{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/46.2-1573.20.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/46.2-1573.20.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/46.2-1573.20.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/46.2-1573.20.html"}],"law_id":78599,"edition_id":1,"section_id":78599,"structure_id":16127,"section_number":"46.2-1573.20","catch_line":"Warranty obligations","history":"1996, cc. 1043, 1052, \u00a7 46.2-1992.72; 2015, c. 615.","full_text":"A\n\nEach trailer manufacturer, factory branch, distributor, or distributor branch shall (i) specify in writing to each of its trailer dealers licensed in the Commonwealth the dealer’s obligations for preparation, delivery, and warranty service on its products and (ii) compensate the dealer for warranty parts, service, and diagnostic work required of the dealer by the manufacturer or distributor as follows:1\n\nCompensation of a dealer for warranty parts, service, and diagnostic work shall not be less than the amounts charged by the dealer for the manufacturer’s or distributor’s original parts, service, and diagnostic work to retail customers for nonwarranty service, parts, and diagnostic work installed or performed in the dealer’s service department unless the amounts are not reasonable;2\n\nFor purposes of determining warranty parts and service compensation, menu-priced parts or services, group discounts, special event discounts, and special event promotions shall not be considered in determining amounts charged by the dealer to retail customers;3\n\nIncreases in dealer warranty parts and service compensation and diagnostic work compensation, pursuant to this section, shall be requested by the dealer in writing, shall be based on 100 consecutive repair orders or all repair orders over a 90-day period, whichever occurs first, and, in the case of parts, shall be stated as a percentage of markup that shall be uniformly applied to all the manufacturer’s or distributor’s parts;4\n\nIn the case of warranty parts compensation, the provisions of this subsection shall be effective only for model year 1992 and succeeding model years;5\n\nIf a manufacturer or distributor furnishes a part to a dealer at no cost for use by the dealer in performing work for which the manufacturer or distributor is required to compensate the dealer under this section, the manufacturer or distributor shall compensate the dealer for the part in the same manner as warranty parts compensation, less the wholesale costs, for such part as listed in the manufacturer’s current price schedules; or6\n\nIn the case of service work, manufacturer original parts or parts otherwise specified by the manufacturer or distributor, and parts provided by a dealer either pursuant to an adjustment program as defined in § 59.1-207.34 or as otherwise requested by the manufacturer or distributor, the dealer shall be compensated in the same manner as for warranty service or parts.\n\t\t\t\tThis section does not apply to compensation for parts such as components, systems, fixtures, appliances, furnishings, accessories, and features that are designed, used, and maintained primarily for nonvehicular, residential purposes. Warranty audits of dealer records may be conducted by the manufacturer, factory branch, distributor, or distributor branch on a reasonable basis, and dealer claims for warranty compensation shall not be denied except for good cause, such as performance of nonwarranty repairs, lack of material documentation, fraud, or misrepresentation. Claims for dealer compensation shall be paid within 30 days of dealer submission or within 30 days of the end of an incentive program or rejected in writing for stated reasons. The manufacturer, factory branch, distributor, or distributor branch shall reserve the right to reasonable periodic audits to determine the validity of all such paid claims for dealer compensation. Any chargebacks for warranty parts or service compensation and service incentives shall only be for the 12-month period immediately following the date of the claim and, in the case of chargebacks for sales compensation only, for the 18-month period immediately following the date of claim. However, such limitations shall not be effective in the case of intentionally false or fraudulent claims.B\n\nIt shall be unlawful for any trailer manufacturer, factory branch, distributor, or distributor branch to:1\n\nFail to perform any of its warranty obligations, including tires, with respect to a trailer;2\n\nFail to assume all responsibility for any liability resulting from structural or production defects;3\n\nFail to include in written notices of factory recalls to trailer owners and dealers the expected date by which necessary parts and equipment will be available to dealers for the correction of defects;4\n\nFail to compensate any of the trailer dealers licensed in the Commonwealth for repairs effected by the dealer of merchandise damaged in manufacture or transit to the dealer where the carrier is designated by the manufacturer, factory branch, distributor, or distributor branch;5\n\nFail to compensate its trailer dealers licensed in the Commonwealth for warranty parts, work, and service pursuant to subsection A or for legal costs and expenses incurred by such dealers in connection with warranty obligations for which the manufacturer, factory branch, distributor, or distributor branch is legally responsible or that the manufacturer, factory branch, distributor, or distributor branch imposes upon the dealer;6\n\nMisrepresent in any way to purchasers of trailers that warranties with respect to the manufacture, performance, or design of the trailer are made by the dealer, either as warrantor or co-warrantor;7\n\nRequire the dealer to make warranties to customers in any manner related to the manufacture, performance, or design of the trailer; or8\n\nShift or attempt to shift to the trailer dealer, directly or indirectly, any liabilities of the manufacturer, factory branch, distributor, or distributor branch under the Virginia Motor Vehicle Warranty Enforcement Act (§ 59.1-207.9 et seq.), unless such liability results from the act or omission by the dealer.C\n\nNotwithstanding the terms of any franchise, it shall be unlawful for any trailer manufacturer, factory branch, distributor, or distributor branch to fail to indemnify and hold harmless its trailer dealers against any losses or damages arising out of complaints, claims, or suits relating to the manufacture, assembly, or design of trailers, parts, or accessories, or other functions by the manufacturer, factory branch, distributor, or distributor branch beyond