Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 394 Second Substitute (2015GS)

Sponsor

Rep. Coleman, K.

Final action

LFA/ fiscal note publicly available 3/10/2015

Outcome

LFA/ fiscal note publicly available

Summary

What it does

• This bill:
• defines terms;
• allows and creates a license for a new car dealer to conduct business exclusively online;
• creates a license for an online salesperson;
• exempts a franchisee who operates exclusively online from the provisions of the New Automobile Franchise Act; and
• makes technical and conforming changes.

Every vote on this bill

Bill text

NEW CAR SALES AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Kim Coleman
Senate Sponsor: 
____________
LONG TITLE
General Description:
This bill modifies provisions relating to the sale of new motor vehicles.
Highlighted Provisions:
This bill:
▸ defines terms;
▸ allows and creates a license for a new car dealer to conduct business exclusively
online;
▸ creates a license for an online salesperson;
▸ exempts a franchisee who operates exclusively online from the provisions of the
New Automobile Franchise Act; and
▸ makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
41-1a-802
, as last amended by Laws of Utah 2005, Chapter 32
41-3-102
, as last amended by Laws of Utah 2014, Chapter 237
41-3-103
, as last amended by Laws of Utah 2010, Chapter 393
41-3-105
, as last amended by Laws of Utah 2010, Chapter 393
41-3-201
, as last amended by Laws of Utah 2013, Chapter 463
41-3-202
, as last amended by Laws of Utah 2009, Chapter 78
41-3-203
, as renumbered and amended by Laws of Utah 1992, Chapter 234
41-3-204
, as last amended by Laws of Utah 2008, Chapter 388
41-3-209
, as last amended by Laws of Utah 2012, Chapter 145
41-3-210
, as last amended by Laws of Utah 2007, Chapter 322
59-12-107
, as last amended by Laws of Utah 2012, Chapters 178, 312, and 399
ENACTS:
13-14-108
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
13-14-108
 is enacted to read:
 13-14-108.
Applicability.
The provisions of this chapter do not apply to the parties to a franchise agreement under
which the franchisee agrees to transact business exclusively online.
Section 2. Section 
41-1a-802
 is amended to read:
41-1a-802.
Identification number inspectors -- Duties.
(1) The following are qualified identification number inspectors:
(a) the commission;
(b) designated officers and employees of the division;
(c) a person operating a safety inspection station under Title 53, Chapter 8, Part 2,
Motor Vehicle Safety Inspection Act;
(d) an official inspection station certified inspector;
(e) a dealer licensed under Subsection 
41-3-202
(1), (2), [
(3), or
] (4)
, or (5)
; and
(f) all peace officers of the state.
(2) The qualified identification number inspectors shall, upon the application for the
first registration in this state of any vehicle:
(a) inspect the identification number of the vehicle;
(b) make a record of the identification number inspection upon an application form
provided by the division; and
(c) verify the facts in the application.
Section 3. Section 
41-3-102
 is amended to read:
41-3-102.
Definitions.
As used in this chapter:
(1) "Administrator" means the motor vehicle enforcement administrator.
(2) "Agent" means a person other than a holder of any dealer's or salesperson's license
issued under this chapter, who for salary, commission, or compensation of any kind, negotiates
in any way for the sale, purchase, order, or exchange of three or more motor vehicles for any
other person in any 12-month period.
(3) "Auction" means a dealer engaged in the business of auctioning motor vehicles,
either owned or consigned, to the general public.
(4) "Board" means the advisory board created in Section 
41-3-106
.
(5) "Body shop" means a business engaged in rebuilding, restoring, repairing, or
painting primarily the body of motor vehicles damaged by collision or natural disaster.
(6) "Commission" means the State Tax Commission.
(7) "Crusher" means a person who crushes or shreds motor vehicles subject to
registration under Title 41, Chapter 1a, Motor Vehicle Act, to reduce the useable materials and
metals to a more compact size for recycling.
(8) (a) "Dealer" means a person:
(i) whose business in whole or in part involves selling new, used, or new and used
motor vehicles or off-highway vehicles; and
(ii) who sells, displays for sale, or offers for sale or exchange three or more new or
used motor vehicles or off-highway vehicles in any 12-month period.
(b) "Dealer" includes a representative or consignee of any dealer.
(9) (a) "Dismantler" means a person engaged in the business of dismantling motor
vehicles subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, for the resale of
parts or for salvage.
(b) "Dismantler" includes a person who dismantles three or more motor vehicles in any
12-month period.
(10) "Distributor" means a person who has a franchise from a manufacturer of motor
vehicles to distribute motor vehicles within this state and who in whole or in part sells or
distributes new motor vehicles to dealers or who maintains distributor representatives.
(11) "Distributor branch" means a branch office similarly maintained by a distributor
for the same purposes a factory branch is maintained.
(12) "Distributor representative" means a person and each officer and employee of the
person engaged as a representative of a distributor or distributor branch of motor vehicles to
make or promote the sale of the distributor or the distributor branch's motor vehicles, or for
supervising or contacting dealers or prospective dealers of the distributor or the distributor
branch.
(13) "Division" means the Motor Vehicle Enforcement Division created in Section
41-3-104
.
(14) "Factory branch" means a branch office maintained by a person who manufactures
or assembles motor vehicles for sale to distributors, motor vehicle dealers, or who directs or
supervises the factory branch's representatives.
(15) "Factory representative" means a person and each officer and employee of the
person engaged as a representative of a manufacturer of motor vehicles or by a factory branch
to make or promote the sale of the manufacturer's or factory branch's motor vehicles, or for
supervising or contacting the dealers or prospective dealers of the manufacturer or the factory
branch.
(16) "Franchise" means a contract or agreement between a dealer and a manufacturer of
new motor vehicles or its distributor or factory branch by which the dealer is authorized to sell
any specified make or makes of new motor vehicles.
(17) "Manufacturer" means a person engaged in the business of constructing or
assembling new motor vehicles, ownership of which is customarily transferred by a
manufacturer's statement or certificate of origin, or a person who constructs three or more new
motor vehicles in any 12-month period.
(18) "Motorcycle" has the same meaning as defined in Section 
41-1a-102
.
(19) (a) "Motor vehicle" means a vehicle that is:
(i) self-propelled;
(ii) a trailer, travel trailer, or semitrailer; or
(iii) an off-highway vehicle or small trailer.
(b) "Motor vehicle" does not include:
(i) mobile homes as defined in Section 
41-1a-102
;
(ii) trailers of 750 pounds or less unladen weight;
(iii) farm tractors and other machines and tools used in the production, harvesting, and
care of farm products; and
(iv) park model recreational vehicles as defined in Section 
41-1a-102
.
(20) "New motor vehicle" means a motor vehicle that has never been titled or
registered and has been driven less than 7,500 miles, unless the motor vehicle is an
off-highway vehicle, small trailer, trailer, travel trailer, or semitrailer, in which case the
mileage limit does not apply.
(21) "Off-highway vehicle" has the same meaning as provided in Section 
41-22-2
.
(22) "Online dealer" means a person who sells, displays for sale, or offers for sale or
exchange:
(a) three or more new motor vehicles in any 12-month period; and
(b) exclusively online.
(23) "Online salesperson" means an individual who for a salary, commission, or
compensation of any kind, is employed either directly, indirectly, regularly, or occasionally by
an online dealer to sell, purchase, or exchange, or to negotiate for the sale, purchase, or
exchange of new motor vehicles.
[
(22)
] 
(24)
 "Pawnbroker" means a person whose business is to lend money on security
of personal property deposited with him.
[
(23)
] 
(25)
 "Principal place of business" means a site or location in this state:
(a) devoted exclusively to the business for which the dealer, manufacturer,
remanufacturer, transporter, dismantler, crusher, or body shop is licensed, and businesses
incidental to them;
(b) sufficiently bounded by fence, chain, posts, or otherwise marked to definitely
indicate the boundary and to admit a definite description with space adequate to permit the
display of three or more new, or new and used, or used motor vehicles and sufficient parking
for the public; and
(c) that includes a permanent enclosed building or structure large enough to
accommodate the office of the establishment and to provide a safe place to keep the books and
other records of the business, at which the principal portion of the business is conducted and
the books and records kept and maintained.
