NEW JERSEY DECEPTIVE AUTOMOBILE ADVERTISING REGULATIONS
Keywords, Automobile advertising, consumer fraud, deception, deceptive advertising, bait and switch, claim, lawyer, bait and switch advertising, legal claim, false advertising, dealership advertisement, dealer ad, claim, bait and switch advertising, misleading ad, claim, legal.
SUBCHAPTER 26A. MOTOR VEHICLE ADVERTISING PRACTICES
13:45A-26A.1 Scope
Without limiting any other practices which may be unlawful under the Consumer
Fraud Act, N.J.S.A. 56:8-1 et seq., the
rules contained in this subchapter set forth motor vehicle advertising practices
which are prohibited as unlawful under the
Consumer Fraud Act; the rules also include mandatory disclosure in
advertisements of certain information relating to advertised
motor vehicles as well as on-site disclosures relating to advertised motor
vehicles.
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13:45A-26A.2 Application
(a) These rules shall apply to the following advertisements:
1. Any advertisement, including radio and television broadcasts, uttered,
issued, printed, disseminated, published,
circulated or distributed within this State concerning motor vehicles offered
for sale or lease at locations exclusively
within this State; and
2. Any advertisement, including radio and television broadcasts, uttered,
issued, printed, disseminated, published,
circulated or distributed to any substantial extent within this State concerning
motor vehicles offered for sale or
lease at locations within this State and outside this State, or at locations
exclusively outside the State.
13:45A-26A.3 Definitions
The following words and terms, when used in this subchapter, shall have the
following meanings, unless the context
clearly indicates otherwise.
“Advertised motor vehicle” means any new or used motor vehicle offered for sale
or lease and specifically identified by
an advertised price. With respect to an advertisement which offers a group of
new or used vehicles for sale or lease covering
a specified price range (for example, “1995 Metros for sale-- $10,000 to
12,999,” or “Lease a new Olds for $298 a month and
up.”), the least expensive motor vehicle in that advertised range is considered
to be an advertised motor vehicle.
“Advertised price” means the dollar amount required to purchase or lease a motor
vehicle, advertised as:
1. The total price; or
2. The monthly payment price; or
3. The deferred payment price; or
4. A specific discount or savings on the manufacturer’s suggested retail price.
“Advertisement” means any advertisement as defined by N.J.S.A. 56:8-1(a) of any
motor vehicle including any statement
appearing in a newspaper, periodical, pamphlet, circular, or other publication,
paper, sign or radio or television broadcast
which offers a motor vehicle for sale or lease at retail.
“Advertiser” means any person as defined by N.J.S.A. 56:8-1(d) who in the
ordinary course of business is engaged in the
sale, leasing or financing of motor vehicles at retail or who in the course of
any 12 month period offers more than three motor
vehicles for sale or lease or who is engaged in the brokerage of motor vehicles
whether for sale or lease and who causes an
advertisement to be made for the retail sale or lease of motor vehicles. An
advertising agency and the owner or publisher of
a newspaper, magazine, periodical, circular, billboard or radio or television
station acting on behalf of an advertiser shall be
deemed an advertiser within the meaning of this subchapter, when the agency or
owner’s or publisher’s staff prepares and
places an advertisement for publication. The agency, owner, or publisher shall
not be liable for a violation of this subchapter
when reasonably relying upon data, information or material supplied by the
person for whom the advertisement is prepared
or placed or when the violation is caused by an act, error or omission beyond
the preparer’s control, including but not limited
to, the post-publication performance of the person on whose behalf such
advertisement was placed.
“Broker” means a person who in the course of any 12 month period arranges or
offers to arrange the retail sale or lease
of more than three motor vehicles from the inventory of other business entities.
“Closed-end lease” means a lease in which the lessee is not responsible for the
value of the motor vehicle at the end of the
lease term unless there is excessive damage, wear and tear, or mileage.
“Dealer” means any person who in the ordinary course of business is engaged in
the sale or leasing of motor vehicles at
retail or who in the course of any 12-month period offers more than three motor
vehicles for sale or lease at retail.