the control of the dealer, including, without limitation, the selection by the manufacturer, factory branch, distributor, or distributor branch of parts or components for the trailer or any damages to merchandise occurring in transit to the dealer where the carrier is designated by the manufacturer, factory branch, distributor, or distributor branch. The dealer shall notify the manufacturer of pending suits in which allegations are made that come within this subsection whenever reasonably practicable to do so. Every trailer dealer franchise issued to, amended, or renewed for trailer dealers in the Commonwealth shall be construed to incorporate provisions consistent with the requirements of this subsection.D\n\nOn any new trailer, any uncorrected damage or any corrected damage exceeding three percent of the manufacturer’s or distributor’s suggested retail price as defined in 15 U.S.C. \u00a7\u00a7 1231-1233, as measured by retail repair costs, must be disclosed to the dealer in writing prior to delivery. Factory mechanical repair and damage to glass, tires, and bumpers are excluded from the three percent rule when properly replaced by identical manufacturer’s or distributor’s original equipment or parts. Whenever a new trailer is damaged in transit, when the carrier or means of transportation is determined by the manufacturer or distributor, or whenever a trailer is otherwise damaged prior to delivery to the new trailer dealer, the new trailer dealer shall:1\n\nNotify the manufacturer or distributor of the damage within three business days from the date of delivery of the new trailer to the new trailer dealership or within the additional time specified in the franchise; and2\n\nRequest from the manufacturer or distributor authorization to replace the components, parts, and accessories damaged or otherwise correct the damage, unless the damage to the trailer exceeds the three percent rule, in which case the dealer may reject the trailer within three business days.E\n\nIf the manufacturer or distributor refuses or fails to authorize correction of such damage within 10 days after receipt of notification, or if the dealer rejects the trailer because damage exceeds the three percent rule, ownership of the new trailer shall revert to the manufacturer or distributor, and the new trailer dealer shall have no obligation, financial or otherwise, with respect to such trailer. Should either the manufacturer, distributor, or the dealer elect to correct the damage or any other damage exceeding the three percent rule, full disclosure shall be made by the dealer in writing to the buyer and an acknowledgment by the buyer is required. If there is less than three percent damage, no disclosure is required, provided that the damage has been corrected. Predelivery mechanical work shall not require a disclosure. Failure to disclose any corrected damage within the knowledge of the selling dealer to a new trailer in excess of the three percent rule shall constitute grounds for revocation of the buyer order, provided that, within 30 days of purchase, the trailer is returned to the dealer with an accompanying written notice of the grounds for revocation. In case of revocation pursuant to this section, the dealer shall accept the trailer and refund any payments made to the dealer in connection with the transaction, less a reasonable allowance for the consumer’s use of the trailer as defined in § 59.1-207.11.F\n\nIf there is a dispute between the manufacturer, factory branch, distributor, or distributor branch and the dealer with respect to any matter referred to in subsection A, B, or C, either party may petition the Commissioner in writing, within 30 days after either party has given written notice of the dispute to the other, for a hearing. The decision of the Commissioner shall be binding on the parties, subject to rights of judicial review and appeal as provided in the Administrative Process Act (§ 2.2-4000 et seq.). However, nothing contained in this section shall give the Commissioner any authority as to the content or interpretation of any manufacturer’s or distributor’s warranty.","order_by":null,"text":{"0":{"id":281647,"text":"Each trailer manufacturer, factory branch, distributor, or distributor branch shall (i) specify in writing to each of its trailer dealers licensed in the Commonwealth the dealer’s obligations for preparation, delivery, and warranty service on its products and (ii) compensate the dealer for warranty parts, service, and diagnostic work required of the dealer by the manufacturer or distributor as follows:","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"A1"},"1":{"id":281648,"text":"Compensation of a dealer for warranty parts, service, and diagnostic work shall not be less than the amounts charged by the dealer for the manufacturer’s or distributor’s original parts, service, and diagnostic work to retail customers for nonwarranty service, parts, and diagnostic work installed or performed in the dealer’s service department unless the amounts are not reasonable;","type":"section","prefixes":["A","1"],"prefix":"1","entire_prefix":"A1","prefix_anchor":"A1","level":2,"prior_prefix":"A","next_prefix":"A2"},"2":{"id":281649,"text":"For purposes of determining warranty parts and service compensation, menu-priced parts or services, group discounts, special event discounts, and special event promotions shall not be considered in determining amounts charged by the dealer to retail customers;","type":"section","prefixes":["A","2"],"prefix":"2","entire_prefix":"A2","prefix_anchor":"A2","level":2,"prior_prefix":"A1","next_prefix":"A3"},"3":{"id":281650,"text":"Increases in dealer warranty parts and service compensation and diagnostic work compensation, pursuant to this section, shall be requested by the dealer in writing, shall be based on 100 consecutive repair orders or all repair orders over a 90-day period, whichever occurs first, and, in the case of parts, shall be stated as a percentage of markup that shall be uniformly applied to all the manufacturer’s or distributor’s parts;","type":"section","prefixes":["A","3"],"prefix":"3","entire_prefix":"A3","prefix_anchor":"A3","level":2,"prior_prefix":"A2","next_prefix":"A4"},"4":{"id":281651,"text":"In the case of warranty parts compensation, the provisions of this subsection shall be effective only for model year 1992 and succeeding model years;","type":"section","prefixes":["A","4"],"prefix":"4","entire_prefix":"A4","prefix_anchor":"A4","level":2,"prior_prefix":"A3","next_prefix":"A5"},"5":{"id":281652,"text":"If a manufacturer or distributor furnishes a part to a dealer at no cost for use by the dealer in performing work for which the manufacturer or distributor is required to compensate the dealer under this section, the manufacturer or distributor shall compensate the dealer for the part in the same manner as warranty parts compensation, less the wholesale costs, for such part as listed in the manufacturer’s current price schedules; or","type":"section","prefixes":["A","5"],"prefix":"5","entire_prefix":"A5","prefix_anchor":"A5","level":2,"prior_prefix":"A4","next_prefix":"A6"},"6":{"id":281653,"text":"In the case of service work, manufacturer original parts or parts otherwise specified by the manufacturer or distributor, and parts provided by a dealer either pursuant to an adjustment program as defined in § 59.1-207.34 or as otherwise requested by the manufacturer or distributor, the dealer shall be compensated in the same manner as for warranty service or parts.