CHAPTER 2. REGULATION OF VEHICLE MERCHANDISING - Indiana Statutes

IC 9-23-2
     Chapter 2. Regulation of Vehicle Merchandising

IC 9-23-2-1
Persons required to be licensed
     Sec. 1. (a) The following persons must be licensed under this article to engage in the business of buying or selling motor vehicles:
        (1) An automobile auctioneer.
        (2) A converter manufacturer.
        (3) A dealer.
        (4) A distributor.
        (5) A distributor branch.
        (6) A distributor representative.
        (7) A factory branch.
        (8) A factory representative.
        (9) A manufacturer.
        (10) A transfer dealer.
        (11) A wholesale dealer.
        (12) An automotive mobility dealer.
    (b) An automotive mobility dealer who engages in the business of:
        (1) selling, installing, or servicing;
        (2) offering to sell, install, or service; or
        (3) soliciting or advertising the sale, installation, or servicing of;
equipment or modifications specifically designed to facilitate use or operation of a vehicle by an individual who is disabled or aged must be licensed under this article.
As added by P.L.2-1991, SEC.11. Amended by P.L.268-2003, SEC.25; P.L.147-2009, SEC.9.

IC 9-23-2-2 Version a
Application for license; affidavits; bonds
     Note: This version of section amended by P.L.17-2010, SEC.1. See also following version of this section amended by P.L.93-2010, SEC.11.
    Sec. 2. (a) An application for a license under this chapter must:
        (1) be accompanied by the fee required under IC 9-29-8;
        (2) be on a form prescribed by the secretary of state;
        (3) contain the information the secretary of state considers necessary to enable the secretary of state to determine fully the following information:
            (A) The qualifications and eligibility of the applicant to receive the license.
            (B) The location of each of the applicant's places of business in Indiana.
            (C) The ability of the applicant to conduct properly the business for which the application is submitted; and
        (4) contain evidence of a bond required in subsection (e).
    (b) An application for a license as a dealer must show whether the applicant proposes to sell new or used motor vehicles, or both.     (c) An applicant who proposes to use the Internet or other computer network in aid of its sale of motor vehicles to consumers in Indiana, which activities may result in the creation of business records outside Indiana, shall provide the division with the name, address, and telephone number of the person who has control of those business records. The secretary of state may not issue a license to a dealer who transacts business in this manner who does not have an established place of business in Indiana.
    (d) This subsection applies to an application for a license as a dealer in a city having a population of more than ninety thousand (90,000) but less than one hundred five thousand (105,000). The application must include an affidavit from:
        (1) the person charged with enforcing a zoning ordinance described in this subsection; or
        (2) the zoning enforcement officer under IC 36-7-4, if one exists;
who has jurisdiction over the real property where the applicant wants to operate as a dealer. The affidavit must state that the proposed location is zoned for the operation of a dealer's establishment. The applicant may file the affidavit at any time after the filing of the application. However, the secretary of state may not issue a license until the applicant files the affidavit.
    (e) This subsection does not apply to a person listed in the categories set forth in section 1(a)(10) through 1(a)(12) of this chapter and that was licensed under this chapter before July 1, 2009. A licensee shall maintain a bond satisfactory to the secretary of state in the amount of twenty-five thousand dollars ($25,000), which must:
        (1) be in favor of the state; and
        (2) secure payment of fines, penalties, costs, and fees assessed by the secretary of state after notice, opportunity for a hearing, and opportunity for judicial review, in addition to securing the payment of damages to a person aggrieved by a violation of this chapter by the licensee after a judgment has been issued.
    (f) Service shall be made in accordance with the Indiana Rules of Trial Procedure.
As added by P.L.2-1991, SEC.11. Amended by P.L.98-1997, SEC.1; P.L.74-2001, SEC.2; P.L.170-2002, SEC.74; P.L.184-2007, SEC.19; P.L.147-2009, SEC.10; P.L.17-2010, SEC.1.

