# Transportation (GTR) ## Title 15. Vehicle Laws -- Licensing of Businesses and Occupations ### Subtitle 1. Definitions; General Provisions #### Section 15-101 (a) In this title the following words have the meanings indicated. (b) "Administration funds" means any payment or other money which is: (1) Paid to a person licensed under Subtitle 2, 3, 4, or 6 of this title; and (2) Owed to the Administration for payment of taxes or fees. (c) (1) "Dealer" means, except as provided in paragraph (3) of this subsection, a dealer in vehicles of a type required to be registered under Title 13 of this article. (2) (i) "Dealer" includes: (1) A person who is in the business of buying, selling, or exchanging vehicles, including a person who during any 12-month period offers to sell three or more of these vehicles, the ownership of which was acquired for resale purposes; and (2) For the purposes of Sec.Sec. 15-301 through 15-315, inclusive, of this title, any person who sells vehicles, whether or not that person acquired the vehicles for personal or business use, if the vehicles are displayed at a fixed location used principally for the purpose of selling vehicles on a regular basis. (ii) (1) For the purposes of subparagraph (i)1 of this paragraph, a person who offers to sell three or more vehicles during any 12-month period is presumed to have acquired the vehicles for resale purposes. (2) The vehicle owner has the burden of rebutting the presumption established under subsubparagraph 1 of this subparagraph by a preponderance of the evidence. (3) "Dealer" does not include: (i) A public official who sells or disposes of vehicles in the performance of his official duties; (ii) An insurance company, finance company, bank, or other lending institution licensed or otherwise authorized to do business in this State that, to save it from loss, sells or disposes of vehicles under a contractual right and in the regular course of its business; (iii) A licensed auctioneer acting on behalf of a seller, secured party or owner and where title does not pass to the auctioneer and the auction is not for the purpose of avoiding the provisions of this title; (iv) A receiver, trustee, personal representative, or other person appointed by or acting under the authority of any court; (v) Either a manufacturer or distributor who sells or distributes vehicles to licensed dealers or a person employed by a manufacturer or distributor to promote the sale of the vehicles of the manufacturer or distributor, if that manufacturer, distributor, or person does not sell vehicles to retail buyers; (vi) A person who sells or disposes of vehicles acquired and used for personal or business use and not for the purpose of avoiding the provisions of this title, if that person is not engaged in buying, selling, or exchanging vehicles as a business; (vii) An automotive dismantler and recycler who during the normal course of business acquires a salvage vehicle and transfers the vehicle on a salvage certificate. However, if the automotive dismantler and recycler rebuilds and sells more than 5 vehicles during a 12-month period to a person other than another automotive dismantler and recycler or licensed dealer, the automotive dismantler and recycler must be licensed as a dealer under Sec. 15-302 of this title; (viii) A person engaged in the leasing of motor vehicles under leases not intended as security; (ix) A religious, charitable, or volunteer organization exempt from taxation under Sec. 501(c) of the Internal Revenue Code, the Department of Human Services, or a local department of social services transferring a vehicle under Sec. 13-810 of this article; or (x) An autonomous vehicle converter as defined in Sec. 15-901 of this title. (d) "New Class A vehicle" and "new Class B vehicle" means a new vehicle that, if later sold and registered in this State, could be registered either as a Class A (passenger) vehicle or a Class B (for hire) vehicle, as the case may be. (e) "Truck component part" means a truck's engine, power train, or rear axle that is not warranted by the final manufacturer of the truck. (f) "Two-stage vehicle" means a two-stage vehicle, as defined in Sec. 13-113.2 of this article, that is of a type required to be registered under Title 13 of this article. (g) (1) "Vehicle salesman" means, except as provided in paragraph (2) of this subsection, any individual who: (i) For a commission or other compensation, under any form of agreement or arrangement with a dealer, buys, sells, or exchanges or negotiates or attempts to negotiate a sale or exchange of an interest in a vehicle of a type required to be registered under Title 13 of this article; (ii) Induces or attempts to induce any other person to buy or exchange an interest in a vehicle of a type required to be registered under Title 13 of this article and receives or expects to receive a commission or other compensation from either the seller or the buyer of the vehicle; or (iii) For a commission or other compensation, negotiates with or induces any other person to enter into a financial security or warranty agreement on behalf of a dealer in connection with the sale of a vehicle. (2) "Vehicle salesman" does not include: (i) A person described in subsection (c)(3) of this section; (ii) An individual acting as a representative of a person described in subsection (c)(3) of this section; (iii) A person who: (1) Is compensated for arranging for the leasing of a vehicle for a period exceeding 180 days; and (2) As an incidental step in the consummation of the lease, induces or arranges for the sale of a vehicle from a licensed dealer to another person, who in turn leases the vehicle to a lessee under a lease not intended as a security; or (iv) A person engaged in the leasing of vehicles under leases not intended as security. #### Section 15-102 (a) Each application for a license under this title shall be made on the form that the Administration requires. (b) In addition to any other information required by this title, each application for a license under this title shall include: (1) The name and address of the applicant; (2) The address of the fixed location from which the licensed activity of the applicant will be conducted; (3) A statement of the maximum amount charged as a dealer processing charge under Sec. 15-311.1 of this title; and (4) Any other information that the Administration requires. (c) Each application for a license under this title shall: (1) Contain a certification by the applicant that the information given in it is true; and (2) Be signed by: (i) The applicant, if the applicant is an individual; (ii) A partner or other authorized representative, if the application is made for a partnership; or (iii) An officer or other authorized representative, if the application is made for a corporation or any other business entity. (d) Except for an application for a drivers' school license, each application for a license under this title shall be accompanied by the annual fee required for that license. #### Section 15-103 (a) (1) Except as provided in paragraph (2) of this subsection, a surety bond required of a licensee under this title shall be for the benefit of the Administration and any other person who suffers any loss because of a violation by the licensee, his agents, or employees of those provisions of the Maryland Vehicle Law that the Administration specifies. (2) A manufacturer's or distributor's bond required under Subtitle 2 of this title shall be for the benefit of the Administration, any dealer, any buyer of a new or used Class A vehicle, and any member of the public who suffers any loss because of the breach of any express or implied warranty given by the manufacturer or distributor to a buyer of the vehicle from a dealer. (b) Any person who suffers a loss described in subsection (a) of this section has a right of action in his own name against the surety on the bond. (c) If, before a surety bond required under this title expires or is terminated, the licensee does not file satisfactory evidence that the bond has been extended or replaced by a bond that the Administration approves, his license automatically is suspended. The Administration immediately shall notify the licensee of the suspension. #### Section 15-104 The Administration shall issue a license under this title to an applicant if: (1) The applicant has complied with the provisions of this title that apply to that license; and (2) The applicant otherwise is entitled to a license. #### Section 15-105 (a) (1) A person who is licensed under this title may conduct the licensed activity only from a fixed location, as specified in the application for the license, unless conducting wholesale transactions at auctions or at other licensed dealership locations. (2) The books of account and records of, except as otherwise specified by law, the licensee shall be kept at that location. (3) A person, who holds multiple licenses at more than one location and has established a computerized data processing record keeping system at one of his locations, may keep certain records, as designated by the Administrator, of all his licensed activities at the centralized location, provided prior approval of the Administrator has been granted. (b) A licensee may not remove or relocate the location specified for the licensed activity, unless the licensee has applied for and obtained a supplemental license from the Administration. (c) A licensee may not open any additional location other than a location specified for the licensed activity, unless the licensee has applied for and obtained a supplemental license from the Administration. (d) Each licensee under this title shall maintain and keep records required by this article. (e) The records shall be kept for 3 years after the transaction to which it applies. (f) During business hours, the records of the licensee shall be open to inspection by the Administration or any police officer while discharging his official duties. #### Section 15-106 (a) If, during any license year, there is any change in the information that a licensee gave the Administration in obtaining a license under this title, the licensee shall report the change to the Administration within 30 days after the change occurs. (b) If, during any license year, there is any change in the information that a licensee gave the Administration in retaining a license under this title, the licensee shall report the change to the Administration within 30 days after the change occurs. (c) The report under this section shall be made on the form that the Administration requires. (d) The licensee shall sign the form and certify that the information given in it is true. #### Section 15-107 If a license issued under this title is lost, stolen, mutilated, destroyed, or becomes illegible, the Administration may issue a duplicate license on application and payment of a fee established by the Administration. Before the Administration issues a duplicate, it may require the licensee to furnish satisfactory proof of the loss, theft, mutilation, destruction, or illegibility. When the Administration issues the duplicate, the license previously issued is void. #### Section 15-108 (a) Each license issued under this title expires on a staggered basis as determined by the Administration. (b) A license issued under this title may be renewed on application and payment of the fee required by this title for that license. #### Section 15-109 (a) Subject to subsection (b) of this section, in addition to any other grounds specified in this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this title to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that: (1) The person has violated or is attempting to violate any provision of this title or any rule or regulation adopted under this title; (2) The person has violated or is attempting to violate any of the other provisions of the Maryland Vehicle Law that relate to the business or activity of that person; or (3) Any officer, manager, agent, or employee of the person has violated or is attempting to violate any provision of this title, any rule or regulation adopted under this title, or any of the other provisions of the Maryland Vehicle Law that relate to the business or activity of the person, unless the Administration is satisfied that the individuals engaged in the management of the business or activity: (i) Had no knowledge of the wrongful conduct; or (ii) Were unable to prevent the violation or attempted violation. (b) The Administration shall suspend the license of a person if it finds that the person violated Sec. 15-606(f) of this title. #### Section 15-110 (a) If the Administration refuses an application for a license or for the renewal of a license under this title, the applicant may request a hearing under Title 12, Subtitle 2 of this article. (b) Except as provided in subsection (c) of this section, the Administration may suspend or revoke a license issued under this title only after a hearing under Title 12, Subtitle 2 of this article. (c) (1) If the Administration determines that a person licensed under this title is violating the used vehicle safety inspection requirements under Sec. 23-106 of this article and that there is a danger of immediate, substantial, and continuing harm to the public if the license is continued pending a hearing, the Administration: (i) May immediately suspend the license; (ii) Shall, within 7 days of a request for a hearing on the license suspension, grant the hearing in accordance with Title 12, Subtitle 2 of this article; and (iii) After the hearing, render an immediate decision to: (1) Continue the license suspension; (2) Revoke the license; or (3) Reinstate the license. (2) To the extent of a conflict between this subsection and Title 12, Subtitle 2 of this article, this subsection shall take precedence. #### Section 15-110.1 (a) If the Administration determines that there are reasonable grounds to suspend, revoke, or refuse to renew a license under this title, the Administration and the licensee may agree to conciliate the matter by conference. (b) The Administration shall adopt regulations establishing criteria for the assessment of fines under this title. #### Section 15-111 (a) If the Administration suspends the license of any person licensed under this title, the licensee immediately shall return the license to the Administration. (b) If the Administration revokes the license of any person licensed under this title, the licensee immediately shall return the license to the Administration. #### Section 15-112 (a) Any dealer or agent or employee of a dealer, any vehicle salesman, or any other person who sells a motorized minibike shall inform the buyer in writing that a motorized minibike may not be driven on a highway in the State. (b) Any dealer or agent or employee of a dealer, any vehicle salesman, or any other person who sells a motorized minibike shall inform the buyer in writing that local law, ordinance, and regulation may limit the use of the motorized minibike. #### Section 15-113 (a) Each person who conducts auctions as a business in this State of motor vehicles of a type required to be registered under this article shall keep a record of: (1) The name and address of the consignor; (2) The date on which it was consigned; (3) The year, make, model, and serial number of each vehicle consigned; (4) The title number and state where the vehicle was last registered; (5) The odometer mileage reading at the time of consignment; (6) The name and address of the person to whom the vehicle was sold; (7) The selling price; and (8) The date of sale. (b) During business hours, the records shall be open to inspection by the Administration, by the Department of State Police, or by a law enforcement officer with a county or municipal police department or sheriff's office who is assigned to an antitheft unit. (c) The records required by this section shall be kept for at least 3 years after the transaction to which it applies. (d) A person who fails to comply with any requirement under subsections (a) through (c) of this section is subject to a civil penalty not exceeding: (1) For a first offense, $500; or (2) For a second or subsequent offense, $1,000. #### Section 15-113.1 (a) (1) In this section the following words have the meanings indicated. (2) (i) "Automotive repair facility" means a facility where malfunctions of a motor vehicle are diagnosed or corrected for compensation. (ii) "Automotive repair facility" includes a body shop. (3) "Major component part" means: (i) An air bag; (ii) A bumper; (iii) An engine; (iv) A front fender; (v) A front or rear side door; (vi) A hood; (vii) A pickup box or cargo box; (viii) A rear quarter panel; (ix) A rear door, deck lid, hatchback, or tailgate; (x) A side assembly; (xi) A sliding or cargo door; or (xii) A transmission. (4) "Used major component part" does not include a: (i) Remanufactured part that has not been installed on a motor vehicle since remanufacture; (ii) Core element that is held solely for the purpose of being returned for remanufacture; or (iii) Part that is unsuitable for reuse in or on a motor vehicle. (5) "Vehicle storage facility" means a facility where disabled vehicles are stored at any time for compensation. (b) A person who operates an automotive repair facility shall keep accurate and complete records at the location where motor vehicle repairs are conducted of: (1) The name and address of the owner of each motor vehicle repaired or stored at the automotive repair facility or each customer who leaves a motor vehicle for repair or storage at the automotive repair facility; (2) The date a motor vehicle was left at the automotive repair facility; (3) The year, model, and, when repairs involve a used major component part, the vehicle identification number of the vehicle; and (4) For a used major component part at the automotive repair facility, proof of ownership or proof of the right of possession, including, if available, the vehicle identification number on the component part. (c) A person who operates a vehicle storage facility shall keep accurate and complete records at the location where vehicles are stored of: (1) The name and address of the individual who requested storage of each vehicle; (2) The date that each vehicle was brought into the vehicle storage facility; (3) The year, model, and, if available, the vehicle identification number of each vehicle; and (4) The date and manner of disposition of each vehicle. (d) (1) Records required under subsection (b) or (c) of this section shall be kept for at least 1 year after the date: (i) Of the transaction to which the record applies; or (ii) On which a part or vehicle is at the automotive repair facility or vehicle storage facility. (2) A person who operates an automotive repair facility or vehicle storage facility may satisfy the record requirement if the required record is a computerized record that is accessible at the automotive repair facility or vehicle storage facility. (e) (1) During business hours or other hours of operation, an automotive repair facility or vehicle storage facility shall make available for inspection by the Administration, by the Department of State Police, or by a law enforcement officer with a county or municipal police department or sheriff's office who is assigned to an antitheft unit: (i) Records required under this section; and (ii) Used major component parts and vehicles for which records are required. (2) If an automotive repair facility or a vehicle storage facility is unable to produce a record required under this section, the automotive repair facility or vehicle storage facility may produce other evidence satisfactory to the Administration or law enforcement officer of proof of ownership or right of possession. (f) A person who fails to comply with any requirement under this section is subject to a civil penalty not exceeding: (1) For a first offense, $500; or (2) For a second or subsequent offense, $1,000. #### Section 15-115 (a) (1) A person issued a citation under Sec. 15-113 or Sec. 15-113.1 of this subtitle shall comply with a notice to appear contained in a citation or a trial notice issued by the District Court. (2) A person may comply with the notice to appear by: (i) Appearance in person or by counsel; or (ii) Payment of the civil penalty as provided in the citation. (b) A citation issued for a violation under Sec. 15-113 or Sec. 15-113.1 of this subtitle shall include: (1) Information advising the person receiving the citation of the manner in which liability may be contested; and (2) A warning that failure to pay the civil penalty or to contest liability in a timely manner in accordance with the citation: (i) Is an admission of liability and waiver of defenses; and (ii) Results in an entry of a default judgment that may include a fine, court costs, and administrative expenses in favor of the Administration against the person named in the citation. (c) (1) Subject to paragraph (2) of this subsection, the District Court: (i) May enter a default judgment in favor of the Administration if a person fails to pay a fine or comply with a notice to appear; and (ii) Shall mail notice of any default judgment to the person named in the citation. (2) The default judgment shall take effect unless, by the end of the 15th day after the date that notice of the default judgment was mailed, the person named in the citation posts bond or a civil penalty deposit and requests a new date for a trial and the court has granted the motion. #### Section 15-116 Any penalty under this subtitle is in addition to any other penalty provided by law. ### Subtitle 2. Manufacturers, Distributors, and Factory Branches #### Section 15-201 (a) In this subtitle the following words have the meanings indicated. (a-1) "Dealer association" means a business entity that: (1) Is primarily owned by or composed of dealers that collectively represent a majority of the franchised dealers in the State; and (2) Primarily represents the interests of dealers. (b) (1) "Distributor" means a distributor who is authorized by the manufacturer or the manufacturer's authorized importer to enter into franchise agreements with dealers of: (i) New motor vehicles constructed or assembled outside of the United States; or (ii) New two-stage vehicles completed outside of the United States by a second-stage manufacturer. (2) "Distributor" does not include an autonomous vehicle converter as defined in Sec. 15-901 of this title. (c) (1) "Factory branch" means a branch office of a manufacturer from which the manufacturer: (i) Sells or promotes the sale to dealers in this State of a particular brand or make of new motor vehicles, or new completed two-stage vehicles; (ii) Directs and supervises its representatives in this State; or (iii) Supervises or contacts its dealers or prospective dealers in this State. (2) "Factory branch" does not include an autonomous vehicle converter as defined in Sec. 15-901 of this title. (d) "License" means a manufacturer's, distributor's, or factory branch's license issued by the Administration under this subtitle. (e) (1) "Manufacturer" means: (i) A manufacturer of new motor vehicles constructed or assembled in the United States; (ii) A second-stage manufacturer of new two-stage vehicles completed in the United States; and (iii) In the case of trucks, a person engaged in the business of manufacturing truck component parts. (2) "Manufacturer" does not include an autonomous vehicle converter as defined in Sec. 15-901 of this title. (f) "Manufacturer association" means a business entity that: (1) Is primarily owned by or composed of manufacturers that collectively represent a majority of the manufacturers in the State; and (2) Primarily