[
(24)
] 
(26)
 "Remanufacturer" means a person who reconstructs used motor vehicles
subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, to change the body style
and appearance of the motor vehicle or who constructs or assembles motor vehicles from used
or new and used motor vehicle parts, or who reconstructs, constructs, or assembles three or
more motor vehicles in any 12-month period.
[
(25)
] 
(27)
 "Salesperson" means an individual who for a salary, commission, or
compensation of any kind, is employed either directly, indirectly, regularly, or occasionally by
any new motor vehicle dealer or used motor vehicle dealer to sell, purchase, or exchange or to
negotiate for the sale, purchase, or exchange of motor vehicles.
[
(26)
] 
(28)
 "Semitrailer" has the same meaning as defined in Section 
41-1a-102
.
[
(27)
] 
(29)
 "Small trailer" means a trailer that has an unladen weight of more than 750
pounds, but less than 2,000 pounds.
[
(28)
] 
(30)
 "Special equipment" includes a truck mounted crane, cherry picker, material
lift, post hole digger, and a utility or service body.
[
(29)
] 
(31)
 "Special equipment dealer" means a new or new and used motor vehicle
dealer engaged in the business of buying new incomplete motor vehicles with a gross vehicle
weight of 12,000 or more pounds and installing special equipment on the incomplete motor
vehicle.
[
(30)
] 
(32)
 "Trailer" has the same meaning as defined in Section 
41-1a-102
.
[
(31)
] 
(33)
 "Transporter" means a person engaged in the business of transporting motor
vehicles as described in Section 
41-3-202
.
[
(32)
] 
(34)
 "Travel trailer" has the same meaning as provided in Section 
41-1a-102
.
[
(33)
] 
(35)
 "Used motor vehicle" means a vehicle that has been titled and registered to
a purchaser other than a dealer or has been driven 7,500 or more miles, unless the vehicle is a
trailer, or semitrailer, in which case the mileage limit does not apply.
[
(34)
] 
(36)
 "Wholesale motor vehicle auction" means a dealer primarily engaged in the
business of auctioning consigned motor vehicles to dealers or dismantlers who are licensed by
this or any other jurisdiction.
Section 4. Section 
41-3-103
 is amended to read:
41-3-103.
Exceptions to "dealer" definition -- Dealer licensed in other state --
Online dealer or salesperson.
Under this chapter:
(1) (a) An insurance company, bank, finance company, company registered as a title
lender under Title 7, Chapter 24, Title [
Lender
] 
Lending
 Registration Act, company registered
as a check casher or deferred deposit lender under Title 7, Chapter 23, Check Cashing and
Deferred Deposit Lending Registration Act, public utility company, commission impound yard,
federal or state governmental agency, or any political subdivision of any of them or any other
person coming into possession of a motor vehicle as an incident to its regular business, that
sells the motor vehicle under contractual rights that it may have in the motor vehicle is not
considered a dealer.
(b) A person who sells or exchanges only those motor vehicles that the person has
owned for over 12 months is not considered a dealer.
(2) (a) A person engaged in leasing motor vehicles is not considered as coming into
possession of the motor vehicles incident to the person's regular business.
(b) A pawnbroker engaged in selling, exchanging, or pawning motor vehicles is
considered as coming into possession of the motor vehicles incident to the person's regular
business and must be licensed as a used motor vehicle dealer.
(3) A person currently licensed as a dealer or salesperson by another state or country
and not currently under license suspension or revocation by the administrator may only sell
motor vehicles in this state to licensed dealers, dismantlers, or manufacturers, and only at their
places of business.
(4) Except as otherwise expressly provided:
(a) an online dealer is subject to the same provisions under this chapter as a new motor
vehicle dealer; and
(b) an online salesperson is subject to the same provisions under this chapter as a
salesperson.
(5) Notwithstanding any provision of this section to the contrary, an online dealer may:
(a) operate without a principal place of business; and
(b) sell new motor vehicles without a franchise, if the online dealer also manufactures
the new motor vehicles.
Section 5. Section 
41-3-105
 is amended to read:
41-3-105.
Administrator's powers and duties -- Administrator and investigators
to be law enforcement officers.
(1) The administrator may make rules to carry out the purposes of this chapter and
Sections 
41-1a-1001
 through 
41-1a-1007
 according to the procedures and requirements of Title
63G, Chapter 3, Utah Administrative Rulemaking Act.
(2) (a) The administrator may employ clerks, deputies, and assistants necessary to
discharge the duties under this chapter and may designate the duties of those clerks, deputies,
and assistants.
(b) The administrator, assistant administrator, and all investigators shall be law
enforcement officers certified by peace officer standards and training as required by Section
53-13-103
.
(3) (a) The administrator may investigate any suspected or alleged violation of:
(i) this chapter;
(ii) Title 41, Chapter 1a, Motor Vehicle Act;
(iii) any law concerning motor vehicle fraud; or
(iv) any rule made by the administrator.
(b) The administrator may bring an action in the name of the state against any person to
enjoin a violation found under Subsection (3)(a).
(4) (a) The administrator may prescribe forms to be used for applications for licenses.
(b) The administrator may require information from the applicant concerning the
applicant's fitness to be licensed.
(c) Each application for a license shall contain:
(i) if the applicant is an individual, the name and residence address of the applicant and
the trade name, if any, under which the applicant intends to conduct business;
(ii) if the applicant is a partnership, the name and residence address of each partner,
whether limited or general, and the name under which the partnership business will be
conducted;
(iii) if the applicant is a corporation, the name of the corporation, and the name and
residence address of each of its principal officers and directors;
(iv) 
unless the applicant is applying for an online dealer license or an online
salesperson license,
 a complete description of the principal place of business, including:
(A) the municipality, with the street and number, if any;
(B) if located outside of any municipality, a general description so that the location can
be determined; and
(C) any other places of business operated and maintained by the applicant in
conjunction with the principal place of business;
(v) if the application is for a new motor vehicle dealer's license, the name of each
motor vehicle the applicant has been enfranchised to sell or exchange, the name and address of
the manufacturer or distributor who has enfranchised the applicant, and the names and
addresses of the individuals who will act as salespersons under authority of the license;
(vi) at least five years of business history;
(vii) the federal tax identification number issued to the dealer; and
(viii) the sales and use tax license number issued to the dealer under Title 59, Chapter
12, Sales and Use Tax Act
, if applicable
.
(5) The administrator may adopt a seal with the words "Motor Vehicle Enforcement
Administrator, State of Utah," to authenticate the acts of the administrator's office.
(6) (a) The administrator may require that [
the
] 
a
 licensee
, other than an online dealer
or online salesperson,
 erect or post signs or devices on the licensee's principal place of business
and any other sites, equipment, or locations operated and maintained by the licensee in
conjunction with the licensee's business.
(b) The signs or devices shall state the licensee's name, principal place of business,
type and number of licenses, and any other information that the administrator considers
necessary to identify the licensee.
(c) The administrator may make rules in accordance with Title 63G, Chapter 3, Utah
Administrative Rulemaking Act, determining allowable size and shape of signs or devices,
their lettering and other details, and their location.
(7) (a) The administrator shall provide for quarterly meetings of the advisory board and
may call special meetings.
(b) Notices of all meetings shall be sent to each member not fewer than five days prior
to the meeting.
(8) The administrator, the officers and inspectors of the division designated by the
commission, and peace officers shall:
(a) make arrests upon view and without warrant for any violation committed in their
presence of any of the provisions of this chapter, or Title 41, Chapter 1a, Motor Vehicle Act;
(b) when on duty, upon reasonable belief that a motor vehicle, trailer, or semitrailer is
being operated in violation of any provision of Title 41, Chapter 1a, Motor Vehicle Act, require
the driver of the vehicle to stop, exhibit the person's driver license and the registration card
issued for the vehicle and submit to an inspection of the vehicle, the license plates, and
registration card;
(c) serve all warrants relating to the enforcement of the laws regulating the operation of
motor vehicles, trailers, and semitrailers;
(d) investigate traffic accidents and secure testimony of witnesses or persons involved;
and
(e) investigate reported thefts of motor vehicles, trailers, and semitrailers.
(9) The administrator may contract with a public prosecutor to provide additional
prosecution of this chapter.
Section 6. Section 
41-3-201
 is amended to read:
41-3-201.