\n\t\t\t\tThis section does not apply to compensation for parts such as components, systems, fixtures, appliances, furnishings, accessories, and features that are designed, used, and maintained primarily for nonvehicular, residential purposes. Warranty audits of dealer records may be conducted by the manufacturer, factory branch, distributor, or distributor branch on a reasonable basis, and dealer claims for warranty compensation shall not be denied except for good cause, such as performance of nonwarranty repairs, lack of material documentation, fraud, or misrepresentation. Claims for dealer compensation shall be paid within 30 days of dealer submission or within 30 days of the end of an incentive program or rejected in writing for stated reasons. The manufacturer, factory branch, distributor, or distributor branch shall reserve the right to reasonable periodic audits to determine the validity of all such paid claims for dealer compensation. Any chargebacks for warranty parts or service compensation and service incentives shall only be for the 12-month period immediately following the date of the claim and, in the case of chargebacks for sales compensation only, for the 18-month period immediately following the date of claim. However, such limitations shall not be effective in the case of intentionally false or fraudulent claims.","type":"section","prefixes":["A","6"],"prefix":"6","entire_prefix":"A6","prefix_anchor":"A6","level":2,"prior_prefix":"A5","next_prefix":"B"},"7":{"id":281654,"text":"It shall be unlawful for any trailer manufacturer, factory branch, distributor, or distributor branch to:","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A6","next_prefix":"B1"},"8":{"id":281655,"text":"Fail to perform any of its warranty obligations, including tires, with respect to a trailer;","type":"section","prefixes":["B","1"],"prefix":"1","entire_prefix":"B1","prefix_anchor":"B1","level":2,"prior_prefix":"B","next_prefix":"B2"},"9":{"id":281656,"text":"Fail to assume all responsibility for any liability resulting from structural or production defects;","type":"section","prefixes":["B","2"],"prefix":"2","entire_prefix":"B2","prefix_anchor":"B2","level":2,"prior_prefix":"B1","next_prefix":"B3"},"10":{"id":281657,"text":"Fail to include in written notices of factory recalls to trailer owners and dealers the expected date by which necessary parts and equipment will be available to dealers for the correction of defects;","type":"section","prefixes":["B","3"],"prefix":"3","entire_prefix":"B3","prefix_anchor":"B3","level":2,"prior_prefix":"B2","next_prefix":"B4"},"11":{"id":281658,"text":"Fail to compensate any of the trailer dealers licensed in the Commonwealth for repairs effected by the dealer of merchandise damaged in manufacture or transit to the dealer where the carrier is designated by the manufacturer, factory branch, distributor, or distributor branch;","type":"section","prefixes":["B","4"],"prefix":"4","entire_prefix":"B4","prefix_anchor":"B4","level":2,"prior_prefix":"B3","next_prefix":"B5"},"12":{"id":281659,"text":"Fail to compensate its trailer dealers licensed in the Commonwealth for warranty parts, work, and service pursuant to subsection A or for legal costs and expenses incurred by such dealers in connection with warranty obligations for which the manufacturer, factory branch, distributor, or distributor branch is legally responsible or that the manufacturer, factory branch, distributor, or distributor branch imposes upon the dealer;","type":"section","prefixes":["B","5"],"prefix":"5","entire_prefix":"B5","prefix_anchor":"B5","level":2,"prior_prefix":"B4","next_prefix":"B6"},"13":{"id":281660,"text":"Misrepresent in any way to purchasers of trailers that warranties with respect to the manufacture, performance, or design of the trailer are made by the dealer, either as warrantor or co-warrantor;","type":"section","prefixes":["B","6"],"prefix":"6","entire_prefix":"B6","prefix_anchor":"B6","level":2,"prior_prefix":"B5","next_prefix":"B7"},"14":{"id":281661,"text":"Require the dealer to make warranties to customers in any manner related to the manufacture, performance, or design of the trailer; or","type":"section","prefixes":["B","7"],"prefix":"7","entire_prefix":"B7","prefix_anchor":"B7","level":2,"prior_prefix":"B6","next_prefix":"B8"},"15":{"id":281662,"text":"Shift or attempt to shift to the trailer dealer, directly or indirectly, any liabilities of the manufacturer, factory branch, distributor, or distributor branch under the Virginia Motor Vehicle Warranty Enforcement Act (§ 59.1-207.9 et seq.), unless such liability results from the act or omission by the dealer.","type":"section","prefixes":["B","8"],"prefix":"8","entire_prefix":"B8","prefix_anchor":"B8","level":2,"prior_prefix":"B7","next_prefix":"C"},"16":{"id":281663,"text":"Notwithstanding the terms of any franchise, it shall be unlawful for any trailer manufacturer, factory branch, distributor, or distributor branch to fail to indemnify and hold harmless its trailer dealers against any losses or damages arising out of complaints, claims, or suits relating to the manufacture, assembly, or design of trailers, parts, or accessories, or other functions by the manufacturer, factory branch, distributor, or distributor branch beyond the control of the dealer, including, without limitation, the selection by the manufacturer, factory branch, distributor, or distributor branch of parts or components for the trailer or any damages to merchandise occurring in transit to the dealer where the carrier is designated by the manufacturer, factory branch, distributor, or distributor branch. The dealer shall notify the manufacturer of pending suits in which allegations are made that come within this subsection whenever reasonably practicable to do so. Every trailer dealer franchise issued to, amended, or renewed for trailer dealers in the Commonwealth shall be construed to incorporate provisions consistent with the requirements of this subsection.