships; and HB 2502, which allows the Commissioner of Motor Vehicles to appoint motor vehicle dealers as licensed agents. This will allow dealers who choose to do so to use electronic online titling systems to do title work for consumers.

The MVDB determined to take no position on many other legislative bills that are pending. The following actions were also taken:

Advertising. The MVDB considered several ads that promised a payment if the dealer could not meet the price of a competing dealer, and noted that: a dealer who advertises a comparative price offer (e.g. we will pay you $____ if we cannot beat a competing price) must disclose all conditions in the ad. It is not permissible to say things such as rules and terms are available in showroom.

All conditions of the offer must be specific, verifiable and reasonable. For example, a statement that the competitorês price must be from a local dealer is not verifiable. The location of the competitor must be more specifically defined. Finally, the advertisement must state specifically any material conditions that must be met and what evidence the consumer must present to take advantage of the offer in the advertisement.

Sales Persons Licensing. The MVDB accepted a resolution by its Task Force on Licensing that the board implement a policy that all salespersons must be employed by the dealership as wage employees and not as independent contractors. The Virginia Motor Vehicle Dealer Act defines a salesperson as someone employed as such by a motor vehicle dealer . . . Noting that under IRS regulations, independent contractors must act independently of dealer control, it was determined that independent contractors, by definition, cannot be under the control of a dealer so that they can be considered employed as the statute requires. A notice to this effect will go out to all dealers by March 1, 2003. The MVDB also voted to develop a system to make sure that each applicant for a license or license renewal be employed by the dealer.

The next meeting of the committees and the board was set for March 10, 2003.