S T A T E O F N E W Y O R K
________________________________________________________________________
7553--A
2023-2024 Regular Sessions
I N S E N A T E
June 5, 2023
___________
Introduced by Sens. THOMAS, SCARCELLA-SPANTON -- read twice and ordered
printed, and when printed to be committed to the Committee on Rules --
recommitted to the Committee on Consumer Protection in accordance with
Senate Rule 6, sec. 8 -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the general business law and the vehicle and traffic
law, in relation to automobile broker businesses
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision 1 of section 736 of the general business law,
as amended by chapter 28 of the laws of 2018, is amended to read as
follows:
1. "Automobile broker business" means any person who, for a fee,
commission or other valuable consideration, regardless of whether such
fee, commission, or consideration is paid directly by a consumer, offers
to provide, provides, or represents that [he or she] SUCH AUTOMOBILE
BROKER BUSINESS will provide a service of purchasing, arranging, assist-
ing, facilitating or effecting the purchase or lease of an automobile as
agent, broker, or intermediary for a consumer. "Automobile broker busi-
ness" does not include any person registered as a dealer pursuant to
article sixteen of the vehicle and traffic law, ONLY WHEN OPERATING IN A
MANNER PURSUANT TO SUCH REGISTRATION UNDER ARTICLE SIXTEEN OF THE VEHI-
CLE AND TRAFFIC LAW, ANY PERSON REGISTERED UNDER SECTION FOUR HUNDRED
FIFTEEN-A OF THE VEHICLE AND TRAFFIC LAW, ONLY WHEN OPERATING IN A
MANNER DESCRIBED IN SECTION FOUR HUNDRED FIFTEEN-A OF THE VEHICLE AND
TRAFFIC LAW, AN AUTOMOBILE AUCTIONEER, ONLY WHEN OPERATING IN THE MANNER
DESCRIBED IN SECTION TWENTY-THREE OF THIS CHAPTER, nor any bona fide
employee of a registered dealer while acting for such dealer, or any
person who sells, offers for sale or lease or acts as agent, broker or
intermediary in effecting the purchase or lease of three or fewer auto-
mobiles in any calendar year, any national service which aggregates
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11745-02-4
S. 7553--A 2
information for consumers, but does not otherwise have contact with
consumers, or any motor vehicle franchisor, manufacturer, [or] distribu-
tor, DISTRIBUTOR BRANCH OR FACTORY BRANCH registered under article
sixteen of the vehicle and traffic law.
§ 2. Section 736 of the general business law is amended by adding a
new subdivision 4 to read as follows:
4. "PLACE OF BUSINESS" MEANS A DESIGNATED PERMANENT LOCATION AT WHICH
THE BUSINESS OF THE AUTOMOBILE BROKER BUSINESS IS CONDUCTED.
§ 3. The general business law is amended by adding a new section 736-b
to read as follows:
§ 736-B. PLACE OF BUSINESS REQUIRED. 1. NO PERSON SHALL ENGAGE IN
BUSINESS AS AN AUTOMOBILE BROKER BUSINESS, AS DEFINED IN SECTION SEVEN
HUNDRED THIRTY-SIX OF THIS ARTICLE, WITHOUT MAINTAINING A PLACE OF BUSI-
NESS.
2. THE CERTIFICATE OF REGISTRATION FOR AN AUTOMOBILE BROKER BUSINESS
PURSUANT TO PARAGRAPH C OF SUBDIVISION SEVEN OF SECTION FOUR HUNDRED
FIFTEEN OF THE VEHICLE AND TRAFFIC LAW SHALL BE AMENDED WITHIN THIRTY
DAYS OF A CHANGE OF ADDRESS OF AN AUTOMOBILE BROKER BUSINESS TO REFLECT
THE NEW ADDRESS OF ITS PLACE OF BUSINESS.