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B8","next_prefix":"D"},"17":{"id":281664,"text":"On any new trailer, any uncorrected damage or any corrected damage exceeding three percent of the manufacturer’s or distributor’s suggested retail price as defined in 15 U.S.C. \u00a7\u00a7 1231-1233, as measured by retail repair costs, must be disclosed to the dealer in writing prior to delivery. Factory mechanical repair and damage to glass, tires, and bumpers are excluded from the three percent rule when properly replaced by identical manufacturer’s or distributor’s original equipment or parts. Whenever a new trailer is damaged in transit, when the carrier or means of transportation is determined by the manufacturer or distributor, or whenever a trailer is otherwise damaged prior to delivery to the new trailer dealer, the new trailer dealer shall:","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"D1"},"18":{"id":281665,"text":"Notify the manufacturer or distributor of the damage within three business days from the date of delivery of the new trailer to the new trailer dealership or within the additional time specified in the franchise; and","type":"section","prefixes":["D","1"],"prefix":"1","entire_prefix":"D1","prefix_anchor":"D1","level":2,"prior_prefix":"D","next_prefix":"D2"},"19":{"id":281666,"text":"Request from the manufacturer or distributor authorization to replace the components, parts, and accessories damaged or otherwise correct the damage, unless the damage to the trailer exceeds the three percent rule, in which case the dealer may reject the trailer within three business days.","type":"section","prefixes":["D","2"],"prefix":"2","entire_prefix":"D2","prefix_anchor":"D2","level":2,"prior_prefix":"D1","next_prefix":"E"},"20":{"id":281667,"text":"If the manufacturer or distributor refuses or fails to authorize correction of such damage within 10 days after receipt of notification, or if the dealer rejects the trailer because damage exceeds the three percent rule, ownership of the new trailer shall revert to the manufacturer or distributor, and the new trailer dealer shall have no obligation, financial or otherwise, with respect to such trailer. Should either the manufacturer, distributor, or the dealer elect to correct the damage or any other damage exceeding the three percent rule, full disclosure shall be made by the dealer in writing to the buyer and an acknowledgment by the buyer is required. If there is less than three percent damage, no disclosure is required, provided that the damage has been corrected. Predelivery mechanical work shall not require a disclosure. Failure to disclose any corrected damage within the knowledge of the selling dealer to a new trailer in excess of the three percent rule shall constitute grounds for revocation of the buyer order, provided that, within 30 days of purchase, the trailer is returned to the dealer with an accompanying written notice of the grounds for revocation. In case of revocation pursuant to this section, the dealer shall accept the trailer and refund any payments made to the dealer in connection with the transaction, less a reasonable allowance for the consumer’s use of the trailer as defined in § 59.1-207.11.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D2","next_prefix":"F"},"21":{"id":281668,"text":"If there is a dispute between the manufacturer, factory branch, distributor, or distributor branch and the dealer with respect to any matter referred to in subsection A, B, or C, either party may petition the Commissioner in writing, within 30 days after either party has given written notice of the dispute to the other, for a hearing. The decision of the Commissioner shall be binding on the parties, subject to rights of judicial review and appeal as provided in the Administrative Process Act (§ 2.2-4000 et seq.). However, nothing contained in this section shall give the Commissioner any authority as to the content or interpretation of any manufacturer’s or distributor’s warranty.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E"}},"ancestry":[{"id":16127,"edition_id":1,"name":"Trailer Franchises","identifier":"7.3","label":"article","depth":4,"order_by":1,"parent_id":13356,"metadata":{},"date_created":"2026-06-26 04:06:49","date_modified":"2026-06-26 04:06:49","permalink":{"id":231637,"object_type":"structure","relational_id":16127,"identifier":"7.3","token":"46.2\/IV\/15\/7.3","url":"\/46.2\/IV\/15\/7.3\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13356,"edition_id":1,"name":"Motor Vehicle Dealers","identifier":"15","label":"chapter","depth":3,"order_by":1,"parent_id":13355,"metadata":{},"date_created":"2026-06-26 03:44:42","date_modified":"2026-06-26 03:44:42","permalink":{"id":231067,"object_type":"structure","relational_id":13356,"identifier":"15","token":"46.2\/IV\/15","url":"\/46.2\/IV\/15\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13355,"edition_id":1,"name":"Dealers and Driver Training Schools","identifier":"IV","label":"subtitle","depth":2,"order_by":1,"parent_id":12770,"metadata":{},"date_created":"2026-06-26 03:44:42","date_modified":"2026-06-26 03:44:42","permalink":{"id":231065,"object_type":"structure","relational_id":13355,"identifier":"IV","token":"46.2\/IV","url":"\/46.2\/IV\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12770,"edition_id":1,"name":"Motor Vehicles","identifier":"46.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:52","date_modified":"2026-06-26 03:43:52","permalink":{"id":225289,"object_type":"structure","relational_id":12770,"identifier":"46.2","token":"46.2","url":"\/46.