represents the interests of manufacturers. (g) "Second-stage manufacturer" has the meaning stated in Sec. 13-113.2 of this article. #### Section 15-201.1 This subtitle does not apply to manufacturers or distributors of, or factory branches for, recreational vehicles. #### Section 15-202 (a) A manufacturer may not transfer any new motor vehicle, new two-stage vehicle, or truck component part to any dealer or distributor in this State unless the manufacturer is licensed by the Administration under this subtitle. (b) A distributor may not transfer any new motor vehicle, or new two-stage vehicle to any dealer in this State unless the distributor is licensed by the Administration under this subtitle. (c) A person may not conduct the business of a factory branch in new motor vehicles, or new two-stage vehicles unless the person is licensed by the Administration under this subtitle. #### Section 15-203 (a) In addition to the information required under Subtitle 1 of this title, each application for a license shall include: (1) The address of the principal place of business of the applicant; (2) The address of each place from which the applicant will make substantial contacts with dealers in this State; and (3) The nature of the business to be conducted at each address. (b) Each applicant for a license shall submit as part of the application: (1) A copy of each form of any new vehicle warranty currently given or offered by the applicant; (2) A copy of each form of franchise and any other contract with dealers used by the applicant, together with a list of dealers in this State who hold a franchise from the applicant; (3) A copy of the vehicle preparation and delivery obligations of its dealers; and (4) A statement of the compensation the applicant agrees to pay a dealer for parts supplied and work done by the dealer under: (i) The preparation and delivery obligations referred to in item (3) of this subsection; or (ii) Any outstanding express or implied new vehicle warranty. #### Section 15-204 (a) Each licensee shall pay an annual fee to the Administration for each license year or part of a license year for which the license is issued. (b) The annual license fee for a manufacturer or a distributor shall be established by the Administration based on the combined number of new motor vehicles, new two-stage vehicles, and truck component parts transferred by the manufacturer or distributor to dealers in this State during the preceding license year. (c) The annual license fee for a factory branch shall be established by the Administration. #### Section 15-205 (a) After the Administration notifies a manufacturer or distributor of new motor vehicles of the approval of an application for a license and before the Administration issues a license, the manufacturer or distributor shall file with the Administration a surety bond in the form and with the surety that the Administration approves. (b) (1) The amount of the surety bond shall be based on the number of new motor vehicles transferred by the manufacturer or distributor to dealers in this State during the preceding license year, according to the following schedule: (i) 1 to 50 vehicles - $25,000 surety bond; (ii) 51 to 500 vehicles - $50,000 surety bond; (iii) 501 to 10,000 vehicles - $100,000 surety bond; and (iv) Over 10,000 vehicles - $300,000 surety bond. (2) Each bond shall remain continuously in the amounts specified in this subsection. (3) A manufacturer or distributor need file only one bond, regardless of the number of makes of motor vehicles manufactured or distributed. (4) A manufacturer of truck component parts shall file a bond in the amount of $25,000. #### Section 15-206 A license issued under this subtitle authorizes the licensee to conduct the business of a manufacturer, distributor, or factory branch, as the case may be, during the license year for which it is issued. #### Section 15-206.1 (a) In this section, "good faith" means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade. (b) A manufacturer, distributor, or factory branch, whether directly or through an agent, employee, or representative, may not fail to act in good faith: (1) In acting or purporting to act under the terms, provisions, or conditions of any franchise agreement; or (2) In any transaction or conduct governed by this subtitle. #### Section 15-207 (a) (1) In this section the following words have the meanings indicated. (2) (i) "Coerce" means to compel or attempt to compel by threat of harm, breach of contract, or other adverse action or consequences, including the loss of any incentive or other benefit made available to other dealers of the same line make in the State. (ii) "Coerce" includes to act in a manner that violates Sec. 15-206.1 of this subtitle. (iii) "Coerce" does not include to argue, urge, recommend, or persuade. (3) "Require" means to impose upon a dealer a provision not required by law or previously agreed to by a dealer in a franchise agreement, excluding business decisions made to comply with the requirements of this title by a manufacturer, distributor, or factory branch which are uniformly applied to all Maryland dealers in new vehicles of the manufacturer, distributor, or factory branch. (b) A manufacturer, distributor, or factory branch, whether directly or through an agent, employee, affiliate, or representative, may not coerce any dealer to make any agreement with the manufacturer, distributor, or factory branch or their agent, employee, affiliate, or representative. (c) A manufacturer, distributor, or factory branch, whether directly or through an agent, employee, affiliate, or representative, may not coerce any dealer to order or accept delivery of any vehicle, any equipment, parts, or accessories for a vehicle, or any other commodity that is not required by law or by the dealer's franchise or that was not ordered voluntarily by the dealer. (d) A manufacturer, distributor, or factory branch, whether directly or through an agent, employee, affiliate, or representative, may not require or coerce a dealer, by franchise agreement or otherwise, or as a condition to the renewal or continuation of a franchise agreement, to: (1) Exclude from the use of the dealer's facilities a dealership for which the dealer has a franchise agreement to utilize the facilities; or (2) Materially change the dealer's facilities or method of conducting business if the change would impose substantial financial hardship on the business of the dealer. (e) (1) The provisions of this subsection apply notwithstanding the terms of any franchise agreement or agreement related to a franchise. (2) A manufacturer, distributor, or factory branch, whether directly or through an agent, employee, affiliate, or representative, may not require or coerce a dealer to adhere to performance standards that are not applied uniformly to other similarly situated dealers. (3) (i) Whether or not uniformly applied to other similarly situated dealers, an assigned market area or a performance standard, sales objective, or program for measuring dealership performance that may have a material effect on a dealer, including the dealer's right to a benefit or payment under any incentive or reimbursement program, and the application of the standard, sales objective, or program by a manufacturer, distributor, or factory branch shall: (1) Be fair, reasonable, and equitable; (2) Be based on accurate information; and (3) Include considerations of the demographic characteristics and consumer preferences of the population in the dealer's assigned market area, including: (A) Car and truck preferences of consumers; and (B) Geographic characteristics, such as natural boundaries, road conditions, and terrain, that affect car and truck shopping patterns. (ii) A dealer that claims that the assignment of a market area or application of a performance standard, sales objective, or program for measuring dealership performance is unfair or unreasonable due to the manufacturer, distributor, or factory branch failing to reasonably consider demographic characteristics of the population in the dealer's assigned market area, including car and truck preferences of consumers, or due to the geographic characteristics, such as natural boundaries, road conditions, and terrain, that affect car and truck shopping patterns in the dealer's assigned marketing area, may file a claim in a court of competent jurisdiction to determine whether the design of the assigned market area or the application of the performance standard, sales objective, or program is unfair or unreasonable under this paragraph. (iii) A manufacturer, distributor, or factory branch has the burden of proving that the design of the assigned market area, or the performance standard, sales objective, or program for measuring dealership performance is fair and reasonable under this paragraph. (4) (i) If the performance standard is based on a survey, it must be shown that: (1) The survey was designed with experts; (2) The proper universe was examined; (3) A representative sample was chosen; and (4) The data was accurately reported. (ii) The manufacturer, distributor, or factory branch shall establish the objectivity of the survey process and provide this information to any dealer of the same line make covered by the survey on request. (f) A franchise agreement or other contract offered to a dealer by a manufacturer, distributor, or factory branch may not contain any provision requiring a dealer to pay the attorney's fees of the manufacturer, distributor, or factory branch related to disputes involving the franchise. (g) (1) (i) If the dealer is an entity other than an individual, the dealer shall designate an individual to represent the dealer to do business with the manufacturer, distributor, or factory branch. (ii) Approval of the individual may not be withheld by the manufacturer, distributor, or factory branch unless the individual is unfit due to lack of good moral character or fails to meet reasonable general business experience requirements. (2) A dealer shall have a reasonable amount of time to: (i) Designate a representative or a successor if a change is required for any reason; and (ii) Obtain approval of the representative or successor designated under item (i) of this paragraph, including time for a hearing, in the event of any objection by the manufacturer, distributor, or factory branch. (3) At a hearing resulting from an objection to the approval of the designated individual, the manufacturer, distributor, or factory branch has the burden of proving that the designated individual is not of good moral character or fails to meet reasonable general business experience requirements. (h) (1) (i) Any consumer rebates, dealer incentives, price or interest rate reductions, or finance terms that a manufacturer, distributor, or factory branch offers or advertises, or allows its dealers to offer or advertise, shall be offered to all dealers of the same line make. (ii) Any manufacturer, distributor, or factory branch that denies the benefit of any consumer rebates, dealer incentives, price or interest rate reductions, or finance terms to a dealer on the basis that the dealer failed to comply with performance standards has the burden of proving that the performance standards comply with the provisions of this section. (2) Unless a dealer violates a State or local law intended to protect the public, a manufacturer, distributor, or factory branch may not: (i) Require a dealer to alter or replace an existing dealership facility; or (ii) Deny, or threaten to deny, any benefit generally available to all dealers for a dealer's failure to alter or replace an existing dealership facility. (3) Unless a dealer violates Sec. 15-313(a) or (b) of this title or a State or local law intended to protect the public, a manufacturer, distributor, or factory branch may not take an adverse action against a dealer for disclosing on its website that the advertised price of a vehicle is the manufacturer's minimum allowable advertised price and that the dealer may offer a lower price for the vehicle. (4) A manufacturer, distributor, or factory branch may not reduce the price of a motor vehicle charged to a dealer or provide different financing terms to a dealer in exchange for the dealer's agreement to: (i) Maintain an exclusive sales or service facility; (ii) Build or alter a sales or service facility; or (iii) Participate in a floor plan or other financing arrangement. (i) A manufacturer, distributor, or factory branch may offer rebates, cash incentives, or other promotional items for the sale of a vehicle by its dealers if: (1) The same rebate, cash incentive, or promotion is offered to all of its dealers of the same line make; and (2) Any rebate, cash incentive, or promotion that is based on the sale of an individual vehicle is not increased for meeting a performance standard unless the standard is reasonable considering all existing circumstances. (j) A manufacturer, distributor, or factory branch may not discriminate among its dealers in any program that provides assistance to its dealers, including Internet listings, sales leads, warranty policy adjustments, marketing programs, and dealer recognition programs. (k) (1) This subsection does not apply to: (i) The purchase or procurement of: (1) Moveable displays; (2) Brochures or other promotional materials; (3) Special tools and training as required by the manufacturer; (4) Parts for repairs made under warranty obligations of a manufacturer, distributor, or factory branch; or (5) Any goods or services for which a manufacturer, a distributor, a factory branch, or an affiliate provides a credit, stipend, payment, or reimbursement to the dealer that covers all or a substantial portion of the dealer's program costs; (ii) Optional programs; (iii) A program, or the renewal or modification of a program, in existence on October 1, 2014; or (iv) An agreement between the manufacturer, distributor, factory branch, or affiliate and the dealer that is directly related to the dealer's completion of a program if separate and valuable consideration has been offered to the dealer and accepted. (2) (i) Subject to subparagraph (ii) of this paragraph, a manufacturer, distributor, factory branch, or one of its affiliates may not, directly or through an agent, an employee, an affiliate, or a representative, require or coerce by agreement, program, or incentive provision, a dealer to purchase goods or services from a vendor that is selected, identified, or designated by the manufacturer, distributor, factory branch, or one of its affiliates. (ii) A manufacturer, distributor, factory branch, or one of its affiliates may offer a dealer the option to obtain goods or services under this subsection of substantially similar quality and design from a vendor chosen by the dealer subject to the advanced approval of the manufacturer, distributor, factory branch, or one of its affiliates. (3) A manufacturer, distributor, factory branch, or one of its affiliates may not unreasonably withhold the approval required under paragraph (2) of this subsection. (4) Nothing in this subsection may be construed to allow a dealer or vendor to: (i) Directly or indirectly eliminate or impair in any way a manufacturer's intellectual property, trademark, or trade dress rights; or (ii) Erect or maintain signs that do not conform to the intellectual property usage guidelines of the manufacturer, distributor, factory branch, or one of its affiliates. (5) (i) A manufacturer, distributor, factory branch, or one of its affiliates may not penalize a dealer for failure to participate in an optional program. (ii) Withholding the benefits of an optional program in which the dealer failed to participate may not be construed to be a penalty imposed by the manufacturer, distributor, factory branch, or affiliate. #### Section 15-207.1 (a) (1) In this section the following words have the meanings indicated. (2) (i) "Consumer data" means nonpublic personal information, as defined in 15 U.S.C. Sec. 6809(4), collected by a dealer and provided by the dealer directly to a manufacturer, distributor, or factory branch, or its agent. (ii) "Consumer data" does not include the same or similar data that is obtained by a manufacturer from any other source. (3) "Data management system" means a computer hardware or software system that: (i) Is owned, leased, or licensed by a dealer, including a system of web-based applications; (ii) Is located at the dealership or hosted remotely; and (iii) Stores and provides access to consumer data collected and stored by the dealer. (b) Notwithstanding the provisions of any franchise agreement, a manufacturer, distributor, or factory branch, or its agent: (1) Shall allow a dealer to furnish consumer data in a widely accepted file format, such as comma-separated values, and through a third-party vendor selected by the dealer; (2) May access or obtain consumer data directly from a dealer's data management system only with the express written consent of the dealer; (3) May not take any adverse action against a dealer for refusing to grant access to the dealer's data management system; (4) May require that a franchised dealer of the manufacturer, distributor, or factory branch provide consumer data or transactional data that pertains to: (i) Claims for warranty parts or repairs; (ii) Sales and deliveries of new or certified pre-owned vehicles of any line make of the manufacturer, distributor, or factory branch; (iii) Safety or recall obligations; or (iv) Validation and payment of customer or dealer incentives; and (5) Shall indemnify the dealer for any third-party claims asserted against or damages incurred by the dealer to the extent the claims of damages are caused by access to and unlawful disclosure of consumer data resulting from a breach caused by the manufacturer, distributor, or factory branch, or its agent, or a third party to which the manufacturer, distributor, or factory branch, or its agent, has provided the consumer data in violation of this section. (c) A manufacturer, distributor, or factory branch, or its agent, may not require that a dealer grant the manufacturer, distributor, or factory branch, or its agent, access to the dealer's data management system through a franchise agreement or as a condition of renewal or continuation of the franchise agreement. (d) Written consent under subsection (b)(2) of this section: (1) Shall be separate from the dealer franchise agreement; (2) Shall be executed by the dealer; and (3) May be withdrawn by the dealer on 30 days' written notice to the manufacturer, distributor, or factory branch. #### Section 15-208 (a) A manufacturer may not refuse to deliver new motor vehicles, new two-stage vehicles, or truck component parts, as the case may be, to a licensed dealer or distributor, in reasonable quantities and within a reasonable time after receipt of a written or electronic order, if: (1) The manufacturer specifically advertises that these vehicles or truck component parts are available for immediate delivery; and (2) The dealer or distributor has a franchise or other contract with the manufacturer for the sale of these vehicles or truck component parts to the public. (b) A distributor may not refuse to deliver new motor vehicles, or new two-stage vehicles, as the case may be, to a licensed dealer, in reasonable quantities and within a reasonable time after receipt of a written or electronic order, if: (1) The distributor specifically advertises that these vehicles are available for immediate delivery; and (2) The dealer has a franchise or other contract with the distributor for the sale of these vehicles to the public. (c) A factory branch may not refuse to deliver new motor vehicles, or new two-stage vehicles, as the case may be, to a licensed dealer, in reasonable quantities and within a reasonable time after receipt of a written or electronic order, if: (1) The factory branch specifically advertises that these vehicles are available for immediate delivery; and (2) The dealer has a franchise or other contract with the factory branch for the sale of these vehicles to the public. (d) A failure to deliver vehicles because of a labor strike, government regulation, or other cause not the fault of the manufacturer, distributor, or factory branch is not a violation of this section. (e) If a dealer has a franchise or other contract with a manufacturer, distributor, or factory branch for the sale of vehicles or truck component parts of a specific line or make, the manufacturer, distributor, or factory branch shall allow the dealer to: (1) Purchase the vehicles or truck component parts at the same price and on the same terms as all other dealers with a franchise or other contract for the sale of vehicles or truck component parts of the same line or make; and (2) Receive the same right to incentive payments that is given to all other dealers with a franchise or other contract for the sale of vehicles or truck component parts of the same line or make. (f) (1) Any system operated by a manufacturer, distributor, or factory branch or its affiliate for the allocation of new vehicles to dealers shall be reasonable and fair for all dealers. (2) On the written request by any of its dealers, a manufacturer, distributor, or factory branch or its affiliate shall disclose to the dealer the method by which new vehicles are allocated to dealers of the same line make. (3) In any dispute over compliance with this subsection, a manufacturer, distributor, or factory branch or its affiliate has the burden of proving its compliance. #### Section 15-209 (a) A manufacturer may not terminate, cancel, or fail to renew the franchise of a dealer, notwithstanding any term or provision of the franchise, unless: (1) The dealer has failed to comply substantially with the reasonable requirements of the franchise; and (2) Except as otherwise provided by subsection (d) of this section, the manufacturer: (i) Gives the dealer at least 90 days' prior written notice of the termination, cancellation, or nonrenewal and of the specific grounds for the action; and (ii) Provides the Administration with a copy of that notice. (b) A distributor may not terminate, cancel, or fail to renew the franchise of a dealer, notwithstanding any term or provision of the franchise, unless: (1) The dealer has failed to comply substantially with the reasonable requirements of the franchise; and (2) Except as otherwise provided by subsection (d) of this section, the distributor: (i) Gives the dealer at least 90 days' prior written notice of the termination, cancellation, or nonrenewal and of the specific grounds for the action; and (ii) Provides the Administration with a copy of that notice. (c) A factory branch may not terminate, cancel, or fail to renew the franchise of a dealer, notwithstanding any term or provision of the franchise, unless: (1) The dealer has failed to comply substantially with the reasonable requirements of the franchise; and (2) Except as otherwise provided by subsection (d) of this section, the factory branch: (i) Gives the dealer at least 90 days' prior written notice of the termination, cancellation, or nonrenewal and of the specific grounds for the action; and (ii) Provides the Administration with a copy of that notice. (d) The 90-day notice period required by subsection (a) of this section: (1) May be reduced to not less than 15 days, if the ground for the termination, cancellation, or nonrenewal is the dealer's inability to reasonably serve the interests of the public; and (2) Is not required, if the dealer waives it in writing. (e) (1) If a dealer receives written notice that his franchise is being terminated, canceled, or not renewed, the dealer may, within the