Licenses required -- Restitution -- Education.
(1) As used in this section, "new applicant" means a person who is applying for a
license that the person has not been issued during the previous licensing year.
(2) A person may not act as any of the following without having procured a license
issued by the administrator:
(a) a dealer;
(b) salvage vehicle buyer;
(c) salesperson;
(d) manufacturer;
(e) transporter;
(f) dismantler;
(g) distributor;
(h) factory branch and representative;
(i) distributor branch and representative;
(j) crusher;
(k) remanufacturer; [
or
]
(l) body shop[
.
]
;
(m) online dealer; or
(n) online salesperson.
(3) (a) Except as provided in Subsection (3)(c), a person may not bid on or purchase a
vehicle with a nonrepairable or salvage certificate as defined in Section 
41-1a-1001
 at or
through a motor vehicle auction unless the person is a licensed salvage vehicle buyer.
(b) Except as provided in Subsection (3)(c), a person may not offer for sale, sell, or
exchange a vehicle with a nonrepairable or salvage certificate as defined in Section 
41-1a-1001
at or through a motor vehicle auction except to a licensed salvage vehicle buyer.
(c) A person may offer for sale, sell, or exchange a vehicle with a nonrepairable or
salvage certificate as defined in Section 
41-1a-1001
 at or through a motor vehicle auction:
(i) to an out-of-state or out-of-country purchaser not licensed under this section, but
that is authorized to do business in the domestic or foreign jurisdiction in which the person is
domiciled or registered to do business;
(ii) subject to the restrictions in Subsection (3)(d), to an in-state purchaser not licensed
under this section that:
(A) has a valid business license in Utah; and
(B) has a Utah sales tax license; and
(iii) to a crusher.
(d) (i) An operator of a motor vehicle auction shall verify that an in-state purchaser not
licensed under this section has the licenses required in Subsection (3)(c)(ii).
(ii) An operator of a motor vehicle auction may only offer for sale, sell, or exchange
five vehicles with a salvage certificate as defined in Section 
41-1a-1001
 at or through a motor
vehicle auction in any 12 month period to an in-state purchaser that does not have a salvage
vehicle buyer license issued in accordance with Subsection 
41-3-202
[
(15)
]
(17)
.
(iii) The five vehicle limitation under this Subsection (3)(d) applies to each Utah sales
tax license and not to each person with the authority to use a sales tax license.
(iv) An operator of a motor vehicle auction may not sell a vehicle with a nonrepairable
certificate as defined in Section 
41-1a-1001
 to a purchaser otherwise allowed to purchase a
vehicle under Subsection (3)(c)(ii).
(e) For a vehicle with a salvage certificate purchased under Subsection (3)(c)(ii), an
operator of a motor vehicle auction shall:
(i) (A) until Subsection (3)(e)(i)(B) applies, make application for a salvage certificate
of title on behalf of the Utah purchaser within seven days of the purchase if the purchaser does
not have a salvage vehicle buyer license, dealer license, body shop license, or dismantler
license issued in accordance with Section 
41-3-202
; or
(B) beginning on or after the date that the Motor Vehicle Division has implemented the
Motor Vehicle Division's GenTax system, make application electronically, in a form and time
period approved by the Motor Vehicle Division, for a salvage certificate of title to be issued in
the name of the purchaser;
(ii) give to the purchaser a disclosure printed on a separate piece of paper that states:
"THIS DISCLOSURE STATEMENT MUST BE GIVEN BY THE SELLER TO THE
BUYER EVERY TIME THIS VEHICLE IS RESOLD WITH A SALVAGE CERTIFICATE
Vehicle Identification Number (VIN)
Year: Make: Model:
SALVAGE VEHICLE--NOT FOR RESALE WITHOUT DISCLOSURE
WARNING: THIS SALVAGE VEHICLE MAY NOT BE SAFE FOR OPERATION
UNLESS PROPERLY REPAIRED. SOME STATES MAY REQUIRE AN INSPECTION
BEFORE THIS VEHICLE MAY BE REGISTERED. THE STATE OF UTAH MAY
REQUIRE THIS VEHICLE TO BE PERMANENTLY BRANDED AS A REBUILT
SALVAGE VEHICLE. OTHER STATES MAY ALSO PERMANENTLY BRAND THE
CERTIFICATE OF TITLE.
_________________________________________________________________
Signature of Purchaser Date"; and
(iii) if applicable, provide evidence to the Motor Vehicle Division of:
(A) payment of sales taxes on taxable sales in accordance with Section 
41-1a-510
;
(B) the identification number inspection required under Section 
41-1a-511
; and
(C) the odometer disclosure statement required under Section 
41-1a-902
.
(f) The Motor Vehicle Division shall include a link to the disclosure statement
described in Subsection (3)(e)(ii) on its website.
(g) The commission may impose an administrative entrance fee established in
accordance with the procedures and requirements of Section 
63J-1-504
 not to exceed $10 on a
person not holding a license described in Subsection (3)(e)(i) that enters the physical premises
of a motor vehicle auction for the purpose of viewing available salvage vehicles prior to an
auction.
(h) A vehicle sold at or through a motor vehicle auction to an out-of-state purchaser
with a nonrepairable or salvage certificate may not be certificated in Utah until the vehicle has
been certificated out-of-state.
(4) (a) An operator of a motor vehicle auction shall keep a record of the sale of each
salvage vehicle.
(b) A record described under Subsection (4)(a) shall contain:
(i) the purchaser's name and address; and
(ii) the year, make, and vehicle identification number for each salvage vehicle sold.
(c) An operator of a motor vehicle auction shall:
(i) provide the record described in Subsection (4)(a) electronically in a method
approved by the division to the division within two business days of the completion of the
motor vehicle auction;
(ii) retain the record described in this Subsection (4) for five years from the date of
sale; and
(iii) make a record described in this Subsection (4) available for inspection by the
division at the location of the motor vehicle auction during normal business hours.
(5) (a) If applicable, an operator of a motor vehicle auction shall comply with the
reporting requirements of the National Motor Vehicle Title Information System overseen by
the United States Department of Justice if the person sells a vehicle with a salvage certificate to
an in-state purchaser under Subsection (3)(c)(ii).
(b) The Motor Vehicle Division shall include a link to the National Motor Vehicle
Title Information System on its website.
(6) (a) An operator of a motor vehicle auction that sells a salvage vehicle to a person
that is an out-of-country buyer shall:
(i) stamp on the face of the title so as not to obscure the name, date, or mileage
statement the words "FOR EXPORT ONLY" in all capital, black letters; and
(ii) stamp in each unused reassignment space on the back of the title the words "FOR
EXPORT ONLY."
(b) The words "FOR EXPORT ONLY" shall be:
(i) at least two inches wide; and
(ii) clearly legible.
(7) A supplemental license shall be secured by a dealer, manufacturer, remanufacturer,
transporter, dismantler, crusher, or body shop for each additional place of business maintained
by the licensee.
(8) (a) A person who has been convicted of any law relating to motor vehicle
commerce or motor vehicle fraud may not be issued a license or purchase a vehicle with a
salvage or nonrepairable certificate unless full restitution regarding those convictions has been
made.
(b) An operator of a motor vehicle auction, a dealer, or a consignor may not sell a
vehicle with a nonrepairable or salvage certificate to a buyer described in Subsection (8)(a) if
the division has informed the operator of the motor vehicle auction, the dealer, or the consignor
in writing that the buyer is prohibited from purchasing a vehicle with a nonrepairable or
salvage certificate under Subsection (8)(a).
(9) (a) The division may not issue a license to a new applicant for a new or used motor
vehicle dealer license, a new or used motorcycle dealer license, 
an online dealer,
 or a small
trailer dealer license unless the new applicant completes an eight-hour orientation class
approved by the division that includes education on motor vehicle laws and rules.
(b) The approved costs of the orientation class shall be paid by the new applicant.
(c) The class shall be completed by the new applicant and the applicant's partners,
corporate officers, bond indemnitors, and managers.
(d) (i) The division shall approve:
(A) providers of the orientation class; and
(B) costs of the orientation class.
(ii) A provider of an orientation class shall submit the orientation class curriculum to
the division for approval prior to teaching the orientation class.