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":81000,"structure_id":16127,"section_number":"46.2-1573.13","catch_line":"Applicability of requirements to certain trailers","url":"\/46.2-1573.13\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.13","metadata":false},{"id":76422,"structure_id":16127,"section_number":"46.2-1573.14","catch_line":"Trailer dealers filing of franchises","url":"\/46.2-1573.14\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.14","metadata":false},{"id":70177,"structure_id":16127,"section_number":"46.2-1573.15","catch_line":"Exemption of franchises from Retail Franchising Act","url":"\/46.2-1573.15\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.15","metadata":false},{"id":83510,"structure_id":16127,"section_number":"46.2-1573.16","catch_line":"Coercion of retail dealer by manufacturer or distributor with respect to retail installment sales contracts prohibited; penalty","url":"\/46.2-1573.16\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.16","metadata":false},{"id":65421,"structure_id":16127,"section_number":"46.2-1573.17","catch_line":"Other coercion of dealers; transfer, grant, succession to and cancellation of dealer franchises; delivery of trailers, parts, and accessories","url":"\/46.2-1573.17\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.17","metadata":false},{"id":80483,"structure_id":16127,"section_number":"46.2-1573.18","catch_line":"Manufacturer or distributor right of first refusal","url":"\/46.2-1573.18\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.18","metadata":false},{"id":71690,"structure_id":16127,"section_number":"46.2-1573.19","catch_line":"Discontinuation of distributors","url":"\/46.2-1573.19\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.19","metadata":false},{"id":78599,"structure_id":16127,"section_number":"46.2-1573.20","catch_line":"Warranty obligations","url":"\/46.2-1573.20\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.20","metadata":false},{"id":63879,"structure_id":16127,"section_number":"46.2-1573.21","catch_line":"Operation of dealership by manufacturer","url":"\/46.2-1573.21\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.21","metadata":false},{"id":64136,"structure_id":16127,"section_number":"46.2-1573.22","catch_line":"Ownership of service facilities","url":"\/46.2-1573.22\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.22","metadata":false},{"id":69569,"structure_id":16127,"section_number":"46.2-1573.23","catch_line":"Hearings and other remedies; civil penalties","url":"\/46.2-1573.23\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.23","metadata":false},{"id":81860,"structure_id":16127,"section_number":"46.2-1573.24","catch_line":"Late model and factory repurchase franchises","url":"\/46.2-1573.24\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.24","metadata":false}],"previous_section":{"id":71690,"structure_id":16127,"section_number":"46.2-1573.19","catch_line":"Discontinuation of distributors","url":"\/46.2-1573.19\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.19","metadata":false},"next_section":{"id":63879,"structure_id":16127,"section_number":"46.2-1573.21","catch_line":"Operation of dealership by manufacturer","url":"\/46.2-1573.21\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.21","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/46.2-1573.20\/","history_text":"

This law was first created in 1996. The record of its establishment is cataloged in chapters 1043<\/a> and 1052<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. It has been modified 1 time. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. That modification is as follows: in 2015, chapter 615<\/a>.<\/p>","references":false,"refers_to":[{"id":86911,"section_number":"2.2-4000","catch_line":"Short title; purpose","order_by":null,"url":"\/2.2-4000\/"},{"id":63318,"section_number":"59.1-207.34","catch_line":"Definitions","order_by":null,"url":"\/59.1-207.34\/"},{"id":83922,"section_number":"59.1-207.9","catch_line":"Short title","order_by":null,"url":"\/59.1-207.9\/"}],"permalink":{"id":231667,"object_type":"law","relational_id":78599,"identifier":"46.2-1573.20","token":"46.2\/IV\/15\/7.3\/46.2-1573.20","url":"\/46.2-1573.20\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/46.2-1573.20\/","token":"46.2\/IV\/15\/7.3\/46.2-1573.20","dublin_core":{"Title":"Warranty obligations","Type":"Text","Format":"text\/html","Identifier":"\u00a7 46.2-1573.20","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Each trailer<\/span> manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> shall (i) specify in writing to each of its trailer<\/span> dealers<\/span> licensed in the Commonwealth the dealer<\/span>’s obligations for preparation, delivery, and warranty service on its products and (ii) compensate the dealer<\/span> for warranty parts, service, and diagnostic work required of the dealer<\/span> by the manufacturer<\/span> or distributor as follows: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> Compensation of a dealer<\/span> for warranty parts, service, and diagnostic work shall not be less than the amounts charged by the dealer<\/span> for the manufacturer<\/span>’s or distributor’s original parts, service, and diagnostic work to retail customers for nonwarranty service, parts, and diagnostic work installed or performed in the dealer<\/span>’s service department<\/span> unless the amounts are not reasonable; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> For purposes of determining warranty parts and service compensation, menu-priced parts or services, group discounts, special event discounts, and special event promotions shall not be considered in determining amounts charged by the dealer<\/span> to retail customers; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> Increases in dealer<\/span> warranty parts and service compensation and diagnostic work compensation, pursuant to this section, shall be requested by the dealer<\/span> in writing, shall be based on 100 consecutive repair orders<\/span> or all repair orders<\/span> over a 90-day period, whichever occurs first, and, in the case of parts, shall be stated as a percentage of markup that shall be uniformly applied to all the manufacturer<\/span>’s or distributor’s parts; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> In the case of warranty parts compensation, the provisions of this subsection shall be effective only for model year 1992 and succeeding model years; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> If a manufacturer<\/span> or distributor furnishes a part to a dealer<\/span> at no cost for use by the dealer<\/span> in performing work for which the manufacturer<\/span> or distributor is required to compensate the dealer<\/span> under this section, the manufacturer<\/span> or distributor shall compensate the dealer<\/span> for the part in the same manner as warranty parts compensation, less the wholesale<\/span> costs, for such part as listed in the manufacturer<\/span>’s current price schedules<\/span>; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

