2.075 Report of Sale Books Issued to Licensees (VC §11714)

Some dealers are also licensed as dismantlers. The two businesses must be completely separate from each other.

A Report of Sale–Used Vehicle (REG 51) form must be completed for any vehicle sold from the dealer’s inventory.

2.075 Report of Sale Books Issued to Licensees (VC §11714)

Reports of sale and dismantler acquisition forms must be ordered by mailing a completed supply order form to the Occupational Licensing section at the address shown on the form.

Supply order forms are available on the DMV website at dmv.ca.gov.

2.065 Remanufacturer (VC §507.8)

A renter is in the business of renting, leasing, or bailing vehicles at a fixed rate or price for a term not exceeding four months. A renter is not a dealer (VC §286(j)).

2.065 Remanufacturer (VC §507.8)

A remanufacturer is a person who, for commission, money, or other value produces a vehicle consisting of any used, reconditioned integral parts, including but not limited to the frame, engine, transmission, axles, brakes, or suspension, which is subject to registration. A remanufacturer is not a person who incidentally repairs, restores, or modifies an existing vehicle by replacing or adding parts or accessories.

Remanufactured Vehicle Dealer (VC §11700)—Remanufacturers licensed as dealers must:

• Report sales of remanufactured vehicles on the Certificate of Remanufactured Vehicle (REG 8) form, which are issued by the Occupational Licensing Unit at DMV headquarters.
• Request REG 8 forms in writing.
• Verbally notify the buyer that the vehicle was remanufactured (VC §11713.7).
• Place the statement “This vehicle has been remanufactured and contains used or reconditioned parts” on:
  • The purchase order or conditional sales contract signed by the buyer.
  • Any advertisement pertaining to the remanufactured vehicle.
  • A remanufactured vehicle displayed for retail purposes or at the location where the vehicle is displayed.

2.055 Manufacturer (VC §672)

A registration service is a person engaged in the business of soliciting or receiving any application for registration, renewal of registration, or transfer of registration or ownership of a vehicle subject to registration under the VC, or transmitting or presenting any of those documents to DMV, when compensation is solicited or received for the service. Registration service includes, but is not limited to, a person who for compensation processes registration documents, conducts lien sales, or processes vehicle dismantling documents.

No person shall act as a registration service, without a valid license or temporary permit issued by DMV (VC §11400).

Registration service does not include a:

• Person performing registration service on a vehicle acquired by that person for their own personal use or for use in the regular course of that person’s business.
• Person who solicits applications for or sells for compensation, nonresident permits for the operation of vehicles within this state. An employee of one or more dealers or dismantlers, or a combination thereof, who performs registration services for vehicles acquired by, consigned to, or sold by the employing dealers or dismantlers.
• Motor club, as defined in California Insurance Code §12142.
• Common carrier acting in the regular course of its business in transmitting applications.

Important Transactions submitted by a registration service to DMV, except those submitted with the Transmittal of Registration Applications (FO 247) form and lien sale applications, must include the registration service’s occupational license (OL) number on the face of the top document of each transaction (CCR §450.32).

2.055 Manufacturer (VC §672)

A manufacturer is a person who produces from raw materials or new basic component parts vehicles subject to registration, off-highway motorcycles, or new commercial vehicles permanently altered for the purpose of retail sale, by converting the vehicles into housecars. Permanently altered does not include the permanent attachment of a camper to a vehicle.

A manufacturer branch is an office maintained by a manufacturer for the sale of new vehicles to dealers, or for directing or supervising, in whole or in part, the manufacturer’s representatives (VC §389).

Unless a manufacturer either grants franchises to franchisees in California, or issues vehicle warranties directly to franchisees or consumers in this state, the manufacturer must have an established place of business or a representative in California.

2.050 License Required

It is unlawful for a person to act as a dealer, distributor, manufacturer, remanufacturer, transporter, or any of its branches without first obtaining a license or temporary permit issued by DMV. Each business or its branch must make application to DMV for a special license plate and submit proof of status as a bona fide dealer, distributor, manufacturer, remanufacturer, transporter, or any of its branches, as may be reasonably required by DMV (VC §11700).

It is unlawful for:

• A lessor-retailer to make a retail sale of a vehicle subject to registration, without first having either a vehicle dealer license, a lessor-retailer license, or a temporary permit issued by DMV.
• A lessor-retailer with a suspended, revoked, invalidated, or expired license to make a retail sale of a vehicle subject to registration (VC §11600).
• A person who, for compensation, acts as a registration service without first obtaining a registration service license or temporary permit issued by DMV (VC §11400).

Important Information on obtaining the required license for each of the licensees listed can be found by searching Occupational Licenses on the DMV website.

2.045 Lessor-Retailer (VC §373)

A lessor-retailer is a lessor or renter who sells previously leased or rented vehicles to the public.

This does not include sales to:

• The lessee of the vehicle.
• The person who, for a period of at least one year, has been designated by the lessee as the driver of the vehicle covered by a written lease agreement.
• A buyer for agricultural, business, or commercial purposes.
• A government, government agency, or instrumentality. A lessor-retailer must secure either a vehicle dealer or lessor-retailer license to conduct this activity (VC §11600).

