Texas 2009 - 81st Regular

Texas Senate Bill SB1758 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	81R8184 BEF-F
2	2	By: Watson S.B. No. 1758
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the regulation of motor vehicle manufacturers and
8	8	distributors.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 2301.465(a)(1), Occupations Code, is
11	11	amended to read as follows:
12	12	(1) "Net cost" means the franchised dealer cost for a
13	13	new, unsold, undamaged, and complete motor vehicle [of the current
14	14	model year or the previous model year] in a dealer's inventory:
15	15	(A) plus any charges by the manufacturer,
16	16	distributor, or representative for distribution, delivery, and
17	17	taxes; and
18	18	(B) less all allowances paid to the franchised
19	19	dealer by the manufacturer, distributor, or representative.
20	20	SECTION 2. Section 2301.467, Occupations Code, is amended
21	21	to read as follows:
22	22	Sec. 2301.467. PROHIBITIONS: SALES STANDARDS, RELOCATIONS,
23	23	FACILITY CHANGES, PURCHASE OF EQUIPMENT. (a) Notwithstanding the
24	24	terms of any franchise, a manufacturer, distributor, or
25	25	representative may not:
26	26	(1) require adherence to unreasonable sales or service
27	27	standards; or
28	28	(2) unreasonably require a franchised dealer to
29	29	purchase special tools or equipment.
30	30	(b) Notwithstanding the terms of any franchise, a
31	31	manufacturer, distributor, or representative may not unreasonably
32	32	require a franchised dealer to relocate, or to replace or
33	33	substantially change, alter, or remodel the dealer's facilities.
34	34	For purposes of this subsection, an act is reasonable if it is
35	35	justifiable in light of current and reasonably foreseeable
36	36	projections of economic conditions, financial expectations, and
37	37	the market for new motor vehicles in the relevant market area.
38	38	(c) The prohibitions under this section apply to the
39	39	relationship between a manufacturer and:
40	40	(1) a current franchisee of the manufacturer; or
41	41	(2) a franchised dealer who is seeking to become a
42	42	franchisee of the manufacturer.
43	43	SECTION 3. Section 2301.472(d), Occupations Code, is
44	44	amended to read as follows:
45	45	(d) In determining whether a manufacturer or distributor
46	46	has established that the denial or withholding of approval is
47	47	reasonable, the board shall consider all existing circumstances,
48	48	including:
49	49	(1) the dealer's sales in relation to the sales in the
50	50	market;
51	51	(2) the dealer's investment and obligations;
52	52	(3) injury or benefit to the public;
53	53	(4) the adequacy of the dealer's sales and service
54	54	facilities, equipment, parts, and personnel in relation to those of
55	55	other dealers of new motor vehicles of the same line-make;
56	56	(5) whether warranties are being honored by the dealer
57	57	agreement;
58	58	(6) the parties' compliance with the franchise, except
59	59	to the extent that the franchise conflicts with this chapter;
60	60	(7) the enforceability of the franchise from a public
61	61	policy standpoint, including issues of the reasonableness of the
62	62	franchise's terms, oppression, adhesion, and the parties' relative
63	63	bargaining power;
64	64	(8) whether the dealer complies with reasonable
65	65	capitalization requirements or will be able to comply with
66	66	reasonable capitalization requirements within a reasonable time;
67	67	(9) any harm to the manufacturer or distributor if the
68	68	denial or withholding of approval is not upheld; [and]
69	69	(10) any harm to the dealer if the denial or
70	70	withholding of approval is upheld; and
71	71	(11) whether the denial or withholding of approval is
72	72	justified in light of current and reasonably foreseeable
73	73	projections of economic conditions, financial expectations, and
74	74	the market for new motor vehicles in the relevant market area.
75	75	SECTION 4. Section 2301.475, Occupations Code, is amended
76	76	by adding Subsection (c) to read as follows:
77	77	(c) Money paid by a manufacturer or distributor as a result
78	78	of an incentive program:
79	79	(1) shall be paid to a dealer; and
80	80	(2) may not be paid to an employee of a dealer.
81	81	SECTION 5. Subchapter J, Chapter 2301, Occupations Code, is
82	82	amended by adding Section 2301.479 to read as follows:
83	83	Sec. 2301.479. ADVERSE ACTION IN CONNECTION WITH EXPORT OF
84	84	VEHICLE. (a) Except as otherwise provided by this section, a
85	85	manufacturer, distributor, or representative may not take an
86	86	adverse action against a franchised dealer because the franchised
87	87	dealer sells or leases a vehicle that is later exported to a
88	88	location outside the United States.
89	89	(b) A franchise provision that allows a manufacturer,
90	90	distributor, or representative to take adverse action against a
91	91	franchised dealer because the franchised dealer sells or leases a
92	92	vehicle that is later exported to a location outside the United
93	93	States is enforceable only if, at the time of the original sale or
94	94	lease, the dealer has actual knowledge that the vehicle will be
95	95	exported to a location outside the United States.
96	96	(c) A franchised dealer is presumed to have no actual
97	97	knowledge that a vehicle the dealer sells or leases will be exported
98	98	to a location outside the United States if, under the laws of a
99	99	state of the United States:
100	100	(1) the vehicle is titled;
101	101	(2) the vehicle is registered; and
102	102	(3) applicable state and local taxes are paid for the
103	103	vehicle.
104	104	(d) The presumption under Subsection (c) may be rebutted by
105	105	direct, clear, and convincing evidence that the franchised dealer
106	106	had actual knowledge at the time of the original sale or lease that
107	107	the vehicle will be exported to a location outside the United
108	108	States.
109	109	(e) Except as otherwise expressly permitted by this
110	110	section, a franchise provision that allows a manufacturer,
111	111	distributor, or representative to take adverse action against a
112	112	franchised dealer because the franchised dealer sells or leases a
113	113	vehicle that is later exported to a location outside the United
114	114	States is void and unenforceable.
115	115	SECTION 6. Section 2301.652(a), Occupations Code, is
116	116	amended to read as follows:
117	117	(a) The board may deny an application for a license to
118	118	establish a dealership if, following a protest, the applicant fails
119	119	to establish good cause for establishing the dealership. In
120	120	determining good cause, the board shall consider:
121	121	(1) whether the manufacturer or distributor of the
122	122	same line-make of new motor vehicle is being adequately represented
123	123	as to sales and service;
124	124	(2) whether the protesting franchised dealer
125	125	representing the same line-make of new motor vehicle is in
126	126	substantial compliance with the dealer's franchise, to the extent
127	127	that the franchise is not in conflict with this chapter;
128	128	(3) the desirability of a competitive marketplace;
129	129	(4) any harm to the protesting franchised dealer;
130	130	[and]
131	131	(5) the public interest; and
132	132	(6) current and reasonably foreseeable projections of
133	133	economic conditions, financial expectations, and the market for new
134	134	motor vehicles in the relevant market area.
135	135	SECTION 7. This Act takes effect September 1, 2009.