License Requirements

Generally, no person may engage in the business of selling or advertising the sale of new or used vehicles or boats, without a dealer license. A violation is a Class 1 misdemeanor. A second or subsequent violation is a Class 6 felony.

No person may act as, offer to act as, or hold himself or herself out to be a broker. A violation is a Class 2 misdemeanor.

Common Exceptions:
  • Any person not engaged in the sale of vehicles/boats/off-road vehiclesas a business and is disposing of vehicles/boats used solely for personal use if the vehicles/boats/off-road vehicles were acquired and used in good faith and not for the purpose of avoiding the provisions of this chapter.
  • Any person who sells less than five vehicles/boats in a 12-month period, unless the person is licensed as a dealer in another state or holds himself or herself out as being in the business of selling vehicles/boats.  However, if the vehicles are travel trailers, any person who sells less than three travel trailers in a twelve-month period.
  • Regulated Lenders as that term is defined in § 54-3-14, any insurance company authorized to do business in this state or any financing institution as defined in and license pursuant to Chapter 54-7 (this link says it is repealed) that acquires vehicles/boats as an incident to its regular business.
  • Financial Institutions chartered or licensed in any other jurisdiction that acquires vehicles/boats as an incident to its regular business and sells such vehicles/boats to dealers licensed under this chapter.
  • Vehicle Rental and Leasing Companies that sell their used vehicles to dealers licensed under this chapter.
  • Any Nonprofit Automobile Club if selling automobiles twenty years old or older under the provisions of Chapter 32-3.
  • Any person engaged in the business of manufacturing or converting new vehicles/boats if selling such vehicles/boats to a licensed dealer holding a franchise from the original manufacturer of the vehicle/boat.
  • Any person acting as an auctioneer if auctioning South Dakota titled vehicles for a licensed dealer or a person who is exempt from the provisions of this chapter.
  • Any Towing Agency that acquires and sells a vehicle which has been towed at the request of a private landowner under the provision of Chapter 32-36 or at the request of a law enforcement officer, if no vehicle is sold for an amount over two hundred dollars.
  • Any person not engaged in the sale of vehicles as a business who operates fleets of vehicles is disposing of vehicles used in the person's business, if the same were acquired and used in good faith and not for the purpose of avoiding the provisions of this chapter.

Fees

The actual (paper) dealer license is issued for a 5-year period, unless canceled or revoked for cause by the Division of Motor Vehicles; however, each year, a License Renewal Notice and Billing is sent out by the division approximately 3 months before the expiration of the license.

 

New License Fees

Vehicle dealer/used vehicle dealer - $300/initial, $175/renewal
Mobile home dealer - $300/initial, $150/renewal
Motorcycle/Off-Road Vehicle dealer - $250/initial, $150/renewal
Trailer dealer - $125/initial, $100/renewal
Boat dealer - $250/initial, $175/renewal
Snowmobile dealer - $150/initial, $125/renewal

Before a dealer's license may be issued, the following must be submitted with the application for dealer license:

Before a dealer's license may be issued, the following must be submitted with the application for dealer license:
The actual (paper) dealer license is issued for a 5-year period, unless canceled or revoked for cause by the Division of Motor Vehicles; however, each year, a License Renewal Notice and Billing is sent out by the division approximately 3 months before the expiration of the license. The License Renewal Notice contains all pertinent data on file relative to the dealership. The Notice and Billing must be thoroughly reviewed for accuracy, with required changes noted thereon. The document must then be signed and returned to the county treasurer of the county in which the dealership is located by the deadline date shown on the Notice and Billing.
Payment of the annual dealer renewal license fee and dealer plate fees must accompany the License Renewal Notice and Billing.


Renewal License Fees (if submitted prior to the expiration of the license)

  1. Vehicle Dealer - $175
  2. Used Vehicle Dealer - $175
  3. Mobile/Manufactured Home Dealer -$150
  4. Motorcycle/Off-Road Vehicle Dealer - $150
  5. Snowmobile Dealer - $125
  6. Trailer Dealer - $100
  7. Boat Dealer - $175
  8. Emergency Vehicle Dealer - $175

Failure to renew a dealer license prior to its expiration will result in the dealer being assessed the same fee as the initial license fee.
In the event a dealer possesses more than one type of dealer license, the dealer must renew all the licenses during the license renewal month assigned to the dealer.

Principal Place of Business
*Any applicant or current license holder who is moving their dealership to a new location must obtain permission from the DRR.

New and Used Vehicle Dealers, Boats, Motorcycles and Trailers
All applicants and existing dealerships must have a principal place of business that conforms to the laws and rules under dealer licensing. For vehicle, used vehicle, motorcycle, trailer, and boat dealers, this requires an enclosed permanent structure located within the state, easily accessible and open to the public at all reasonable times. There must be an improved area adjoining the building that is large enough to display five or more vehicles/boats of the type the dealer is licensed to sell.
The principle place of business location must accord to all applicable land use ordinances, building codes and zoning. It is the location that all books, records and files necessary to conduct business are kept and maintained. In no event may rooms in a hotel, motel, apartment house, or any part of a single or multiple unit dwelling house be considered a "principal place of business", unless the entire ground floor is devoted principally to, and occupied for, commercial purposes.
The principal place of business must have separate office space for conducting business if more than one business occupies the structure.
The licensed dealer must be open for business on a continuing basis, with normal business hours posted in a place visible for viewing by the public.
The dealership must maintain a telephone and telephone number in the name of the business. In the event the principal place of business is in a structure which houses more than one business, the dealer's office must be separate from the other business.
A dealer inspector must inspect all principal places of business and certify they are in accordance with the law before a dealer license is issued.

Mobile/Manufactured Homes
The principal place of business for mobile/manufactured home dealers may not be a tent, temporary stand or other temporary quarters, nor permanent quarters occupied pursuant to any temporary arrangement.
The license may use unimproved lots and premises for sale, storage and display of mobile homes and manufactured homes.
A licensee may use a residence located within or adjacent to his mobile home park or a manufactured home park as a principal place of business, unless prohibited by local zoning.

Snowmobile
A snowmobile dealer must have a place of business in which the records, books and files necessary to conduct business are maintained and available for inspection.

Bond
A surety bond issued by a bonding company qualified to do business in South Dakota. Any dealer renewing his South Dakota dealer license, and who has already filed such surety bond with the department, need not file any further bond; unless the dealership name changes.
New and used vehicle, mobile homes - $25,000
Trailers (over 3,000 pounds) - $10,000
Boats - $20,000
Motorcycles, off-road vehicles,and snowmobiles - $5,000

Insurance
A public liability insurance policy of not less than $300,000 for vehicle dealers, used vehicle dealers and motorcycle dealers is required. This is not required of trailer dealers, snowmobile dealers, mobile home dealers, and boat dealers.

Contact Us
Motor Vehicle Information Section  - Call for general motor vehicle questions, titling and registration.
Phone: 605-773-3541 | Fax: 605-773-2550
Dealer Agent - Answers dealer business questions, provides training and instruction on compliance and procedures, enforces laws and regulations, investigates complaints and violations, conducts inspections, etc.

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