(iii) A provider of an orientation class shall include in the orientation materials:
(A) ethics training;
(B) motor vehicle title and registration processes;
(C) provisions of Title 13, Chapter 5, Unfair Practices Act, relating to motor vehicles;
(D) Department of Insurance requirements relating to motor vehicles;
(E) Department of Public Safety requirements relating to motor vehicles;
(F) federal requirements related to motor vehicles as determined by the division; and
(G) any required disclosure compliance forms as determined by the division.
(10) A person or purchaser described in Subsection (3)(c)(ii):
(a) may not purchase more than five salvage vehicles with a nonrepairable or salvage
certificate as defined in Section 
41-1a-1001
 in any 12-month period;
(b) may not, without first complying with Section 
41-1a-705
, offer for sale, sell, or
exchange more than two vehicles with a salvage certificate as defined in Section 
41-1a-1001
 in
any 12-month period to a person not licensed under this section; and
(c) may not, without first complying with Section 
41-1a-705
, offer for sale, sell, or
exchange a vehicle with a nonrepairable certificate as defined in Section 
41-1a-1001
 to a 
person not licensed under this section.
(11) An operator of a motor vehicle auction, a dealer, or a consignor may not sell a
vehicle with a nonrepairable or salvage certificate to a buyer described in Subsection (10)(a) if
the division has informed the operator of the motor vehicle auction, the dealer, or the consignor
in writing that the buyer is prohibited from purchasing a vehicle with a nonrepairable or
salvage certificate under Subsection (10)(a).
Section 7. Section 
41-3-202
 is amended to read:
41-3-202.
Licenses -- Classes and scope.
(1) A new motor vehicle dealer's license permits the licensee to:
(a) offer for sale, sell, or exchange new motor vehicles if the licensee possesses a
franchise from the manufacturer of the motor vehicle offered for sale, sold, or exchanged by the
licensee;
(b) offer for sale, sell, or exchange used motor vehicles;
(c) operate as a body shop; and
(d) dismantle motor vehicles.
(2) A used motor vehicle dealer's license permits the licensee to:
(a) offer for sale, sell, or exchange used motor vehicles;
(b) operate as a body shop; and
(c) dismantle motor vehicles.
(3) An online dealer's license permits the licensee to offer new motor vehicles for sale,
sell, or exchange exclusively online.
[
(3)
] 
(4)
 A new motorcycle, off-highway vehicle, and small trailer dealer's license
permits the licensee to:
(a) offer for sale, sell, or exchange new motorcycles, off-highway vehicles, or small
trailers if the licensee possesses a franchise from the manufacturer of the motorcycle,
off-highway vehicle, or small trailer offered for sale, sold, or exchanged by the licensee;
(b) offer for sale, sell, or exchange used motorcycles, off-highway vehicles, or small
trailers; and
(c) dismantle motorcycles, off-highway vehicles, or small trailers.
[
(4)
] 
(5)
 A used motorcycle, off-highway vehicle, and small trailer dealer's license
permits the licensee to:
(a) offer for sale, sell, or exchange used motorcycles, off-highway vehicles, and small
trailers; and
(b) dismantle motorcycles, off-highway vehicles, or small trailers.
[
(5)
] 
(6)
 (a) Except as provided in Subsection [
(5)
] 
(6)
(b), a salesperson's license
permits the licensee to act as a motor vehicle salesperson and is valid for employment with
only one dealer at a time.
(b) A licensee that has been issued a salesperson's license and that is employed by a
dealer that operates as a wholesale motor vehicle auction may be employed by more than one
dealer that operates as a wholesale motor vehicle auction at a time.
(7) An online salesperson's license permits the licensee to sell, purchase, or exchange,
or to negotiate for the sale, purchase, or exchange of new motor vehicles for one online dealer.
[
(6)
] 
(8)
 (a) A manufacturer's license permits the licensee to construct or assemble
motor vehicles subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, at an
established place of business and to remanufacture motor vehicles.
(b) Under rules made by the administrator, the licensee may issue and install vehicle
identification numbers on manufactured motor vehicles.
(c) The licensee may franchise and appoint dealers to sell manufactured motor vehicles
by notifying the division of the franchise or appointment.
[
(7)
] 
(9)
 A transporter's license permits the licensee to transport or deliver motor
vehicles subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, from a
manufacturing, assembling, or distributing point or from a dealer, to dealers, distributors, or
sales agents of a manufacturer or remanufacturer, to or from detail or repair shops, and to
financial institutions or places of storage from points of repossession.
[
(8)
] 
(10)
 A dismantler's license permits the licensee to dismantle motor vehicles
subject to registration under Title 41, Chapter 1a, Motor Vehicle Act, for the purpose of
reselling parts or for salvage, or selling dismantled or salvage vehicles to a crusher or other
dismantler.
[
(9)
] 
(11)
 A distributor or factory branch and distributor branch's license permits the
licensee to sell and distribute new motor vehicles, parts, and accessories to their franchised
dealers.
[
(10)
] 
(12)
 A representative's license, for factory representatives or distributor
representatives permits the licensee to contact the licensee's authorized dealers for the purpose
of making or promoting the sale of motor vehicles, parts, and accessories.
[
(11)
] 
(13)
 (a) (i) A remanufacturer's license permits the licensee to construct,
reconstruct, assemble, or reassemble motor vehicles subject to registration under Title 41,
Chapter 1a, Motor Vehicle Act, from used or new motor vehicles or parts.
(ii) Evidence of ownership of parts and motor vehicles used in remanufacture shall be
available to the division upon demand.
(b) Under rules made by the administrator, the licensee may issue and install vehicle
identification numbers on remanufactured motor vehicles.
[
(12)
] 
(14)
 A crusher's license permits the licensee to engage in the business of
crushing or shredding motor vehicles subject to registration under Title 41, Chapter 1a, Motor
Vehicle Act, for the purpose of reducing the useable materials and metals to a more compact
size for recycling.
[
(13)
] 
(15)
 A body shop's license permits the licensee to rebuild, restore, repair, or
paint primarily the body of motor vehicles damaged by collision or natural disaster, and to
dismantle motor vehicles.
[
(14)
] 
(16)
 A special equipment dealer's license permits the licensee to:
(a) buy incomplete new motor vehicles with a gross vehicle weight of 12,000 or more
pounds from a new motor vehicle dealer and sell the new vehicle with the special equipment
installed without a franchise from the manufacturer;
(b) offer for sale, sell, or exchange used motor vehicles;
(c) operate as a body shop; and
(d) dismantle motor vehicles.
[
(15)
] 
(17)
 (a) A salvage vehicle buyer license permits the licensee to bid on or
purchase a vehicle with a salvage certificate as defined in Section 
41-1a-1001
 at any motor
vehicle auction.
(b) A salvage vehicle buyer license may only be issued to a motor vehicle dealer,
dismantler, or body shop who qualifies under rules made by the division and is licensed in any
state as a motor vehicle dealer, dismantler, or body shop.
(c) The division may not issue more than two salvage vehicle buyer licenses to any one
dealer, dismantler, or body shop.
(d) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
administrator shall make rules establishing qualifications of an applicant for a salvage vehicle
buyer license. The criteria shall include:
(i) business history;
(ii) salvage vehicle qualifications;
(iii) ability to properly handle and dispose of environmental hazardous materials
associated with salvage vehicles; and
(iv) record in demonstrating compliance with the provisions of this chapter.
Section 8. Section 
41-3-203
 is amended to read:
41-3-203.
Licenses -- Form -- Seal -- Custody of salesperson's license -- Display of
salesperson and dealer licenses -- Licensee's pocket card.
(1) (a) The administrator shall prescribe the form of each license and the seal of his
office shall be imprinted on each license.
(b) The license of each salesperson shall be delivered or mailed to the dealer
employing the salesperson and it shall be kept in the custody and control of the dealer and
,
except in the case of an online dealer,
 conspicuously displayed in the dealer's place of business.
(c) Each licensee shall display conspicuously his own license in his place of business
,
unless the licensee is an online dealer or an online salesperson
.
(2) (a) The administrator shall prepare and deliver a pocket card, certifying that the
person whose name is on the card is licensed under this chapter.
(b) Each salesperson's card shall also contain the name and address of the dealer
employing him.
(c) Each salesperson shall on request display his pocket card.