§ 4. Subdivision 1 and the opening paragraph of subdivision 2 of
section 738 of the general business law, subdivision 1 and the opening
paragraph of subdivision 2 as added by chapter 616 of the laws of 1988,
the opening paragraph and paragraph (e) of subdivision 1 as amended by
chapter 28 of the laws of 2018, and paragraphs (f) and (g) of subdivi-
sion 1 as amended by chapter 477 of the laws of 2017, are amended to
read as follows:
1. PRIOR TO THE PURCHASE OR LEASE OF AN AUTOMOBILE, THE CONSUMER AND
THE AUTOMOBILE BROKER BUSINESS SHALL ENTER INTO A CONTRACT. Every
contract between a consumer and an automobile broker business for the
purchase OR LEASE of an automobile shall be in writing, shall be dated,
shall contain the street address of the PLACE OF BUSINESS OF THE automo-
bile broker business, THE REGISTRATION NUMBER ISSUED TO THE AUTOMOBILE
BROKER BUSINESS PURSUANT TO SECTION FOUR HUNDRED FIFTEEN OF THE VEHICLE
AND TRAFFIC LAW and THE NAME AND ADDRESS OF the consumer and shall be
signed by the consumer and by the automobile broker business. Every
contract shall comply with the requirements set forth in this section
and contain the following:
(a) A complete description of the automobile and each option, if any,
ordered; a statement of whether the automobile is or will be manufac-
tured in accordance with United States specifications and is or will be
certified by the manufacturer as such; if the automobile is not or will
not be manufactured in accordance with United States safety and environ-
mental specifications, and the consumer has retained the automobile
broker business to arrange for the modification of the automobile to
meet such specifications, the name and street address of the modifica-
tion facility and a statement in immediate proximity to such information
that the automobile broker business assumes full financial responsibil-
ity that the automobile will be properly modified to meet all United
States safety and environmental specifications.
(b) The price of the automobile including any options ordered. If the
price set forth is an estimated price, a statement in immediate proximi-
ty to the price that the price is an estimated price only and that the
consumer has the right to cancel the contract and to receive a full
refund if the final price exceeds the estimated price by more than five
percent.
S. 7553--A 3
(c) The estimated delivery date of the automobile and the place of
delivery and a statement in immediate proximity to the estimated deliv-
ery date that, if the automobile has not been delivered in accordance
with the contract within thirty days following such estimated delivery
date, the consumer has the right to cancel the contract and to receive a
full refund, unless the delay in delivery is attributable to the consum-
er.
(d) A statement of whether or not the manufacturer's warranty accompa-
nying the automobile is the same warranty as that furnished to purchas-
ers of that make automobile from an authorized dealer located in the
United States.
(e) A STATEMENT THAT THE BROKER SHALL ONLY ACCEPT PAYMENT FOR THEIR
SERVICES FROM EITHER THE DEALER SELLING OR LEASING THE AUTOMOBILE OR THE
BUYER OR LESSEE OF THE AUTOMOBILE, BUT MAY NOT ACCEPT PAYMENT FROM BOTH.
(F) A STATEMENT THAT THE CONSUMER HAS THE OPTION TO TAKE DELIVERY OF A
MOTOR VEHICLE AT THE SELLING OR LEASING DEALERSHIP.
(G) A description of any other services and an itemization of the
charges for each. Such description shall include disclosure of the auto-
mobile dealer from which the automobile was purchased OR LEASED, as well
as all fees, commissions or other valuable considerations paid by an
automobile dealer to the automobile broker business for selling, arrang-
ing, assisting or effecting the sale OR LEASE of an automobile as agent,
broker, or intermediary between the consumer and the automobile dealer.
[(f)] (H) If a consumer elects to cancel the contract pursuant to
paragraph (b) or (c) of this subdivision, he or she shall notify in
writing the automobile broker business at the address specified in the
contract. The automobile broker business shall make a full refund to the
consumer within ten business days following receipt of the request for a
refund. The contract shall contain a statement, setting forth the
consumer's right to cancel the contract under paragraphs (b) and (c) of
this subdivision and the refund obligations of the automobile broker
business.
[(g)] (I) The statements required by paragraphs (a), (b), (c), [and]
(E), (f), (G) AND (H) of this subdivision shall be printed in at least
[ten] TWELVE point bold type.
The contract shall be accompanied by a completed form in duplicate,
captioned "Notice of Cancellation" which shall be attached to the
contract and easily detachable, and which shall contain in at least
[ten] TWELVE point type the following:
§ 5. Section 741-a of the general business law, as amended by chapter
477 of the laws of 2017, is amended to read as follows:
§ 741-a. Advertising. 1. Automobile broker businesses shall clearly
and conspicuously disclose the following in all advertisements in any
medium, and in any print advertisement such disclosures shall not appear
in any footnotes and shall be situated in the top half of any such
advertisement in an easily readable typeface:
(a) That the automobile broker business is not a registered new motor
vehicle dealer but is a registered automobile broker business as defined
in section four hundred fifteen of the vehicle and traffic law;
(b) The registration number issued to the automobile broker business
pursuant to section four hundred fifteen of the vehicle and traffic law;
(c) Whether any fees may be imposed by the automobile broker business
for services rendered. Details of such compensation shall be provided by
the automobile broker business upon request by the consumer; [and]
(d) That no warranty repair services will be provided by the automo-
bile broker business; AND
S. 7553--A 4
(E) THAT THE AUTOMOBILE BROKER BUSINESS IS NOT AFFILIATED WITH ANY
MANUFACTURER, DEALERSHIP, OR DEALERSHIP GROUP.