notice period required by this section, request a hearing under Title 12, Subtitle 2 of this article in which the manufacturer, distributor, or factory branch must show that the dealer has failed to comply substantially with the reasonable requirements of the franchise. (2) If the dealer requests a hearing under this subsection, the dealer's franchise continues in effect, notwithstanding any term or provision of the franchise or any other provision of this subtitle, until the Administration, after the hearing, makes a final determination. (3) A dealer, manufacturer, distributor, or factory branch may appeal the determination of the Administration to the circuit court for the county in which the dealer's principal place of business is located. (4) If the dealer, manufacturer, distributor, or factory branch appeals the determination of the Administration to a circuit court, the dealer's franchise continues in effect, notwithstanding any term or provision of the franchise or any other provision of this subtitle, until the circuit court makes a final determination. (5) A dealer, manufacturer, distributor, or factory branch may appeal from a final judgment entered by a circuit court to the Appellate Court of Maryland as provided in Sec. 12-301 of the Courts and Judicial Proceedings Article. (f) (1) In addition to any administrative and criminal sanctions imposed under this subtitle, a manufacturer, distributor, or factory branch that terminates, cancels, or fails to renew the franchise of a dealer in violation of this section shall pay to the dealer the fair value of his business as a going concern. (2) On payment, the dealer shall convey his business, free of liens and encumbrances, to the manufacturer, distributor, or factory branch. #### Section 15-210 (a) A manufacturer, whether directly or through an agent, employee, or representative, may not use any advertisement that is in any way false, deceptive, or misleading. (b) A distributor, whether directly or through an agent, employee, or representative, may not use any advertisement that is in any way false, deceptive, or misleading. (c) A factory branch, whether directly or through an agent, employee, or representative, may not use any advertisement that is in any way false, deceptive, or misleading. #### Section 15-211 (a) A manufacturer, whether directly or through an agent, employee, affiliate, or representative, may not prevent, by contract or otherwise, any owner, partner, or stockholder of any dealership from transferring any ownership interest in the dealership to any other person. (b) A distributor, whether directly or through an agent, employee, affiliate, or representative, may not prevent, by contract or otherwise, any owner, partner, or stockholder of any dealership from transferring any ownership interest in the dealership to any other person. (c) A factory branch, whether directly or through an agent, employee, affiliate, or representative, may not prevent, by contract or otherwise, any owner, partner, or stockholder of any dealership from transferring any ownership interest in the dealership to any other person. (d) (1) A dealer or an owner, partner, or stockholder of a dealership may not sell, assign, or otherwise transfer a franchise or any right under a franchise without the consent of the manufacturer. (2) Notwithstanding the terms of any franchise agreement or agreement related to a franchise, a manufacturer may not exercise a right of first refusal in the event of a sale or transfer or proposed sale or transfer of a dealer's business or any equity interest in a dealer's business to a person who meets the manufacturer's reasonable qualifications for ownership and is: (i) A member of the dealer's immediate family; (ii) A qualified manager with at least 2 years management experience at the dealer's business; (iii) An existing dealer in good standing; or (iv) A business entity controlled by a person described in item (i), (ii), or (iii) of this paragraph. (3) If a manufacturer exercises a right of first refusal in the event of a sale or transfer or proposed sale or transfer of the dealer's business or an equity interest in the dealer's business, the manufacturer shall pay the reasonable expenses, including customary attorney's fees, incurred by the prospective purchaser in negotiating and implementing the contract for the proposed sale or transfer, provided that the dealer has given the manufacturer at least 45 days' notice of an intent to sell or transfer. (e) (1) A manufacturer may not unreasonably withhold consent to the transfer of a franchise under subsection (d) of this section. (2) If an owner, partner, or stockholder of a dealership seeks to sell, assign, or otherwise transfer a franchise or any right under a franchise, the owner, partner, or stockholder shall provide written notice to the manufacturer of the proposed transfer. (3) Within 20 days after a manufacturer receives written notice of a proposed transfer from a transferor, the manufacturer shall provide the transferor with all forms and requests for information that the manufacturer considers necessary to evaluate the proposed transfer. (4) Within 75 days after a manufacturer receives all completed forms and requested information from a transferor, the manufacturer shall: (i) Give consent to the transfer; or (ii) Provide a written statement of the specific grounds for its refusal to consent to the transfer, consistent with the requirements under subsection (k) of this section. (f) (1) A dealer or an owner, partner, or stockholder of a dealership may not sell, assign, or otherwise transfer a franchise or any right under a franchise without the consent of the distributor. (2) Notwithstanding the terms of any agreement related to the franchise, a distributor may not exercise a right of first refusal in the event of a sale or transfer or proposed sale or transfer of a dealer's business or any equity interest in a dealer's business to a person who meets the distributor's reasonable qualifications for ownership and is: (i) A member of the dealer's immediate family; (ii) A qualified manager with at least 2 years management experience at the dealer's business; (iii) An existing dealer in good standing; or (iv) A business entity controlled by a person described in item (i), (ii), or (iii) of this paragraph. (3) If a distributor exercises a right of first refusal in the event of a sale or transfer or proposed sale or transfer of the dealer's business or an equity interest in the dealer's business, the distributor shall pay the reasonable expenses, including customary attorney's fees, incurred by the prospective purchaser in negotiating and implementing the contract for the proposed sale or transfer, provided that the dealer has given the distributor at least 45 days' notice of an intent to sell or transfer. (g) However, the distributor may not unreasonably withhold consent to the transfer of a franchise under subsection (f) of this section. (h) (1) A dealer or an owner, partner, or stockholder of a dealership may not sell, assign, or otherwise transfer a franchise or any right under a franchise without the consent of the factory branch. (2) Notwithstanding the terms of any agreement related to the franchise, a factory branch may not exercise a right of first refusal in the event of a sale or transfer or proposed sale or transfer of a dealer's business or any equity interest in a dealer's business to a person who meets the factory branch's reasonable qualifications for ownership and is: (i) A member of the dealer's immediate family; (ii) A qualified manager with at least 2 years management experience at the dealer's business; (iii) An existing dealer in good standing; or (iv) A business entity controlled by a person described in item (i), (ii), or (iii) of this paragraph. (3) If a factory branch exercises a right of first refusal in the event of a sale or transfer or proposed sale or transfer of the dealer's business or an equity interest in the dealer's business, the factory branch shall pay the reasonable expenses, including customary attorney's fees, incurred by the prospective purchaser in negotiating and implementing the contract for the proposed sale or transfer, provided that the dealer has given the factory branch at least 45 days' notice of an intent to sell or transfer. (i) However, the factory branch may not unreasonably withhold consent to the transfer of a franchise under subsection (h) of this section. (j) A manufacturer, distributor, or factory branch may not impose a condition on the approval of the sale or transfer of the ownership of a dealership, by the sale of the business, stock transfer, or otherwise, if the condition would violate the provisions of this title if imposed on an existing dealer. (k) (1) A manufacturer, distributor, or factory branch violates this section if, without a statement of specific grounds consistent with this title for the action, the manufacturer, distributor, or factory branch takes action to prevent or refuse to approve: (i) The sale, assignment, or transfer of the ownership of a dealership by the sale of the business, stock transfer, or otherwise; (ii) The sale, transfer, or assignment of a dealer franchise; or (iii) A change in the executive management or principal operator of the dealership. (2) (i) An existing dealer denied the sale, assignment, transfer, or change under this section may request that the Administrator conduct a hearing to review the denial or the imposition of a condition in violation of this section. (ii) If the Administrator finds that the action leading to the denial or the imposition of a condition was in violation of this section, the Administrator may order the sale, assignment, or transfer to be approved by the manufacturer, distributor, or factory branch without imposition of the condition. (3) (i) An applicant for approval of a sale, assignment, or transfer of ownership of a dealership or an existing dealer denied the sale, assignment, or transfer may institute an action for damages in the circuit court for the county in which the dealer's principal place of business is located, if: (1) The existing dealer does not request a hearing by the Administrator; and (2) The action taken in violation of this section to deny the sale, assignment, or transfer of ownership or the change in executive management or the condition imposed on the sale, assignment, or transfer is the proximate cause of the failure of the contract for the sale, assignment, or transfer of ownership of the dealership. (ii) An action for damages under this section must be instituted within 2 years of the violation of this section. #### Section 15-211.1 (a) (1) A designated family member of a deceased or incapacitated dealer may succeed the dealer in the ownership or operation of the dealership under the existing franchise agreement if the designated family member: (i) Gives the manufacturer, distributor, or factory branch written notice of the designated family member's intention to succeed to the dealership within 120 days after the dealer's death or incapacity; (ii) Agrees to be bound by all of the terms and conditions of the franchise agreement; and (iii) Meets the current criteria that the manufacturer, distributor, or factory branch generally applies in qualifying dealers. (2) A manufacturer, distributor, or factory branch may refuse to honor the existing franchise agreement with the designated family member only for good cause. (b) (1) The manufacturer, distributor, or factory branch may request from a designated family member personal and financial data reasonably necessary to determine whether the existing franchise agreement should be honored. (2) The designated family member shall supply the personal and financial data promptly upon the request. (c) If a manufacturer, distributor, or factory branch believes that good cause exists for refusing to honor the succession, the manufacturer, distributor, or factory branch may, within 60 days after receipt of the notice of the designated family member's intent to succeed the dealer or, if the manufacturer, distributor, or factory branch requested personal or financial data, within 60 days after the receipt of the requested data, provide written notice to the designated family member of the manufacturer, distributor, or factory branch's refusal to approve the succession. (d) The notice of the manufacturer, distributor, or factory branch provided in accordance with subsection (c) of this section shall state the specific grounds for the refusal to approve the succession and that discontinuance of the franchise agreement shall take effect not less than 90 days after the date the notice is provided. (e) If written notice of refusal is not provided in accordance with subsection (c) of this section, the franchise agreement shall continue in effect and shall be subject to termination only as otherwise permitted by this title. (f) This section does not preclude a dealer from designating any person as the dealer's successor by written instrument filed with the manufacturer, distributor, or factory branch. If a written instrument is filed, the instrument alone shall determine the succession rights to the management and operation of the dealership. (g) (1) This section applies only to a dealer who is an individual. (2) In the event of the incapacity or death of an individual designated to act as a representative of a dealer that is an entity under Sec. 15-207(g) of this subtitle, the procedure for replacement of the individual shall be as provided in Sec. 15-207(g) of this subtitle. #### Section 15-212 (a) In this section, "motor home" means a motor vehicle that: (1) Is designed to provide temporary living quarters, built into as an integral part of, or permanently attached to, a self-propelled motor vehicle chassis or van; and (2) Contains permanently installed independent life support systems which provide at least four of the following facilities: (i) Cooking; (ii) Refrigeration or ice box; (iii) Self-contained toilet; (iv) Heating, air-conditioning, or both; (v) A potable water supply system including a faucet and sink; (vi) Separate 110-125 volt electrical power supply; or (vii) An LP gas supply. (b) In addition to the other grounds specified in Subtitle 1 of this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this subtitle to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that the person has: (1) Made any material misrepresentation in transferring a vehicle or truck component part to a dealer or distributor; (2) Failed to comply with any written warranty agreement; or (3) Failed to reasonably compensate any franchised dealer who does work under: (i) The vehicle preparation and delivery obligations of the dealer; or (ii) Any outstanding express or implied new vehicle or truck component parts warranty. (c) (1) A licensee shall specify in writing to each of its motor vehicle dealers licensed in the State: (i) The dealer's obligation for vehicle preparation, delivery, warranties, and recalls on its products; (ii) The schedule of compensation to be paid to the dealers for parts, including parts assemblies, and labor, including diagnostic labor and associated administrative requirements, in connection with the service obligations established under item (i) of this paragraph; and (iii) A time allowance for the performance of labor described in this paragraph that is reasonable and adequate. (2) Reasonable compensation under this section may not be less than: (i) With respect to labor for warranty or recall repairs, the dealer's current labor rate for nonwarranty repairs of a like kind for retail customers; and (ii) With respect to any part, the dealer's cost plus its current retail mark-up percentage charged to retail customers for nonwarranty repairs of a like kind. (3) (i) For purposes of paragraph (2) of this subsection, the dealer's labor rate or parts mark-up percentage shall be established by a submission to the licensee of whichever of the following produces fewer repair orders closed, as of the date of submission, within the preceding 180 days: (1) 100 qualifying sequential customer-paid repair orders; or (2) 90 days of qualifying customer-paid repair orders. (ii) With respect to parts, a schedule of compensation established under this subsection shall be equal to the parts mark-up percentage as reflected in qualifying repair orders, calculated by dividing the total charges for parts in the repair orders by the total dealer cost for the parts minus one. (iii) (1) A dealer may not make a submission under this subsection more than once in 1 year. (2) For purposes of subsubparagraph 1 of this subparagraph, a revision or supplement to a submission to correct or clarify the submission does not constitute a new submission. (4) Repair orders for labor or parts in connection with any of the following may not constitute a qualifying repair order under paragraph (2) of this subsection: (i) Accessories; (ii) Repairs for manufacturer, distributor, or factory branch special events, promotions, or service campaigns; (iii) Repairs related to collision; (iv) Vehicle emission or safety inspections required by law; (v) Parts sold, or repairs performed, at wholesale or for insurance carriers, or other third-party payors; (vi) Routine maintenance not covered under any warranty, including maintenance involving fluids, filters, and belts not provided in the course of repairs; (vii) Nuts, bolts, fasteners, and similar items that do not have an individual parts number; (viii) Tires; (ix) Vehicle reconditioning; (x) Goodwill or policy repairs or replacements; or (xi) Repairs on vehicles from a different line-make. (5) If a licensee gives a dealer a part at no cost to use in performing a repair under a recall, campaign service action, or warranty repair, the licensee shall compensate the dealer for the part by paying the dealer the parts mark-up percentage established under this subsection on the cost for the part listed on the licensee's price schedule. (6) (i) The schedule of compensation submitted under paragraph (3) of this subsection shall be presumed to be accurate and reasonable. (ii) The licensee shall approve or rebut the dealer's submission within 30 days of receipt. (iii) If the licensee approves a dealer's submission, the licensee shall begin compensating the dealer under the schedule within 30 days after the date of approval. (iv) In the absence of a timely rebuttal by the licensee, the schedule of compensation submitted by the dealer shall go into effect on the 31st day following the licensee's receipt of the schedule. (v) Any rebuttal of the schedule of compensation by the licensee shall: (1) Be delivered to the dealer within 30 days of the licensee's receipt of the schedule; and (2) Consist of reasonable substantiating evidence that the declared rate is materially inaccurate. (vi) In the event of a timely rebuttal, on resolution of the matter by agreement of the parties or by administrative, judicial, or other action, a licensee's payment obligations under the resulting schedule of compensation shall begin on the 31st day following a final order unless otherwise provided for by the fact finder. (vii) (1) To the extent that any action commenced under subsection (d) of this section or Sec. 15-213 or Sec. 15-214 of this subtitle involves the application of paragraph (3) of this subsection, the issues shall be limited to whether the labor rate or parts mark-up percentage stated in the dealer's submission was materially inaccurate. (2) A licensee shall have the burden of proving under this subparagraph that the dealer's submission was materially inaccurate. (viii) (1) A licensee may verify a dealer's effective rates once annually. (2) If a licensee finds that a dealer's effective rates have increased or decreased, the licensee may increase or decrease, respectively, the warranty reimbursement rate prospectively. (7) A licensee may not directly or indirectly: (i) Calculate its own labor rate or parts mark-up percentage on a warranty reimbursement rate submission by the licensee's dealer under this section, or require a dealer to calculate a labor rate or parts mark-up percentage, by any method not required under this section, including a method that is unduly burdensome or time-consuming or that requires information that is unduly burdensome or time-consuming to provide such as: (1) A part-by-part or transaction-by-transaction calculation; or (2) Presentation of information as to, or calculations based on, the dealer's or other dealers' warranty compensation; (ii) Establish or implement a special part or component number for parts used in warranty fulfillment, if the special part or component number results in reduced compensation for the dealer unless the part is used for specific, limited repair situations; (iii) Require or coerce a dealer to change the prices for which it sells parts or labor for retail customer repairs; (iv) Take adverse action against a dealer because the dealer seeks compensation under this section, by: (1) Implementing a process that is inconsistent with the licensee's obligations to the dealer under this subtitle; or (2) Failing to act in good faith; (v) Conduct any warranty or retail customer repair audit, or other service-related audit, solely because the dealer makes a request for warranty reimbursement at retail rates in the ordinary course of business; or (vi) Establish, implement, enforce, or apply any policy, standard, rule, program, or incentive regarding the compensation due under this section other than in a uniform manner among the licensee's dealers in the State. (8) The provisions of paragraphs (1) through (7) of this subsection do not apply to travel trailers or parts of systems, fixtures, appliances, furnishings, accessories, and features of motor homes that are not manufactured by the manufacturer of the motor home as a part of the unit. (9) (i) A claim filed under this section by a dealer with a manufacturer or distributor shall be: (1) In the manner and form reasonably prescribed by the manufacturer or distributor; and (2) Approved or disapproved within 30 days of receipt. (ii) A claim not approved or disapproved within 30 days of receipt shall be deemed approved. (iii) Payment of or credit issued on a claim filed under this section shall be made within 30 days of approval. (10) A dealer's failure to comply with a specific requirement of the manufacturer or distributor may not constitute grounds for denial of the claim or reduction of the amount of compensation paid to the dealer if the dealer presents documentation or other reasonable evidence to substantiate that the repair and the claim were done according to manufacturer warranty guidelines. (11) (i) If a claim filed under this section is shown by the manufacturer or distributor to be false or unsubstantiated, the manufacturer or distributor may charge back the claim within 9 months from the date the claim was paid or credit issued. (ii) This paragraph does not limit the right of a manufacturer or distributor to: (1) Conduct an audit of any claim filed under this section; or (2) Charge back for any claim that is proven to be fraudulent. (iii) An audit under this paragraph shall be conducted according to generally accepted accounting principles. (12) A licensee may not prohibit a dealer from, or take any adverse action against a dealer for, providing to a customer information given to the dealer by a manufacturer related to any condition that may substantially affect motor vehicle safety, durability, reliability, or performance. (13) A dealer may provide the information specified in paragraph (12) of this subsection only to a customer that has: (i) Purchased the vehicle for which the