“Demo” means a motor vehicle used exclusively by a dealer or dealer’s employee
that has never been titled and to which
the new vehicle warranty still applies.
“Dealer-installed option” means optional equipment installed by the dealer at an
additional cost.
“Lease” means a contract for the use of a motor vehicle for a period of time
exceeding four months whether or not the
lessee may become the owner of the motor vehicle at the expiration of the lease.
“Lessee” means a person as defined in the Consumer Fraud Act, N.J.S.A.
56:8-1(d), who leases a motor vehicle from a
broker or dealer.
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“Open-end lease” means a lease in which the lessee may owe additional amounts
that is, a “balloon” payment, depending
on the value of the motor vehicle at the end of the lease term.
“Monroney label” is the label required by Section 3 of the Automobile
Information Disclosure Act, 15 U.S.C. §§ 1231-1233.
“Motor vehicle” means any vehicle driven otherwise than by muscular power,
excepting such vehicles as those which
run only upon rails or tracks.
“MSRP” means the manufacturer’s suggested retail price.
“Period of publication” means the time period between 48 hours prior to the date
of first publication of an advertisement
and midnight of the third business day following the date of final publication;
in the case of a special offer, the period of
publication shall extend until midnight of the date the special offer ends.
“Person” means a person as defined in the Consumer Fraud Act, N.J.S.A.
56:8-1(d).
“Rebate” means any payment of money by the manufacturer to or on behalf of a
consumer who has bought or leased a
motor vehicle, whether called “rebate”, “factory rebate”, “cash back”, “money
back”, or a term of similar import.
“Sale” means a sale as defined by N.J.S.A. 56:8-1(e) of any motor vehicle.
“Special offer” means any advertisement of a reduction from the usual selling
price for an applicable time period,
whether called “sale”, “sale days”, “bargain”, “bargain days”, “special offer”,
“discount”, “reduction”, “clearance”, “prices
slashed”, “special savings”, or a term of similar import.
“Taxes, licensing costs and registration fees” means those usual taxes, charges
and fees payable to or collected on behalf
of governmental agencies and necessary for the transfer of any interest in a
motor vehicle or for the use of a motor vehicle.
“Used motor vehicle” means any motor vehicle with an odometer reading of greater
than 1,000 miles, except for a
“demo”.
13:45A-26A.4 Bait and switch
(a) The following motor vehicle advertising practices constitute “bait and
switch” and are prohibited and unlawful:
1. The advertisement of a motor vehicle as part of a plan or scheme not to sell
or lease it or not to sell or lease it at
the advertised price.
2. Without limiting other means of proof, the following shall be prima facie
evidence of a plan or scheme not to
sell or lease a motor vehicle as advertised or not to sell or lease it at the
advertised price:
i. Refusal to show, display, sell, or lease the advertised motor vehicle in
accordance with the terms of the
advertisement, unless the vehicle has been actually sold or leased during the
period of publication; in that
case, the advertiser shall retain records of that sale or lease for 180 days
following the date of the transaction,
and shall make them available for inspection by the Division of Consumer
Affairs.
ii. Accepting a deposit for an advertised motor vehicle, then switching the
purchaser to a higher-priced motor
vehicle, except when the purchaser has initiated the switch as evidenced by a
writing to that effect signed by
the purchaser.
iii. The failure to make delivery of an advertised motor vehicle, then switching
the purchaser to a higher-priced
motor vehicle; except when thepurchaser has initiated the switch as evidenced by
a writing to that effectsigned
by the purchaser.