Section 9. Section 
41-3-204
 is amended to read:
41-3-204.
Licenses -- Principal place of business as prerequisite -- Change of
location -- Relinquishment on loss of principal place of business.
(1) (a) The following licensees must maintain a principal place of business:
(i) dealers;
(ii) special equipment dealers;
(iii) manufacturers;
(iv) transporters;
(v) remanufacturers;
(vi) dismantlers;
(vii) crushers;
(viii) body shops; and
(ix) distributors who:
(A) are located within the state; or
(B) have a branch office within the state.
(b) The administrator may not issue a license under Subsection (1)(a) to an applicant
who does not have a principal place of business.
(c) If a licensee changes the location of his principal place of business, he shall
immediately notify the administrator and a new license shall be granted for the unexpired
portion of the term of the original license at no additional fee.
(2) (a) If a licensee loses possession of a principal place of business, the license is
automatically suspended and he shall immediately notify the administrator and upon demand
by the administrator deliver the license, pocket cards, special plates, and temporary permits to
the administrator.
(b) The administrator shall hold the licenses, cards, plates, and permits until the
licensee obtains a principal place of business.
(3) This section does not apply to an online dealer.
Section 10. Section 
41-3-209
 is amended to read:
41-3-209.
Administrator's findings -- Suspension and revocation of license.
(1) If the administrator finds that an applicant is not qualified to receive a license, a
license may not be granted.
(2) (a) On December 1, 2010, the administrator shall suspend the license of a
salesperson who fails to submit to the division fingerprints as required under Subsection
41-3-205.5
(1)(b) on or before November 30, 2010.
(b) If the administrator finds that there is reasonable cause to deny, suspend, or revoke
a license issued under this chapter, the administrator shall deny, suspend, or revoke the license.
(c) Reasonable cause for denial, suspension, or revocation of a license includes, in
relation to the applicant or license holder or any of its partners, officers, or directors:
(i) lack of a principal place of business
, if applicable
;
(ii) 
except as an online dealer,
 lack of a sales tax license required under Title 59,
Chapter 12, Sales and Use Tax Act;
(iii) lack of a bond in effect as required by this chapter;
(iv) current revocation or suspension of a dealer, 
online dealer,
 dismantler, auction,
[
or
] salesperson
, or online salesperson
 license issued in another state;
(v) nonpayment of required fees;
(vi) making a false statement on any application for a license under this chapter or for
special license plates;
(vii) a violation of any state or federal law involving motor vehicles;
(viii) a violation of any state or federal law involving controlled substances;
(ix) charges filed with any county attorney, district attorney, or U.S. attorney in any
court of competent jurisdiction for a violation of any state or federal law involving motor
vehicles;
(x) a violation of any state or federal law involving fraud;
(xi) a violation of any state or federal law involving a registerable sex offense under
Section 
77-41-106
; or
(xii) having had a license issued under this chapter revoked within five years from the
date of application.
(d) Any action taken by the administrator under Subsection (2)(c)(ix) shall remain in
effect until a final resolution is reached by the court involved or the charges are dropped.
(3) If the administrator finds that an applicant is not qualified to receive a license under
this section, the administrator shall provide the applicant written notice of the reason for the
denial.
(4) If the administrator finds that the license holder has been convicted by a court of
competent jurisdiction of violating any of the provisions of this chapter or any rules made by
the administrator, or finds other reasonable cause, the administrator may, by complying with
the emergency procedures of Title 63G, Chapter 4, Administrative Procedures Act:
(a) suspend the license on terms and for a period of time the administrator finds
reasonable; or
(b) revoke the license.
(5) (a) After suspending or revoking a license, the administrator may take reasonable
action to:
(i) notify the public that the licensee is no longer in business; and
(ii) prevent the former licensee from violating the law by conducting business without
a license.
(b) Action under Subsection (5)(a) may include signs, banners, barriers, locks,
bulletins, and notices.
(c) Any business being conducted incidental to the business for which the former
licensee was licensed may continue to operate subject to the preventive action taken under this
subsection.
Section 11. Section 
41-3-210
 is amended to read:
41-3-210.
License holders -- Prohibitions and requirements.
(1) The holder of any license issued under this chapter may not:
(a) intentionally publish, display, or circulate any advertising that is misleading or
inaccurate in any material fact or that misrepresents any of the products sold, manufactured,
remanufactured, handled, or furnished by a licensee;
(b) intentionally publish, display, or circulate any advertising without identifying the
seller as the licensee by including in the advertisement the full name under which the licensee
is licensed or the licensee's number assigned by the division;
(c) violate this chapter or the rules made by the administrator;
(d) violate any law of the state respecting commerce in motor vehicles or any rule
respecting commerce in motor vehicles made by any licensing or regulating authority of the
state;
(e) engage in business as a new motor vehicle dealer, special equipment dealer, used
motor vehicle dealer, motor vehicle crusher, or body shop without having in effect a bond as
required in this chapter;
(f) 
unless licensed as an online dealer,
 act as a dealer, dismantler, crusher,
manufacturer, transporter, remanufacturer, or body shop without maintaining a principal place
of business;
(g) engage in a business respecting the selling or exchanging of new or new and used
motor vehicles for which he is not licensed, including selling or exchanging a new motor
vehicle for which the licensee does not have a franchise, but this Subsection (1)(g) does not
apply to
:
(i)
 a special equipment dealer who sells a new special equipment motor vehicle with a
gross vehicle weight of 12,000 or more pounds after installing special equipment on the motor
vehicle; 
or
(ii) an online dealer who manufactures the motor vehicles that the online dealer sells;
(h) dismantle or transport to a crusher for crushing or other disposition any motor
vehicle without first obtaining a dismantling or junk permit under Section 
41-1a-1009
,
41-1a-1010
, or 
41-1a-1011
;
(i) as a new motor vehicle dealer, special equipment dealer, or used motor vehicle
dealer fail to give notice of sales or transfers as required in Section 
41-3-301
;
(j) advertise or otherwise represent, or knowingly allow to be advertised or represented
on his behalf or at his place of business, that no down payment is required in connection with
the sale of a motor vehicle when a down payment is required and the buyer is advised or
induced to finance a down payment by a loan in addition to any other loan financing the
remainder of the purchase price of the motor vehicle;
(k) as a crusher, crush or shred a motor vehicle brought to the crusher without
obtaining proper evidence of ownership of the motor vehicle; proper evidence of ownership is
a certificate of title endorsed according to law or a dismantling or junk permit issued under
Section 
41-1a-1009
, 
41-1a-1010
, or 
41-1a-1011
;
(l) as a manufacturer or remanufacturer assemble a motor vehicle that does not comply
with construction, safety, or vehicle identification number standards fixed by law or rule of any
licensing or regulating authority;
(m) as anyone other than a salesperson licensed under this chapter, be present on a
dealer display space and contact prospective customers to promote the sale of the dealer's
vehicles;
(n) 
unless licensed as an online dealer or an online sales person,
 sell, display for sale,
or offer for sale motor vehicles at any location other than the principal place of business or
additional places of business licensed under this chapter; this provision is construed to prevent
dealers, salespersons, or any other representative of a dealership from selling, displaying, or
offering motor vehicles for sale from their homes or other unlicensed locations;
(o) (i) as a dealer, dismantler, body shop, or manufacturer, maintain a principal place of
business or additional place of business that shares any common area with a business or
activity not directly related to motor vehicle commerce; or
(ii) maintain any places of business that share any common area with another dealer,
dismantler, body shop, or manufacturer;
(p) withhold delivery of license plates obtained by the licensee on behalf of a customer
for any reason, including nonpayment of any portion of the vehicle purchase price or down
payment;
(q) issue a temporary permit for any vehicle that has not been sold by the licensee;
(r) alter a temporary permit in any manner;
(s) operate any principal place of business or additional place of business in a location
that does not comply with local ordinances, including zoning ordinances;
(t) sell, display for sale, offer for sale, or exchange any new motor vehicle if the
licensee does not:
(i) 
(A)
 have a new motor vehicle dealer's license under Section 
41-3-202
; and
[
(ii)
] 
(B)
 possess a franchise from the manufacturer of the new motor vehicle sold,
displayed for sale, offered for sale, or exchanged by the licensee; or
(ii) have an online dealer license under Section 
41-3-202
; or
(u) 
(i)
 as a new motor vehicle dealer or used motor vehicle dealer, encourage or
conspire with any person who has not obtained a salesperson's license to solicit for prospective
purchasers[
.