information pertains from the dealer; or (ii) Had the vehicle for which the information pertains serviced by the dealer. (14) A licensee may not deny a claim, reduce the amount of compensation to a dealer, or process a charge back to a dealer for performing covered warranty or required recall repairs on a vehicle: (i) For resolving a condition covered by the licensee's original warranty; (ii) For remedying a safety-related defect that is subject to an outstanding recall under federal law; (iii) If the dealer properly performed the repairs and submitted the claims; or (iv) If the dealer discovered the need for repairs: (1) During the course of a separate repair requested by the customer; or (2) Through notice of an outstanding recall under federal law for a safety-related defect. (d) As to any person licensed under this subtitle, instead of or in addition to revocation, suspension, or nonrenewal of a license under this section, the Administrator: (1) May order the licensee to pay a fine not exceeding $50,000 for each violation of this subtitle; and (2) May order the licensee to compensate any person for financial injury or other damage suffered as a result of the violation. #### Section 15-212.1 (a) Upon the filing of a claim, a manufacturer, factory branch, or distributor shall compensate a dealer for any incentive or reimbursement program sponsored by the manufacturer, factory branch, or distributor, under the terms of which the dealer is eligible for compensation. (b) (1) A claim filed under this section shall be: (i) In the manner and form prescribed by the manufacturer, factory branch, or distributor; and (ii) Approved or disapproved within 30 days of receipt. (2) A claim not approved or disapproved within 30 days of receipt shall be deemed approved. (3) Payment of a claim filed under this section shall be made within 30 days of approval. (c) (1) If a claim filed under this section is shown by the manufacturer, factory branch, or distributor to be false or unsubstantiated, the manufacturer, factory branch, or distributor may charge back the claim within 6 months from the payment of the incentive or reimbursement. (2) This paragraph does not limit the right of a manufacturer, factory branch, or distributor to: (i) Conduct an audit of any claim filed under this section; or (ii) Charge back for any claim that is proven to be fraudulent. (3) An audit under this paragraph shall be conducted according to generally accepted accounting principles. (d) A manufacturer, distributor, or factory branch may not refuse to pay, or claim reimbursement from, a dealer for sales, incentives, or payments related to a motor vehicle sold by the dealer because the purchaser of the motor vehicle exported or resold the motor vehicle in violation of the policy of the manufacturer, distributor, or factory branch unless the manufacturer, distributor, or factory branch can show that, at the time of sale, the dealer knew or should have known of the purchaser's intention to export or resell the motor vehicle. (e) (1) This subsection applies only to an incentive payment, a reimbursement payment, cash, a gift, or a thing of value earned by an employee of a dealer on or after May 1, 2009. (2) (i) An incentive payment, a reimbursement payment, cash, a gift, or a thing of value to be given by a manufacturer, distributor, or factory branch to an employee of a dealer may be given: (1) Directly to the employee; or (2) To the dealer to be distributed to the employee. (ii) An incentive payment, a reimbursement payment, or cash given to a dealer for distribution to an employee under this paragraph shall be distributed to the employee as part of the payroll process after the appropriate payroll deductions have been made by the dealer. (3) A manufacturer, distributor, or factory branch shall make information available to a dealer about any incentive payment, reimbursement payment, cash, gift, or thing of value totaling more than $200 in a calendar year that is given directly to an employee of the dealer. #### Section 15-212.2 (a) If a manufacturer, distributor, or factory branch terminates, suspends, refuses to renew, or closes a dealer's franchise or refuses to supply new vehicles to a dealer who holds a franchise, the manufacturer, distributor, or factory branch shall: (1) Reimburse the dealer for any costs the dealer incurred for facility upgrades or alterations required by the manufacturer, distributor, or factory branch within the previous 2 years; (2) Pay the dealer at least the dealer cost, plus any charges by the franchisor, distributor, or factory branch, for distribution, delivery, and taxes paid by the dealer, less all allowances paid to the dealer by the franchisor for any new, undamaged motor vehicles purchased within 18 months of the date of the termination, suspension, refusal to renew, closure, or refusal to supply, whether acquired from the franchisor or from another dealer of the same line make in the ordinary course of business; (3) Pay the dealer at least the dealer acquisition cost of each new, unused, undamaged, and unsold part or accessory if the part or accessory is in the current parts catalog and is: (i) Still in the original, resalable merchandising package and in unbroken lots; or (ii) In the case of sheet metal, in the original packaging or a comparable substitute for the original packaging; (4) Pay the dealer at least the fair market value of each undamaged sign owned by the dealer that bears a trademark, trade name, or commercial symbol used or claimed by the franchisor if the sign was purchased from or at the request of the franchisor; (5) Pay the dealer at least the fair market value of all special tools and automotive service equipment owned by the dealer that were recommended and designated as special tools or equipment by the franchisor, if the tools and equipment are in useable and good condition except for normal wear and tear; and (6) Pay the dealer at least the reasonable cost of transporting, handling, packing, and loading motor vehicle parts, signs, tools, and special equipment subject to repurchase under this section. (b) (1) If a manufacturer of motor homes terminates or cancels a motor home dealer, the manufacturer shall reimburse the dealer, less any allowances, discounts, or rebates paid to the dealer by the manufacturer, for at least: (i) The total net inventory invoice costs; (ii) Any charges by the manufacturer for distribution delivery; and (iii) Any inventory related taxes paid by the dealer. (2) This subsection only applies to motor homes in inventory that: (i) Are new and untitled; (ii) Were acquired from the manufacturer within 18 months before the effective date of the notice of termination or cancellation; (iii) Have not been used, other than for demonstration purposes; and (iv) Have not been altered or damaged. #### Section 15-213 Notwithstanding any administrative or criminal sanctions imposed by this subtitle, if a person suffers financial injury or other damage as a result of a violation of this subtitle by any other person, whether or not that other person has been found guilty of a criminal violation, the injured person may recover damages and reasonable attorneys' fees in any court of competent jurisdiction. #### Section 15-214 (a) Subject to subsection (b) of this section and except as provided in subsection (c) of this section, in addition to any other right to request a hearing under this subtitle and notwithstanding any provisions of the franchise agreement to the contrary, a dealer, designated dealer successor as provided in Sec. 15-211.1 of this subtitle, dealer association on behalf of itself, a dealer, or a group of dealers, manufacturer, manufacturer association on behalf of itself, a manufacturer, or a group of manufacturers, distributor, or factory branch may request a hearing under Title 12, Subtitle 2 of this article to: (1) Resolve a dispute under any provision of this title between a dealer, a designated dealer successor, or a dealer association and a manufacturer, manufacturer association, distributor, or factory branch; or (2) Seek clarification or interpretation of any provision of this title. (b) A dealer association may request a hearing under subsection (a)(1) of this section only if: (1) At least one member of the dealer association has a dispute under any provision of this title with a manufacturer, distributor, or factory branch; (2) The interests that the dealer association seeks to protect are germane to the purpose of the dealer association; and (3) The claim asserted and the relief requested do not require the participation of each of the individual members. (c) Subsection (a)(1) of this section does not apply to a dispute involving a manufacturer, distributor, or factory branch that does not have at least one franchised dealer in this State. ### Subtitle 3. Dealers #### Section 15-301 In this subtitle, "license" means a dealer's license issued by the Administration under this subtitle. #### Section 15-302 (a) A person may not conduct the business of a dealer unless the person is licensed by the Administration under this subtitle. (b) Any person who has been refused a dealer's license in this State or whose dealer's license is revoked or suspended may not conduct the business of a dealer under any license, permit, or registration certificate issued by any other jurisdiction. (c) A person convicted of a violation of this section is subject to imprisonment not exceeding 1 year or a fine not exceeding $5,000 or both. #### Section 15-303 (a) A license may not be issued to a partnership or corporation as such. (b) (1) If an application for a license is made for a corporation, the license shall be applied for by and issued to three officers of the corporation who are authorized to act for it or, if it is a close corporation, at least one officer authorized to act for the close corporation. (2) If an application is made for a partnership, the license shall be applied for and issued to all of the partners who are authorized to act for the partnership. However, as to any such partner that is a corporation, the application for the corporate partner shall be made by and issued to three officers of the corporate partner who are authorized to act for it or, if it is a close corporation, at least one officer authorized to act for the close corporation. (c) Each individual who applies for a license under this section assumes, as an individual, all responsibilities of the dealership and, as an individual, is subject to all conditions, restrictions, and penalties imposed on licensed dealers by the Maryland Vehicle Law. #### Section 15-304 (a) Except as provided in subsection (b) of this section, a person may not be licensed under this subtitle unless: (1) The business to be conducted under the license is the only or principal business conducted from the fixed location specified in the application; (2) That business is conducted from a building that is adequate and appropriate for the sale of the vehicles that may be sold under the license; and (3) That business either: (i) Maintains and operates an automotive repair facility equipped for reasonably adequate and proper servicing of the vehicles to be sold by it; or (ii) Has an existing contract, approved by the Administration, that requires the contractor to service, at a reasonably convenient location, the vehicles to be sold by the business. (b) (1) As to trailers, semitrailers, motorcycles, Class C (funeral and ambulance) vehicles, or emergency vehicles as defined in Sec. 11-118(2), (5), and (7) of this article, the sale of these vehicles need not be the only or principal business conducted from the fixed location, but shall be subject to any reasonable location requirements determined by the Administration by rule or regulation. (2) A wholesale dealer may be licensed under this subtitle regardless of whether the wholesale dealer meets the requirements of subsection (a)(1) and (3) of this section, but a wholesale dealer shall be subject to any reasonable location requirements determined by the Administration by rule or regulation. (c) Notwithstanding the provisions of this section: (1) Except as provided in paragraph (3) of this subsection, a new vehicle dealer, or a licensed vehicle salesman who is employed by the dealer, may participate in 2 annual vehicle shows for each dealer location. (2) A display or exhibit of vehicles provided by a vehicle manufacturer is not a vehicle show under this section if buyers' orders are not executed and deposits are not accepted. (3) (i) A new vehicle dealer franchised to sell Class M motor homes or Class G trailers, or a licensed salesman who is employed by the dealer, may participate in 3 annual vehicle shows. (ii) A new vehicle dealer franchised to sell motorcycles, or a licensed salesman who is employed by the dealer, may participate in more than 2 annual vehicle shows. (d) A vehicle dealer or licensed vehicle salesman listed in subsection (c) of this section may participate in a vehicle show if: (1) The dealer holds a valid license issued under this title; and (2) At least 60 days before the vehicle show, an application is filed with the Administration, for approval by the Administration, that contains: (i) A list of the names and business addresses of participating dealers to the extent known; (ii) The location of the vehicle show; (iii) The specific dates on which the vehicle show will be held; and (iv) Other reasonable information required by the Administration; and (3) The vehicle show does not exceed 10 consecutive days and, except for motorcycle shows, is restricted to new vehicles only. (e) (1) This subsection does not apply to a licensed motorcycle dealer or a licensed motorcycle salesman who is employed by the dealer. (2) A licensed dealer, or a licensed vehicle salesman who is employed by the dealer, who participates in a vehicle show may execute a buyer's order and accept a deposit as provided in paragraph (3) of this subsection. (3) A licensed dealer may not accept a deposit that: (i) For an order for any vehicle, except a Class M motor home, exceeds 5 percent of the cost of the vehicle; or (ii) For an order of a Class M motor home, exceeds 10 percent of the cost of the motor home. (4) Except as otherwise provided in paragraph (2) of this subsection, a licensed dealer, or a licensed vehicle salesman who is employed by the dealer, shall conduct activities involved in a vehicle sale, including the completion of the sales contract, the issuance of temporary registration plates and a temporary registration certificate, and delivery of the vehicle, at the dealer's fixed location as shown in the dealer's application for the license. (f) A licensed motorcycle dealer, or a licensed salesman who is employed at a vehicle show by the dealer, may conduct all activities involved in a motorcycle sale, including executing a buyer's order, accepting a deposit of any amount, completing the sales contract, issuing temporary registration plates and a temporary registration certificate, and delivery of the motorcycle. #### Section 15-304.1 (a) There is an out-of-state motor home and recreational trailer vehicle show permit. (b) The Administration may issue a permit under this section to a dealer of motor homes or recreational trailers licensed in another state only if that state reciprocally authorizes Maryland dealers of motor homes and recreational trailers to display or exhibit motor homes or recreational trailers at vehicle shows in that state. (c) A permit holder: (1) May display or exhibit motor homes or recreational trailers at a vehicle show for motor homes or recreational trailers in Worcester County; and (2) May not execute a buyer's order or accept a deposit. (d) An out-of-state dealer of motor homes or recreational trailers that is licensed by the licensing authority of another state may apply for a permit. (e) The Administration shall determine the duration of a permit issued under this section. (f) (1) After a permit has been approved by the Administration, the permit holder shall file a bond with the Administration. (2) The bond shall be on a form prescribed and furnished by the Administration, payable to the State, and conditioned on compliance with the conditions and limitations of the permit. (3) The amount of the bond shall be determined by the Administration. (4) (i) Liability under the bond shall be for the duration of the permit. (ii) A bond may not be fully released until all requirements of this section, regulations adopted in accordance with this section, and permit conditions have been met or complied with. (5) The bond shall be executed by the permit holder and by a corporate surety approved by the Administration. (g) The Administration may suspend or revoke a permit if the Administration determines that the permit holder is out of compliance with this section or any permit conditions. #### Section 15-305 (a) A license to deal in new vehicles may not be issued to any person unless the manufacturer or distributor of the vehicles is in compliance with the surety bond requirements of Sec. 15-205 of this title. (b) A license to deal in new vehicles may be issued only for a dealer in new vehicles who holds a franchise from: (1) The manufacturer of the vehicles; or (2) A distributor who is authorized by the manufacturer or the manufacturer's authorized importer of the vehicles. (c) If an applicant for a license to deal in new vehicles seeks to qualify under subsection (b) of this section, the applicant shall submit with the application an exact copy of the required franchise. (d) (1) If a franchise required by this section is terminated in accordance with Sec. 15-209 of this title, the license of the dealer shall be suspended automatically unless, before the effective date of termination, the licensed dealer files satisfactory evidence that the franchise has been extended. The Administration immediately shall notify the licensee of the suspension. (2) (i) Notwithstanding paragraph (1) of this subsection, if a franchise issued to a licensee who deals in Class M motor homes or Class G travel trailers is terminated for any reason, the Administration may authorize the licensee to dispose of the Class M motor homes and Class G travel trailers that were in the dealer's inventory prior to the franchise termination without applying for a certificate of title in the dealership's name or paying the applicable excise tax. (ii) The initial authorization period under subparagraph (i) of this paragraph may not exceed 12 months from the date of the franchise termination. (iii) After the initial authorization period under subparagraph (i) of this paragraph, the Administration may review each situation on a case by case basis and determine whether a further extension of time to dispose of remaining inventory is warranted or whether the dealer shall be required to take title to any remaining Class M motor homes and Class G travel trailers in the dealer's inventory. (e) (1) Notwithstanding subsections (a) and (f) of this section, a manufacturer or distributor may be licensed as a dealer if the manufacturer or distributor: (i) Operates temporarily a dealership that: (1) Was previously owned by a franchised dealer; and (2) Is for sale to any qualified person at a reasonable price; (ii) Operates a dealership in a bona fide relationship in which an independent person: (1) Has made a significant investment, subject to loss, in the dealership; and (2) Can reasonably expect to acquire full ownership of the dealership under reasonable terms and conditions; or (iii) (1) Is a second-stage manufacturer as defined in Sec. 13-113.2(a)(7) of this article; and (2) Deals only in Class E (truck) vehicles with a gross weight limit of 10,000 pounds or more, as defined in Sec. 13-916 of this article. (2) (i) Notwithstanding subsections (b) and (f) of this section and subject to subparagraph (ii) of this paragraph, a manufacturer or distributor may be licensed as a dealer if: (1) The manufacturer or distributor deals only in electric or nonfossil-fuel burning vehicles; (2) No dealer in the State holds a franchise from the manufacturer or distributor; (3) The manufacturer or distributor, or a subsidiary, an affiliate, or a controlled entity of the manufacturer or distributor, does not hold a controlling interest in another manufacturer or distributor, or a subsidiary, an affiliate, or a controlled entity of the other manufacturer or distributor, that is licensed as a dealer under this paragraph; and (4) No other manufacturer or distributor, or subsidiary, affiliate, or controlled entity of the other manufacturer or distributor, that is licensed as a dealer under this paragraph, holds a controlling interest in the manufacturer or distributor, or a subsidiary, an affiliate, or a controlled entity of the manufacturer or distributor. (ii) No more than four licenses may be issued under this paragraph. (iii) The Administration shall adopt regulations to implement this paragraph. (f) A manufacturer or distributor, or a person who is acting for a partnership or corporation that is owned or controlled by or under common control with a manufacturer or distributor, may not sell a new vehicle to a retail buyer. #### Section 15-305.1 (a) A wholesale dealer who is licensed by the Administration under this subtitle: (1) May buy a vehicle from another dealer, at an auto auction, or from a retail seller; (2) May sell a vehicle to or exchange vehicles with another dealer; (3) Except as provided in item (4) of this subsection, may sell a vehicle or exchange vehicles at an auto auction; (4) May not sell a vehicle to or exchange vehicles with a retail buyer; and (5) May not buy, sell, or exchange new vehicles. (b) A wholesale dealer shall keep a record of the following: (1) The year, make, model, and identification number of a vehicle that is bought, sold, or exchanged; (2) The date that a vehicle is bought, sold, or exchanged; (3) The amount for which a vehicle is bought or sold; (4) The name, address, and license number of the other person with whom the wholesale dealer conducts a purchase, sale, or exchange; (5) The odometer mileage statement for a vehicle that is required under the federal Motor Vehicle Information and Cost Act; and (6) Each invoice, bill of sale, and other pertinent document and record in the form required by the Administration. #### Section 15-306 In addition to the information required under Subtitle 1 of this title, each application for a license shall include: (1) The type of dealership applied for; (2) If the application is made for a partnership, the name and address of each partner applying for the partnership; (3) If the application is made for a corporation or for a partnership by a corporate partner, the name and address of each of the officers applying for the corporation or partnership; (4) If the application is made for a corporation, the place of its incorporation; and (5) The nature of the business to be conducted at each address. #### Section 15-307 (a) Each licensed dealer shall pay to the Administration an annual license fee established by the Administration for each license year or part of a license year for which the license is issued. (b) A licensed dealer need not pay more than one annual fee, regardless of the number of its business locations. (c) On payment of the fee required by this section and issuance of a dealer's license, the Administration also shall issue one vehicle salesman's license without further charge. #### Section 15-308 (a) (1) After the Administration notifies an applicant of the approval of an application and before the Administration issues a license, the applicant shall file with the Administration a surety bond in the form and with the