13:45A-26A.5 Advertisements; mandatory disclosure requirements in all
advertisements for sale
(a) In any advertisement in which an advertiser offers a new motor vehicle for
sale at an advertised price, the following
information must be included:
1. The advertiser’s business name and business address;
2. A statement that “price(s) include(s) all costs to be paid by a consumer,
except for licensing costs, registration
fees, and taxes”. If this statement appears as a footnote, it must be set forth
in at least 10 point type. For
purposes of this subsection, “all costs to be paid by a consumer” means
manufacturer-installed options, freight,
transportation, shipping, dealer preparation, and any other costs to be borne by
a consumer except licensing
costs, registration fees, and taxes;
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3. The manufacturer’s suggested retail price as it appears on the Monroney
label, clearly denominated by using
the abbreviation “MSRP”;
4. The year, make, model, and number of engine cylinders of the advertised motor
vehicle;
5. Whether the transmission is automatic or manual; whether the brakes and
steering mechanism are power or
manual; and whether the vehicle has air conditioning, unless those items are
standard equipment on the advertised
motor vehicle. This provision shall not apply to advertisements for motorcycles;
6. The last eight digits of the vehicle identification number, preceded by the
letters “VIN”. This provision shall
not apply to radio and television broadcasts, or to advertisements for
motorcycles;
7. A list of any dealer installed options on the advertised motor vehicle and
the retail price of each, as determined
by the dealer.
(b) In any advertisement offering for sale a used motor vehicle at an advertised
price, the information described in (a)1,
2, 4, 5 and 6 above must be included, as well as the following additional
information:
1. The actual odometer reading as of the date the advertisement is placed for
publication; and
2. The nature of prior use unless previously and exclusively owned or leased by
individuals for their personal use,
when such prior use is known or should have been known by the advertiser.
(c) In any advertisement offering a “demo” for sale, the information listed in
(a) above must be included, as well as:
1. Identification as a “demo”; and
2. The actual odometer reading as of the date the advertisement is placed for
publication.
(d) It shall be an unlawful practice to fail to include the information required
by this section.
13:45A-26A.6 Advertisements: mandatory disclosure in advertisements for lease of
a new or used motor vehicle
(a) In any advertisement offering a new or used motor vehicle for lease, at an
advertised price, the following information
shall be included:
1. That the transaction advertised is a lease;
2. The amount of any payment required at the inception of the lease or that no
payment is required if that is the
case;
3. The number, amounts, due dates or periods of scheduled payments and the total
of such payments under the
lease;
4. A toll-free number that may be used by consumers to obtain the information
required under (f) below; and
5. The business name and, if an individual dealer, the address of the
advertiser.
(b) In all written advertisements the information required in (a) above shall be
prominently displayed in at least 10 point
type and shall be easy to find, read and understand.
(c) If the advertiser elects to use a full disclosure format in a written
advertisement, then the information in (f) below
shall be prominently displayed in at least 10 point type and must be easy to
find, read and understand.
(d) An advertisement which is not in writing shall clearly and audibly state the
information in (a) above at a decibel level
equal to the highest decibel level used in the advertisement and at a speed
equal to or slower than any other statement
contained in the advertisement. In a television broadcast, the information shall
be prominently and conspicuously
displayed for at least five continuous seconds for each model advertised.
(e) The toll free number required pursuant to (a)4 above shall be operational
not later than the date on which the
advertisement is broadcast or published. The advertiser shall:
1. Maintain the toll free number for 48 hours after the last day of the
advertisement;
2. Ensure that the toll free number is operational from 9:00 A.M. to 9:00 P.M.
Monday through Saturday;
3. Provide the information required under (f) below in a clear and audible
manner, to any person who calls the toll
free number; and
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4. If requested, provide the information required under (f) below in written
form to be mailed, postage paid, to the
consumer’s address.