]
; or
(ii) as an online dealer, encourage or conspire with any person who has not obtained an
online salesperson license to solicit for prospective purchasers.
(2) (a) If a new motor vehicle is constructed in more than one stage, such as a motor
home, ambulance, or van conversion, the licensee shall advertise, represent, sell, and exchange
the vehicle as the make designated by the final stage manufacturer, except in those specific
situations where
:
(i)
 the licensee possesses a franchise from the initial or first stage manufacturer,
presumably the manufacturer of the motor vehicle's chassis[
.
]
; or
(ii) the licensee manufactured the initial or first stage of the motor vehicle.
(b) Sales of multiple stage manufactured motor vehicles shall include the transfer to the
purchaser of a valid manufacturer's statement or certificate of origin from each manufacturer
under Section 
41-3-301
.
(3) Each licensee, except [
salespersons
] 
a salesperson or an online salesperson
, shall
maintain and make available for inspection by peace officers and employees of the division:
(a) a record of every motor vehicle bought, or exchanged by the licensee or received or
accepted by the licensee for sale or exchange;
(b) a record of every used part or used accessory bought or otherwise acquired;
(c) a record of every motor vehicle bought or otherwise acquired and wrecked or
dismantled by the licensee;
(d) all buyers' orders, contracts, odometer statements, temporary permit records,
financing records, and all other documents related to the purchase, sale, or consignment of
motor vehicles; and
(e) a record of the name and address of the person to whom any motor vehicle or motor
vehicle body, chassis, or motor vehicle engine is sold or otherwise disposed of and a
description of the motor vehicle by year, make, and vehicle identification number.
(4) Each licensee required by this chapter to keep records shall:
(a) be kept by the licensee at least for five years; and
(b) furnish copies of those records upon request to any peace officer or employee of the
division during reasonable business hours.
(5) A manufacturer, distributor, distributor representative, or factory representative
may not induce or attempt to induce by means of coercion, intimidation, or discrimination any
dealer to:
(a) accept delivery of any motor vehicle, parts, or accessories or any other commodity
or commodities, including advertising material not ordered by the dealer;
(b) order or accept delivery of any motor vehicle with special features, appliances,
accessories, or equipment not included in the list price of the motor vehicle as publicly
advertised by the manufacturer;
(c) order from any person any parts, accessories, equipment, machinery, tools,
appliances, or any other commodity;
(d) enter into an agreement with the manufacturer, distributor, distributor
representative, or factory representative of any of them, or to do any other act unfair to the
dealer by threatening to cancel any franchise or contractual agreement between the
manufacturer, distributor, distributor branch, or factory branch and the dealer;
(e) refuse to deliver to any dealer having a franchise or contractual arrangement for the
retail sale of new and unused motor vehicles sold or distributed by the manufacturer,
distributor, distributor branch or factory branch, any motor vehicle, publicly advertised for
immediate delivery within 60 days after the dealer's order is received; or
(f) unfairly, without regard to the equities of the dealer, cancel the franchise of any
motor vehicle dealer; the nonrenewal of a franchise or selling agreement without cause is a
violation of this subsection and is an unfair cancellation.
(6) A dealer may not assist an unlicensed dealer or salesperson in unlawful activity
through active or passive participation in sales, or by allowing use of his facilities or dealer
license number, or by any other means.
(7) (a) The holder of any new motor vehicle dealer license issued under this chapter
may not sell any new motor vehicle to:
(i) another dealer licensed under this chapter who does not hold a valid franchise for
the make of new motor vehicles sold, unless the selling dealer licenses and titles the new motor
vehicle to the purchasing dealer; or
(ii) any motor vehicle leasing or rental company located within this state, or who has
any branch office within this state, unless the dealer licenses and titles the new motor vehicle to
the purchasing, leasing, or rental company.
(b) Subsection (7)(a)(i) does not apply to the sale of a new incomplete motor vehicle
with a gross vehicle weight of 12,000 or more pounds to a special equipment dealer licensed
under this chapter.
(8) A dealer licensed under this chapter may not take on consignment any new motor
vehicle from anyone other than a new motor vehicle dealer, factory, or distributor who is
licensed and franchised 
or otherwise authorized
 to distribute or sell that make of motor vehicle
in this or any other state.
(9) A body shop licensed under this chapter may not assist an unlicensed body shop in
unlawful activity through active or passive means or by allowing use of its facilities, name,
body shop number, or by any other means.
(10) A used motor vehicle dealer licensed under this chapter may not advertise, offer
for sale, or sell a new motor vehicle that has been driven less than 7,500 miles by obtaining a
title only to the vehicle and representing it as a used motor vehicle.
(11) (a) Except as provided in Subsection (11)(c), or in cases of undue hardship or
emergency as provided by rule by the division, a dealer or salesperson licensed under this
chapter may not, on consecutive days of Saturday and Sunday, sell, offer for sale, lease, or offer
for lease a motor vehicle.
(b) Each day a motor vehicle is sold, offered for sale, leased, or offered for lease in
violation of Subsection (11)(a) and each motor vehicle sold, offered for sale, leased, or offered
for lease in violation of Subsection (11)(a) shall constitute a separate offense.
(c) The provisions of Subsection (11)(a) shall not apply to 
an online dealer or
 a dealer
participating in a trade show or exhibition if:
(i) there are five or more dealers participating in the trade show or exhibition; and
(ii) the trade show or exhibition takes place at a location other than the principal place
of business of one of the dealers participating in the trade show or exhibition.
(12) For purposes of imposing the sales and use tax under Title 59, Chapter 12, Sales
and Use Tax Act, a licensee issuing a temporary permit under Section 
41-3-302
 shall separately
identify the fees required by Title 41, Chapter 1a, Motor Vehicle Act.
(13) (a) A dismantler or dealer engaged in the business of dismantling motor vehicles
for the sale of parts or salvage shall identify any vehicles or equipment used by the dismantler
or dealer for transporting parts or salvage on the highways.
(b) The identification required under Subsection (13)(a) shall:
(i) include the name, address, and license number of the dismantler or dealer; and
(ii) be conspicuously displayed on both sides of the vehicle or equipment in clearly
legible letters and numerals not less than two inches in height.
Section 12. Section 
59-12-107
 is amended to read:
59-12-107.
Definitions -- Collection, remittance, and payment of tax by sellers or
other persons -- Returns -- Reports -- Direct payment by purchaser of vehicle -- Other
liability for collection -- Rulemaking authority -- Credits -- Treatment of bad debt --
Penalties and interest.
(1) As used in this section:
(a) "Ownership" means direct ownership or indirect ownership through a parent,
subsidiary, or affiliate.
(b) "Related seller" means a seller that:
(i) meets one or more of the criteria described in Subsection (2)(a)(i); and
(ii) delivers tangible personal property, a service, or a product transferred electronically
that is sold:
(A) by a seller that does not meet one or more of the criteria described in Subsection
(2)(a)(i); and
(B) to a purchaser in the state.
(c) "Substantial ownership interest" means an ownership interest in a business entity if
that ownership interest is greater than the degree of ownership of equity interest specified in 15
U.S.C. Sec. 78p, with respect to a person other than a director or an officer.
(2) (a) Except as provided in Subsection (2)(e), Section 
59-12-107.1
, or Section
59-12-123
, and subject to Subsection (2)(f), each seller shall pay or collect and remit the sales
and use taxes imposed by this chapter if within this state the seller:
(i) has or utilizes:
(A) an office;
(B) a distribution house;
(C) a sales house;
(D) a warehouse;
(E) a service enterprise; or
(F) a place of business similar to Subsections (2)(a)(i)(A) through (E);
(ii) maintains a stock of goods;
(iii) regularly solicits orders, regardless of whether or not the orders are accepted in the
state, unless the seller's only activity in the state is:
(A) advertising; or
(B) solicitation by:
(I) direct mail;
(II) electronic mail;
(III) the Internet;
(IV) telecommunications service; or
(V) a means similar to Subsection (2)(a)(iii)(A) or (B);
(iv) regularly engages in the delivery of property in the state other than by:
(A) common carrier; or
(B) United States mail; or
(v) regularly engages in an activity directly related to the leasing or servicing of
property located within the state.