surety that the Administration approves. (2) The bond shall be for the applicant's primary location and all supplemental locations if all of the locations are licensed under the same dealer business license number. (b) The amount of the surety bond shall be: (1) For a licensee who is licensed to deal only in trailers or semitrailers 15 feet or less in length, or only in boat trailers of any size $5,000; (2) For a licensee who is licensed to deal in the sale of new motor vehicles, an amount based on the number of new motor vehicle sales during the preceding license year, according to the following schedule: (i) 1 to 500 vehicles $50,000; (ii) 501 to 1,000 vehicles $75,000; (iii) 1,001 to 2,500 vehicles $100,000; and (iv) Over 2,500 vehicles $300,000; and (3) For a licensee who is licensed to deal only in the sale of used motor vehicles, including wholesalers, or a licensee who is licensed to deal in the sale of trailers or semitrailers over 15 feet in length, an amount based on the number of used vehicle sales, or sales of trailers or semitrailers over 15 feet in length, during the preceding license year, according to the following schedule: (i) 1 to 250 vehicles $15,000; (ii) 251 to 500 vehicles $25,000; (iii) 501 to 1,000 vehicles $35,000; (iv) 1,001 to 2,500 vehicles $50,000; and (v) Over 2,500 vehicles $150,000. (c) (1) This subsection applies only to an applicant who: (i) Applies for a license to deal in the sale of new or used vehicles; and (ii) Was not licensed to sell vehicles during the preceding license year. (2) Subject to paragraph (3) of this subsection, the Administration shall base the amount of a surety bond for an applicant described in paragraph (1) of this subsection on the estimated volume of sales in the initial year in which the license is in effect. (3) The amount of the surety bond under paragraph (2) of this subsection may not be less than: (i) For an applicant for a license to deal in the sale of new motor vehicles, $50,000; or (ii) For an applicant for a license to deal in the sale of either used vehicles or trailers or semitrailers over 15 feet in length, $15,000. (d) Notwithstanding subsection (c) of this section, if an applicant seeks a license for a location that is or that previously had been operated by a licensed dealer, the Administration may require a surety bond under subsection (b)(2) or (3) of this section based on the volume of sales at that location during a preceding license year. #### Section 15-309 A license issued under this subtitle authorizes the licensed dealer to conduct the business of a dealer in the types of vehicles specified in it during the license year for which it is issued. #### Section 15-310 Each license shall state: (1) The type of vehicles in which the licensee may deal; (2) The locations from which the licensee may deal in that type of vehicle; (3) If it is a license to deal in new vehicles, the make of new vehicles in which the licensee may deal; (4) As to a wholesale dealer, that the wholesale dealer may not sell a vehicle to or exchange vehicles with a retail buyer; and (5) As to a wholesale dealer, that the wholesale dealer may not buy, sell, or exchange new vehicles. #### Section 15-311 (a) A contract for the sale of a vehicle by a dealer shall contain a clear statement of: (1) The principal amount charged for the vehicle; (2) Any interest charged on the principal amount; (3) Any fee charged under Sec. 13-610 of this article; (4) Any dealer processing charge, as defined in Sec. 15-311.1 of this subtitle; and (5) Any other charge made in connection with the sale of the vehicle. (b) In addition to the information required by subsection (a) of this section, a contract for the sale of a new vehicle shall include: (1) The base price of the vehicle; (2) The manufacturer's code or stock number for the vehicle; and (3) A clear and specific description of each extra item and each extra charge not included in the base price of the vehicle ordered by the buyer. (c) If a licensee issues a stop sale directive applicable to a used vehicle manufactured by the licensee to a dealer that holds a franchise from the licensee and there are no remedies or parts available to fix the motor vehicle, the licensee shall compensate the dealer by: (1) Providing payment to the dealer at a rate of at least 1% per month or portion of a month of the value of the vehicle; or (2) Compensating the dealer under a national program that is applicable to all dealers holding a franchise from the licensee for the dealer's costs associated with the stop sale directive. (d) When a vehicle arrives for delivery, the dealer shall advise the buyer of any extra items ordered by the buyer that are not on the vehicle. (e) When a vehicle arrives for delivery, the dealer shall advise the buyer of any extra items on the vehicle that the buyer did not order. (f) When a vehicle arrives for delivery, the dealer shall advise the buyer of the cost of extra items described under subsections (d) and (e) of this section. #### Section 15-311.1 (a) (1) In this section, "dealer processing charge" includes an amount charged by a dealer for: (i) The preparation of written documentation of the transaction; (ii) Obtaining the title and license plates for the vehicle; (iii) Obtaining a release of lien; (iv) Filing title documents with the Administration; (v) Retaining documentation and records of the transaction; (vi) Complying with federal or State privacy laws; or (vii) Other administrative services concerning the sale of the vehicle. (2) "Dealer processing charge" does not include a charge to purchase or install tangible personal property on or in the vehicle, or to perform mechanical service on the vehicle. (b) (1) If a dealer charges a dealer processing charge, the charge: (i) Shall be reasonable; (ii) May not exceed: (1) $200 for the period from July 1, 2011, through June 30, 2014; (2) $300 for the period from July 1, 2014, through June 30, 2020; (3) $500 for the period from July 1, 2020, through June 30, 2024; and (4) $800 on and after July 1, 2024; and (iii) Shall reflect dealer expenses generally incurred for the services identified in subsection (a)(1) of this section. (2) A dealer shall provide a written disclosure of the services included in the dealer processing charge on request by the purchaser. (c) Any dealer processing charge or freight charge shall be disclosed to a purchaser as provided in this section. (d) A contract for the sale of a vehicle shall contain a statement, in 12 point type or larger, on the contract form as follows: "Dealer processing charge (not required by law): $....". "Freight charge: $ ....". (e) If a dealer advertises the price of a vehicle, the amount of any dealer processing charge and freight charge shall be included in the advertised price unless the dealer clearly and conspicuously discloses the amount of the dealer processing charge and freight charge in at least 10 point and bold font within reasonable proximity to the advertised price. (f) The dealer shall attach its price statement to a window of the vehicle, next to any other price disclosure required by law. The dealer's price statement shall state the total price for which the dealer is offering to sell the vehicle. The total price stated shall include any dealer processing charge, which shall be disclosed above the total price in at least 10 point type as "dealer processing charge (not required by law): $.....". The total price may exclude only the taxes and title fees payable to the State. #### Section 15-311.2 (a) (1) In this section the following words have the meanings indicated. (2) "Agent" means a business entity that is authorized by an obligor or a licensed vehicle dealer to sell a mechanical repair contract. (3) (i) "Mechanical repair contract" means any agreement or contract sold by a licensed vehicle dealer, an obligor, or an agent under which the obligor agrees to perform over a fixed period of time, for a specific duration, and for a specific identifiable price, provided that the purchase of the contract is optional to the purchaser, any of the following services: (1) The repair, replacement, or maintenance of a motor vehicle, or the indemnification for the repair, replacement, or maintenance of a motor vehicle, for the operational or structural failure of the motor vehicle due to a defect in materials, workmanship, or normal wear and tear, with or without additional provisions for incidental payment of indemnity for services including towing, rental and emergency road service, and road hazard protection; (2) The repair, replacement, or maintenance of a motor vehicle for the operational or structural failure of one or more parts or systems of the motor vehicle brought about by the failure of an additive product to perform as represented; (3) The repair or replacement of tires or wheels on a motor vehicle damaged as a result of coming into contact with road hazards, including potholes, rocks, wood debris, metal parts, glass, plastic, curbs, or composite scraps; (4) The removal and repair of dents, dings, or creases on a motor vehicle using the process of paintless dent removal; (5) The repair of chips or cracks in, or the replacement of, motor vehicle windshields as a result of damage caused by road hazards; (6) The replacement of a motor vehicle key or key fob if the key or key fob becomes inoperable or is lost or stolen; or (7) Other services or products that may be approved by the Insurance Commissioner if consistent with the provisions of this section. (ii) "Mechanical repair contract" includes extended warranties and extended service contracts. (iii) "Mechanical repair contract" does not include: (1) Warranties under the Magnuson-Moss Warranty Act, 15 U.S.C. Sec. 2301, et seq.; (2) Contracts or agreements for regular maintenance only; or (3) An agreement between a motor club, as defined in Sec. 26-101 of the Insurance Article, and a member or subscriber of the motor club. (4) (i) "Obligor" means the person specified in a mechanical repair contract that is contractually obligated to perform the services set forth in the mechanical repair contract. (ii) "Obligor" does not include an insurer that provides insurance coverage in accordance with subsection (b) of this section. (b) (1) (i) An obligor under a mechanical repair contract shall maintain adequate insurance reserves, as defined by the Insurance Commissioner, for each such contract for the protection of the purchasing consumer. (ii) A policy or policies of insurance providing coverage for all obligations and liabilities incurred by an obligor under the terms of a mechanical repair contract or, in the event of the obligor's nonperformance, providing performance or payment on behalf of the obligor for all covered contractual obligations incurred by an obligor under a mechanical repair contract shall constitute adequate insurance reserves. (2) Each policy of insurance used to satisfy paragraph (1) of this subsection must be issued by: (i) An insurer authorized to do business in Maryland on an admitted or surplus lines basis; or (ii) A risk retention group, as defined in Sec. 25-101 of the Insurance Article, if that risk retention group is: (1) In full compliance with federal law; (2) In good standing in its domiciliary jurisdiction; and (3) Properly registered under State law. (3) A purchaser of a mechanical repair contract shall be entitled to make a direct claim against the insurer or risk retention group issuing a policy or policies of insurance under this subsection upon failure of the obligor to pay any claim or make any refund or consideration due within 60 days after the proof is filed with the obligor. (4) (i) At least 45 days before selling a mechanical repair contract, the obligor shall file the contract with the Insurance Commissioner along with evidence that the obligor maintains adequate insurance reserves as required under this section. (ii) Except as provided in subparagraphs (iv) through (vii) of this paragraph, a filing required under this subsection is not subject to the approval of the Insurance Commissioner. (iii) An obligor that is required to file a mechanical repair contract under this subsection shall pay a filing fee as provided in Sec. 2-112(a)(10) of the Insurance Article. (iv) The Commissioner may investigate and determine whether a mechanical repair contract filed under this paragraph is in compliance with this section. (v) If, after a hearing, the Commissioner finds that a mechanical repair contract is not in compliance with this section, the Commissioner shall issue an order that requires that use of the mechanical repair contract be discontinued after a date specified in the order. (vi) Pending a hearing, the Commissioner may issue an order that suspends use of a mechanical repair contract filed by an obligor if the Commissioner has reasonable cause to believe that: (1) The mechanical repair contract is in violation of this section; (2) Unless the order of suspension is issued, purchasers of the mechanical repair contract will suffer irreparable harm; (3) The harm that purchasers of the mechanical repair contract will suffer in the absence of the order of suspension outweighs the harm that the obligor would suffer if the order of suspension were issued; and (4) The order of suspension will not cause substantial harm to the public. (vii) Unless the obligor waives a hearing, the Commissioner: (1) Shall hold a hearing within 15 business days after issuing the order of suspension; and (2) Within 15 business days after the conclusion of the hearing, shall make a determination and issue an order as to whether the mechanical repair contract should be disapproved. (c) (1) An obligor shall register with the Insurance Commissioner each year. (2) As part of registration, an obligor shall provide the following information for registration with the Commissioner: (i) The name, corporate address, and telephone number of the obligor; (ii) The name, address, and telephone number of an individual designated to receive correspondence on behalf of the obligor; and (iii) The name and address of a designated agent authorized to accept service on behalf of the obligor in the State. (3) An obligor shall notify the Commissioner within 30 days of any change to the registration information required under this subsection. (4) An obligor that is required to register under this section shall pay an annual registration fee as provided in Sec. 2-112(a)(12) of the Insurance Article. (5) (i) Only a licensed vehicle dealer, an agent, or a registered obligor, or an employee of a licensed vehicle dealer, an agent, or a registered obligor may offer, sell, or negotiate a mechanical repair contract. (ii) An obligor or a licensed vehicle dealer is liable for the actions of its agent when the agent is offering or selling a mechanical repair contract on behalf of the obligor or vehicle dealer. (iii) The Commissioner may pursue an action against a person that violates this paragraph. (6) Subject to paragraph (7) of this subsection, the Commissioner shall register each obligor that meets the requirements of this section. (7) The Commissioner may deny a registration to an applicant or refuse to renew, suspend, or revoke the registration of a registrant, after notice and an opportunity for a hearing under Sec.Sec. 2-210 through 2-214 of the Insurance Article, if the applicant or registrant, or an officer, director, or employee of the applicant or registrant: (i) Makes a material misstatement or misrepresentation in an application for registration; (ii) Fraudulently or deceptively obtains or attempts to obtain a registration for the applicant, the registrant, or another person; (iii) Has been convicted of a felony or of a misdemeanor involving moral turpitude in connection with the sale, solicitation, negotiation, or administration of a mechanical repair contract; (iv) Commits fraud or engages in illegal or dishonest activities in connection with the administration of a mechanical repair contract; or (v) Has violated any provision of this section or a regulation adopted under this section. (8) Instead of, or in addition to, suspending or revoking a registration, the Commissioner may impose on the registrant a civil penalty of: (i) Not less than $100 but not exceeding $1,000 for each violation of this section; and (ii) Not less than $100 but not exceeding $5,000 for each violation of this section committed by an agent or the agent's employee while offering or selling a mechanical repair contract on behalf of the registrant. (d) (1) An obligor or a licensed vehicle dealer that uses an agent to sell a mechanical repair contract shall: (i) Maintain a list of its agents; and (ii) Make the list available to the Insurance Commissioner on request. (2) An agent shall: (i) Maintain a list containing the names of each employee who is authorized to sell a mechanical repair contract; and (ii) On request, provide the list to its obligor or licensed vehicle dealer within 10 business days from receipt of the request. (3) A list maintained under this subsection may be stored in an electronic format. (e) A mechanical repair contract shall be offered in addition to any express warranty originally included as part of the contract for sale of a new motor vehicle. (f) A mechanical repair contract shall clearly and conspicuously set forth the date when the warranty begins. (g) A mechanical repair contract shall clearly and conspicuously set forth the date or the odometer reading at which the warranty expires and the name and address of the insurer issuing the policy of insurance as described in subsection (b) of this section. (h) The repair of a malfunction or defect covered under a mechanical repair contract shall include the cost of the teardown and diagnosing the malfunction or defect. (i) The provisions of the Maryland Consumer Products Guaranty Act, Title 14, Subtitle 4 of the Commercial Law Article, apply to a mechanical repair contract sold in the State. (j) The provisions of this section do not apply to mechanical repair contracts issued by the motor vehicle manufacturer or the distributor or a wholly owned subsidiary of the manufacturer or the distributor as defined in Sec. 15-201 of this title. (k) Notwithstanding subsection (j) of this section, licensed vehicle dealers and obligors who sell mechanical repair contracts shall have the same obligations as a seller under Sec. 2-314 of the Commercial Law Article. (l) A person that sells a mechanical repair contract may not, directly or indirectly, make a false, deceptive, or misleading statement with respect to: (1) The person's affiliation with a motor vehicle manufacturer, manufacturer's subsidiary, distributor, factory branch, or dealer; (2) The person's possession of information regarding the manufacturer's original equipment warranty for a motor vehicle; (3) The expiration of a manufacturer's original equipment warranty for a motor vehicle; or (4) A requirement that a motor vehicle owner register for a new mechanical repair contract with the person in order to maintain coverage under the owner's current mechanical repair contract or the manufacturer's original equipment warranty. (m) Except as expressly provided under this section, an obligor that complies with this section is not required to comply with any other provisions of the Insurance Article. (n) Unless specifically described in subsection (a)(3) of this section, a mechanical repair contract may not provide indemnification for a loss caused by collision or by perils that are commonly covered by comprehensive or collision provisions of a motor vehicle insurance policy. (o) In addition to any applicable disclosures required by the Maryland Consumer Products Guaranty Act, (Title 14, Subtitle 4 of the Commercial Law Article), a mechanical repair contract shall include the following disclosures: (1) The name, corporate address, and telephone number of the obligor and the mechanical repair contract seller; and (2) The right of the purchaser of the mechanical repair contract to make a direct claim against the insurer or risk retention group issuing a policy or policies of insurance as provided in subsection (b)(3) of this section. (p) A person convicted of a violation of subsection (c)(5) of this section: (1) Is subject to imprisonment not exceeding 1 year or a fine not exceeding $5,000 or both; and (2) May be required to pay restitution. #### Section 15-311.3 (a) (1) For a buyer purchasing a vehicle through dealer-arranged financing or leasing before approval of a third-party institution has been received, the following notice shall be provided to the buyer in a separate document and signed by the dealer and the buyer: "For finance or lease sales: The financing or lease agreement you entered into with the dealer is not final and must be approved by a third-party financial institution. If the terms are approved, the sale cannot be canceled. If the terms are not approved, the dealer must notify you in writing within 4 days of delivery of the vehicle to you, and you or the dealer may cancel this sale. If the sale is canceled, the vehicle delivered to you must be returned to the dealer in the same condition it was given to you, except for normal wear and tear, within 2 days of your receipt of a written notice of the third-party rejection. Unless you and the dealer agree on different terms, any down payment, titling fee, excise tax, dealer processing charge, or any other fee, tax, or charge associated with the transaction, and any trade-in vehicle, in the same condition in which the dealer received the vehicle, will be returned to you immediately and you may not be charged a fee for use of the vehicle that was the subject of the sale. You may not waive any of these rights. If you feel the dealer has failed to comply with the terms of this notice, you may contact the Motor Vehicle Administration or the Consumer Protection Division of the Office of the Attorney General.". (2) A copy of the signed notice shall be provided to the buyer before delivery of the vehicle to the buyer. (b) A dealer shall notify a buyer in writing if the terms of a financing or lease agreement between a dealer and a buyer are not approved by a third-party finance source within 4 days of delivery of a vehicle to the buyer. (c) (1) If the terms of a financing or lease agreement between a dealer and a buyer are not approved by a third-party finance source, the buyer shall return the vehicle to the dealer in the same condition in which the buyer received the vehicle, except for normal wear and tear, within 2 days of receipt of the notice required under subsection (b) of this section. (2) If a buyer does not return the vehicle to the dealer as required under paragraph (1) of this subsection, the dealer may repossess the vehicle in accordance with State law. (d) (1) A dealer and a buyer may agree on new financing or leasing terms on return of a vehicle under subsection (c)(1) of this section. (2) (i) If a dealer and a buyer do not agree on new financing or leasing terms, the dealer or the buyer may cancel the sale. (ii) If a sale is canceled under subparagraph (i) of this paragraph, the dealer: (1) Shall return to the buyer: (A) Any trade-in vehicle in the same condition in which the dealer received the vehicle; (B) Any down payment; (C) The titling fee and excise tax paid under Title 13, Subtitle 8 of this article; (D) Any dealer processing charge; and (E) Any other fee, tax, or charge associated with the transaction; and (2) May not charge the buyer a fee for the use of the vehicle. (e) A dealer shall maintain the required security for the vehicle under Sec. 17-104(b) of this article until the terms of the financing or lease agreement between a buyer and a dealer are approved by a