2. THE OFFICIAL BUSINESS CERTIFICATE OF REGISTRATION SHALL BE CLEARLY
AND CONSPICUOUSLY DISPLAYED AT THE PLACE OF BUSINESS OF AN AUTOMOBILE
BROKER BUSINESS.
§ 6. The general business law is amended by adding a new section 741-c
to read as follows:
§ 741-C. PRIVATE INFORMATION SECURITY. IN ADDITION TO THE REQUIREMENTS
OF SUBDIVISION TWENTY-ONE OF SECTION FOUR HUNDRED FIFTEEN OF THE VEHICLE
AND TRAFFIC LAW, AN AUTOMOBILE BROKER BUSINESS SHALL:
1. KEEP AND MAINTAIN ALL CONSUMER RECORDS CONTAINING PRIVATE INFORMA-
TION IN A SAFE PLACE THAT IS NOT ACCESSIBLE TO PERSONS NOT EMPLOYED BY
THE AUTOMOBILE BROKER BUSINESS, INCLUDING BY KEEPING AND MAINTAINING A
CLEAR AND PERMANENT PHYSICAL BARRIER FROM OTHER BUSINESSES THAT SHARE OR
NEIGHBOR ITS PLACE OF BUSINESS;
2. HAVE A SEPARATE MAILBOX AT SUCH PLACE OF BUSINESS FOR THE AUTOMO-
BILE BROKER BUSINESS; AND
3. HAVE A METHOD OF SECURING PERSONAL INFORMATION, INCLUDING BUT NOT
LIMITED TO IN A LOCKING CABINET OR SAFE.
§ 7. Section 415 of the vehicle and traffic law is amended by adding
four new subdivisions 22, 23, 24 and 25 to read as follows:
22. COMPLIANCE. ALL DEALERS AND AUTOMOBILE BROKER BUSINESSES REGIS-
TERED UNDER SUBDIVISIONS THREE AND THREE-A OF THIS SECTION SHALL CERTIFY
AND ATTEST TO COMPLIANCE WITH SECTIONS THREE HUNDRED NINETY-NINE-CC, AS
ADDED BY CHAPTER 655 OF THE LAWS OF 2005, THREE HUNDRED NINETY-NINE-DD,
AS ADDED BY CHAPTER 487 OF THE LAWS OF 2006, THREE HUNDRED NINETY-NINE-
DDD, THREE HUNDRED NINETY-NINE-H, THREE HUNDRED NINETY-NINE-OO, THREE
HUNDRED NINETY-NINE-P, THREE HUNDRED NINETY-NINE-PP, EIGHT HUNDRED NINE-
TY-NINE-BB OF THE GENERAL BUSINESS LAW, AND PART THREE HUNDRED FOURTEEN
OF TITLE SIXTEEN OF THE CODE OF FEDERAL REGULATIONS AS APPLICABLE.
23. AUTOMOBILE BROKER RECORD REQUIREMENTS. (A) FOR EACH COMPLETED
TRANSACTION AND WITHIN THREE BUSINESS DAYS OF CONSUMMATION THEREOF,
AUTOMOBILE BROKERS SHALL MAINTAIN A PERMANENT PAPER FILE RECORD THAT
CLEARLY EVIDENCES AND RECORDS THE MAKE, MODEL, YEAR, COLOR AND VEHICLE
IDENTIFICATION NUMBER OF ALL PREVIOUSLY UNREGISTERED MOTOR VEHICLES FOR
WHICH SUCH BROKER HAS PROVIDED A SERVICE OF PURCHASING, ARRANGING,
ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF SUCH MOTOR
VEHICLE. SUCH RECORDS SHALL BE MAINTAINED FOR A SIX-YEAR PERIOD AFTER
CONSUMMATION OF THE TRANSACTION. SUCH RECORDS SHALL ALSO INCLUDE THE
NAME AND ADDRESS OF THE PURCHASER OR LESSEE OF SUCH MOTOR VEHICLE, THE
DATE OF SALE OR COMMENCEMENT OF LEASE WITH RESPECT TO SUCH MOTOR VEHICLE
AND THE NAME AND ADDRESS OF THE DEALER FROM WHICH THE MOTOR VEHICLE WAS
PURCHASED OR LEASED.