6.<\/span> In the case of service work, manufacturer<\/span> original parts or parts otherwise specified by the manufacturer<\/span> or distributor, and parts provided by a dealer<\/span> either pursuant to an adjustment program as defined in § 59.1-207.34<\/a> or as otherwise requested by the manufacturer<\/span> or distributor, the dealer<\/span> shall be compensated in the same manner as for warranty service or parts.\n\t\t\t\tThis section does not apply to compensation for parts such as components, systems, fixtures, appliances, furnishings, accessories, and features that are designed, used<\/span>, and maintained primarily for nonvehicular, residential purposes. Warranty audits of dealer<\/span> records may be conducted by the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> on a reasonable basis, and dealer<\/span> claims for warranty compensation shall not be denied except for good cause, such as performance of nonwarranty repairs, lack of material<\/span> documentation, fraud<\/span>, or misrepresentation. Claims for dealer<\/span> compensation shall be paid within 30 days of dealer<\/span> submission or within 30 days of the end of an incentive program or rejected in writing for stated reasons. The manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> shall reserve the right to reasonable periodic audits to determine the validity of all such paid claims for dealer<\/span> compensation. Any chargebacks for warranty parts or service compensation and service incentives shall only be for the 12-month period immediately following the date of the claim and, in the case of chargebacks for sales compensation only, for the 18-month period immediately following the date of claim. However, such limitations shall not be effective in the case of intentionally false or fraudulent claims. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> It shall be unlawful for any trailer<\/span> manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> to: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> Fail to perform any of its warranty obligations, including tires, with respect to a trailer<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> Fail to assume all responsibility for any liability resulting from structural or production defects; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> Fail to include in written notices of factory recalls to trailer<\/span> owners<\/span> and dealers<\/span> the expected date by which necessary parts and equipment will be available to dealers<\/span> for the correction of defects; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> Fail to compensate any of the trailer<\/span> dealers<\/span> licensed in the Commonwealth for repairs effected by the dealer<\/span> of merchandise damaged in manufacture or transit to the dealer<\/span> where the carrier is designated by the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> Fail to compensate its trailer<\/span> dealers<\/span> licensed in the Commonwealth for warranty parts, work, and service pursuant to subsection A or for legal costs and expenses incurred by such dealers<\/span> in connection with warranty obligations for which the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> is legally responsible or that the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> imposes upon the dealer<\/span>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

6.<\/span> Misrepresent in any way to purchasers of trailers<\/span> that warranties with respect to the manufacture, performance, or design of the trailer<\/span> are made by the dealer<\/span>, either as warrantor or co-warrantor; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

7.<\/span> Require the dealer<\/span> to make warranties to customers in any manner related to the manufacture, performance, or design of the trailer<\/span>; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

8.<\/span> Shift or attempt to shift to the trailer<\/span> dealer<\/span>, directly or indirectly, any liabilities of the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> under the Virginia Motor Vehicle<\/span> Warranty Enforcement Act (§ 59.1-207.9<\/a> et seq.), unless such liability results from the act or omission by the dealer<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> Notwithstanding the terms of any franchise<\/span>, it shall be unlawful for any trailer<\/span> manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> to fail to indemnify and hold harmless its trailer<\/span> dealers<\/span> against any losses or damages<\/span> arising out of complaints, claims, or suits relating to the manufacture, assembly, or design of trailers<\/span>, parts, or accessories, or other functions by the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> beyond the control of the dealer<\/span>, including, without limitation, the selection by the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> of parts or components for the trailer<\/span> or any damages<\/span> to merchandise occurring in transit to the dealer<\/span> where the carrier is designated by the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span>. The dealer<\/span> shall notify the manufacturer<\/span> of pending suits in which allegations<\/span> are made that come within this subsection whenever reasonably practicable to do so. Every trailer<\/span> dealer<\/span> franchise<\/span> issued to, amended, or renewed for trailer<\/span> dealers<\/span> in the Commonwealth shall be construed to incorporate provisions consistent with the requirements of this subsection. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> On any new trailer<\/span>, any uncorrected damage or any corrected damage exceeding three percent of the manufacturer<\/span>’s or distributor’s suggested retail price as defined in 15 U.S.C. \u00a7\u00a7 1231-1233, as measured by retail repair costs, must be disclosed to the dealer<\/span> in writing prior to delivery. Factory mechanical repair and damage to glass, tires, and bumpers are excluded from the three percent rule when properly replaced by identical manufacturer<\/span>’s or distributor’s original equipment or parts. Whenever a new trailer<\/span> is damaged in transit, when the carrier or means of transportation is determined by the manufacturer<\/span> or distributor, or whenever a trailer is otherwise damaged prior to delivery to the new trailer<\/span> dealer<\/span>, the new trailer<\/span> dealer<\/span> shall: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> Notify the manufacturer<\/span> or distributor of the damage within three business days from the date of delivery of the new trailer<\/span> to the new trailer<\/span> dealership or within the additional time specified in the franchise<\/span>; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> Request from the manufacturer<\/span> or distributor authorization to replace the components, parts, and accessories damaged or otherwise correct the damage, unless the damage to the trailer exceeds the three percent rule, in which case the dealer<\/span> may reject the trailer within three business days. