ADVERTISING
OBJECTIVE:
Rule 3 implements the Legislative intent of the law governing advertising as stated in the Arkansas Motor Vehicle Commission Act. False and misleading advertising will be defined and prohibited in a unified effort to insure truthful and accurate product advertising that will benefit the consumers and businesses of this State affected by legislation. Certain key examples of prohibited advertising will be exhibited, but shall not be construed as an all-inclusive exhibit of prohibited practices. The Commission has been granted the authority to review all advertising pertaining to new and used motor vehicles. The Commission will review each advertisement for misleading and deceptive practices and will govern them accordingly.
Rule 3 does not apply to:
Violation of any Advertising Rule(s) by any licensee shall be considered a prima facie violation of A.C.A. § 23-112-402(3) or A.C.A. § 23-112-403(a)(2)(D).
The Commission monitors and evaluates dealer advertising regarding compliance with laws and rules. The advertising sections activities include, but are not limited to:
The "Rule of Thumb" is: If in doubt, spell it out.
("Rule of Thumb" in price advertising is for the most prominent price in the advertisement to be the sales price and/or monthly payments a consumer can reasonably expect to pay for the vehicle.)
The following are specific but not the exclusive examples of standards for advertising new, used or for lease motor vehicles which shall be adhered to by licensees:
"The dealer's contribution may affect the final negotiated price of the motor vehicle."
"The dealer's contribution may affect the final negotiated price of the motor vehicle."
The following statements are presumptively false and misleading, and the burden of proving otherwise shall be on the Advertiser/Licensee:
When a salesperson e-mails a prospective customer, he or she must adhere to rules in dealing with the public. This should apply to a company's website as well as business correspondence with the public.
An advertisement which complies with the Federal Truth in Lending Act ( 15 U.S.C. § 1601 et seq.) and amendments thereto, and any rules issued or which may be issued there under, shall be deemed in compliance with the provisions of this Section.
CONSUMER CREDIT REQUIRED ADVERTISING DISCLOSURES
GENERAL PROVISIONS
It shall be unlawful willfully and knowingly:
"Consumer Leases"
Consumer Leases apply only to "consumer leases" defined as contracts meeting each of the following elements:
. The lease is for the use of an automobile;
. The lease has a term of more than four months;
. The contractual obligation does not exceed $25,000.
A vehicle leased by an individual can be used for business purposes and be covered under these rules, if the lease was originated by the consumer in their name. A vehicle leased by a company, in the companies' name, IS NOT covered by these stated rules.
How the disclosures must be made:
Consumer lease disclosures must meet the following general criteria:
. Disclosures must reflect the terms of the legal obligations between lessor and lessee.
. Disclosures must be legible, whether typed, handwritten, or printed by computer.
. Disclosures must be "clear and conspicuous", so that the relationship between terms is reasonably understandable and apparent.
. A copy of the disclosures must be given to the lessee at or prior to inception of the lease.
. Disclosures must be made on a dated, written statement which identifies the lessor and lessee.
What must be disclosed:
This rule also stipulates specific content of the disclosures, and requires that certain information be segregated on the lease contract. The specific content of disclosures required under this rule includes:
. Description of property;
. Amount due at lease signing or delivery;
. Payment schedule and total amount of periodic payments;
. Disclosure of other anticipated charges during normal execution of the lease agreement;
. Total of payments;
. Payment calculation;
. Lease term;
. Early termination conditions and penalties;
. Maintenance responsibilities;
. Purchase option;
. Statement referencing "non-segregated" disclosures;
. The right of appraisal;
. Liability at the end of the lease term;
. Fees and taxes;
. Insurance and warranties.
An advertisement which complies with the Consumer Leasing Act of 1976 ( 15 U.S.C. § 1601 et seq.), and amendments thereto, and any rules issued or which may be issued there under, shall be deemed in compliance with the provisions of this Section.
063.00.04 Ark. Code R. § 002