(b) A seller is considered to be engaged in the business of selling tangible personal
property, a service, or a product transferred electronically for use in the state, and shall pay or
collect and remit the sales and use taxes imposed by this chapter if:
(i) the seller holds a substantial ownership interest in, or is owned in whole or in
substantial part by, a related seller; and
(ii) (A) the seller sells the same or a substantially similar line of products as the related
seller and does so under the same or a substantially similar business name; or
(B) the place of business described in Subsection (2)(a)(i) of the related seller or an in
state employee of the related seller is used to advertise, promote, or facilitate sales by the seller
to a purchaser.
(c) A seller that does not meet one or more of the criteria provided for in Subsection
(2)(a) or is not a seller required to pay or collect and remit sales and use taxes under Subsection
(2)(b):
(i) except as provided in Subsection (2)(c)(ii), may voluntarily:
(A) collect a tax on a transaction described in Subsection 
59-12-103
(1); and
(B) remit the tax to the commission as provided in this part; or
(ii) notwithstanding Subsection (2)(c)(i), shall collect a tax on a transaction described
in Subsection 
59-12-103
(1) if Section 
59-12-103.1
 requires the seller to collect the tax.
(d) The collection and remittance of a tax under this chapter by a seller that is
registered under the agreement may not be used as a factor in determining whether that seller is
required by Subsection (2) to:
(i) pay a tax, fee, or charge under:
(A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
(B) Title 10, Chapter 1, Part 4, Municipal Telecommunications License Tax Act;
(C) Section 
19-6-714
;
(D) Section 
19-6-805
;
(E) Section 
69-2-5
;
(F) Section 
69-2-5.5
;
(G) Section 
69-2-5.6
; or
(H) this title; or
(ii) collect and remit a tax, fee, or charge under:
(A) Title 10, Chapter 1, Part 3, Municipal Energy Sales and Use Tax Act;
(B) Title 10, Chapter 1, Part 4, Municipal Telecommunications License Tax Act;
(C) Section 
19-6-714
;
(D) Section 
19-6-805
;
(E) Section 
69-2-5
;
(F) Section 
69-2-5.5
;
(G) Section 
69-2-5.6
; or
(H) this title.
(e) A person shall pay a use tax imposed by this chapter on a transaction described in
Subsection 
59-12-103
(1) if:
(i) the seller did not collect a tax imposed by this chapter on the transaction; and
(ii) the person:
(A) stores the tangible personal property or product transferred electronically in the
state;
(B) uses the tangible personal property or product transferred electronically in the state;
or
(C) consumes the tangible personal property or product transferred electronically in the
state.
(f) The ownership of property that is located at the premises of a printer's facility with
which the retailer has contracted for printing and that consists of the final printed product,
property that becomes a part of the final printed product, or copy from which the printed
product is produced, shall not result in the retailer being considered to have or maintain an
office, distribution house, sales house, warehouse, service enterprise, or other place of
business, or to maintain a stock of goods, within this state.
(3) (a) Except as provided in Section 
59-12-107.1
, a tax under this chapter shall be
collected from a purchaser.
(b) A seller may not collect as tax an amount, without regard to fractional parts of one
cent, in excess of the tax computed at the rates prescribed by this chapter.
(c) (i) Each seller shall:
(A) give the purchaser a receipt for the tax collected; or
(B) bill the tax as a separate item and declare the name of this state and the seller's
sales and use tax license number on the invoice for the sale.
(ii) The receipt or invoice is prima facie evidence that the seller has collected the tax
and relieves the purchaser of the liability for reporting the tax to the commission as a
consumer.
(d) A seller is not required to maintain a separate account for the tax collected, but is
considered to be a person charged with receipt, safekeeping, and transfer of public money.
(e) Taxes collected by a seller pursuant to this chapter shall be held in trust for the
benefit of the state and for payment to the commission in the manner and at the time provided
for in this chapter.
(f) If any seller, during any reporting period, collects as a tax an amount in excess of
the lawful state and local percentage of total taxable sales allowed under this chapter, the seller
shall remit to the commission the full amount of the tax imposed under this chapter, plus any
excess.
(g) If the accounting methods regularly employed by the seller in the transaction of the
seller's business are such that reports of sales made during a calendar month or quarterly period
will impose unnecessary hardships, the commission may accept reports at intervals that will, in
the commission's opinion, better suit the convenience of the taxpayer or seller and will not
jeopardize collection of the tax.
(h) (i) For a purchase paid with specie legal tender as defined in Section 
59-1-1501.1
,
and until such time as the commission accepts specie legal tender for the payment of a tax
under this chapter, if the commission requires a seller to remit a tax under this chapter in legal
tender other than specie legal tender, the seller shall state on the seller's books and records and
on an invoice, bill of sale, or similar document provided to the purchaser:
(A) the purchase price in specie legal tender and in the legal tender the seller is
required to remit to the commission;
(B) subject to Subsection (3)(h)(ii), the amount of tax due under this chapter in specie
legal tender and in the legal tender the seller is required to remit to the commission;
(C) the tax rate under this chapter applicable to the purchase; and
(D) the date of the purchase.
(ii) (A) Subject to Subsection (3)(h)(ii)(B), for purposes of determining the amount of
tax due under Subsection (3)(h)(i), a seller shall use the most recent London fixing price for the
specie legal tender the purchaser paid.
(B) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may make rules for determining the amount of tax due under Subsection (3)(h)(i)
if the London fixing price is not available for a particular day.
(4) (a) Except as provided in Subsections (5) through (7) and Section 
59-12-108
, the
sales or use tax imposed by this chapter is due and payable to the commission quarterly on or
before the last day of the month next succeeding each calendar quarterly period.
(b) (i) Each seller shall, on or before the last day of the month next succeeding each
calendar quarterly period, file with the commission a return for the preceding quarterly period.
(ii) The seller shall remit with the return under Subsection (4)(b)(i) the amount of the
tax required under this chapter to be collected or paid for the period covered by the return.
(c) Except as provided in Subsection (5)(c), a return shall contain information and be in
a form the commission prescribes by rule.
(d) (i) Subject to Subsection (4)(d)(ii), the sales tax as computed in the return shall be
based on the total nonexempt sales made during the period for which the return is filed,
including both cash and charge sales.
(ii) For a sale that includes the delivery or installation of tangible personal property at a
location other than a seller's place of business described in Subsection (2)(a)(i), if the delivery
or installation is separately stated on an invoice or receipt, a seller may compute the tax due on
the sale for purposes of Subsection (4)(d)(i) based on the amount the seller receives for that
sale during each period for which the seller receives payment for the sale.
(e) (i) The use tax as computed in the return shall be based on the total amount of
purchases for storage, use, or other consumption in this state made during the period for which
the return is filed, including both cash and charge purchases.
(ii) (A) As used in this Subsection (4)(e)(ii), "qualifying purchaser" means a purchaser
who is required to remit taxes under this chapter, but is not required to remit taxes monthly in
accordance with Section 
59-12-108
, and who converts tangible personal property into real
property.
(B) Subject to Subsections (4)(e)(ii)(C) and (D), a qualifying purchaser may remit the
taxes due under this chapter on tangible personal property for which the qualifying purchaser
claims an exemption as allowed under Subsection 
59-12-104
(23) or (25) based on the period in
which the qualifying purchaser receives payment, in accordance with Subsection (4)(e)(ii)(C),
for the conversion of the tangible personal property into real property.
(C) A qualifying purchaser remitting taxes due under this chapter in accordance with
Subsection (4)(e)(ii)(B) shall remit an amount equal to the total amount of tax due on the
qualifying purchaser's purchase of the tangible personal property that was converted into real
property multiplied by a fraction, the numerator of which is the payment received in the period
for the qualifying purchaser's sale of the tangible personal property that was converted into real
property and the denominator of which is the entire sales price for the qualifying purchaser's
sale of the tangible personal property that was converted into real property.
(D) A qualifying purchaser may remit taxes due under this chapter in accordance with
this Subsection (4)(e)(ii) only if the books and records that the qualifying purchaser keeps in
the qualifying purchaser's regular course of business identify by reasonable and verifiable
standards that the tangible personal property was converted into real property.