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> If the manufacturer<\/span> or distributor refuses or fails to authorize correction of such damage within 10 days after receipt of notification, or if the dealer<\/span> rejects the trailer because damage exceeds the three percent rule, ownership of the new trailer<\/span> shall revert to the manufacturer<\/span> or distributor, and the new trailer<\/span> dealer<\/span> shall have no obligation, financial or otherwise, with respect to such trailer. Should either the manufacturer<\/span>, distributor, or the dealer<\/span> elect to correct the damage or any other damage exceeding the three percent rule, full disclosure shall be made by the dealer<\/span> in writing to the buyer and an acknowledgment by the buyer is required. If there is less than three percent damage, no disclosure is required, provided that the damage has been corrected. Predelivery mechanical work shall not require a disclosure. Failure to disclose any corrected damage within the knowledge of the selling dealer<\/span> to a new trailer<\/span> in excess of the three percent rule shall constitute grounds for revocation<\/span> of the buyer order<\/span>, provided that, within 30 days of purchase, the trailer is returned to the dealer<\/span> with an accompanying written notice of the grounds for revocation<\/span>. In case of revocation<\/span> pursuant to this section, the dealer<\/span> shall accept the trailer and refund any payments made to the dealer<\/span> in connection with the transaction, less a reasonable allowance for the consumer’s use of the trailer as defined in § 59.1-207.11<\/a>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> If there is a dispute between the manufacturer<\/span>, factory branch<\/span>, distributor, or distributor branch<\/span> and the dealer<\/span> with respect to any matter referred to in subsection A, B, or C, either party<\/span> may petition<\/span> the Commissioner<\/span> in writing, within 30 days after either party<\/span> has given written notice of the dispute to the other, for a hearing<\/span>. The decision of the Commissioner<\/span> shall be binding on the parties, subject to rights of judicial review and appeal<\/span> as provided in the Administrative Process Act (§ 2.2-4000<\/a> et seq.). However, nothing contained in this section shall give the Commissioner<\/span> any authority as to the content or interpretation of any manufacturer<\/span>’s or distributor’s warranty. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nWARRANTY OBLIGATIONS (\u00a7 46.2-1573.20)\n\nA. Each trailer manufacturer, factory branch, distributor, or distributor branch\nshall (i) specify in writing to each of its trailer dealers licensed in the\nCommonwealth the dealer’s obligations for preparation, delivery, and\nwarranty service on its products and (ii) compensate the dealer for warranty\nparts, service, and diagnostic work required of the dealer by the manufacturer\nor distributor as follows:\n\n 1. Compensation of a dealer for warranty parts, service, and diagnostic work\n shall not be less than the amounts charged by the dealer for the\n manufacturer’s or distributor’s original parts, service, and\n diagnostic work to retail customers for nonwarranty service, parts, and\n diagnostic work installed or performed in the dealer’s service\n department unless the amounts are not reasonable;\n\n 2. For purposes of determining warranty parts and service compensation,\n menu-priced parts or services, group discounts, special event discounts, and\n special event promotions shall not be considered in determining amounts\n charged by the dealer to retail customers;\n\n 3. Increases in dealer warranty parts and service compensation and diagnostic\n work compensation, pursuant to this section, shall be requested by the dealer\n in writing, shall be based on 100 consecutive repair orders or all repair\n orders over a 90-day period, whichever occurs first, and, in the case of\n parts, shall be stated as a percentage of markup that shall be uniformly\n applied to all the manufacturer’s or distributor’s parts;\n\n 4. In the case of warranty parts compensation, the provisions of this\n subsection shall be effective only for model year 1992 and succeeding model\n years;\n\n 5. If a manufacturer or distributor furnishes a part to a dealer at no cost\n for use by the dealer in performing work for which the manufacturer or\n distributor is required to compensate the dealer under this section, the\n manufacturer or distributor shall compensate the dealer for the part in the\n same manner as warranty parts compensation, less the wholesale costs, for such\n part as listed in the manufacturer’s current price schedules; or\n\n 6. In the case of service work, manufacturer original parts or parts otherwise\n specified by the manufacturer or distributor, and parts provided by a dealer\n either pursuant to an adjustment program as defined in § 59.1-207.34 or\n as otherwise requested by the manufacturer or distributor, the dealer shall be\n compensated in the same manner as for warranty service or parts.\n \t\t\t\tThis section does not apply to compensation for parts such as components,\n systems, fixtures, appliances, furnishings, accessories, and features that are\n designed, used, and maintained primarily for nonvehicular, residential\n purposes. Warranty audits of dealer records may be conducted by the\n manufacturer, factory branch, distributor, or distributor branch on a\n reasonable basis, and dealer claims for warranty compensation shall not be\n denied except for good cause, such as performance of nonwarranty repairs, lack\n of material documentation, fraud, or misrepresentation. Claims for dealer\n compensation shall be paid within 30 days of dealer submission or within 30\n days of the end of an incentive program or rejected in writing for stated\n reasons. The manufacturer, factory branch, distributor, or distributor branch\n shall reserve the right to reasonable periodic audits to determine the\n validity of all such paid claims for dealer compensation. Any chargebacks for\n warranty parts or service compensation and service incentives shall only be\n for the 12-month period immediately following the date of the claim and, in\n the case of chargebacks for sales compensation only, for the 18-month period\n immediately following the date of claim. However, such limitations shall not\n be effective in the case of intentionally false or fraudulent claims.