§437-7 - Application for issuance or renewal of license.

§437-7 Application for issuance or renewal
of license. (a) Any person desiring the issuance of a license under this
chapter shall file an application therefor with the motor vehicle industry
licensing board. Prior to the expiration of the term of a license, the holder
shall file an application for renewal of the license. The board shall
prescribe the form, information required, manner, and time for presentation of
applications for issuance or renewal of licenses issued under this chapter,
except as otherwise provided in this chapter.

(b) A person applying for a salesperson's
license under this section shall be granted a temporary license by the
executive officer of the board; provided no patent disqualification of the
applicant is disclosed or no valid objection to the granting of the temporary
license is apparent and if all requirements relative to the filing of the
application appear to have been met and the dealer files a statement that this
person is employed by and under the supervision of the dealer. A fee shall be
charged for the issuance of the temporary license, as provided in rules adopted
by the director of commerce and consumer affairs pursuant to chapter 91, and
the license shall remain in effect until the board approves or denies the application
for a permanent license.

(1) Applicants for the issuance of a dealer's or
auction's license shall furnish the following financial review or financial
statement to the board:

(A) An applicant proposing to operate as a
sole proprietorship shall furnish a personal financial review or financial
statement and a financial review or financial statement of the proposed
business;

(B) An applicant proposing to operate as a
partnership shall furnish a personal financial review or financial statement
for each general partner and a financial review or a financial statement of the
partnership; and

(2) The board shall determine and prescribe the
requirement of, form, and information required in financial reviews and
financial statements for applicants for other licenses;

(3) All financial reviews and financial statements
shall be certified as to accuracy by a public or certified public accountant;
and

(4) The purpose of the financial review and the
financial statement is to provide the board with information to assist it in
determining the financial capability and integrity of the applicant.

(d) Requirement for lines of credit shall be
as follows:

(1) Applicants for issuance of a dealer's license
shall obtain an inventory or flooring line of credit from a federally insured
financial institution or from a financing source having a net worth of at least
$50,000,000. The line of credit shall be in the following amount:

(A) For new motor vehicle dealer applicants,
$500,000 or the amount required in the applicant's dealer sales and service
agreement, whichever is less;

(B) For used motor vehicle dealer applicants,
$50,000; and

(2) Applicants for issuance of a dealer's license
shall provide the board with a photocopy of the financing statement filed at the
bureau of conveyances of the department of land and natural resources, securing
the line of credit;

(3) Applicants for the issuance of an auction license
shall obtain a secured line of credit in the amount of $100,000 from a
federally insured financial institution; and

(4) When an inventory or flooring line of credit
cannot reasonably be obtained by a dealer, the board may provide that a bond,
in an amount set forth in the board's rules, be obtained as an alternative form
of security for the inventory or flooring line of credit.

(e) Applicants for issuance of an auction
license shall provide a written statement from a federally insured financial
institution verifying that the applicant has a customer trust account for the
auction with that financial institution.

(f) All applicants for the issuance of a
manufacturer's or distributor's license shall submit:

(1) If the manufacturer or distributor is publicly
traded, a financial statement signed by a certified public accountant or an
annual report;

(2) A copy of the executed agreement granting the
distributor applicant the franchise to distribute motor vehicles in this State;

(3) If the applicant is the manufacturer of the motor
vehicles to be distributed, a certified statement to this effect;

(4) Any other documents or information that may be
provided for in rules adopted by the director of commerce and consumer affairs
pursuant to chapter 91; and

(5) The following fees, which shall apply until fees
are adopted by the director under this subsection in accordance with chapter
91:

(A) Nonrefundable application fee: $50;

(B) Original license fee: $500;

(D) Biennial compliance resolution fund fee:
$500 for each dealer franchised by the manufacturer or distributor; and

(E) Verification or duplicate fees as provided
in title 16, Hawaii Administrative Rules, chapter 53.

The nonrefund provisions of section 16-53-4, Hawaii
Administrative Rules, shall apply to fees under this subsection. Application
fees for a new salesperson's license shall be a lesser amount than the fee for
other licenses issued under this chapter.

(g) Upon the filing of any application, a
staff member shall endorse on it the date of filing. If no patent
disqualification of the applicant is disclosed or no valid objection to the
granting of the application is apparent and if all requirements relative to the
filing of the application appear to have been complied with, the chairperson of
the board or executive officer shall review a self-inspection report completed
by the applicant and made a part of the application. The report shall include:

(1) A statement that the applicant is not
disqualified by this chapter from obtaining or exercising a license and has
complied with all the requirements of this chapter relative to the making and
filing of the licensee's application;

(2) Information relating to any and all other matters
and things which pertain to or affect the matter of the application or the
issuance or the exercise of the license applied for;

(3) In the case of an application for a dealer's or
auction's license the applicant shall submit a report which shall include:

(A) A description of the premises intended to
become the licensed premises, and the equipment and surrounding conditions; and

(B) If the applicant has held a prior dealer's
or auction's license for the same or any other premises within two years past,
a statement as to the manner in which the premises have been operated and the
business conducted under the previous license; and

(4) In the case of an application for a dealer's
license, if the applicant proposes to engage in the business of selling new
motor vehicles, a copy of the dealer sales and service agreement from the
applicable manufacturer or distributor.

(h) After the filing of the application, the
board may interview the applicant and upon the interview and other information
that is before the board, it may grant or deny the license.

(i) No dealer's or auction's license shall be
issued under this chapter unless and until the applicant submits:

(1) A description of the premises intended to become
the licensed premises, the office facilities, equipment, and surrounding
conditions;

(2) A statement that the applicant has met the
requirements under section 437-11;

(3) A copy of a minimum one-year lease or rental
agreement for the site the applicant has entered into; and

(4) Photographs of the premises and facilities;

and the board is satisfied that the applicant has
met all the requirements as provided in this chapter and that all other general
conditions and proposed methods of operation under the license are such as are
suitable for carrying on the business in a reputable manner.

(j) Limitations on licenses shall be as
follows:

(1) A dealer's or auction's license issued under this
chapter shall authorize the doing of the business at the licensed premises, the
boundaries of which shall be determined by the map or plan submitted together
with the application for license approved by the board; except in the case of
an enlargement or reduction of the licensed premises with the approval of the
board endorsed on an amended map or plan; and

(2) A license issued under this chapter shall authorize
the doing of a business thereunder only for the county in which the license has
been issued; and in the case of a salesperson, the license shall authorize the
salesperson to be a salesperson only for the dealer named in the application
for a license or an amended license.

(k) A used motor vehicle dealer's license
shall authorize the holder to sell new motorcycles and motor scooters if the
licensee is franchised therefor.

(l) The executive officer may grant
preliminary approval of a dealer or auction license application if all
licensing requirements have been met. The board shall ratify all preliminary
approvals. [L 1939, c 258, §12; RL 1945, §7365; am L 1951, c 90, pt of §1; RL
1955, §160-164; am L 1957, c 302, §1(4), (5); am L 1963, c 199, §1f; HRS
§437-7; am L 1969, c 263, §1(8); am L 1974, c 102, §1; am L 1977, c 134, §2; am
L 1984, c 7, §§2, 3; gen ch 1985; am L 1992, c 153, §3 and c 202, §28; am L
1993, c 265, §1; am L 1996, c 264, §5; am L 1997, c 38, §§1, 2 and c 40, §2; am
L 2003, c 126, §6]