IC 9-23-2-2 Version b
Application for license; affidavits; bonds; membership in risk retention group
     Note: This version of section amended by P.L.93-2010, SEC.11. See also preceding version of this section amended by P.L.17-2010, SEC.1.
    Sec. 2. (a) An application for a license under this chapter must:
        (1) be accompanied by the fee required under IC 9-29-8;
        (2) be on a form prescribed by the secretary of state;
        (3) contain the information the secretary of state considers necessary to enable the secretary of state to determine fully the

following information:
            (A) The qualifications and eligibility of the applicant to receive the license.
            (B) The location of each of the applicant's places of business in Indiana.
            (C) The ability of the applicant to conduct properly the business for which the application is submitted; and
        (4) contain evidence of a bond required in subsection (e).
    (b) An application for a license as a dealer must show whether the applicant proposes to sell new or used motor vehicles, or both.
    (c) An applicant who proposes to use the Internet or other computer network in aid of its sale of motor vehicles to consumers in Indiana, which activities may result in the creation of business records outside Indiana, shall provide the division with the name, address, and telephone number of the person who has control of those business records. The secretary of state may not issue a license to a dealer who transacts business in this manner who does not have an established place of business in Indiana.
    (d) This subsection applies to an application for a license as a dealer in a city having a population of more than ninety thousand (90,000) but less than one hundred five thousand (105,000). The application must include an affidavit from:
        (1) the person charged with enforcing a zoning ordinance described in this subsection; or
        (2) the zoning enforcement officer under IC 36-7-4, if one exists;
who has jurisdiction over the real property where the applicant wants to operate as a dealer. The affidavit must state that the proposed location is zoned for the operation of a dealer's establishment. The applicant may file the affidavit at any time after the filing of the application. However, the secretary of state may not issue a license until the applicant files the affidavit.
    (e) A licensee shall maintain a bond satisfactory to the secretary of state in the amount of twenty-five thousand dollars ($25,000), which must:
        (1) be in favor of the state; and
        (2) secure payment of fines, penalties, costs, and fees assessed by the secretary of state after notice, opportunity for a hearing, and opportunity for judicial review, in addition to securing the payment of damages to a person aggrieved by a violation of this chapter by the licensee after a judgment has been issued.
    (f) Service shall be made in accordance with the Indiana Rules of Trial Procedure.
    (g) Instead of meeting the requirement in subsection (e), a licensee may submit to the secretary of state evidence that the licensee is a member of a risk retention group regulated by the Indiana department of insurance.
As added by P.L.2-1991, SEC.11. Amended by P.L.98-1997, SEC.1; P.L.74-2001, SEC.2; P.L.170-2002, SEC.74; P.L.184-2007, SEC.19; P.L.147-2009, SEC.10; P.L.93-2010, SEC.11.
IC 9-23-2-3
Franchise; filing with secretary of state
     Sec. 3. A manufacturer, distributor, factory branch, distributor branch, or dealer proposing to sell new motor vehicles shall file and maintain with the secretary of state a current copy of each franchise to which the person is a party, or, if multiple franchises are identical except for stated items, a copy of the form franchise with supplemental schedules of variations from the form.
As added by P.L.2-1991, SEC.11. Amended by P.L.184-2007, SEC.20.

