{"id":345284,"date":"2026-10-23T15:33:38","date_gmt":"2026-10-23T22:33:38","guid":{"rendered":"https:\/\/www.dmv.ca.gov\/portal\/?post_type=dmv_handbook&#038;p=345284"},"modified":"2026-10-23T15:46:29","modified_gmt":"2026-10-23T22:46:29","slug":"key-dealer-requirements-under-the-cars-act","status":"publish","type":"dmv_handbook","link":"https:\/\/www.dmv.ca.gov\/portal\/handbook\/vehicle-industry-registration-procedures-manual-2\/new-vehicles-sold-by-california-dealers\/key-dealer-requirements-under-the-cars-act\/","title":{"rendered":"6.030 Key Dealer Requirements Under the CARs Act (CCC \u00a7\u00a71784.20-23, 1784.28, 1784.30-31, 1784.40-44 VC \u00a7\u00a711705 and 11713)"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The California Combating Auto Retail Scams (CARS) Act (SB\u202f766) significantly updated California\u2019s auto\u2011retail regulatory framework, replacing prior cancellation\u2011option rules and enhancing advertising, disclosures, and recordkeeping standards. Outlined are dealer obligations, compliance requirements, consumer protections, and potential penalties for violations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><span role=\"region\" class=\"format-label--note\"><span class=\"format-label__text\">Note<\/span>  October\u202f1,\u202f2026, the CARS Act applies to all licensed California dealers engaging in retail sales or leases of light\u2011duty vehicles under 10,000 lbs., with certain exemptions (for example, wholesale, fleet, and auction).<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Key Dealer Requirements Under the CARS Act&nbsp;<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Mandatory Total Price Disclosure<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Dealers must clearly and conspicuously disclose the total price in:\n<ul class=\"wp-block-list\">\n<li>Any advertisement referring to a specific vehicle or financing terms.<\/li>\n\n\n\n<li>The first written communication with a consumer (email, text message, quote, credit application, etc.)<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Prohibition on Misrepresentations<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Dealers are prohibited from misrepresenting any material information relating to:Vehicle pricing and availability\n<ul class=\"wp-block-list\">\n<li>Financing or lease terms<\/li>\n\n\n\n<li>Add-on product benefits, limitations, or costs<\/li>\n\n\n\n<li>Trade-in payoffs and repossession circumstances<\/li>\n\n\n\n<li>Consumer credit application information<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Add-On Product Regulations\u00a0<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Dealers must:\n<ul class=\"wp-block-list\">\n<li>Clearly disclose that all add-on products are optional, both verbally and in writing (minimum 12 pt. type).<\/li>\n\n\n\n<li>Ensure add-ons provide meaningful benefit to the consumer.<\/li>\n\n\n\n<li>Refrain from selling \u201cvalueless\u201d products (for example, oil changes for EVs and non-beneficial nitrogen tire fills).<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Mandatory 3-Day Cancellation Right for Used Vehicles<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Act replaces the prior optional 2-day paid cancellation agreement.<\/li>\n\n\n\n<li>Dealers must now provide an automatic 3\u2011day cooling-off right for used vehicles priced at $50,000 or less.<\/li>\n\n\n\n<li>Consumers may cancel the contract within three business days, subject to mileage and condition requirements.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Recordkeeping Requirements\u00a0<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Dealers must retain all compliance documentation for two years, including:\n<ul class=\"wp-block-list\">\n<li>Advertisements<\/li>\n\n\n\n<li>Pricing communications<\/li>\n\n\n\n<li>Add-on disclosures and consents<\/li>\n\n\n\n<li>Cancellation-related documents Visit our Web Site\u2014dmv.ca.gov<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Dealer Penalties for Violations<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The CARS Act does not specify fixed per\u2011violation fine schedules; however, violations trigger enforcement through powerful existing California statutes and regulatory agencies.<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Civil Penalties<\/strong> \u00a0<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Violations may be enforced under:\n<ul class=\"wp-block-list\">\n<li>Unfair Competition Law (UCL)<\/li>\n\n\n\n<li>False Advertising Law (FAL)<\/li>\n\n\n\n<li>Consumer Legal Remedies Act (CLRA)<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>These laws enable:\n<ul class=\"wp-block-list\">\n<li>Civil penalties (up to $2,500 per violation under UCL)<\/li>\n\n\n\n<li>Restitution and injunctive relief<\/li>\n\n\n\n<li>Attorneys\u2019 fees and potential class-action exposure<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Administrative Penalties<\/strong> \u00a0<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Agencies with enforcement authority include:\n<ul class=\"wp-block-list\">\n<li>Department of Motor Vehicles (DMV)<\/li>\n\n\n\n<li>Bureau of Automotive Repair (BAR)<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li>Penalties may include:\n<ul class=\"wp-block-list\">\n<li>License suspension or revocation<\/li>\n\n\n\n<li>Administrative fines<\/li>\n\n\n\n<li>Surety bond claims (dealer $50,000 bond requirements remain unchanged)<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Contractual &amp; Transactional Penalties\u00a0<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Dealers who fail to comply with cancellation requirements or misstate add-on<\/li>\n\n\n\n<li>eligibility can be required to:\n<ul class=\"wp-block-list\">\n<li>Refund down payments and trade-in values<\/li>\n\n\n\n<li>Reverse financing contracts<\/li>\n\n\n\n<li>Provide restitution for prohibited or non-beneficial add-ons<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Recordkeeping Violations<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Failure to retain the required two years of records can result in:\n<ul class=\"wp-block-list\">\n<li>Enforcement actions by the Department of Motor Vehicles (DMV)\/Bureau of Automotive Repair (BAR).<\/li>\n\n\n\n<li>Inability to demonstrate compliance, increasing liability exposure.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<div class=\"wp-block-dmv-spacer-block spacer-box\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\">For more information or questions regarding dealer licensing enforcement, fraud or criminal violations, location and contact information can be found at https:\/\/www.dmv.ca.gov\/portal\/locations\/investigations-offices\/.<\/p>\n","protected":false},"featured_media":0,"parent":13633,"menu_order":7,"template":"","dmv_task":[11],"dmv_functional_page_type":[64],"dmv_handbook_category":[595],"class_list":["post-345284","dmv_handbook","type-dmv_handbook","status-publish","hentry","dmv_task-educational","dmv_functional_page_type-informational","dmv_handbook_category-vehicle-industry-reg-procedures-manual"],"featured_image_src":null,"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.7 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>6.030 Key Dealer Requirements Under the CARs Act (CCC \u00a7\u00a71784.20-23, 1784.28, 1784.30-31, 1784.40-44 VC \u00a7\u00a711705 and 11713) - California DMV<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.dmv.ca.gov\/portal\/handbook\/vehicle-industry-registration-procedures-manual-2\/new-vehicles-sold-by-california-dealers\/key-dealer-requirements-under-the-cars-act\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"6.030 Key Dealer Requirements Under the CARs Act (CCC \u00a7\u00a71784.20-23, 1784.28, 1784.30-31, 1784.40-44 VC \u00a7\u00a711705 and 11713) - California DMV\" \/>\n<meta property=\"og:description\" content=\"The California Combating Auto Retail Scams (CARS) Act (SB\u202f766) significantly updated California\u2019s auto\u2011retail regulatory framework, replacing prior cancellation\u2011option rules and enhancing advertising, disclosures, and recordkeeping standards. 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