California Code of Regulations
Title 13 - Motor Vehicles
Division 1 - Department of Motor Vehicles
Chapter 1 - Department of Motor Vehicles
Article 3.6 - Vehicle Industry and Business Enterprises
Section 225.39 - Business Partner Responsibilities

Universal Citation: 13 CA Code of Regs 225.39

Current through Register 2024 Notice Reg. No. 38, September 20, 2024

(a) A first-line service provider shall be responsible for the following:

(1) Provide oversight to ensure second-line business partners comply with the terms and conditions of their BPA contracts.

(2) Ensure prospective second-line business partners submit all application requirements pursuant to Section 225.03 of these regulations.

(3) Order and distribute inventory for their second-line business partners.

(4) Establish and use an automated inventory tracking and assignment system to track accountable and controlled inventory shipped to the first-line service provider and their second-line business partner. The automated inventory tracking and assignment system shall be capable of recording the date received, status, and location of all accountable inventory.

(5) Ensure each second-line business partner has no more than a three (3) month supply of inventory.

(6) Submit comprehensive quarterly physical inventory reports for their second-line business partners on a "Physical Inventory Non-DMV Entities" form, ADM 175A (Rev. 2/2000).

(7) Establish, implement and maintain security awareness and education programs and measures to ensure that all of their second-line business partners are aware of the first-line service provider's procedures for protecting the confidentiality of records.

(8) Ensure all of their second-line business partners implement and maintain the physical security required in this article and by the BPA contract to prevent and discourage inadvertent or deliberate alteration, disclosure, destruction, loss, misuse, or theft of DMV records, proprietary assets, and accountable and controlled items in their possession.

(9) Control access to the department's vehicle registration and titling and inventory databases by use of an authentication credentialing system that shall identify, authenticate and authorize access for each individual user.

(10) Train second-line business partners to accurately process registration and titling transactions.

(11) Audit and reconcile transactions processed by their second-line business partners.

(12) Submit all transactions to the department within twenty (20) days of the date the transaction was processed.

(13) Ensure that all of their second-line business partners comply with the advertising requirements identified in any agreement with the department.

(14) Submit all fees collected for and due to the department.

(15) Ensure their second-line business partners only process the types of vehicle transactions authorized for each second-line business partner.

(b) Whenever the State examines, audits or investigates any second-line business partner, the second-line business partner shall pay, within thirty (30) days after receipt of a statement from the State, the reasonable costs incurred by the State for the performance of the examination, audit or investigation, including, but not limited to:

(1) The reasonable amount of the salary and/or other compensation paid to the persons making the examination, audit or investigation.

(2) The reasonable expenses for travel, meals and lodging of the persons making the examination, audit or investigation.

(3) The reasonable amount of any other expenses, including overhead.

(c) When the second-line business partner fails to pay the department for the examination, audit or investigation within the thirty (30) days as required in Section 225.39(b) of these regulations, the first-line service provider that provides the interface access to the department for the second-line business partner shall be billed by the department and have thirty (30) days from the billing date to pay for the examination, audit or investigation.

1. New section filed 7-5-2002 as an emergency; operative 7-5-2002 (Register 2002, No. 28). A Certificate of Compliance must be transmitted to OAL by 11-4-2002 or emergency language will be repealed by operation of law on the following day.
2. New section with amendment of section heading and section refiled 11-4-2002 as an emergency; operative 11-4-2002 (Register 2002, No. 45). A Certificate of Compliance must be transmitted to OAL by 3-4-2003 or emergency language will be repealed by operation of law on the following day.
3. New section refiled 3-3-2003 as an emergency; operative 3-3-2003 (Register 2003, No. 10). A Certificate of Compliance must be transmitted to OAL by 7-1-2003 or emergency language will be repealed by operation of law on the following day.
4. Certificate of Compliance as to 3-3-2003 order transmitted to OAL 6-27-2003 and filed 8-11-2003 (Register 2003, No. 33).
5. Amendment of subsection (a)(7), new subsection (a)(16) and amendment of subsection (c) filed 7-9-2007; operative 8-8-2007 (Register 2007, No. 28).
6. Amendment filed 11-13-2017; operative 1-1-2018 (Register 2017, No. 46).

Note: Authority cited: Sections 1651 and 1685, Vehicle Code. Reference: Sections 1652, 1653, and 1685, Vehicle Code.

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