IC 9-23-2-4
Display of license; change of business name or location; application for approval of change; affidavit
     Sec. 4. (a) The license issued to a factory branch, a distributor branch, an automobile auctioneer, a transfer dealer, or a dealer under this chapter must specify the location of each place of business and shall be conspicuously displayed at each business location.
    (b) If a business name or location is changed, the holder shall notify the secretary of state within ten (10) days and remit the fee required under IC 9-29-8. The secretary of state shall endorse that change on the license if the secretary of state determines that the change is not subject to other provisions of this article.
    (c) A dealer who uses the Internet or other computer network to facilitate the sale of motor vehicles as set forth in section 2(c) of this chapter shall notify the secretary of state within ten (10) days upon any change in the name, address, or telephone number of business records located outside Indiana that have been created in transactions made in Indiana by the dealer. A report made under this subsection is not subject to the fee required under IC 9-29-8-5.
    (d) This subsection applies to a dealer in a city having a population of more than ninety thousand (90,000) but less than one hundred five thousand (105,000). A dealer who wants to change a location must submit to the secretary of state an application for approval of the change. The application must be accompanied by an affidavit from:
        (1) the person charged with enforcing a zoning ordinance described in this subsection; or
        (2) the zoning enforcement officer under IC 36-7-4, if one exists;
who has jurisdiction over the real property where the applicant wants to operate as a dealer. The affidavit must state that the proposed location is zoned for the operation of a dealer's establishment. The secretary of state may not approve a change of location or endorse a change of location on the dealer's license until the dealer provides the affidavit.
    (e) For the purpose of this section, an offsite license issued under section 7 of this chapter does not constitute a change of location.
As added by P.L.2-1991, SEC.11. Amended by P.L.98-1997, SEC.2; P.L.74-2001, SEC.3; P.L.170-2002, SEC.75; P.L.184-2007, SEC.21.
IC 9-23-2-5
License issued to representative; name of employer; change of employer; display of license; temporary license for representative
     Sec. 5. The license issued to a factory representative or distributor representative must state the name of the employer. Within ten (10) days after a change of employer, the holder shall mail the license to the secretary of state and indicate the name and address of the holder's new employer. The secretary of state shall endorse the change on the license and return the license to the licensee in care of the licensee's new employer. A factory representative, distributor representative, or wholesale dealer must have a license when engaged in business and shall display the license upon request. A temporary license for a factory representative or distributor representative may be issued for a period up to one hundred twenty (120) days pending investigation by the secretary of state of the applicant's qualification for a license.
As added by P.L.2-1991, SEC.11. Amended by P.L.268-2003, SEC.26; P.L.184-2007, SEC.22.

IC 9-23-2-5.5
Application for and renewal of automotive mobility dealer's license
     Sec. 5.5. The secretary of state shall, by rule adopted under IC 4-22-2, establish requirements for an initial application for and renewal of an automotive mobility dealer's license. The rules must include a requirement that each initial or renewal application for an automotive mobility dealer's license include proof that the applicant is accredited through the Quality Assurance Program of the National Mobility Equipment Dealers Association.
As added by P.L.147-2009, SEC.11.

IC 9-23-2-5.7
Automotive mobility dealers; display, inventory, advertising, and offering for sale adapted vehicles
     Sec. 5.7. An automotive mobility dealer licensed under this chapter is entitled to:
        (1) display;
        (2) inventory;
        (3) advertise;
        (4) offer for sale; or
        (5) do any combination of subdivisions (1) through (4) concerning;
any adapted vehicle.
As added by P.L.147-2009, SEC.12.

IC 9-23-2-6
Vehicle sales made away from dealer's place of business and without offsite sales license; trade shows
     Sec. 6. This section does not apply to sales made at a motor vehicle industry sponsored trade show. A dealer may not sell a vehicle at a location away from the dealer's established place of

business without obtaining an offsite sales license under section 7 of this chapter.
As added by P.L.2-1991, SEC.11.

IC 9-23-2-7
Offsite sales license
     Sec. 7. (a) Except as provided in subsections (b) through (g), the secretary of state shall issue an offsite sales license to a dealer licensed under this chapter who submits an application for the license not later than ten (10) business days or two (2) calendar weeks before the offsite sale date. License applications under this section shall be made public upon the request of any person.
    (b) The secretary of state may not issue an offsite sales license to a dealer who does not have an established place of business within Indiana.
    (c) The secretary of state may not issue an offsite sales license to a licensed dealer proposing to conduct the sale outside a radius of twenty (20) miles from its established place of business. This subsection does not apply to:
        (1) new manufactured housing dealers;
        (2) recreational vehicle dealers;
        (3) a rental company that is a dealer conducting a sale at a site within twenty (20) miles of any of its company owned affiliates; or
        (4) off-road vehicle dealers.
    (d) A vehicle display is not considered an offsite sale if it is conducted by a new vehicle franchised dealer in an open area where no sales personnel and no sales material are present.
    (e) The secretary of state may not issue an offsite sales license to a licensed dealer proposing to conduct the offsite sale for more than ten (10) calendar days.
    (f) As used in this subsection, "executive" has the meaning set forth in IC 36-1-2-5. The secretary of state may not issue an offsite sales license to a licensed dealer if the dealer does not have authorization that the offsite sale would be in compliance with local zoning ordinances or other local ordinances. Authorization under this subsection may only be obtained from the following:
        (1) If the offsite sale would be located within the corporate boundaries of a city or town, the executive of the city or town.
        (2) If the offsite sale would be located outside the corporate boundaries of a city or town:
            (A) except as provided in clause (B), the executive of the county; or
            (B) if the city or town exercises zoning jurisdiction under IC 36-7-4-205(b) over the area where the offsite sale would be located, the executive of the city or town.
    (g) The secretary of state may not issue an offsite sales license to a licensed dealer who has held more than three (3) nonconsecutive offsite sales in the year ending on the date of the offsite sale for which the current license application is being submitted.     (h) The requirements of section 2(c) of this chapter do not apply to the application or issuance of an offsite sales license under this section.
As added by P.L.2-1991, SEC.11. Amended by P.L.99-1997, SEC.1; P.L.98-1997, SEC.3; P.L.268-2003, SEC.27; P.L.63-2006, SEC.1; P.L.184-2007, SEC.23; P.L.107-2008, SEC.13; P.L.131-2008, SEC.49.