(f) Information provided through the use of a toll free telephone number shall
include:
1. The advertiser’s business name and address;
2. Identification of the transaction as a lease;
3. Whether or not the advertised price refers solely to a business lease;
4. Whether it is an open-end or closed-end lease;
5. The number, amounts, due dates or periods of scheduled payments and the total
of such payments under the
lease;
6. All other itemized payments such as security deposits or capitalized cost
reduction required at the initiation of
the lease;
7. The cost of the lease which shall include the sum of (f)5 and 6 above;
8. The manufacturer’s suggested retail price as it appears on the Monroney
label; when given in writing to the
consumer, clearly denominated by using the abbreviation “MSRP”;
9. A statement that “price(s) include(s) all costs to be paid by the consumer,
except for licensing, registration and
taxes.” When given in writing to the consumer, it must be set forth in at least
10 point type;
10. Whether the lessee has the option to purchase the advertised motor vehicle
and at what price and time; the
method of determining the price may be substituted for disclosure of the price;
11. The amount (including termination charge, if any) or method of determining
any liability imposed upon the
lessee at the end of the term and a statement that the lessee shall be liable
for the difference, if any, between the
estimated value of the leased motor vehicle and its realized value at the end of
the lease term, if the lessee has
such liability;
12. A statement of the items included as standard equipment on the advertised
motor vehicle;
13. Whether the transmission is automatic or standard; whether the brakes and
steering mechanism are power or
manual and whether the vehicle has air conditioning, unless such items are
included under (f)12 above. This
provision shall not apply to motorcycles;
14. The year, make, model and number of engine cylinders of the advertised
vehicle;
15. The last eight digits of the vehicle identification number or “VIN.” This
provision shall not apply to motorcycles;
16. If the advertised vehicle is a used vehicle, the actual odometer reading at
the date of placing the advertisement
for publication; and the nature of prior use, unless previously and exclusively
owned or leased by individuals
for their personal use, when such use is known or should have been known by the
advertiser; and
17. If the advertised vehicle is a “demonstration vehicle” or “demo,”
identification of the vehicle as a “demonstration
vehicle” or “demo;” and the actual odometer reading at the date of placing the
advertisement for publication.
(g) It shall be an unlawful practice to fail to include the information required
by this section.
13:45A-26A.7 Unlawful advertising practices
(a) In any type of motor vehicle advertising, the following practices shall be
unlawful:
1. The use of any type size, location, lighting, illustration, graphic depiction
or color so as to obscure or make
misleading any material fact;
2. The setting forth of an advertised price which has been calculated by
deducting a down payment, trade-in
allowance or any deductions other than a manufacturer’s rebate and dealer’s
discount;
3. The setting forth of an advertised price which fails to disclose, adjacent to
the advertised price, that it has been
calculated by deducting a manufacturer’s rebate or dealer’s discount;
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4. The failure to state all disclaimers, qualifiers, or limitations that in fact
limit, condition, or negate a purported
unconditional offer (such as a low APR or high trade-in amount), clearly and
conspicuously, next to the offer
and not in a footnote identified by an asterisk. Such disclosure shall be made
verbally in a radio or television
advertisement. Identical information pertaining to all motor vehicles in a group
of advertised motor vehicles,
however, may appear in a footnote, provided the type is no smaller than 10
point;
5. The failure to state the applicable time period of any special offer, in at
least 10-point type immediately adjacent
to the special offer, unless the special offer is a manufacturer’s program;
6. The use of the word “free” when describing equipment or other item(s) to be
given to the purchaser or lessee of
a motor vehicle, if the “free” item has a value which has increased the
advertised price. In using the word “free”
in advertising, the advertiser shall comply with the Federal Trade Commission
Rule, 16 CFR § 251, and any
amendments thereto;
7. The failure to disclose that the motor vehicle had been previously damaged
and that substantial repair or body
work has been performed on it when such prior repair or body work is known or
should have been known by the
advertiser; for the purposes of this subsection, “substantial repair or body
work” shall mean repair or body
work having a retail value of $1,000 or more;
8. The use of the terms “Public Notice”, “Public Sale”, “Liquidation”,
“Liquidation Sale”, or terms of similar
import, where such sale is not required by court order or by operation of law or
by impending cessation of the
advertiser’s business;
9. The use of terms such as “Authorized Sale”, “Authorized Distribution Center”,
“Factory Outlet”, “Factory
Authorized Sale”, or other term(s) which imply that the advertiser has an
exclusive or unique relationship with
the manufacturer;
10. The use, directly or indirectly, of a comparison to the dealer’s cost,
inventory price, factory invoice, floor plan
balance, tissue, or terms of similar import; or the claim that the advertised
price is “wholesale” or “at no
profit”;
11. The use of the terms “guaranteed discount”, “guaranteed lowest prices” or
other term of similar import unless
the advertiser clearly and conspicuously discloses the manner in which the
guarantee will be performed and any
conditions or limitations controlling such performance; this information shall
be disclosed adjacent to the
claim and not in a footnote;
12. The use of the statement “We will beat your best deal”, or similar term or
phrase if a consumer must produce a
contract that the consumer has signed with another dealer or lessor in order to
receive the “better” deal;
13. The use of such terms or phrases as “lowest prices”, “lower prices than
anyone else” or “our lowest prices of the
year”, or similar terms or phrases if such claim cannot be substantiated by the
advertiser.