third-party finance source. (f) A buyer may not waive the rights established under this section. (g) A violation of this section by a dealer: (1) Is an unfair and deceptive trade practice under Title 13 of the Commercial Law Article; and (2) Is subject to the enforcement and penalty provisions contained in Title 13 of the Commercial Law Article. #### Section 15-312 (a) A dealer or an agent or employee of a dealer may not permit any individual to road test a motor vehicle if he knows that the other individual does not have a license to drive of the appropriate class. (b) A dealer or an agent or employee of a dealer may not make any material misrepresentation in obtaining a vehicle sales contract. (c) A dealer or an agent or employee of a dealer may not commit any fraud in the execution of or any material alteration of a contract, power of attorney, or other document incident to a sales transaction. (d) A dealer or an agent or employee of a dealer may not prepare or accept any promissory note or other evidence of indebtedness on a vehicle sales contract knowing that it requires the debtor to pay an amount greater than that agreed on in the written contract for the sale of the vehicle. (e) A dealer or an agent or employee of a dealer may not willfully fail to perform, without justification, any vehicle sales contract. (f) A dealer or an agent or employee of a dealer may not materially deviate from or disregard, without the consent of the buyer, any of the original terms of the contract. (g) A dealer or an agent or employee of a dealer may not willfully fail to comply with the terms of a warranty or guarantee. (h) A dealer or an agent or employee of a dealer may not rent a dealer registration plate issued by the Administration. (i) A person convicted of a violation of this section is subject to imprisonment not exceeding 2 months or a fine not exceeding $500 or both. #### Section 15-313 (a) A dealer or an agent or employee of a dealer may not use any advertisement that is in any way false, deceptive, or misleading. (b) A dealer or an agent or employee of a dealer may not by any means advertise or offer to the public any vehicle without intent to sell it as advertised or offered. (c) (1) A dealer or an agent or employee of a dealer: (i) May not state the purchase price of a vehicle in an advertisement unless the price is the full delivered purchase price of the vehicle, excluding only taxes, title fees, and any freight or dealer processing charge disclosed in accordance with Sec. 15-311.1 of this subtitle; and (ii) Shall print the full delivered purchase price in a vehicle advertisement in the largest font used in the advertisement to provide any information related to the price of the vehicle. (2) The advertisement of a leased vehicle by a dealer is governed under Title 14, Subtitle 20 of the Commercial Law Article. (d) (1) A dealer or an agent or employee of a dealer may not place on a vehicle an insignia, logo, or other plate that advertises the name of the dealer, unless: (i) The contract of sale for the vehicle contains a notice of the rights of the buyer described in this subsection; and (ii) The buyer of the vehicle consents to the placement of the insignia, logo, or other plate on the vehicle. (2) A dealer or an agent or employee of a dealer may enter into an agreement with a buyer of a vehicle to compensate the buyer in exchange for the buyer's consent to the placement on the vehicle of an insignia, logo, or other plate that advertises the name of the dealer. (3) If a dealer or an agent or employee of a dealer places an insignia, logo, or other plate that advertises the name of the dealer without obtaining a buyer's consent, the dealer shall, at the request of the buyer, remove the advertising and make all repairs necessary to restore the vehicle to its original appearance at no charge to the buyer. (e) A dealer or an agent or employee of a dealer may not sell a Class A (passenger) or Class M (multipurpose) vehicle that has a maximum speed capability of more than 25 miles per hour but less than 55 miles per hour unless the dealer: (1) Permanently affixes an emblem to the vehicle in accordance with Sec. 21-805.1 of this article; and (2) Informs the buyer in writing that the vehicle may be driven lawfully only on highways on which the speed capability of the vehicle exceeds the posted maximum speed limit for the highway by at least 5 miles per hour. (f) A person convicted of a violation of this section is subject to imprisonment not exceeding 2 months or a fine not exceeding $500 or both. #### Section 15-314 (a) A dealer or an agent or employee of a dealer may not misrepresent any material fact in obtaining a license. (b) A dealer or an agent or employee of a dealer may not conduct a dealership in any name other than the one in which the dealer is licensed. (c) A dealer or an agent or employee of a dealer may not willfully fail to notify the Administration of any change of ownership, management, business name, or location or of the employment of vehicle salesmen, as required by this title. (d) A dealer or an agent or employee of a dealer may not do any vehicle sales business with or through any person required to be licensed under this title if he knows that the person is not licensed. (e) A dealer or an agent or employee of a dealer may not sell any new motor vehicle, or new two-stage motor vehicle unless the manufacturer or distributor of the vehicle is licensed as required by this title. (f) A dealer or an agent or employee of a dealer may not willfully fail to comply with any rule, regulation, or lawful order adopted by the Administration under this title. (g) A dealer or an agent or employee of a dealer may not willfully violate any of the dealer licensing laws of this State. (h) A person convicted of a violation of this section is subject to imprisonment not exceeding 2 months or a fine not exceeding $500 or both. #### Section 15-315 (a) In addition to the other grounds specified in Subtitle 1 of this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this subtitle to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that: (1) The person, his management personnel, or any other person who has a direct or indirect financial interest in the dealership is untrustworthy, lacks competence, or has been convicted by final judgment in any court of a crime of moral turpitude; (2) The vehicle sales transactions of the person have been marked by a practice of failure to perform contracts or by fraud or bad faith; (3) The person or the manufacturer or distributor of the vehicles in which the person deals is not in compliance with the surety bond requirements of Sec. 15-205 of this title; or (4) The person has failed to comply with any of the provisions of the Maryland Vehicle Law relating to the registration of vehicles, certificates of title, and the sale of vehicles. (b) As to any person licensed under this subtitle, instead of or in addition to revocation, suspension, or refusal to renew a license under this section, the Administrator may order the licensee to pay a fine not exceeding $1,000 for each violation of this subtitle. ### Subtitle 4. Vehicle Salesmen #### Section 15-401 In this subtitle, "license" means a vehicle salesman's license issued by the Administration under this subtitle. #### Section 15-402 (a) Except as provided in Sec.Sec. 10-14A-03 and 10-14B-03 of the State Government Article, a person may not act as a vehicle salesman unless the person is licensed by the Administration under this subtitle. (b) Any person who has been refused a vehicle salesman's license in this State or whose vehicle salesman's license is revoked or suspended may not conduct the business of a vehicle salesman under any license, permit, or registration certificate issued by any other jurisdiction. (c) A person convicted of a violation of this section is subject to: (1) For a first offense, imprisonment not exceeding 6 months or a fine not exceeding $1,000 or both; and (2) For a second or subsequent offense, imprisonment not exceeding 1 year or a fine not exceeding $2,000 or both. #### Section 15-403 A license may not be issued under this subtitle to a partnership, corporation, or other entity. It only may be applied for by and issued to an individual. #### Section 15-404 (a) A person may not be licensed under this subtitle unless the person: (1) Is a licensed dealer; or (2) Is employed as a vehicle salesman by a licensed dealer. (b) Unless the applicant is himself a licensed dealer, each application for a license shall contain or be accompanied by the written statement of the licensed dealer by whom the applicant is or will be employed, certifying that the applicant has been accepted by the licensed dealer for employment as a vehicle salesman. The written statement shall be signed on behalf of the licensed dealer by a person authorized under this title to sign an application for a dealer's license. (c) If a dealer makes a certified statement under this section, the dealer immediately shall notify the Administration of any termination of employment of the salesman. (d) The notification required under subsection (c) of this section shall be made on the form that the Administration requires. #### Section 15-405 In addition to the information required under Subtitle 1 of this title, each application for a license shall include: (1) The name and business address of the licensed dealer by whom the applicant is or will be employed; or (2) A statement that the applicant is himself a licensed dealer. #### Section 15-406 (a) Except as otherwise provided in this title, each licensee shall pay an annual fee to the Administration for each license year or part of a license year for which the license is issued. (b) The annual license fee shall be established by the Administration. #### Section 15-408 A license issued under this subtitle authorizes the licensee to be a vehicle salesman for a licensed dealer during the license year for which it is issued. #### Section 15-409 (a) Each license shall state the name of the licensed dealer by whom the licensee is employed, as specified in the application for the license. (b) A licensed vehicle salesman may not act as a vehicle salesman for any person other than the licensed dealer named in the salesman's license. (c) A licensed vehicle salesman may act as a vehicle salesman for any dealership that is at least 60 percent owned by the licensed dealer named in the salesman's license. #### Section 15-410 A contract for the sale of a vehicle by a vehicle salesman shall comply with the requirements of Sec. 15-311 of this title on contracts by a dealer. #### Section 15-411 (a) A vehicle salesman may not fail to account for and remit to his dealership any payment received by him in connection with a vehicle sales contract. (b) A vehicle salesman may not do any act that a dealer is prohibited from doing under Sec. 15-312 of this title as to vehicle sales transactions. (c) A vehicle salesman may not do any act that a dealer is prohibited from doing under Sec. 15-313 of this title on prohibited advertising practices. (d) A vehicle salesman may not misrepresent any material fact in obtaining a license. (e) A vehicle salesman may not do any vehicle sales business with or through any person required to be licensed under this title if he knows that the person is not licensed. (f) A vehicle salesman may not willfully fail to comply with any rule, regulation, or lawful order adopted by the Administration under this title. (g) A person convicted of a violation of this section is subject to imprisonment not exceeding 2 months or a fine not exceeding $500 or both. #### Section 15-412 In addition to the other grounds specified in Subtitle 1 of this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this subtitle to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that: (1) The person has been convicted by final judgment in any court of a crime of moral turpitude; or (2) The vehicle sales transactions of the person have been marked by a practice of failure to perform contracts or by fraud or bad faith. ### Subtitle 5. Automotive Dismantlers and Recyclers and Scrap Processors #### Section 15-501 (a) In this subtitle the following words have the meanings indicated. (b) (1) "Automotive dismantler and recycler" means a person in the business of: (i) Dismantling, destroying, or scrapping any vehicle for the purpose of reselling any of its usable parts; or (ii) Otherwise acquiring vehicles for the benefit of their parts or the materials in them. (2) Notwithstanding any provision to the contrary, any reference to a wrecker in any statute, rule, or regulation shall apply to an automotive dismantler and recycler. (c) "License" means an automotive dismantler's or recycler's or scrap processor's license issued by the Administration under this subtitle. (d) "Scrap processor" means a person in a business: (1) That has facilities for processing iron, steel, and nonferrous scrap metal; and (2) The principal product of which is scrap iron, scrap steel, and nonferrous scrap for sale only for resmelting purposes. (e) "Vehicle" means any vehicle, or the body or chassis of any vehicle, that is to be dismantled, destroyed, or scrapped. #### Section 15-502 (a) Except as provided in Sec.Sec. 10-14A-03 and 10-14B-03 of the State Government Article, a person may not conduct the business of an automotive dismantler and recycler or a scrap processor, or engage in the business of acquiring or offering to purchase or remove vehicles which are to be dismantled in whole or in part by that person for the sale of usable parts, unless the person is licensed by the Administration under this subtitle. (b) (1) Except as provided in Sec.Sec. 10-14A-03 and 10-14B-03 of the State Government Article, a person may not advertise for the purchase, towing, or removal of junk or abandoned vehicles unless the person is licensed by the Administration under this subtitle. (2) Any advertisement for the purchase, towing, or removal of junk or abandoned vehicles by a licensee under this subtitle shall include the license number of the licensee. (c) Except as provided in Sec.Sec. 10-14A-03 and 10-14B-03 of the State Government Article, a person may not store on any private property for more than 30 days any vehicle that is to be dismantled, destroyed, or scrapped, unless the person is an automotive dismantler and recycler or a scrap processor licensed under this subtitle. (d) This section does not prohibit an unlicensed person from purchasing, transporting, towing, or removing a vehicle to a licensed automotive dismantler and recycler or a licensed scrap processor for dismantling, destroying, or scrapping. (e) A person convicted of a violation of subsection (a) of this section is subject to: (1) For a first offense, imprisonment not exceeding 6 months or a fine not exceeding $1,000 or both; and (2) For a second or subsequent offense, imprisonment not exceeding 1 year or a fine not exceeding $2,000 or both. #### Section 15-503 (a) A person may not be licensed under this subtitle unless: (1) The business to be conducted under the license is conducted from a building that is adequate and appropriate for the business; (2) That business has a storage area large enough for at least 25 vehicles; and (3) At the fixed location from which the business is conducted, as specified in the application, there is a substantial and legible sign: (i) That advertises the type of business conducted at the location; and (ii) That is placed in a way so as to be seen readily by the public. (b) A person may not be licensed as a scrap processor unless the person maintains the following equipment suitable for processing vehicle scrap: (1) A hydraulic baler and shears; (2) A shredder; or (3) Any other suitable equipment that the Administration requires by rule or regulation. (c) A person licensed under this subtitle at a fixed location, as specified in the application, on or before December 31, 1985, and the person's successors or assigns, may not be refused permission to operate at the fixed location solely because any portion of the fixed location is within the 100-year floodplain of waters of the State as defined in Sec. 8-101 of the Natural Resources Article. #### Section 15-504 The Administration shall submit a copy of each application for a license under this subtitle to the Maryland Department of Health, for its comments on matters relating to air pollution and health. #### Section 15-505 (a) Each licensee shall pay an annual fee to the Administration for each license year or part of a license year for which the license is issued. (b) The annual license fee shall be established by the Administration. #### Section 15-506 A license issued under this subtitle authorizes the licensee to conduct the business of an automotive dismantler and recycler or scrap processor, as the case may be, during the license year for which it is issued. #### Section 15-507 (a) Except as provided in subsection (c) of this section, any person who transfers a vehicle to an automotive dismantler and recycler or scrap processor shall execute an assignment and warranty of title on: (1) The certificate of title issued for the vehicle by this State or any other state; or (2) Any other documentary evidence of ownership acceptable to the Administration. (b) Except as provided in subsection (c) of this section, any person who transfers a vehicle to an automotive dismantler and recycler or scrap processor shall deliver the certificate of title or other documentary evidence of ownership to the automotive dismantler and recycler or scrap processor at the time of the transfer. (c) If a person holds an assigned certificate of title or any other documentary evidence of ownership acceptable to the Administration, the person: (1) May transfer the vehicle to an automotive dismantler and recycler or scrap processor by endorsing a reassignment and warranty of title on the forms that the Administration requires; and (2) Need not obtain a certificate of title in the person's own name. #### Section 15-509 (a) (1) If an automotive dismantler and recycler or scrap processor takes possession of a vehicle from a person other than the owner of the vehicle and does not receive a certificate of title, a certificate of authority under Sec. 25-209 of this article, or other documentary evidence of ownership acceptable to the Administration, the automotive dismantler and recycler or scrap processor shall comply with this section. (2) This section does not apply to a vehicle towed from residential or commercial property under a continuing contract to tow unauthorized vehicles, for which a certificate of authority is required to be obtained under Sec. 25-209 of this article. (b) (1) As soon as reasonably possible and within 7 days after it takes a vehicle into possession from a person other than the owner of the vehicle, an automotive dismantler and recycler or scrap processor shall send a notice, by certified mail, return receipt requested, bearing a postmark from the United States Postal Service, to: (i) The last known registered owner of the vehicle; and (ii) Each secured party, as shown on the records of the Administration. (2) The notice shall: (i) State that the vehicle has been taken into custody; (ii) Describe the year, make, model, and vehicle identification number of the vehicle; (iii) Give the location of the facility where the vehicle is held; (iv) Inform the owner and secured party of the owner's and secured party's right to reclaim the vehicle within 11 working days after the date of the notice, on payment of all towing, recovery, and storage charges owed to the automotive dismantler and recycler or scrap processor resulting from taking or holding the vehicle; and (v) State that the failure of the owner or secured party to exercise this right in the time provided is: (1) A waiver by the owner or secured party of all of the owner's or secured party's right, title, and interest in the vehicle; and (2) A consent to the dismantling, destroying, or scrapping of the vehicle. (c) If the automotive dismantler and recycler or scrap processor receives with the vehicle documentary proof that the notification procedures of subsection (b) of this section already have been completed by another person before taking possession of the vehicle or that the vehicle is being received from the owner of the vehicle or an agent of the owner, the automotive dismantler and recycler or scrap processor may accept documentation as to notice or ownership as proof of compliance and is not required to repeat provision of this notification. (d) In addition to documentation of notice under subsections (b) and (c) of this section, an automotive dismantler and recycler or scrap processor shall obtain from a person who provides the vehicle: (1) An affidavit in a form approved by the Administration signed under penalty of perjury by the person providing the vehicle; (2) A copy of the driver's license of the person who provides the vehicle; (3) Any proof of ownership documents acceptable to the Administration, if available; and (4) If the vehicle is transported by a tow vehicle, a copy of the registration of the tow vehicle. (e) An affidavit under subsection (d) of this section shall include: (1) A statement that the person providing the vehicle has the lawful right to possess the vehicle and the basis of that right; (2) A statement that, except as provided in Sec. 25-209 of this article, the vehicle may not be retitled and may only be dismantled, destroyed, or scrapped; (3) A description of the vehicle, including year, make, model, color, and vehicle identification number; (4) The name, address, driver's license number, and signature of the person providing the vehicle; (5) An acknowledgement that: (i) The form is being signed under penalty of perjury; and (ii) The penalties established under subsection (k) of this section apply; (6) The date the vehicle is provided to the automotive dismantler and recycler or scrap processor; (7) The name, address, and State-issued license number of the automotive dismantler and recycler or scrap processor acquiring the vehicle; and (8) The printed name, title, and signature of the person accepting the vehicle. (f) The automotive dismantler and recycler or scrap processor shall keep and make available for inspection by a law enforcement agency for 3 years under procedures adopted by the Administration by regulation: (1) All documentation of notice provided under subsection (b) or (c) of this section; and (2) All additional documentation required to be obtained or kept on file under subsection (d) of this section. (g) An automotive dismantler and recycler or scrap processor may not accept a vehicle that is transported by a tow truck unless the tow truck is registered under Sec. 13-920 of this article. (h) On receipt of a vehicle, an automotive dismantler and recycler or scrap processor shall comply with procedures for notification, reporting, and document retention as established by the Administration by regulation. (i) The automotive dismantler and recycler or scrap processor takes unencumbered title to the vehicle for the purpose of dismantling, recycling, or scrap processing, without having to obtain a certificate of title for it in his own name, if: (1) The automotive dismantler and recycler or scrap processor has complied with this section; and (2) The vehicle has not been recovered or reclaimed, before the end of the 11-working day period specified in the notice, by the owner, secured party, or other person entitled to its possession. (j) A person may not knowingly make a false statement on an affidavit of lawful possession under this section. (k) A person who violates subsection (j) of this section