IC 9-23-2-8
Duration of licenses; expiration schedule
     Sec. 8. A license issued under this chapter is valid for a one (1) year period in accordance with the following schedule:
        (1) A person whose business name begins with the letters A through B, inclusive, shall register before March 1 of each year.
        (2) A person whose business name begins with the letters C through D, inclusive, shall register before April 1 of each year.
        (3) A person whose business name begins with the letters E through G, inclusive, shall register before May 1 of each year.
        (4) A person whose business name begins with the letters H through I, inclusive, shall register before June 1 of each year.
        (5) A person whose business name begins with the letters J through L, inclusive, shall register before July 1 of each year.
        (6) A person whose business name begins with the letters M through O, inclusive, shall register before August 1 of each year.
        (7) A person whose business name begins with the letters P through R, inclusive, shall register before September 1 of each year.
        (8) A person whose business name begins with the letters S through T, inclusive, shall register before October 1 of each year.
        (9) A person whose business name begins with the letters U through Z, inclusive, shall register before November 1 of each year.
A sole proprietor shall register based upon the name of the sole proprietorship.
As added by P.L.2-1991, SEC.11. Amended by P.L.88-1996, SEC.3.

IC 9-23-2-9
Authority to transfer or assign motor vehicle title
     Sec. 9. A person licensed under this article may transfer or assign a title for a motor vehicle.
As added by P.L.2-1991, SEC.11.

IC 9-23-2-10
Liability insurance or garage liability insurance coverage
     Sec. 10. (a) A person licensed under this article shall furnish evidence that the person currently has liability insurance or garage liability insurance covering the person's place of business. The policy must have limits of not less than the following:         (1) One hundred thousand dollars ($100,000) for bodily injury to one (1) person.
        (2) Three hundred thousand dollars ($300,000) for bodily injury for each accident.
        (3) Fifty thousand dollars ($50,000) for property damage.
    (b) The minimum amounts required by subsection (a) must be maintained during the time the license is valid.
As added by P.L.2-1991, SEC.11. Amended by P.L.39-2000, SEC.9.

IC 9-23-2-11
Cessation of business activity
     Sec. 11. A person who ceases a business activity for which a license was issued under this chapter shall do the following:
        (1) Notify the secretary of state of the date that the business activity will cease.
        (2) Deliver all permanent dealer license plates and interim license plates issued to the person to the secretary of state within ten (10) days of the date the business activity will cease.
As added by P.L.2-1991, SEC.11. Amended by P.L.176-2001, SEC.10; P.L.184-2007, SEC.24; P.L.93-2010, SEC.12.

IC 9-23-2-12
Repealed
    (Repealed by P.L.60-1994, SEC.3.)

IC 9-23-2-13
Deposit of revenues in motor vehicle highway account
     Sec. 13. Except as provided in IC 9-29-1-5 and IC 9-29-8-7, all revenues accruing to the secretary of state under this article shall be deposited in the motor vehicle highway account.
As added by P.L.2-1991, SEC.11. Amended by P.L.184-2007, SEC.25; P.L.106-2008, SEC.29.