13:45A-26A.8 Certain credit and installment sale advertisements
(a) The following information must be stated in any credit and installment sale
advertising. It must appear adjacent to
the description of the advertised motor vehicle and not in a footnote or
headline unless the information is the same
for all motor vehicles advertised. If in a footnote, it must be in at least
10-point type. Failure to include this
information shall be an unlawful practice.
1. The total cost of the installment sale, which shall include the down payment
or trade-in or rebate, if any, plus the
total of the scheduled periodic payments;
2. The annual percentage rate;
3. The monthly payment figure and the number of required payments; and
4. The amount of any down payment or trade-in required or a statement that none
is required.
(b) The following motor vehicle advertising practices concerning credit and
installment sale advertisements shall be
unlawful:
1. The advertising of credit, including but not limited to such terms as “easy
credit” or “one-day credit”, other than
that actually provided by the advertiser on a regular basis in the ordinary
course of business;
2. The use or statement of an installment payment on any basis other than a
monthly basis.
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13:45A-26A.9 On-site disclosures
(a) The following information relating to an advertised motor vehicle must be
provided at the main entrance(s) to the
business premises where the motor vehicle is displayed or in proximity to the
vehicle or on the vehicle itself:
1. A copy of any printed advertisement that quotes a price for the sale or lease
of that vehicle; alternatively, a tag
may be attached to the motor vehicle(s) stating the advertised price as well as
the other information required in
N.J.A.C. 13:45A-26A.5 or 26A.6.
2. A fuel economy label, if required by the Motor Vehicle Information and Cost
Savings Act, 15 U.S.C. § 2006;
and
3. The Used Car Buyers Guide, if required by the Federal Trade Commission’s Used
Car Rule, 16 C.F.R. Part
455.2.
(b) A dealer shall not advertise a new motor vehicle which does not have the
Monroney label, if required by the Automobile
Information Disclosure Act, 15 U.S.C. §§ 1231-1233.
(c) It shall be an unlawful practice to fail to comply with the disclosures
required by this section.
13:45A-26A.10 Record of transactions
(a) An advertiser shall have a motor vehicle advertised for sale on premises and
available for sale at the advertised price
during the period of publication, or a record of the sale of that vehicle at the
advertised price or less during that
period. An advertiser shall have a motor vehicle advertised for lease available
for lease at the advertised price during
the period of publication, or a record of the lease of that vehicle at the
advertised price or less during that period.
Such record shall consist of all applicable advertisements and a copy of the
executed contract with the purchaser or
lessee of the vehicle; this documentation shall be maintained for 180 days after
the transaction and shall be made
available for inspection by the Division of Consumer Affairs.
(b) If the motor vehicle is sold or leased during the period of publication, the
advertiser must so notify consumers who
inquire by telephone or in person.
(c) It shall be an unlawful practice to fail to comply with the requirements of
this section.
Keywords, Automobile advertising, consumer fraud, deception, deceptive advertising, bait and switch, claim, lawyer, bait and switch advertising, legal claim, false advertising, dealership advertisement, dealer ad, claim, bait and switch advertising, misleading ad, claim, legal.
Law Offices of Howard A. Gutman,
230 Route 206 (near Routes 80 and 46)
Flanders, New Jersey 07836
(973) 598-1980,
E-mail Howian@aol.com
Fax (973)257-9128
New York Office
305 Madison Avenue, Suite 449
New York, New York 10165 (212) 886-4838
Keywords, Automobile advertising, consumer fraud, deception, deceptive
advertising, bait and switch, claim, lawyer, bait and switch advertising, legal
claim, false advertising, dealership advertisement, dealer ad, claim, bait and
switch advertising, misleading ad, claim, legal.
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