\n\nB. It shall be unlawful for any trailer manufacturer, factory branch,\ndistributor, or distributor branch to:\n\n 1. Fail to perform any of its warranty obligations, including tires, with\n respect to a trailer;\n\n 2. Fail to assume all responsibility for any liability resulting from\n structural or production defects;\n\n 3. Fail to include in written notices of factory recalls to trailer owners and\n dealers the expected date by which necessary parts and equipment will be\n available to dealers for the correction of defects;\n\n 4. Fail to compensate any of the trailer dealers licensed in the Commonwealth\n for repairs effected by the dealer of merchandise damaged in manufacture or\n transit to the dealer where the carrier is designated by the manufacturer,\n factory branch, distributor, or distributor branch;\n\n 5. Fail to compensate its trailer dealers licensed in the Commonwealth for\n warranty parts, work, and service pursuant to subsection A or for legal costs\n and expenses incurred by such dealers in connection with warranty obligations\n for which the manufacturer, factory branch, distributor, or distributor branch\n is legally responsible or that the manufacturer, factory branch, distributor,\n or distributor branch imposes upon the dealer;\n\n 6. Misrepresent in any way to purchasers of trailers that warranties with\n respect to the manufacture, performance, or design of the trailer are made by\n the dealer, either as warrantor or co-warrantor;\n\n 7. Require the dealer to make warranties to customers in any manner related to\n the manufacture, performance, or design of the trailer; or\n\n 8. Shift or attempt to shift to the trailer dealer, directly or indirectly,\n any liabilities of the manufacturer, factory branch, distributor, or\n distributor branch under the Virginia Motor Vehicle Warranty Enforcement Act\n (§ 59.1-207.9 et seq.), unless such liability results from the act or\n omission by the dealer.\n\nC. Notwithstanding the terms of any franchise, it shall be unlawful for any\ntrailer manufacturer, factory branch, distributor, or distributor branch to fail\nto indemnify and hold harmless its trailer dealers against any losses or damages\narising out of complaints, claims, or suits relating to the manufacture,\nassembly, or design of trailers, parts, or accessories, or other functions by\nthe manufacturer, factory branch, distributor, or distributor branch beyond the\ncontrol of the dealer, including, without limitation, the selection by the\nmanufacturer, factory branch, distributor, or distributor branch of parts or\ncomponents for the trailer or any damages to merchandise occurring in transit to\nthe dealer where the carrier is designated by the manufacturer, factory branch,\ndistributor, or distributor branch. The dealer shall notify the manufacturer of\npending suits in which allegations are made that come within this subsection\nwhenever reasonably practicable to do so. Every trailer dealer franchise issued\nto, amended, or renewed for trailer dealers in the Commonwealth shall be\nconstrued to incorporate provisions consistent with the requirements of this\nsubsection.\n\nD. On any new trailer, any uncorrected damage or any corrected damage exceeding\nthree percent of the manufacturer’s or distributor’s suggested\nretail price as defined in 15 U.S.C. \u00a7\u00a7 1231-1233, as measured by retail\nrepair costs, must be disclosed to the dealer in writing prior to delivery.\nFactory mechanical repair and damage to glass, tires, and bumpers are excluded\nfrom the three percent rule when properly replaced by identical\nmanufacturer’s or distributor’s original equipment or parts.\nWhenever a new trailer is damaged in transit, when the carrier or means of\ntransportation is determined by the manufacturer or distributor, or whenever a\ntrailer is otherwise damaged prior to delivery to the new trailer dealer, the\nnew trailer dealer shall:\n\n 1. Notify the manufacturer or distributor of the damage within three business\n days from the date of delivery of the new trailer to the new trailer\n dealership or within the additional time specified in the franchise; and\n\n 2. Request from the manufacturer or distributor authorization to replace the\n components, parts, and accessories damaged or otherwise correct the damage,\n unless the damage to the trailer exceeds the three percent rule, in which case\n the dealer may reject the trailer within three business days.\n\nE. If the manufacturer or distributor refuses or fails to authorize correction\nof such damage within 10 days after receipt of notification, or if the dealer\nrejects the trailer because damage exceeds the three percent rule, ownership of\nthe new trailer shall revert to the manufacturer or distributor, and the new\ntrailer dealer shall have no obligation, financial or otherwise, with respect to\nsuch trailer. Should either the manufacturer, distributor, or the dealer elect\nto correct the damage or any other damage exceeding the three percent rule, full\ndisclosure shall be made by the dealer in writing to the buyer and an\nacknowledgment by the buyer is required. If there is less than three percent\ndamage, no disclosure is required, provided that the damage has been corrected.\nPredelivery mechanical work shall not require a disclosure. Failure to disclose\nany corrected damage within the knowledge of the selling dealer to a new trailer\nin excess of the three percent rule shall constitute grounds for revocation of\nthe buyer order, provided that, within 30 days of purchase, the trailer is\nreturned to the dealer with an accompanying written notice of the grounds for\nrevocation. In case of revocation pursuant to this section, the dealer shall\naccept the trailer and refund any payments made to the dealer in connection with\nthe transaction, less a reasonable allowance for the consumer’s use of the\ntrailer as defined in § 59.1-207.11.\n\nF. If there is a dispute between the manufacturer, factory branch, distributor,\nor distributor branch and the dealer with respect to any matter referred to in\nsubsection A, B, or C, either party may petition the Commissioner in writing,\nwithin 30 days after either party has given written notice of the dispute to the\nother, for a hearing. The decision of the Commissioner shall be binding on the\nparties, subject to rights of judicial review and appeal as provided in the\nAdministrative Process Act (§ 2.2-4000 et seq.). However, nothing contained\nin this section shall give the Commissioner any authority as to the content or\ninterpretation of any manufacturer’s or distributor’s warranty.\n\nHISTORY: 1996, cc. 1043, 1052, \u00a7 46.2-1992.72; 2015, c. 615.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}