By: Van de Putte S.B. No. 854
(Harper-Brown)
A BILL TO BE ENTITLED
AN ACT
relating to the regulation of motor vehicle dealers, manufacturers,
distributors, and representatives.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter J, Chapter 2301, Occupations Code, is
amended by adding Section 2301.483 to read as follows:
Sec. 2301.483. SPECIFIC USE AGREEMENTS. (a) In this
section:
(1) "Necessary real estate" means real estate that is
necessary for the proper operation of a dealership in the
dealership's location as determined by the manufacturer's,
distributor's, or representative's facility requirements or to
comply with any applicable law or zoning requirement.
(2) "Owner" means a manufacturer, distributor, or
representative, including an entity owned or controlled by a
manufacturer, distributor, or representative.
(3) "Specific use agreement" means a property use
agreement that is executed in conjunction with a sale or as part of
the terms of a lease by an owner of real property to a transferee for
use by the transferee as a dealership under the terms of a franchise
executed or to be executed between the owner and the transferee.
(4) "Transferee" means a person who is a purchaser or
lessee of real property subject to a specific use agreement.
(b) To the extent of any conflict between this section and
another section of this chapter regarding a specific use agreement,
this section controls. Notwithstanding any other section of this
chapter and except as provided by this section, a specific use
agreement may include provisions that allow an owner to:
(1) limit the transferee's ability to add a line-make
after the transferee has opened a franchised dealership on the
property to which the specific use agreement applies;
(2) prohibit the sale or sublease of the dealership
property by the transferee to a person for a purpose other than the
operation of a dealership under a franchise with the owner of the
property; or
(3) make the limitations described by Subdivisions (1)
and (2) applicable to any successor or sublessee of the transferee.
(c) An owner may not coerce or attempt to coerce an existing
franchised dealer of the owner to relocate an existing dealership
of the same line-make to property that is subject to a specific use
agreement. If it is proven in a civil suit that a person entered
into a specific use agreement containing a provision described by
Subsection (b) as a result of coercion, the specific use agreement
is void.
(d) A specific use agreement executed in conjunction with
the sale of real property may apply only to the necessary real
estate.
(e) A specific use agreement executed in conjunction with
the sale of real property to an existing franchised dealer for the
purpose of relocating an existing dealership of the same line-make
to property that is the subject of the specific use agreement or to
a person for the purpose of establishing a new dealership expires on
the earliest of:
(1) the date established by the specific use
agreement;
(2) the termination or discontinuance of the franchise
between the parties to the specific use agreement as a result of the
owner:
(A) discontinuing all line-makes applicable to
the necessary real estate that are under the control of a
manufacturer or distributor holding property use rights for the
necessary real estate under the specific use agreement;
(B) ceasing to do business in this state; or
(C) changing the distributor or method of
distribution of the owner's products in this state;
(3) the 10th anniversary of the date the dealership
opens for business; or
(4) any time after the expiration of nine years from
the date the dealership opens for business if the transferee has
performed all the transferee's financial duties as provided by the
contract and title to the property has passed to the transferee.
(f) Unless a specific use agreement associated with the sale
of property expressly provides otherwise, there is no penalty for
the full performance by the transferee and transfer of title to the
transferee prior to the time set forth by the contract's terms.
SECTION 2. Subsection (d), Section 2301.6521, Occupations
Code, is amended to read as follows:
(d) A franchised dealer may not protest an application to
relocate a dealership under this section if the proposed relocation
site is not:
(1) more than two miles [or less] from the site where
the dealership is currently located; or
(2) closer to the franchised dealer than the site from
which the dealership is being relocated [dealership's current
location].
SECTION 3. Section 2301.483, Occupations Code, as added by
this Act, applies only to an agreement entered into or renewed under
Chapter 2301, Occupations Code, on or after the effective date of
this Act. An agreement entered into or renewed before that date 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 4. Subsection (d), Section 2301.6521, Occupations
Code, as amended by this Act, applies only to an application to
relocate a dealership that is made on or after the effective date of
this Act. An application made before that date is governed by the
law in effect on the date the application was made, and the former
law is continued in effect for that purpose.
SECTION 5. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2013.