99-052

Response May 9, 2000

REQUEST LETTER

NAME

October 19, 1999

RE: Internet Automotive Finder Services Our File Reference: #####

Dear NAME:

As NAME of our office discussed with you, we represent a publicly traded, national Internet company (the "Internet Company"). Through its Web site, the Internet Company would like to offer a car service that permits consumers and duly licensed automobile dealers to pursue a mutually satisfactory transaction for the purchase of anew car. The Internet Company would like to offer this service to consumers who reside in Utah. We believe that the Internet Company does not require a license in Utah. You have indicated that your preliminary assessment agrees with ours, but asked us to confirm our client's business plan in writing so that you would have the opportunity to review it with industry representatives later this month. We believe that our client's business model, which does not require the dealers to pay a fee unless a sale occurs, and does not restrict dealers to particular territories, will only broaden possible referrals and sales to the dealers and will be supported by the industry.

The auto service of the Internet Company allows consumers to purchase a new vehicle on price and other terms identified by the consumer. If a consumer would like to purchase a vehicle, (s)he indicates the price (s)he would like to pay and the vehicle configurations (s)he will accept. The consumer request is then disseminated to factory authorized dealers within the geographic area specified by the consumer. Any dealer may accept the consumer=s offer if it agrees to the terms of the program. There are no territories awarded or other impediments to participation faced by any dealers within a given geographic market. There are no dealer membership fees.

If the consumer and a local licensed dealer reach agreement, the vehicle is delivered directly to the consumer by the dealer at its dealership. The dealer completes all paperwork, arranges for titling and tax payments, and otherwise closes the transaction as it would if the consumer had first come directly to the dealer. As such, all of Utah's procedures and consumer protections will be in place, and all state taxes and fees will be collected, with respect to the sale.

The consumer will pay the Internet Company a nominal fee of $$$$$ only after (s)he takes delivery of the vehicle from the local dealership. The local dealership will also pay a fee to the Internet Company with respect to the successful transaction. The Internet Company will never take possession of a vehicle, never close a sale and will not need a display area or other facility within Utah.

Given that (I) our client has no physical presence in Utah; (ii) all transactions will be entered into directly between the consumer and properly licensed dealers in Utah; (iii) closing will occur at the local dealership (subject to all applicable laws and taxes pertaining to with vehicle sales), and (iv) our client will be compensated only after the consumer has taken delivery of the vehicle and the transaction is completed in accordance with applicable state law, we believe that our client is a finder and does not need to be licensed in Utah with respect to these proposed motor vehicle related activities.

If based upon the description of our client's activities set out above, you agree that no licensing of our client presently is required in Utah, please confirm the same either by signing in the space below, or by sending a separate confirming letter. We understand that laws and policies can change overtime, and that if new legislation, regulations or policies are established, you reserve the right to modify your position. If you have any questions, we would welcome the opportunity to discuss them with you.

Thank you for your cooperation and your attention to this matter. Our client looks forward to being able to extend what is expected to be a product to the consumers of Utah and to working cooperatively with you in further developing a current approach to Internet based business activities. Should you have any questions, please do not hesitate to call NAME or me in our STATE OFFICE.

Sincerely,

NAME

RESPONSE LETTER

May 9, 2000

NAME

Re: Motor Vehicle Dealer Licensing Requirements for Internet Activities

Dear NAME,

You describe activities to be performed by an Internet company (the AInternet Company@), which plans to offer a service to bring together motor vehicle customers and licensed motor vehicle dealers. On your Internet site, customers would be able to indicate a price at which they would be willing to purchase a vehicle. This information is disseminated to dealers, who may accept or reject the customer=s offer. Given these and the other facts supplied in your letter, you ask whether the Internet Company is required to obtain a Utah dealer=s license.

Utah Code Ann. '41-3-201.5(1) requires that A[a] person, may not, for a fee, commission, or other form of compensation, arrange, offer to arrange, or broker a transaction involving the sale or lease of more than two new motor vehicles in any 12 consecutive month period, unless the person is licensed under Subsection 41‑3‑202(1).@ For purposes of this opinion, we presume that the Internet Company will generate the sale of more than two new motor vehicles in any 12 consecutive month period. In addition, the Internet Company will receive compensation from both the customer and the dealer for each sale originating from the Internet Company. The only question that remains regarding the licensing requirement is whether the Internet Company, under the circumstances described, is deemed to Aarrange, offer to arrange, or broker@ the transactions originating from its Internet Company.

A Abroker@ is defined in Black=s Law Dictionary (5th ed. 1979) to include an agent employed to make bargains and contracts for a compensation, a middleman or negotiator between parties, a person dealing with another for the sale of property, or a person whose business it is to bring buyer and seller together. Your description of activities to be conducted by the Internet Company differ from those activities an entity in the business of advertising would perform. An entity in the business of advertising is generally compensated for placing the advertisement and does not receive any additional compensation upon the completion of a transaction. Accordingly, we deem that the Internet Company would be in business to bring a buyer and a seller of motor vehicles together and, accordingly, is a broker. As the Internet Company would meet all the licensing conditions required under section 41-3-201.5(1), the Internet Company must be licensed as a dealer under section 41-3-202(1).

If you have any other questions, please contact us.

For the Commission,

Marc B. Johnson

Commissioner

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