2.040 Lemon Law Buybacks and Warranty Returns (VC §§4453 and 11713.12, CCC §§1793.22-25)

California Civil Code (CCC) §1793.22 requires vehicle manufacturers to replace a new vehicle, or make restitution to the consumer if, after making a reasonable number of attempts to repair it, the vehicle does not conform to applicable warranties. This is commonly known as the “Lemon Law.”

DMV is required to identify these vehicles on the titling documents. This includes vehicles for which similarly marked nonresident titling documents are submitted.

DMV identifies these vehicles as:

• Lemon Law Buyback—A vehicle reacquired by the manufacturer on or after January 1, 1996.
• Warranty Return—A vehicle reacquired by the manufacturer on or prior to December 31, 1995. The registration certificate for some warranty return vehicles may reflect an abbreviated brand of “WARNTY RET.”

The certificate of title and registration card are branded. The brand serves as notification to subsequent buyers that the vehicle was previously returned to the manufacturer because it did not conform to applicable warranties.

Note Customers with questions regarding the process may obtain a copy of the Department of Consumer Affairs brochure, Lemon-aid For Consumers.

Lemon Law Buyback Vehicles Procedures

Vehicles reacquired by the manufacturer because of a specific warranty defect, on or after January 1, 1996, including vehicles registered in another state must be marked with the brand “LEMON LAW BUYBACK.”

Manufacturer Notification Requirements

The manufacturer of any vehicle reacquired on or after January 1, 1996, because of a specific warranty defect must:

• Obtain a title and registration to the vehicle in the manufacturer’s name marked with the notation “LEMON LAW BUYBACK”.
• Furnish and affix a decal to the vehicle which states that the title has been inscribed with the term “Lemon Law Buyback”.
  • The decal is affixed to the vehicle’s left-door frame; primary front entrance (right-door frame) on vehicles not having a left door, such as recreational vehicles; or in a prominent area on the left side of vehicles without doors, such as motorcycles.
• Notify the transferee/buyer of the vehicle of the warranty defect(s) in writing.

Issuance of Title in Manufacturer’s Name

The basic requirements for the transaction type apply when a lemon law buyback vehicle is registered in the manufacturer’s name, except:

• A document/statement indicating the vehicle is a lemon law buyback must be included with the application.
  • The dealer’s or manufacturer’s letterhead or a Statement of Facts (REG 256) (PDF) form may be used for this purpose.
• A smog certification is not required.
• The vehicle license fee (VLF) is not reclassified.
• A prior history fee is due to mark the record of the reacquired vehicle.
• Use tax is not due.
• Fees are due upon retail sale of the vehicle.

Disclosure Statement Requirement

• After the manufacturer replaces the warranty return vehicle or reimburses the consumer, the vehicle can be resold as a used vehicle.
  • Generally, the vehicles are sold through a dealer. However, the manufacturer will always be reflected in the chain of ownership for the vehicle.
• Any dealer selling a vehicle that is known to have been replaced or accepted for restitution under the consumer warranty laws of California, any other state, or federal law must include a disclosure statement signed by the new owner with the titling documents required to register the vehicle.
  • This includes vehicles with similarly branded out-of-state documents for which the dealer has knowledge of the vehicle’s return.
  • The disclosure statement may be on a Statement of Facts (REG 256) (PDF) form, dealer’s letterhead, or manufacturer’s invoice.
  • The disclosure statement must identify the vehicle, be personally signed by the buyer (signatures by power of attorney are not acceptable) include the following statement:
    “This motor vehicle has been returned to the dealer or manufacturer due to a defect in the vehicle pursuant to consumer warranty laws.”
• All the following must be disclosed to a transferee:
  • The year, make, model, and vehicle identification number (VIN) of the vehicle.
  • Whether the title to the vehicle is marked “Lemon Law Buyback.”
  • The nature of each nonconformity reported by the original vehicle buyer or lessee.
  • Repairs, if any, made to the vehicle in an attempt to correct each nonconformity.
• The notification must be on white (8.5 x 11 inch) letter-size paper in black print no smaller than 10-point.
  • The notification is not submitted as part of the registration application.

Warranty Returns

Vehicles reacquired prior to January 1, 1996, are referred to and branded as a “WARRANTY RETURN” on the California title (some may show “WARNTY RET”).

• The registration application for a warranty return vehicle sold by a dealer must include the following disclosure statement:
  “This motor vehicle has been returned to the dealer or manufacturer due to a defect in the vehicle, pursuant to consumer warranty laws.”
• The disclosure may be on a Statement of Facts (REG 256) (PDF) form, dealer’s letterhead, or manufacturer’s invoice.
  • It must identify the vehicle and be personally signed by the buyer.
  • Signatures by power of attorney are not acceptable.
  • This includes vehicles with similarly branded out-of-state documents for which the dealer has knowledge of the vehicle’s return.

2.035 Distributor (VC §296)

A distributor is any person, other than a manufacturer, who:

• Sells or distributes new vehicles, off-highway vehicles, motorcycles, and trailers subject to registration or identification under the Vehicle Code to dealers in this state.
• Maintains representatives for the purpose of contacting dealers/prospective dealers in this state.

A distributor must obtain a Letter of Appointment from a California-licensed manufacturer for the product(s) being distributed.