NY Dealer Act Amended

New York's Dealer Act has been amended to prohibit manufacturers from requiring dealers to monetarily contribute to programs and promotions absent each dealer's written consent. This amendment takes effect on January 1, 2012

New York Regulates Brokers

On September 23, 2011, the Governor signed legislation amending Article 35-B of the General Business Law that strengthens regulation of automobile brokers. Article 35-B first became law in 1989 and this new legislation represents the first and only amendment in over 20 years.

Article 35-B prohibits advance fees; sets standards for brokerage contracts including a right of rescission; requires that advance payments be held in escrow; and prohibits certain deceptive trade practices.

The 2011 amendment requires that the brokerage contract disclose the dealer from which the motor vehicle was purchased, all fees and commissions paid by the dealer to the broker in connection with the transaction. The amendment also requires brokers to obtain a surety bond in teh amount of $75,000. Finally, the amendment imposes requirements that all broker advertising discloses that the broker is not a licensed motor vehicle dealer, whether any fees may be imposed by the broker and that no warranty repair services will be provided by the broker.

The amendment takes effect on December 22, 2011.