81R17240 NC-D
By: Deshotel H.B. No. 4395
Substitute the following for H.B. No. 4395:
By: Gattis C.S.H.B. No. 4395
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of boat manufacturers, distributors, and
dealers; providing a civil penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2352.001, Occupations Code, is amended
by amending Subdivisions (1), (3), (4), and (5) and adding
Subdivision (2-a) to read as follows:
(1) "Agreement" means a written agreement between a
manufacturer or distributor and a dealer for the purchase and sale
of new boats or new boat [outboard] motors.
(2-a) "Boat motor" means a mechanical form of
propulsion for a vessel, including an inboard or outboard motor.
(3) "Dealer" means a person engaged in the business of
buying, selling, selling on consignment, displaying for sale, or
exchanging at least five vessels, motorboats, or boat motors during
a calendar year [has the meaning assigned by Section 31.003, Parks
and Wildlife Code].
(4) "Distributor" means a person who:
(A) offers for sale, sells, or distributes new
boats or new boat [outboard] motors to dealers; or
(B) controls a person described by Paragraph
[Subdivision] (A).
(5) "Manufacturer" means a person engaged in the
business of manufacturing new and unused vessels or boat motors for
the purpose of sale or trade [has the meaning assigned by Section
31.003, Parks and Wildlife Code].
SECTION 2. Section 2352.051, Occupations Code, is amended
to read as follows:
Sec. 2352.051. AGREEMENT REQUIRED. A manufacturer or
distributor contracting with a dealer may not sell or offer for
sale, and a dealer may not purchase or offer to purchase, a new boat
or a new boat [outboard] motor unless the manufacturer or
distributor and the dealer enter into an agreement that complies
with this chapter.
SECTION 3. Section 2352.052, Occupations Code, is amended
by amending Subsection (a) and adding Subsection (c) to read as
follows:
(a) An agreement under this chapter must include:
(1) the dealer's location, territory, or market area;
(2) the length of the agreement;
(3) any performance or marketing standards;
(4) any working capital, inventory, facility,
equipment, or tool standards;
(5) provisions for termination or nonrenewal of the
agreement and the designation of a successor dealer in the event of
the dealer's death or disability;
(6) the obligations of the manufacturer, distributor,
and dealer in the preparation and delivery of and warranty service
on new boats and new boat [outboard] motors;
(7) the obligations of the manufacturer, distributor,
and dealer on termination of the agreement, including inventory of
new boats and new boat [outboard] motors, parts inventory,
equipment, furnishings, special tools, and required signs; and
(8) dispute resolution procedures.
(c) The agreement must provide a dealer's territory with an
exclusive market area of not less than a 50-mile radius from the
dealer location.
SECTION 4. Sections 2352.053(b) and (c), Occupations Code,
are amended to read as follows:
(b) Good cause is [not] required for the nonrenewal of an
agreement [other than an agreement having an original term of less
than one year].
(c) The fact that a dealer holds an agreement involving
another line, make, or brand of new boat or new boat [outboard]
motor does not constitute good cause.
SECTION 5. Section 2352.101(a), Occupations Code, is
amended to read as follows:
(a) A manufacturer or distributor who publicly advertises a
new boat, new boat [outboard] motor, or part as available for
immediate delivery shall deliver the boat, boat [outboard] motor,
or part in reasonable quantities and within a reasonable time after
receipt of an order from a dealer who has an agreement with the
manufacturer or distributor applicable to the advertised boat, boat
[outboard] motor, or part.
SECTION 6. Section 2352.103, Occupations Code, is amended
to read as follows:
Sec. 2352.103. FINANCING. (a) A manufacturer or
distributor may not require a dealer to finance through a
particular financing source a new boat or new boat [outboard] motor
sold by the dealer.
(b) A manufacturer or distributor may not require a dealer
to act as the manufacturer's or distributor's agent in securing:
(1) a promissory note and security agreement in
connection with the sale or purchase of a new boat or new boat
[outboard] motor; or
(2) an insurance policy on the operation of a new boat
or new boat [outboard] motor.
SECTION 7. Section 2352.105(b), Occupations Code, is
amended to read as follows:
(b) A [Except as provided by Subsection (c), a] manufacturer
or distributor may not pay a dealer a labor rate for warranty work
that is less than the rate the dealer charges retail customers for
nonwarranty work of the same kind by similar technicians.
SECTION 8. Sections 2352.107(a) and (b), Occupations Code,
are amended to read as follows:
(a) A manufacturer or distributor who terminates an
agreement shall repurchase on demand from the dealer any of the
following items, purchased by the dealer from the manufacturer or
distributor, that are free and clear of a lien or encumbrance:
(1) a new, unsold, retailable, undamaged, and complete
boat, with accessories and packaged trailers sold with the boat,
and any boat [outboard] motor that:
(A) is in the dealer's inventory; and
(B) was purchased during the two years [within
one year] preceding the date of the termination; and
(2) any new, current, unsold, undamaged, and unused
parts or accessories for boats or boat [outboard] motors in the
original resalable merchandising package.
(b) A demand for repurchase must be made in writing not
later than the 90th [30th] day after the date the manufacturer or
distributor terminates the agreement. The dealer must provide the
manufacturer or distributor with a complete list of the items to be
repurchased. The manufacturer or distributor shall complete the
repurchase within a reasonable time.
SECTION 9. Subchapter D, Chapter 2352, Occupations Code, is
amended by adding Section 2352.204 to read as follows:
Sec. 2352.204. CIVIL PENALTY. (a) A person who violates
this chapter is liable to this state for a civil penalty. The
amount of the penalty may not exceed $500 for each violation.
(b) Each sale of, purchase of, or offer to sell or purchase a
new boat or boat motor in violation of Section 2352.051 is a
separate violation.
(c) The attorney general may sue to collect a civil penalty
under this section. The attorney general may recover, on behalf of
the state, the reasonable expenses incurred in obtaining the
penalty, including investigation and court costs, reasonable
attorney's fees, witness fees, and other expenses.
SECTION 10. Section 2352.105(c), Occupations Code, is
repealed.
SECTION 11. The change in law made by this Act applies only
to an agreement entered into or renewed under Chapter 2352,
Occupations Code, on or after the effective date of this Act. An
agreement entered into or renewed before the effective date of this
Act is governed by the law in effect on the date the agreement was
entered into or renewed, and the former law is continued in effect
for that purpose.
SECTION 12. This Act takes effect September 1, 2009.