IC 9-23-2-14
Denial, suspension, or revocation of licenses; investigations; notice
     Sec. 14. (a) The secretary of state may investigate a violation of this chapter. In conducting an investigation under this subsection, the secretary of state may do the following:
        (1) Administer oaths and affirmations.
        (2) Subpoena witnesses and compel attendance.
        (3) Take evidence.
        (4) Require the production of documents or records that the secretary of state determines are material to the investigation.
Upon a motion by the secretary of state, the court may order a person that fails to obey a subpoena issued under subdivision (2) to obey the subpoena.
    (b) A person may not be excused from:
        (1) obeying a subpoena issued by;
        (2) attending a proceeding and testifying as ordered by; or
        (3) otherwise producing evidence as ordered by; the secretary of state on grounds that the person's testimony or evidence may tend to incriminate the person or subject the person to a penalty or forfeiture. However, a person that asserts the privilege against self-incrimination may not be prosecuted or subject to a penalty or forfeiture for any matter concerning the person's testimony or evidence.
    (c) Following an investigation under subsection (a), the secretary of state may, without hearing, issue orders and notices that the secretary of state determines to be in the public interest. The secretary of state may issue an order under this subsection denying, suspending, or revoking a license issued under this chapter for any of the following:
        (1) Material misrepresentation in the application for the license or other information filed with the secretary of state.
        (2) Lack of fitness under the standards set forth in this article or a rule adopted by the secretary of state under this article.
        (3) Willful failure to comply with the provisions of this article or a rule adopted by the secretary of state under this article.
        (4) Willful violation of a federal or state law relating to the sale, distribution, financing, or insuring of motor vehicles.
        (5) Engaging in an unfair practice as set forth in this article or a rule adopted by the secretary of state under this article.
        (6) Violating IC 23-2-2.7.
        (7) Violating IC 9-19-1.
Except as otherwise provided, a denial, suspension, or revocation of a license takes effect after the secretary of state makes a determination and notice of the determination has been served upon the affected person.
    (d) Upon the entry of an order under subsection (c), the secretary of state shall promptly notify all interested parties of the following:
        (1) The date of issuance.
        (2) The reasons for issuance.
        (3) That, upon written request from a party, the matter will be set for hearing within fifteen (15) business days after receipt of the request.
    (e) An order entered under subsection (c) remains in effect until the secretary of state:
        (1) modifies or vacates the summary order; or
        (2) conducts a hearing and issues a final determination.
    (f) Revocation or suspension of a license of a manufacturer, a distributor, a factory branch, a distributor branch, a dealer, or an automobile auctioneer may be limited to one (1) or more locations, to one (1) or more defined areas, or only to certain aspects of the business.
    (g) If the secretary of state conducts a hearing under this section, the secretary of state may depose any witness.
    (h) In addition to all other remedies, the secretary of state may seek the following remedies against a person that violates, attempts to violate, or assists in a violation of or an attempt to violate this chapter:         (1) An injunction.
        (2) Appointment of a receiver or conservator.
        (3) A civil penalty not to exceed five thousand dollars ($5,000) per violation.
        (4) An action to enforce a civil penalty assessed under subdivision (3).
    (i) In a court proceeding initiated under this section in which judgment is awarded to the secretary of state, the secretary of state is entitled to recover the costs and expenses of investigation, and the court shall include the costs in its final judgment.
As added by P.L.2-1991, SEC.11. Amended by P.L.210-2005, SEC.37; P.L.184-2007, SEC.26; P.L.106-2008, SEC.30.

IC 9-23-2-15
Sale of motor vehicle through Internet
     Sec. 15. A dealer who sells a motor vehicle through the use of the Internet or other computer network shall deliver the motor vehicle to the customer at the place of business of the dealer in Indiana.
As added by P.L.74-2001, SEC.4.

IC 9-23-2-16
Special event permits
     Sec. 16. (a) A person licensed under this article shall be issued a special event permit from the secretary of state for a special event meeting the following conditions:
        (1) The event is a vehicle auction conducted by auctioneers licensed under IC 25-6.1-3.
        (2) The vehicles to be auctioned are:
            (A) at least fifteen (15) years old; or
            (B) classified as classic, collector, or antique vehicles under rules adopted by the secretary of state.
        (3) At least one hundred (100) vehicles will be auctioned during the special event.
        (4) An application for a special event permit has been submitted to the secretary of state not later than thirty (30) days before the beginning date of the special event.
        (5) The application is accompanied by the permit fee required under IC 9-29-8-6.5.
    (b) Not more than two (2) special event permits may be issued by the secretary of state within a twelve (12) month period to the same applicant.
As added by P.L.156-2006, SEC.2. Amended by P.L.184-2007, SEC.27.