(B) THE RECORDS MAINTAINED BY THE AUTOMOBILE BROKER BUSINESSES SHALL
INCLUDE A COPY OF THE DEALER RATE SHEETS RECEIVED BY THE AUTOMOBILE
BROKER FROM THE DEALERS THAT WERE RELIED UPON BY THE AUTOMOBILE BROKER
IN CONNECTION WITH SUCH TRANSACTION.
(C) SUCH RECORDS SHALL BE OPEN FOR INSPECTION BY THE COMMISSIONER, OR
HIS OR HER AGENT, DURING REASONABLE BUSINESS HOURS.
(D) AS AN ALTERNATIVE TO PAPER FILE RECORDS, AN AUTOMOBILE BROKER MAY
USE A COMPUTER AND APPROPRIATE SOFTWARE TO MAINTAIN THE RECORDS REQUIRED
TO BE KEPT BY THIS SECTION, PROVIDED ALL INFORMATION REQUIRED BY PARA-
GRAPHS (A) AND (B) OF THIS SUBDIVISION ARE DULY RECORDED AND MAINTAINED
IN ACCORDANCE WITH THIS SUBDIVISION.
24. MAINTENANCE RECORDS. FOR EACH SALE OR LEASE OF A MOTOR VEHICLE
THAT INVOLVES AN AUTOMOBILE BROKER BUSINESS, THE DEALER MUST OBTAIN
S. 7553--A 5
EVIDENCE OF THE AUTOMOBILE BROKER BUSINESS' REGISTRATION AND THE
BROKER'S REGISTRATION NUMBER AND MAINTAIN SUCH RECORDS IN THE DEAL JACK-
ET FOR EACH TRANSACTION WHICH ALSO SHALL CONTAIN THE PURCHASE ORDER,
COPIES OF THE TITLE AND REGISTRATION DOCUMENTS, THE BILL OF SALE AND THE
RETAIL INSTALLMENT SALE CONTRACT REQUIRED UNDER ARTICLE TEN OF THE
PERSONAL PROPERTY LAW OR THE RETAIL LEASE AGREEMENT REQUIRED UNDER ARTI-
CLE NINE-A OF THE PERSONAL PROPERTY LAW.
25. BROKER COMPENSATION. NO DEALER MAY OFFER OR PAY AN AUTOMOBILE
BROKER BUSINESS ANY FEE, OR COMMISSION, OTHER THAN COMPENSATION
DISCLOSED PURSUANT TO SECTION SEVEN HUNDRED THIRTY-EIGHT OR SEVEN
HUNDRED FORTY-ONE-B OF THE GENERAL BUSINESS LAW OR SECTION THREE HUNDRED
TWO OR THREE HUNDRED THIRTY-SEVEN OF THE PERSONAL PROPERTY LAW;
PROVIDED, HOWEVER, THAT THE AUTOMOBILE BROKER BUSINESS MAY NOT ACCEPT
ANY SUCH FEE OR COMMISSION FROM THE DEALER IF THE BROKER HAS OR WILL
ACCEPT PAYMENT FROM THE BUYER OR LESSEE OF THE AUTOMOBILE.
§ 8. The general business law is amended by adding a new section 745
to read as follows:
§ 745. PREEMPTION. THE PROVISIONS OF THIS ARTICLE AND SECTION FOUR
HUNDRED FIFTEEN OF THE VEHICLE AND TRAFFIC LAW SHALL GOVERN THE REQUIRE-
MENTS AND OBLIGATIONS WITH RESPECT TO THE AUTOMOBILE BROKER BUSINESS
NOTWITHSTANDING ANY OTHER LAW TO THE CONTRARY. NO LOCAL OR MUNICIPAL LAW
SHALL BE ENACTED WHICH SHALL IMPOSE ANY DIFFERENT OR OTHER OBLIGATIONS
ON THE AUTOMOBILE BROKER BUSINESS INCLUDING A REQUIREMENT OF ANY FEE OR
LICENSE FOR THE AUTOMOBILE BROKER BUSINESS.
