Benson & Verrelli Bill to Allow Auto Dealers to Sell Vehicles Online and Obtain Electronic Signatures Passes Assembly

(TRENTON) – Auto dealers would be permitted to sell motor vehicles online and complete the sale by allowing transactional documents to be signed via electronic signature under legislation approved Monday by the full Assembly, 75-0.

In April 2020 at the peak of COVID-19 pandemic in New Jersey, new car sales plummeted 70 percent as motor vehicle dealers were forced to close their doors due to statewide stay-at-home restrictions. Governor Phil Murphy signed an executive order to allow auto dealers to sell vehicles online, but customers were still required to come to the dealership to sign necessary paperwork. Without written signatures, the New Jersey Motor Vehicle Commission (MVC) could reject the documents during the registration process.

This bill (A-5033) would allow car sales to be conducted fully online. Customers could select and purchase vehicles as well as sign transactional documents electronically. The MVC would be required to accept documents signed via e-signature.

Additionally, the legislation sets requirements for used car dealers, including that they must maintain an office space in the state and display clear signage.

The measure’s sponsors, Assembly Democrats Daniel Benson (D-Mercer, Middlesex), chair of the Assembly Transportation Committee, and Anthony Verrelli (D-Mercer, Hunterdon) released the following statements:

          Assemblyman Benson: “The COVID-19 pandemic has forced every industry to adapt and innovate the way it does business. The auto industry is no exception. Though many of us are used to visiting a dealership and buying a car in person, we can now envision a future where purchasing a car online is commonplace. This bill removes regulatory hurdles to allow people to buy vehicles without stepping foot in a dealership.”

          Assemblyman Verrelli: “As we continue to grapple with the coronavirus emergency, we must continue finding ways to keep people safe and help businesses stay afloat. Online car sales are a relatively new concept, offering customers convenience, comfort and, during the pandemic, more safety with social distancing. Just as people can sign many other legally binding documents online, there’s no reason car buyers shouldn’t be able to electronically sign papers to purchase a vehicle.”

The measure now goes to the Senate for further review.