IC 9-23-2-17
Appeals
     Sec. 17. (a) An appeal may be taken from a final order of the secretary of state under this chapter as follows:
        (1) By an applicant for a license under this chapter, from a final order of the secretary of state concerning the application.         (2) By a licensee, from a final order of the secretary of state affecting the licensee's license under this chapter.
        (3) By a person against whom a civil penalty is imposed under section 14 of this chapter, from the final order of the secretary of state imposing the civil penalty.
        (4) By a person named as a respondent in an investigation or a proceeding under section 14 of this chapter, from a final order of the secretary of state under section 14 of this chapter. An appeal under this subdivision may be taken in:
            (A) the Marion County circuit court; or
            (B) the circuit or superior court of the county in which the appellant resides or maintains a place of business.
    (b) A person who seeks to appeal a final order of the secretary of state under this section must serve the secretary of state with the following not more than twenty (20) days after the entry of the order:
        (1) A written notice of the appeal stating:
            (A) the court in which the appeal will be taken; and
            (B) the grounds on which a reversal of the final order is sought.
        (2) A written demand from the appellant for:
            (A) a certified transcript of the record; and
            (B) all papers on file in the secretary of state's office;
        concerning the order from which the appeal is being taken.
        (3) A bond in the penal sum of five hundred dollars ($500) payable to the state with sufficient surety to be approved by the secretary of state, conditioned upon:
            (A) the faithful prosecution of the appeal to final judgment; and
            (B) the payment of all costs that are adjudged against the appellant.
    (c) Not later than ten (10) days after the secretary of state is served with the items described in subsection (b), the secretary of state shall make, certify, and deliver to the appellant the transcript described in subsection (b)(2)(A). Not later than five (5) days after the appellant receives the transcript under this subsection, the appellant shall file the transcript and a copy of the notice of appeal with the clerk of the court. The notice of appeal serves as the appellant's complaint. The secretary of state may appear before the court, file any motion or pleading in the matter, and form the issue. The cause shall be entered on the court's calendar to be heard de novo and shall be given precedence over all matters pending in the court.
    (d) The court shall receive and consider any pertinent oral or written evidence concerning the order of the secretary of state from which the appeal is taken. If the order of the secretary of state is reversed, the court shall in its mandate specifically direct the secretary of state as to the secretary of state's further action in the matter. The secretary of state is not barred from revoking or altering the order for any proper cause that accrues or is discovered after the order is entered. If the order is affirmed, the appellant may, after

thirty (30) days from the date the order is affirmed, file a new application for a license under this chapter if the application is not otherwise barred or limited. During the pendency of the appeal, the order from which the appeal is taken is not suspended but remains in effect unless otherwise ordered by the court. An appeal may be taken from the judgment of the court on the same terms and conditions as an appeal is taken in civil actions.
    (e) IC 4-21.5 does not apply to a proceeding under this chapter.
As added by P.L.106-2008, SEC.31.

IC 9-23-2-18
Dealer compliance account
     Sec. 18. (a) The dealer compliance account is established as a separate account to be administered by the secretary of state. The funds in the account must be available, with the approval of the budget agency, for use in enforcing and administering this chapter.
    (b) The expenses of administering the dealer compliance account shall be paid from money in the account.
    (c) The treasurer of state shall invest the money in the dealer compliance account not currently needed to meet the obligations of the account in the same manner as other public money may be invested. Interest that accrues from these investments shall be deposited in the account.
    (d) The dealer compliance account consists of the following:
        (1) Money deposited under:
            (A) IC 9-29-5-43(b).
            (B) IC 9-29-8-7(1).
        (2) Appropriations to the account from other sources.
        (3) Grants, gifts, donations, or transfers intended for deposit in the account.
        (4) Interest that accrues from money in the account.
    (e) Money in the dealer compliance account at the end of a state fiscal year does not revert to the state general fund.
    (f) Money in the dealer compliance account is continuously appropriated to the secretary of state for the purposes of the account.
As added by P.L.106-2008, SEC.32.