DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part of the
legislative instrument. The keyword, one-liner, abstract, and digest do not constitute part of the law
or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 167 Engrossed 2017 Regular Session Carmody
Abstract: Modifies certain exceptions allowing the sale or offer of sale of a new or unused motor
vehicle directly to a consumer.
Present law enumerates a list of restrictions imposed on manufacturers, distributors, wholesalers,
distributor branches, factory branches, converters, or the officers, agents, or other representatives
thereof.
Present law provides that it shall be an unauthorized act to sell or offer to sell a new or unused motor
vehicle directly to a consumer except when as provided in present law, or to compete with a licensee
in the same-line makes, models, or classifications operating under an agreement or franchise from
the aforementioned manufacturer. Present law further provides that a manufacturer shall not,
however, be deemed to be competing when certain conditions are met.
Proposed law modifies present law to provide that it shall be an unauthorized act to sell or offer to
sell a new or unused motor vehicle directly to a consumer except when the manufacturer, distributor,
wholesaler, distributor branch, factory branch, converter, or the officers, agents, or other
representatives thereof meet any one of the following conditions:
(1)Operates a previously existing, licensed, and franchised motor vehicle dealership for a
reasonable period, not to exceed two years.
(2)Operates a previously licensed and franchised motor vehicle dealership which is for sale to
any qualified independent person at a fair and reasonable price, not to exceed two years.
(3)Operates in a bona fide relationship in which a person independent of a manufacturer has
made a significant investment subject to loss in the dealership, and can reasonably expect to
acquire full ownership of such dealership on reasonable terms and conditions.
Present law requires the La. Motor Vehicle Commission (commission) to allow the manufacturer
to compete with licensees of the same-line makes, models, or classifications under an agreement or
franchise from said manufacturer for longer than two years when, in the discretion of the
commission, the best interest of the manufacturer, consuming public, and licensees are best served
after the conditions imposed by present law are satisfied.
Proposed law states that, once the conditions imposed by proposed law are met, the commission may
allow the manufacturer to continue operating a previously licensed and franchised motor vehicle dealership for longer than two years when, in the discretion of the commission, the best interest of
the manufacturer, consuming public, and licensees are best served.
(Amends R.S. 32:1261(A)(1)(k))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Commerce to the original bill:
1. Make technical changes for the purpose of clarity.
2. Clarify that the provisions of proposed law apply to previously existing, licensed, and
franchised motor vehicle dealerships in certain circumstances.