is guilty of a felony and on conviction is subject to imprisonment not exceeding 10 years or a fine not exceeding $1,000 or both. #### Section 15-511 (a) Each automotive dismantler and recycler and each scrap processor shall keep an accurate and complete record of all vehicles acquired in the person's business. (b) The records shall contain, for each vehicle acquired: (1) The name and address of the person from whom the vehicle was acquired; (2) The date on which it was acquired; (3) Documentary evidence acceptable to the Administration of ownership of the vehicle; (4) Any information required under Sec. 17-1009(b) of the Business Regulation Article; and (5) Any other information that the Administration requires. (c) (1) Except as provided in paragraph (3) of this subsection, within 30 days after an automotive dismantler and recycler or scrap processor acquires title to a vehicle, the automotive dismantler and recycler or scrap processor shall, electronically and in a form prescribed by the Administration, notify the Administration or the Administration's designee of the acquisition. (2) Immediately after giving the notice required under paragraph (1) of this subsection, the automotive dismantler and recycler or scrap processor may dispose of the vehicle for dismantling or scrapping. (3) Paragraph (1) of this subsection does not apply to a vehicle acquired through a salvage certificate issued by the Administration or by the appropriate government agency of another state. #### Section 15-513 (a) An automotive dismantler and recycler may not store vehicles at his place of business at a density of more than 250 vehicles for any 1 acre if the vehicles are not crushed. (b) (1) An automotive dismantler and recycler may not store vehicles at the automotive dismantler and recycler's place of business at a density of more than 500 vehicles per acre if the vehicles are crushed. (2) Crushed vehicles may not be stored on more than 1 acre per place of business. #### Section 15-514 (a) In addition to the other grounds specified in Subtitle 1 of this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this subtitle to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that the person has violated any applicable rule or regulation of the Maryland Department of Health. (b) As to any person licensed under this subtitle, instead of or in addition to revocation, suspension, or refusal to renew a license under this section, the Administration may order the licensee to pay a fine not exceeding $1,000 for each violation of this subtitle. #### Section 15-515 Except as otherwise provided in this subtitle, a person convicted of a violation of this subtitle is subject to imprisonment not exceeding 6 months or a fine not exceeding $500 or both. ### Subtitle 6. Title Service Agents #### Section 15-601 (a) In this subtitle the following words have the meanings indicated. (b) "License" means a title service agent's license issued by the Administration under this subtitle. (c) (1) "Title service agent" means any person in the business of physically or electronically transporting to and from the Administration certificates of title, registrations, drivers' licenses, certified copies of records, and other related documents. (2) "Title service agent" does not include a licensed dealer or employee of a licensed dealer who conducts the activities described in paragraph (1) of this subsection only on behalf of the business of that dealer. #### Section 15-602 Except as provided in Sec.Sec. 10-14A-03 and 10-14B-03 of the State Government Article, a person may not conduct the business of a title service agent unless the person is licensed by the Administration under this subtitle. #### Section 15-603 (a) Each licensee shall pay an annual fee to the Administration for each license year or part of a license year for which the license is issued. (b) The annual license fee shall be established by the Administration. #### Section 15-604 (a) This section does not apply to: (1) A licensed dealer who is in compliance with the surety bond requirement of Subtitle 3 of this title; or (2) A motor club that is in compliance with the surety bond requirement of Sec. 26-204 of the Insurance Article. (b) After the Administration notifies an applicant of the approval of an application and before the Administration issues a license, the applicant shall file with the Administration a surety bond in the form and with the surety that the Administration approves. (c) The amount of the surety bond shall be $50,000. #### Section 15-605 A license issued under this subtitle authorizes the licensee to conduct the business of a title service agent during the license year for which it is issued. #### Section 15-606 (a) A title service agent or an agent or employee of a title service agent may not make any material misrepresentation on any form of the Administration. (b) A title service agent or an agent or employee of a title service agent may not misrepresent any material fact in obtaining a license. (c) A title service agent or an agent or employee of a title service agent may not willfully fail to notify the Administration of any change in the ownership, management, name, or location of the business conducted under the license. (d) A title service agent or an agent or employee of a title service agent may not fail to account for and remit to the Administration any fees received by him for any certificates of title, registrations, drivers' licenses, certified copies of records, or other related documents. (e) A title service agent or an agent or employee of a title service agent may not conduct any title service agency business with or through any person required to be licensed under this title if he knows that the person is not licensed. (f) A title service agent or an agent or employee of a title service agent may not sell, offer for sale, advertise, or facilitate the sale of a motor vehicle registration issued by another jurisdiction to a resident of the State. (g) A title service agent or an agent or employee of a title service agent may not willfully violate any provision of the Maryland Vehicle Law that relates to the business of a title service agent. (h) A title service agent or an agent or employee of a title service agent may not willfully fail to comply with any rule, regulation, or lawful order adopted by the Administration under this title. #### Section 15-607 (a) In addition to the other grounds specified in Subtitle 1 of this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this subtitle to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that: (1) The person, his management personnel, or any other person who has a direct or indirect financial interest in the title service agency is untrustworthy, lacks competence, or has been convicted by final judgment in any court of a crime of moral turpitude; or (2) The title service agency transactions of the person with the Administration have been marked by fraud or bad faith. (b) As to any person licensed under this subtitle, instead of or in addition to revocation, suspension, or refusal to renew a license under this section, the Administration may order the licensee to pay a fine not exceeding $1,000 for each violation of this subtitle. #### Section 15-608 (a) A title service agent that, on behalf of the Administration, collects and remits the vehicle excise tax imposed under Title 13, Subtitle 8 of this article may keep the lesser of $12 per vehicle or 0.6% of the gross excise tax that the title service agent collects. (b) Each title service agent that collects any tax or fee required for titling a vehicle shall: (1) Keep complete and accurate records of each taxable sale, together with a record of the tax collected on the sale; (2) Keep copies of every invoice, bill of sale, and other pertinent documents and records, in the form that the Administration requires; and (3) Preserve these records in original form for at least 3 years, unless the Administration consents in writing to their earlier destruction or, by order, requires that they be kept for a longer period. (c) Each title service agent that collects any tax or fee required for titling a vehicle shall, during business hours, allow any representative of the Administration and any police officer full access to the documents and records required to be kept under subsection (b) of this section. (d) If the Administration finds that the records of a title service agent are inadequate or incorrect and that the amount of excise tax collected for the Administration on these sales cannot be determined accurately from the records: (1) The Administration shall determine the taxable sales facilitated by the title service agent for the period involved and compute the tax from the best information available; and (2) The determination and computation of the Administration are prima facie correct. (e) (1) If, under subsection (d) of this section, the Administration determines the taxable sales of vehicles facilitated by the title service agent and computes the tax due, the Administration shall: (i) Levy an assessment against the title service agent for the deficiency, interest, and penalties in the manner authorized in Sec.Sec. 13-401, 13-601, and 13-701 of the Tax - General Article; and (ii) Notify the title service agent of the tax due and the amount of the deficiency assessment. (2) If the title service agent fails to pay the tax and assessment within 10 days after receiving the notice from the Administration, the Administration may levy, in addition to the tax and assessment, a penalty equal to 25% of the tax due. (f) If a title service agent fails to keep any records of sales of vehicles, the Administration may compute the tax due as provided in Sec. 13-407 of the Tax - General Article. (g) All amounts received from a title service agent under this section shall be credited: (1) First, to any penalty and interest accrued under this section; and (2) Then, to the tax due. ### Subtitle 7. Drivers' Schools #### Section 15-701 (a) In this subtitle the following words have the meanings indicated. (b) (1) "Drivers' school" means, except as provided in paragraph (2) of this subsection, any person in the business of giving instruction in the driving of motor vehicles. (2) "Drivers' school" does not include: (i) Any public school or other noncollegiate educational institution giving instruction in the driving of motor vehicles during its normal school hours and not charging a fee for this instruction; or (ii) Any college, university, or other institution of postsecondary education approved by the Maryland Higher Education Commission. (c) "License" means a drivers' school license issued by the Administration under this subtitle. #### Section 15-702 Except as provided in Sec.Sec. 10-14A-03 and 10-14B-03 of the State Government Article, a person may not conduct a drivers' school unless the person is licensed by the Administration under this subtitle. #### Section 15-703 Each application for a license shall be accompanied by a nonrefundable application fee established by the Administration. #### Section 15-704 (a) Each licensee shall pay an annual license fee to the Administration for each license year for which the license is issued. (b) The annual license fee shall be established by the Administration. #### Section 15-705 (a) After the Administration notifies an applicant of the approval of an application and before the Administration issues a license, the applicant shall file with the Administration a surety bond in the form and with the surety that the Administration approves. (b) The amount of the surety bond shall be $40,000. #### Section 15-706 Each applicant for a license shall furnish and maintain with the Administration, as to each of its vehicles used for instruction, proof of financial responsibility in the form and amount that the Administration requires. #### Section 15-707 (a) A license issued under this subtitle authorizes the licensee to conduct a drivers' school during the license year for which the license is issued. (b) The license shall be displayed conspicuously at the location from which the business of the licensee is conducted. #### Section 15-708 Each licensee shall maintain all vehicles used for instruction in the condition that the Administration requires. #### Section 15-709 A drivers' school may not: (1) Provide or offer to provide any instruction in driving unless the individual who gives the instruction is a driving instructor employed by it; or (2) Employ any individual as a driving instructor unless that individual: (i) Is licensed to drive under Title 16 of this article; (ii) Has completed the instructor certification program approved by the Administration; and (iii) Is licensed as a driving instructor under Subtitle 8 of this title. #### Section 15-710 (a) In addition to the other grounds specified in Subtitle 1 of this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this subtitle to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that: (1) The person has made a material misrepresentation or concealed a material fact in obtaining a license; (2) The person is not the true owner of the drivers' school; (3) The person or any partner, officer, director, or stockholder of the person, or any other person who has a direct or indirect interest in the drivers' school: (i) Was the holder of a drivers' school license that was suspended or revoked by the Administration; or (ii) Was an officer, director, stockholder, or partner in a drivers' school the license of which was suspended or revoked by the Administration; (4) The person or any partner, officer, agent, or employee of the person has committed any fraud in connection with the business conducted under the license, including: (i) Inducing any individual to obtain a driver's license by illegal or improper means; (ii) Representing or implying to any individual by word or deed that a driver's license or any other license, registration, or other document or service granted by the Administration may be obtained by any means other than those specified by law; or (iii) Furnishing or obtaining by illegal or improper means any license, registration, or other document or service granted by the Administration, or requesting or accepting money for that purpose; or (5) As to any drivers' school that is a participant in the Maryland driver education program, the person has failed to comply with any of the provisions of or any of the rules and regulations adopted under the Maryland Driver Education Program Act. (b) Notwithstanding the renewal of any license, the Administration may revoke or suspend that license for any violation or other cause, as permitted by this title, that occurred during the 2 license years immediately preceding the renewal. (c) As to any person licensed under this subtitle, instead of or in addition to revocation, suspension, or refusal to renew a license under this section, the Administration may order the licensee to pay a fine not exceeding $1,000 for each violation of this subtitle. ### Subtitle 8. Driving Instructors #### Section 15-801 (a) In this subtitle the following words have the meanings indicated. (b) "Driving instructor" means any individual who: (1) For compensation, under any form of agreement or arrangement with a drivers' school, gives or offers to give instruction in the driving of motor vehicles; or (2) Otherwise gives or offers to give any other individual instruction in the driving of motor vehicles and receives or expects to receive compensation for that instruction. (c) "License" means a driving instructor's license issued by the Administration under this subtitle. #### Section 15-802 Except as provided in Sec.Sec. 10-14A-03 and 10-14B-03 of the State Government Article, a person may not act as a driving instructor unless the person is licensed by the Administration under this subtitle. #### Section 15-803 (a) A person may not be licensed under this subtitle unless the person: (1) Is an individual of good reputation and moral character; (2) Is licensed to drive under Title 16 of this article; (3) Has completed the instructor certification program approved by the Administration; and (4) Is either: (i) Licensed under Subtitle 7 of this title to conduct a drivers' school; or (ii) Employed as a driving instructor by a licensed drivers' school. (b) Unless the applicant himself is licensed to conduct a drivers' school, each application for a license shall contain or be accompanied by the written statement of the licensed drivers' school by whom the applicant is or will be employed, certifying that the applicant has been accepted as a driving instructor. The written statement shall be signed on behalf of the licensed drivers' school by a person authorized under this title to sign an application for a drivers' school license. (c) If a drivers' school makes a certified statement under this section, the drivers' school immediately shall notify the Administration of any termination of employment of the driving instructor. (d) The notification required under subsection (c) of this section shall be made on the form that the Administration requires. #### Section 15-804 (a) In addition to the information required under Sec. 15-102 of this title, each application for a license shall include: (1) The name and business address of the drivers' school by whom the applicant is or will be employed; or (2) A statement that the applicant himself is licensed to conduct a drivers' school. (b) (1) In this subsection, "Central Repository" means the Criminal Justice Information System Central Repository of the Department of Public Safety and Correctional Services. (2) The Administration shall apply to the Central Repository for a State and national criminal history records check for each applicant. (3) As part of the application for a criminal history records check, the Administration shall submit to the Central Repository: (i) One complete set of the applicant's legible fingerprints taken in a manner approved by the Director of the Central Repository and the Director of the Federal Bureau of Investigation; (ii) The fee authorized under Sec. 10-221(b)(7) of the Criminal Procedure Article for access to Maryland criminal history records; and (iii) The mandatory processing fee required by the Federal Bureau of Investigation for a national criminal history records check. (4) In accordance with Sec.Sec. 10-201 through 10-229 of the Criminal Procedure Article, the Central Repository shall forward to the applicant and the Administration the applicant's criminal history record information. (5) If criminal history record information is reported to the Central Repository after the date of the criminal history records check, the Central Repository shall provide to the Administration a revised printed statement of the individual's criminal history record information. (6) Information obtained from the Central Repository under this subsection: (i) Is confidential and may not be redisseminated; and (ii) Shall be used only for the licensing purpose authorized by this subsection. (7) The subject of a criminal history records check under this subsection may contest the contents of the printed statement issued by the Central Repository as provided in Sec. 10-223 of the Criminal Procedure Article. #### Section 15-805 (a) Each licensee shall pay an annual fee to the Administration for each year for which the license is issued. (b) The annual fee shall be established by the Administration. #### Section 15-806 The license authorizes the licensee to be a driving instructor for a licensed drivers' school during the license year for which it is issued. #### Section 15-807 (a) In addition to the other grounds specified in Subtitle 1 of this title for refusal, suspension, or revocation of a license, the Administration may refuse to grant a license under this subtitle to any person and may suspend, revoke, or refuse to renew the license of any person if it finds that the person: (1) Has been convicted of a crime of moral turpitude; or (2) As to any driving instructor that is a participant in the Maryland driver education program, the person has failed to comply with any of the provisions of or any of the rules and regulations adopted under the Maryland Driver Education Program Act. (b) As to any person licensed under this subtitle, instead of or in addition to revocation, suspension, or refusal to renew a license under this section, the Administration may order the licensee to pay a fine not exceeding $1,000 for each violation of this subtitle. ### Subtitle 9. Autonomous Vehicle Converters #### Section 15-901 (a) In this subtitle the following words have the meanings indicated. (b) "Automated driving standards" means the six levels of driving automation established under the SAE International J3016 standard. (c) "Automated driving system" means the hardware and software that are collectively capable of performing part or all of the dynamic driving task on a sustained basis, regardless of whether the driving task is limited to a specific operational design domain. (d) "Autonomous vehicle converter" means a person that: (1) Alters or modifies a new or used motor vehicle by addition, substitution, or removal of components, other than readily attachable components, in compliance with all applicable motor vehicle safety requirements established under federal law; and (2) Assembles, installs, and affixes an automated driving system to a new or used motor vehicle in such a manner that converts the vehicle into a converted autonomous vehicle. (e) "Converted autonomous vehicle" means a motor vehicle that: (1) Is equipped with an aftermarket automated driving system capable of operating in accordance with some or all of the automated driving standards; (2) Meets or exceeds weight or capacity thresholds established under federal law; and (3) Is capable of operating in accordance with applicable State and federal law. (f) "Operational design domain" means operating conditions under which a given automated driving system is specifically designed to function, including conditions subject to: (1) Environmental restrictions; (2) Geographic restrictions; (3) Time-of-day restrictions; or (4) The required presence or absence of certain traffic or roadway characteristics. #### Section 15-902 This subtitle applies only to motor vehicles intended for commercial or industrial use. #### Section 15-903 (a) Notwithstanding any other provision of this article, an autonomous vehicle converter may sell, transfer, lease, offer for sale, or resell: (1) A converted autonomous vehicle; or (2) A motor vehicle purchased by an autonomous vehicle converter with the intent to convert the motor vehicle into a converted autonomous vehicle. (b) An autonomous vehicle converter may not be licensed under this title as a manufacturer, distributor, or factory branch or as a dealer. ### Subtitle 10. Recreational Vehicle Dealer Agreements #### Section 15-1001 (a) In this subtitle the following words have the meanings indicated. (b) "Area of sales" means the geographical area agreed to by the dealer and the manufacturer in an agreement that grants the dealer the exclusive right to display or sell the manufacturer's new recreational vehicles of a particular line-make. (c) (1) "Coerce" means to compel or attempt to compel an action or inaction by threat of harm, breach of contract, or other adverse action or consequences. (2) "Coerce" includes threatening to terminate, cancel, or not renew a dealer agreement without good cause, or hold or delay product delivery as an inducement to amend the dealer agreement. (d) "Dealer" means any person licensed or required to be licensed to sell recreational vehicles. (e) "Dealer agreement" means a written