(f) (i) Subject to Subsection (4)(f)(ii) and in accordance with Title 63G, Chapter 3,
Utah Administrative Rulemaking Act, the commission may by rule extend the time for making
returns and paying the taxes.
(ii) An extension under Subsection (4)(f)(i) may not be for more than 90 days.
(g) The commission may require returns and payment of the tax to be made for other
than quarterly periods if the commission considers it necessary in order to ensure the payment
of the tax imposed by this chapter.
(h) (i) The commission may require a seller that files a simplified electronic return with
the commission to file an additional electronic report with the commission.
(ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission may make rules providing:
(A) the information required to be included in the additional electronic report described
in Subsection (4)(h)(i); and
(B) one or more due dates for filing the additional electronic report described in
Subsection (4)(h)(i).
(5) (a) As used in this Subsection (5) and Subsection (6)(b), "remote seller" means a
seller that is:
(i) registered under the agreement;
(ii) described in Subsection (2)(c); and
(iii) not a:
(A) model 1 seller;
(B) model 2 seller; or
(C) model 3 seller.
(b) (i) Except as provided in Subsection (5)(b)(ii), a tax a remote seller collects in
accordance with Subsection (2)(c) is due and payable:
(A) to the commission;
(B) annually; and
(C) on or before the last day of the month immediately following the last day of each
calendar year.
(ii) The commission may require that a tax a remote seller collects in accordance with
Subsection (2)(c) be due and payable:
(A) to the commission; and
(B) on the last day of the month immediately following any month in which the seller
accumulates a total of at least $1,000 in agreement sales and use tax.
(c) (i) If a remote seller remits a tax to the commission in accordance with Subsection
(5)(b), the remote seller shall file a return:
(A) with the commission;
(B) with respect to the tax;
(C) containing information prescribed by the commission; and
(D) on a form prescribed by the commission.
(ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
commission shall make rules prescribing:
(A) the information required to be contained in a return described in Subsection
(5)(c)(i); and
(B) the form described in Subsection (5)(c)(i)(D).
(d) A tax a remote seller collects in accordance with this Subsection (5) shall be
calculated on the basis of the total amount of taxable transactions under Subsection
59-12-103
(1) the remote seller completes, including:
(i) a cash transaction; and
(ii) a charge transaction.
(6) (a) Except as provided in Subsection (6)(b), a tax a seller that files a simplified
electronic return collects in accordance with this chapter is due and payable:
(i) monthly on or before the last day of the month immediately following the month for
which the seller collects a tax under this chapter; and
(ii) for the month for which the seller collects a tax under this chapter.
(b) A tax a remote seller that files a simplified electronic return collects in accordance
with this chapter is due and payable as provided in Subsection (5).
(7) (a) On each vehicle sale made by other than a regular licensed vehicle dealer,
including an online dealer as defined in Section 
41-3-102
,
 the purchaser shall pay the sales or
use tax directly to the commission if the vehicle is subject to titling or registration under the
laws of this state.
(b) The commission shall collect the tax described in Subsection (7)(a) when the
vehicle is titled or registered.
(8) If any sale of tangible personal property or any other taxable transaction under
Subsection 
59-12-103
(1), is made by a wholesaler to a retailer, the wholesaler is not
responsible for the collection or payment of the tax imposed on the sale and the retailer is
responsible for the collection or payment of the tax imposed on the sale if:
(a) the retailer represents that the personal property is purchased by the retailer for
resale; and
(b) the personal property is not subsequently resold.
(9) If any sale of property or service subject to the tax is made to a person prepaying
sales or use tax in accordance with Title 63M, Chapter 5, Resource Development Act, or to a
contractor or subcontractor of that person, the person to whom such payment or consideration
is payable is not responsible for the collection or payment of the sales or use tax and the person
prepaying the sales or use tax is responsible for the collection or payment of the sales or use tax
if the person prepaying the sales or use tax represents that the amount prepaid as sales or use
tax has not been fully credited against sales or use tax due and payable under the rules
promulgated by the commission.
(10) (a) For purposes of this Subsection (10):
(i) Except as provided in Subsection (10)(a)(ii), "bad debt" is as defined in Section
166, Internal Revenue Code.
(ii) Notwithstanding Subsection (10)(a)(i), "bad debt" does not include:
(A) an amount included in the purchase price of tangible personal property, a product
transferred electronically, or a service that is:
(I) not a transaction described in Subsection 
59-12-103
(1); or
(II) exempt under Section 
59-12-104
;
(B) a financing charge;
(C) interest;
(D) a tax imposed under this chapter on the purchase price of tangible personal
property, a product transferred electronically, or a service;
(E) an uncollectible amount on tangible personal property or a product transferred
electronically that:
(I) is subject to a tax under this chapter; and
(II) remains in the possession of a seller until the full purchase price is paid;
(F) an expense incurred in attempting to collect any debt; or
(G) an amount that a seller does not collect on repossessed property.
(b) (i) To the extent an amount remitted in accordance with Subsection (4)(d) later
becomes bad debt, a seller may deduct the bad debt from the total amount from which a tax
under this chapter is calculated on a return.
(ii) A qualifying purchaser, as defined in Subsection (4)(e)(ii)(A), may deduct from the
total amount of taxes due under this chapter the amount of tax the qualifying purchaser paid on
the qualifying purchaser's purchase of tangible personal property converted into real property to
the extent that:
(A) tax was remitted in accordance with Subsection (4)(e) on that tangible personal
property converted into real property;
(B) the qualifying purchaser's sale of that tangible personal property converted into real
property later becomes bad debt; and
(C) the books and records that the qualifying purchaser keeps in the qualifying
purchaser's regular course of business identify by reasonable and verifiable standards that the
tangible personal property was converted into real property.
(c) A seller may file a refund claim with the commission if:
(i) the amount of bad debt for the time period described in Subsection (10)(e) exceeds
the amount of the seller's sales that are subject to a tax under this chapter for that same time
period; and
(ii) as provided in Section 
59-1-1410
.
(d) A bad debt deduction under this section may not include interest.
(e) A bad debt may be deducted under this Subsection (10) on a return for the time
period during which the bad debt:
(i) is written off as uncollectible in the seller's books and records; and
(ii) would be eligible for a bad debt deduction:
(A) for federal income tax purposes; and
(B) if the seller were required to file a federal income tax return.
(f) If a seller recovers any portion of bad debt for which the seller makes a deduction or
claims a refund under this Subsection (10), the seller shall report and remit a tax under this
chapter:
(i) on the portion of the bad debt the seller recovers; and
(ii) on a return filed for the time period for which the portion of the bad debt is
recovered.
(g) For purposes of reporting a recovery of a portion of bad debt under Subsection
(10)(f), a seller shall apply amounts received on the bad debt in the following order:
(i) in a proportional amount:
(A) to the purchase price of the tangible personal property, product transferred
electronically, or service; and
(B) to the tax due under this chapter on the tangible personal property, product
transferred electronically, or service; and
(ii) to:
(A) interest charges;
(B) service charges; and
(C) other charges.
(h) A seller's certified service provider may make a deduction or claim a refund for bad
debt on behalf of the seller:
(i) in accordance with this Subsection (10); and
(ii) if the certified service provider credits or refunds the entire amount of the bad debt
deduction or refund to the seller.
(i) A seller may allocate bad debt among the states that are members of the agreement
if the seller's books and records support that allocation.
(11) (a) A seller may not, with intent to evade any tax, fail to timely remit the full
amount of tax required by this chapter.
(b) A violation of this section is punishable as provided in Section 
59-1-401
.
(c) Each person who fails to pay any tax to the state or any amount of tax required to be
paid to the state, except amounts determined to be due by the commission under Chapter 1,
Part 14, Assessment, Collections, and Refunds Act, or Section 
59-12-111
, within the time
required by this chapter, or who fails to file any return as required by this chapter, shall pay, in
addition to the tax, penalties and interest as provided in Sections 
59-1-401
 and 
59-1-402
.
(d) For purposes of prosecution under this section, each quarterly tax period in which a
seller, with intent to evade any tax, collects a tax and fails to timely remit the full amount of the
tax required to be remitted, constitutes a separate offense.
Legislative Review Note
 as of 2-23-15 5:38 PM
Office of Legislative Research and General Counsel