1.1 	A bill for an act
1.2 	relating to commerce; expanding the motor vehicle lemon law to protect 
1.3 	very small businesses;amending Minnesota Statutes 2004, section 325F.665, 
1.4 	subdivision 1.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. Minnesota Statutes 2004, section 325F.665, subdivision 1, is amended to 
1.7 	read:
1.8 		Subdivision 1.Definitions. For the purposes of this section, the following terms 
1.9 	have the meanings given them:
1.10 	(a) "consumer" means the purchaser or lessee, other than for purposes of resale or 
1.11 	sublease, of a new motor vehicle used for personal, family, or household, or small business
1.12 	purposes at least 40 percent of the time, or a person to whom the new motor vehicle is 
1.13 	transferred for the same purposes during the duration of an express warranty applicable to 
1.14 	the motor vehicle;
1.15 	(b) "manufacturer" means a person engaged in the business of manufacturing, 
1.16 	assembling or distributing motor vehicles, who will, under normal business conditions 
1.17 	during the year, manufacture, assemble or distribute to dealers at least ten new motor 
1.18 	vehicles;
1.19 	(c) "manufacturer's express warranty" and "warranty" mean the written warranty of 
1.20 	the manufacturer of a new motor vehicle of its condition and fitness for use, including any 
1.21 	terms or conditions precedent to the enforcement of obligations under that warranty;
1.22 	(d) "lease" means a contract in the form of a lease or bailment for the use of personal 
1.23 	property by a natural person consumer for a period of time exceeding four months, used 
1.24 	for personal, family, or household, or small business purposes at least 40 percent of the 
2.1 	time, whether or not the lessee has the option to purchase or otherwise become the owner 
2.2 	of the property at the expiration of the lease;
2.3 	(e) "motor vehicle" means (1) a passenger automobile as defined in section  168.011, 
2.4 	subdivision 7, including pickup trucks and vans, and (2) the self-propelled motor vehicle 
2.5 	chassis or van portion of recreational equipment as defined in section  168.011, subdivision 
2.6 	25, which is sold or leased to a consumer in this state; 
2.7 	(f) "informal dispute settlement mechanism" means an arbitration process or 
2.8 	procedure by which the manufacturer attempts to resolve disputes with consumers 
2.9 	regarding motor vehicle nonconformities and repairs that arise during the vehicle's 
2.10 	warranty period;
2.11 	(g) "motor vehicle lessor" means a person who holds title to a motor vehicle leased 
2.12 	to a lessee under a written lease agreement or who holds the lessor's rights under such 
2.13 	agreement; and
2.14 	(h) "early termination costs" means expenses and obligations incurred by a motor 
2.15 	vehicle lessor as a result of an early termination of a written lease agreement and 
2.16 	surrender of a motor vehicle to a manufacturer under subdivision 4, including penalties for 
2.17 	prepayment of finance arrangements.; and
2.18 	(i) "small business" means an individual or business entity that uses five or fewer 
2.19 	purchased or leased motor vehicles for business purposes.

2.20 	EFFECTIVE DATE. This section is effective August 1, 2006, and applies to 
2.21 	purchases or leases of motor vehicles entered into on or after that date.