agreement or contract entered into between a dealer and a manufacturer or distributor: (1) That states the rights and responsibilities of the parties; and (2) Under which the dealer may sell new recreational vehicles. (f) "Distributor" means any person that purchases new recreational vehicles for resale to dealers. (g) "Factory branch" means a branch office of a manufacturer from which the manufacturer: (1) Sells or promotes sales of a particular brand or make of new recreational vehicles to dealers in the State; (2) Directs and supervises the manufacturer's representatives in the State; or (3) Supervises or contacts dealers or prospective dealers in the State. (h) "Factory campaign" means an effort on the part of a warrantor to contact recreational vehicle owners or dealers to address a part or equipment issue. (i) "Family member" means a spouse, child, grandchild, parent, sibling, niece, or nephew, or a spouse of a child, grandchild, parent, sibling, niece, or nephew. (j) "License" means a manufacturer, distributor, or factory branch license issued by the Administration under this subtitle. (k) "Line-make" means a specific series of recreational vehicles that: (1) Is targeted to a particular market segment, as determined by its decor, features, equipment, size, weight, and price range; (2) Has lengths and interior floor plans that distinguish the recreational vehicles from other similar models; and (3) Belongs to a single distinct classification of recreational vehicle product type that has a substantial degree of commonality in the construction, chassis, frame, and body style. (l) "Manufacturer" means any person engaged in the manufacturing of recreational vehicles. (m) "Model" means a series of recreational vehicle products identified by a common series trade name or trademark. (n) "Proprietary part" means any part manufactured by or for the manufacturer or sold exclusively by the manufacturer. (o) (1) "Recreational vehicle" means a vehicle that is: (i) Either self-propelled or towed by a tow vehicle; and (ii) Designed to provide temporary living quarters for recreational, camping, or travel use. (2) "Recreational vehicle" includes: (i) A motor home; (ii) A travel trailer; (iii) A fifth-wheel travel trailer; (iv) A truck camper; and (v) A folding camping trailer. (p) "Transient customer" means a customer who is temporarily traveling through a dealer's area of sales. (q) (1) "Warrantor" means any person that gives a warranty in connection with new recreational vehicle parts, accessories, or components. (2) "Warrantor" does not include service contracts, insurance, or extended warranties sold for separate consideration by a dealer or person not affiliated with a manufacturer or distributor. #### Section 15-1002 (a) A manufacturer may not transfer any new recreational vehicle to any dealer or distributor in the State unless the manufacturer is licensed by the Administration under this subtitle. (b) A distributor may not transfer any new recreational vehicle to any dealer in the State unless the distributor is licensed by the Administration under this subtitle. (c) A person may not conduct the business of a factory branch of a recreational vehicle manufacturer unless the person is licensed by the Administration under this subtitle. #### Section 15-1003 (a) In addition to the information required under Subtitle 1 of this title, each application for a license under this subtitle shall include: (1) The address of the principal place of business of the applicant; (2) The address of each place of business from which the applicant will make substantial contacts with dealers in the State; and (3) The nature of the business to be conducted at each address. (b) Each applicant for a license shall submit as part of the application: (1) A copy of each form for any new vehicle warranty currently provided or offered by the applicant; (2) A copy of each franchise contract and any other contract with dealers used by the applicant, together with a list of dealers in the State who hold a franchise from the applicant; (3) A copy of the vehicle preparation and delivery obligations of the dealers described in item (2) of this subsection; and (4) A statement of the compensation structure the applicant agrees to pay a dealer for parts supplied and work done by a dealer under: (i) The preparation and delivery obligations of the dealer; or (ii) Any outstanding express or implied new recreational vehicle warranty. #### Section 15-1004 (a) Each licensee shall pay an annual fee to the Administration for each license year or part of a license year for which the license is issued. (b) The annual license fee for a manufacturer or a distributor shall be established by the Administration based on the combined number of new recreational vehicles transferred by the manufacturer or distributor to dealers in the State during the preceding license year. (c) The annual license fee for a factory branch shall be established by the Administration. #### Section 15-1005 (a) After the Administration notifies a manufacturer or distributor of new recreational vehicles of the approval of an application for a license and before the Administration issues a license, the manufacturer or distributor shall file with the Administration a surety bond in the form and with the surety that the Administration requires. (b) (1) The amount of the surety bond shall be based on the number of new recreational vehicles transferred by the manufacturer or distributor to dealers in the State during the preceding license year, as follows: (i) If 1 to 50 vehicles were transferred, a $25,000 surety bond; (ii) If 51 to 500 vehicles were transferred, a $50,000 surety bond; (iii) If 501 to 10,000 vehicles were transferred, a $100,000 surety bond; and (iv) If more than 10,000 vehicles were transferred, a $300,000 surety bond. (2) Each surety bond shall continuously maintain the amount specified in this subsection. (3) A manufacturer or distributor need not file more than one bond regardless of the number of makes of recreational vehicles manufactured or distributed. #### Section 15-1006 A license issued under this subtitle authorizes the licensee to conduct the business of a manufacturer, distributor, or factory branch during the license year for which it is issued. #### Section 15-1007 (a) In this section, "good faith" means honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade. (b) A manufacturer, distributor, or factory branch, whether directly or through an agent, an employee, or a representative, may not fail to act in good faith: (1) In acting or purporting to act under the terms, provisions, or conditions of any franchise agreement; or (2) In any transaction or conduct governed by this subtitle. #### Section 15-1008 (a) A manufacturer or distributor may not sell a new recreational vehicle in the State to or through a dealer without having first entered into a written dealer agreement that has been signed by both parties. (b) (1) Except as specified in paragraph (2) of this subsection, the manufacturer shall designate the duration of the dealer agreement and the area of sales exclusively assigned to a dealer in the dealer agreement and may not make changes to the terms specified in the agreement. (2) The terms specified in the dealer agreement may be altered with written mutual consent of both parties. (c) A dealer may not sell a new recreational vehicle in the State unless: (1) The dealer is licensed by the Administration under Subtitle 3 of this title; (2) The dealer has entered into a dealer agreement; and (3) The dealer is selling within the area of sales designated in the dealer agreement. (d) (1) A manufacturer or distributor shall distribute recreational vehicles to its dealers in a fair and equitable manner. (2) On request, a manufacturer or distributor shall provide information on its manner of distribution to dealers. (e) A manufacturer or distributor shall provide adequate repair instructions to its licensed dealers to facilitate the dealers performing proper service and repairs on recreational vehicles. #### Section 15-1009 (a) (1) A manufacturer or distributor may terminate, cancel, or fail to renew a model, line-make, or dealer agreement with a dealer only for good cause. (2) (i) The manufacturer or distributor has the burden of showing good cause for the termination or cancellation of or failure to renew a model, line-make, or dealer agreement with a dealer. (ii) The determination of good cause shall be based on: (1) The extent of the dealer's penetration into the relevant market area for the relevant model or line-make; (2) The nature and extent of the dealer's investment in the dealer's business; (3) The adequacy of the dealer's service facilities, equipment, parts, supplies, and personnel; (4) The effect of the proposed action on the community; (5) The extent and quality of the dealer's service under recreational vehicle warranties; (6) Any failure of the dealer to follow agreed-on procedures and standards related to the overall operation of the dealership consistent with the law and the dealer agreement; and (7) The dealer's performance under the terms of the dealer agreement. (b) On renewal of a dealer agreement, a manufacturer or distributor may not require additional inventory stocking requirements or increased sales targets in excess of the market growth in the dealer's area of sales. (c) (1) Except as otherwise provided in this subsection, a manufacturer or distributor shall provide a dealer with written notice at least 120 days before the termination, cancellation, or nonrenewal of a model, line-make, or dealer agreement. (2) The notice shall state all reasons for the proposed termination, cancellation, or nonrenewal. (3) (i) Within 30 days following receipt of the notice, a dealer may provide written notice of intent to rectify all claimed deficiencies. (ii) If the deficiencies are rectified by the dealer within 120 days following the notice of intent to rectify, the manufacturer's or distributor's notice of termination is void. (iii) Subject to paragraph (5) of this subsection, if a dealer fails to provide timely written notice of intent to rectify or fails to rectify within 120 days after notice of intent to rectify, the termination, cancellation, or nonrenewal of the dealer agreement shall take effect. (4) The 120-day notice period shall be reduced to 30 days if the termination, cancellation, or nonrenewal is due to: (i) A dealer or one of the dealer's owners being convicted of, or entering a plea of nolo contendere to, a felony; (ii) The abandonment or closing of the business operations of the dealer for 10 consecutive business days, unless the closing is due to a cause that is out of the dealer's control; (iii) A significant misrepresentation by a dealer materially affecting the business relationship; or (iv) A suspension or revocation of a dealer's license, or failure by a dealer to renew a dealer's license. (5) The notice provisions of this section do not apply if the reason for termination, cancellation, or nonrenewal is insolvency, the occurrence of an assignment for the benefit of creditors, or bankruptcy. (d) (1) A dealer may terminate, cancel, or not renew a model, a line-make, or the dealer agreement with a manufacturer or distributor with or without good cause at any time by giving 30 days' written notice to the manufacturer or distributor. (2) (i) If the termination, cancellation, or nonrenewal of the model, line-make, or dealer agreement is for good cause, the dealer has the burden of showing good cause. (ii) A determination of good cause may be based on: (1) A manufacturer or distributor being convicted of, or entering a plea of nolo contendere to, a felony; (2) The business operations having been abandoned or closed for 10 consecutive days, unless the closing is due to a cause that is out of the control of the manufacturer or distributor; (3) A significant misrepresentation by the manufacturer or distributor that materially affects the business relationship; (4) A declaration by the manufacturer or distributor of insolvency, the occurrence of an assignment for the benefit of creditors, or bankruptcy; (5) A manufacturer's or distributor's material violation of the dealer agreement that is not cured within 120 days after written notice by the dealer; (6) A manufacturer or distributor coercing or attempting to coerce a dealer; (7) A manufacturer or distributor violating an area of sales protection or allowing other dealers to violate an area of sales protection; or (8) A material violation of this section that is not cured within 30 days after written notice of the violation by the dealer. (e) If the dealer agreement is terminated, canceled, or not renewed by the dealer for good cause, within 45 days after the termination, cancellation, or nonrenewal, the manufacturer or distributor shall, at request of the dealer, repurchase: (1) All new, unaltered, undamaged, and untitled recreational vehicles that were acquired from the manufacturer or distributor within 18 months before the termination, cancellation, or nonrenewal, at 100% of the invoice cost, including transportation costs, except that if any recreational vehicle is damaged, the amount due to the dealer shall be reduced by the cost to repair the damage; (2) All new, undamaged accessories and proprietary parts with the original invoice sold to the dealer for resale within 12 months before the termination, cancellation, or nonrenewal of the dealer agreement, at 105% of the dealer's original price paid; and (3) Any properly functioning diagnostic equipment, specialty tools, current signage, or other equipment and machinery that was purchased within 5 years before the termination, cancellation, or nonrenewal and can no longer be used in the normal course of business, at 100% of the dealer's original price paid, plus freight, destination, delivery, and any applicable tax. (f) If the dealer agreement is terminated, canceled, or not renewed by the manufacturer or distributor without good cause, the manufacturer or distributor shall repurchase dealer inventory as provided in subsection (e) of this section. (g) A dealer is not prohibited from selling the remaining in-stock inventory of a particular model or line-make after a dealer agreement has been terminated, canceled, or not renewed by the manufacturer or distributor. (h) When taking on an additional line-make of a recreational vehicle, a dealer shall notify in writing any manufacturer or distributor with whom the dealer has a dealer agreement of a similar line-make at least 30 days before entering into a dealer agreement for the additional line-make. #### Section 15-1010 (a) (1) If a dealer desires to make a transfer in ownership by sale of the business assets, stock transfer, or any other method, the dealer shall give a manufacturer or distributor that has entered into a dealer agreement with the dealer written notice at least 10 business days before the transfer, including all supporting documentation as may be reasonably required by the manufacturer or distributor to determine whether an objection to the transfer may be made. (2) A manufacturer or distributor may not object to the proposed transfer of ownership unless the prospective transferee: (i) Has been terminated for cause by the manufacturer or distributor; (ii) Has been convicted of a felony or any crime of moral turpitude; (iii) Lacks any dealer license required by law; (iv) Lacks an active line of credit sufficient to purchase the manufacturer's or distributor's product; or (v) Has undergone bankruptcy, insolvency, a general assignment for the benefit of creditors, or the appointment of a receiver, trustee, or conservator to take possession of the transferee's business property. (b) (1) If the manufacturer or distributor objects to a proposed change of ownership, the manufacturer or distributor shall give written notice to the dealer within 7 business days after receipt of the dealer's notification and complete documentation. (2) If the manufacturer or distributor does not give timely notice of the objection, the transfer shall be deemed approved. (c) (1) A dealer shall have an opportunity to designate, in writing, a family member as a successor to the dealer's business in the event of death, incapacity, or retirement of the dealer. (2) A manufacturer or distributor may object to the successor within 10 business days after receipt of the dealer's succession plan only if the successor: (i) Was convicted of a felony or crime of moral turpitude; (ii) Declared bankruptcy or insolvency within the previous 10 years; (iii) Lacks an active line of credit sufficient to purchase the manufacturer's or distributor's product; (iv) Lacks any dealer's license required by law; or (v) Would cause or has caused a breach of the dealer agreement. #### Section 15-1011 (a) (1) Each warrantor shall: (i) Specify in writing each dealer's obligations for preparation, delivery, and warranty service for the warrantor's products; (ii) Compensate the dealer for warranty service performed by the dealer that is covered by the warranty; and (iii) Provide the dealer a schedule of compensation to be paid and the reasonable time allowance for the performance of any service and repairs under a warranty. (2) If the schedule of compensation does not include a particular service or repair, a warrantor shall reimburse the dealer a reasonable amount for the service or repair. (b) (1) A warrantor shall reimburse the dealer for any warranty part at wholesale cost plus a 30% handling charge. (2) The maximum handling charge under this subsection is $300. (3) A warrantor shall reimburse a dealer the cost of freight to return a warranty part, an accessory, or a component to the warrantor, if the return is requested by the warrantor. (c) Warranty audits of dealer records may be conducted by the warrantor on a reasonable basis. (d) (1) A dealer shall submit a warranty claim within 45 days after completing the work. (2) A warrantor may disapprove warranty claims only in writing within 45 days after the date the warranty claim was submitted by the dealer in the manner prescribed by the warrantor. (3) Claims not disapproved in writing within 45 days shall be deemed to be approved and shall be paid by the warrantor within 60 days. (e) A dealer shall give notice to a warrantor as soon as reasonably possible if the dealer is unable or unwilling to perform material or repetitive warranty repairs. (f) It is a violation of this section for any warrantor to: (1) Fail to perform any of its warranty obligations with respect to its warranted products; (2) Fail to include written notices of factory campaigns to recreational vehicle owners and dealers for the expected date by which parts and equipment will be available to dealers to perform the campaign work; (3) If the carrier is designated by the manufacturer, distributor, or warrantor, fail to compensate a dealer for authorized repairs performed by a dealer for a product damaged in transit to the dealer; (4) Fail to compensate any dealer for authorized warranty service in accordance with the time allowances set forth in the schedule of compensation, if performed in a timely manner; (5) Intentionally misrepresent to purchasers of recreational vehicles that a dealer is a warrantor or co-warrantor; or (6) Require a dealer to make warranties to customers in any manner related to the manufacturing of a recreational vehicle. (g) It is a violation of this section for a dealer to: (1) Fail to perform predelivery inspection functions as specified by the warrantor; (2) Fail to perform warranty service work authorized by the warrantor in a reasonably timely manner on any transient customer's recreational vehicle of the same line-make; (3) Fail to track actual time expended to perform warranty work not governed by time allowance in the schedule of compensation; (4) Claim an agency relationship with a warrantor; or (5) Misrepresent the terms of a warranty. (h) Unless specified in the terms of a dealer agreement, it is a violation of this section for: (1) A warrantor to fail to indemnify, defend, and hold harmless a dealer against any losses or damages to the extent the losses or damages are caused by the negligence or misconduct of the warrantor; or (2) A dealer to fail to indemnify, defend, and hold harmless a warrantor against any losses or damages to the extent the losses or damages are caused by the negligence or misconduct of the dealer. (i) Indemnification under this subsection shall include court costs, reasonable attorney's fees, and expert witness fees incurred by the defending party. #### Section 15-1012 (a) When a new recreational vehicle is damaged before transit to the dealer, or is damaged in transit to the dealer and the manufacturer or distributor was responsible for transit, the dealer shall: (1) Notify the manufacturer or distributor of the damage within the time frame specified in the dealer agreement; (2) Request authorization to replace the components, parts, or accessories damaged; and (3) Reject the recreational vehicle within 2 days after physical delivery of the recreational vehicle. (b) (1) If a dealer determines that a recreational vehicle at the time of delivery has an unreasonable amount of miles on the odometer, the recreational vehicle may be subject to rejection by the dealer and reversion of the recreational vehicle to the manufacturer or distributor. (2) A dealer may not deem less than the distance between the dealer and the manufacturer's factory or a distributor's point of distribution, as appropriate, plus 100 miles as an unreasonable amount of miles. #### Section 15-1013 (a) A manufacturer, distributor, or factory branch, whether directly or through an agent, an employee, an affiliate, or a representative, may not coerce or attempt to coerce a dealer to: (1) Purchase a product the dealer did not order; (2) Enter into an agreement with the manufacturer or distributor; (3) Take action that is unfair or unreasonable to the dealer; or (4) Forgo exercising a right authorized by a dealer agreement or any law governing the business relationship. (b) A dealer bears the burden of proof regarding the prohibited acts described in this section. #### Section 15-1014 (a) Notwithstanding any administrative or criminal sanctions imposed by this subtitle, if a person suffers financial injury or other damage as a result of a violation of this subtitle by any other person, whether or not that other person has been found guilty of a criminal violation, the injured person may recover damages and reasonable attorney's fees in any court of competent jurisdiction. (b) (1) Before bringing a civil action under this section, the party bringing the action shall serve a written demand for mediation on the offending party. (2) The parties to mediation shall pay their own costs for attorney's fees and divide the mediator cost equally. (3) This subsection does not apply to an action for injunctive relief. (c) A dealer, manufacturer, distributor, factory branch, or warrantor may apply for a grant of injunctive relief from a violation of this subtitle or a refusal to comply with a requirement of this subtitle. #### Section 15-1015 (a) The Administration may suspend or revoke any dealer, manufacturer, distributor, or factory branch license on a finding that a party violated this subtitle. (b) The Administration may impose a fine not exceeding $1,000 for each violation of this subtitle. (c) A dealer, manufacturer, distributor, factory branch, or warrantor is entitled to a hearing under Title 12, Subtitle 2 of this article to contest an action or fine imposed under this section. --- Md. Code Ann., Transp. (as displayed at mgaleg.maryland.gov, October 16, 2026)