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House Bill 2640 |
House Author: Smith, Todd |
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Effective: 9-1-09 |
Senate Sponsor: Watson |
House Bill 2640 amends the Occupations Code to provide that the act of filing an application for a motor vehicle dealer's license or a prescribed form relating to such a license does not establish the applicant as a franchised dealer. The bill requires the Motor Vehicle Board of the Texas Department of Transportation, in a protest of a rejection by a manufacturer or distributor of an application for approval of a dealer's transfer of ownership of a franchise, to determine whether the rejection was reasonable under specific criteria rather than whether the prospective transferee is qualified. The bill amends requirements relating to the relocation or termination of a franchised dealer, amends the conditions the board must consider when determining good cause for establishing a dealership, and increases from one mile to two miles the maximum distance from the current site of a dealership for which a franchised dealer is prohibited from protesting an application to relocate the dealership.
House Bill 2640 prohibits a manufacturer, distributor, or representative from unreasonably requiring a current or prospective franchisee to relocate, replace, or substantially change the dealer's facilities and establishes criteria for making such a determination. The bill amends the circumstances the department's Motor Vehicle Division must consider in reviewing a manufacturer's or distributor's denial or withholding of approval of a franchise dealer's application to add a line-make and authorizes money paid by a manufacturer or distributor under an incentive program to only be paid to a dealer, with certain exceptions. The bill prohibits a manufacturer, distributor, or representative from taking an adverse action against a franchised dealer because the dealer sells or leases a vehicle that is later exported to a location outside the United States, provides that a franchise provision allowing such adverse action is enforceable only under specified conditions, and provides that a franchised dealer is presumed to have no actual knowledge that a vehicle will be exported if the vehicle is titled and registered and applicable state and local taxes paid, unless rebutted by certain evidence.