§ 9. Section 741-b of the general business law, as added by chapter 28
of the laws of 2018, is amended to read as follows:
§ 741-b. Disclosure. An automobile broker business shall provide a
disclosure at the time such automobile broker business takes an order to
search for a leased OR PURCHASED vehicle meeting the prospective
lessee's specifications. Such disclosure shall provide the amount of any
fees, commissions or other valuable consideration the automobile broker
business expects to receive, if known, from a dealer, lessor or any
other person or entity for any assistance the automobile broker business
provides in effecting the lease OR PURCHASE transaction. If the amount
of any such fees, commissions or other valuable consideration the auto-
mobile broker business expects to receive is unknown at the time of the
required disclosure, the automobile broker business shall disclose: (a)
whether it has a contract with any dealer, lessor or any other person or
entity for the provision of assistance in effecting a lease OR PURCHASE
transaction; [and] (b) [whether] THAT the automobile broker business
[may] SHALL be compensated by the dealer, lessor or any other person or
entity for any assistance in effecting such lease transaction; AND (C)
THAT THE AMOUNT OF ANY SUCH FEES, COMMISSIONS OR OTHER VALUABLE CONSID-
ERATION THE AUTOMOBILE BROKER BUSINESS RECEIVES, WHETHER FROM THE DEALER
OR THE BUYER OF THE AUTOMOBILE, SHALL BE DISCLOSED ON THE EXECUTED LEASE
OR PURCHASE CONTRACT OR FINANCE AGREEMENT PURSUANT TO SECTION THREE
HUNDRED TWO OR THREE HUNDRED THIRTY-SEVEN OF THE PERSONAL PROPERTY LAW.
§ 10. The general business law is amended by adding a new section
741-d to read as follows:
§ 741-D. PROHIBITED ACTS. AN AUTOMOBILE BROKER BUSINESS IS PROHIBITED
FROM:
1. ADVERTISING THAT SUCH AUTOMOBILE BROKER BUSINESS HAS ANY NEW AUTO-
MOBILE IN STOCK;
2. ADVERTISING ANY PRICE FIGURE IN AN ADVERTISEMENT UNLESS SUCH FIGURE
REPRESENTS THE ACTUAL PRICE OF THE ADVERTISED AUTOMOBILE, EXCLUSIVE OF
REGISTRATION AND TITLES, FEES AND TAXES;
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3. STARTING, COMPLETING, OR ANSWERING ANY PORTION OF A FINANCING OR
CREDIT APPLICATION OR THE LEASE OR PURCHASE AGREEMENT OF AN AUTOMOBILE,
ON BEHALF OF A CONSUMER OR DEALER, WITHOUT INCLUDING ON OR AFFIXING TO
SUCH APPLICATION OR AGREEMENT, THE NAME AND REGISTRATION NUMBER OF THE
AUTOMOBILE BROKER BUSINESS; AND
4. ACCEPTING ANY PAYMENT OTHER THAN THAT DISCLOSED UNDER SECTION SEVEN
HUNDRED THIRTY-EIGHT OR SEVEN HUNDRED FORTY-ONE-B OF THIS ARTICLE,
WHETHER FROM THE DEALER OR BUYER OF THE AUTOMOBILE.
§ 11. Section 743 of the general business law, as amended by chapter
372 of the laws of 2016, is amended to read as follows:
§ 743. Enforcement by attorney general. 1. In addition to the other
remedies provided, whenever there shall be a violation of this article,
application may be made by the attorney general in the name of the
people of the state of New York to a court or justice having jurisdic-
tion by a special proceeding to issue an injunction, and upon notice to
the defendant of not less than five days, to enjoin and restrain the
continuance of such violations; and if it shall appear to the satisfac-
tion of the court or justice that the defendant has, in fact, violated
this article, an injunction may be issued by such court or justice,
enjoining and restraining any further violation, without requiring proof
that any person has, in fact, been injured or damaged thereby. In any
such proceeding, the court may make allowances to the attorney general
as provided in paragraph six of subdivision (a) of section eighty-three
hundred three of the civil practice law and rules, and direct restitu-
tion. Whenever the court shall determine that a violation of this arti-
cle has occurred, the court shall impose a civil penalty of not less
than one thousand dollars and not more than three thousand dollars for
each violation. In connection with any such proposed application, the
attorney general is authorized to take proof and make a determination of
the relevant facts and to issue subpoenas in accordance with the civil
practice law and rules.
2. THE PROVISIONS OF THIS ARTICLE MAY BE ENFORCED CONCURRENTLY BY A
MUNICIPAL CONSUMER AFFAIRS OFFICE.
§ 12. Severability. If any clause, sentence, paragraph, subdivision,
section or part of this act shall be adjudged by any court of competent
jurisdiction to be invalid, such judgment shall not affect, impair, or
invalidate the remainder thereof, but shall be confined in its operation
to the clause, sentence, paragraph, subdivision, section or part thereof
directly involved in the controversy in which such judgment shall have
been rendered. It is hereby declared to be the intent of the legislature
that this act would have been enacted even if such invalid provisions
had not been included herein.
§ 13. This act shall take effect on the one hundred eightieth day
after it shall have become a law. Effective immediately, the addition,
amendment and/or repeal of any rule or regulation necessary for the
implementation of this act on its effective date are authorized to be
made and completed on or before such effective date.
