By: Junell H.B. No. 863
73R2542 LJD-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the marketing of motor fuel; providing penalties.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Title 2, Business & Commerce Code, is amended by
1-5 adding Chapter 20 to read as follows:
1-6 CHAPTER 20. MOTOR FUEL MARKETING
1-7 SUBCHAPTER A. GENERAL PROVISIONS
1-8 Sec. 20.01. DEFINITIONS. In this chapter:
1-9 (1) "Actual cost" means the cost incurred by a person
1-10 in acquiring motor fuel for purposes of sale at the person's
1-11 service facility, computed on a per gallon basis, plus:
1-12 (A) applicable taxes and fees paid per gallon by
1-13 the person to the state, the United States, or another governmental
1-14 agency or instrumentality; and
1-15 (B) transportation costs paid by the person per
1-16 gallon for the motor fuel sold.
1-17 (2) "Distribution point" means a facility at which
1-18 petroleum products are sold or transferred to distributors for
1-19 further distribution by transport vehicle or cargo tanker. The
1-20 term includes a pipeline or barge terminal, refinery, and railcar
1-21 loading rack.
1-22 (3) "Distributor" means a person engaged in the sale
1-23 of motor fuel to a retailer at wholesale, a commercial end-user in
1-24 bulk quantities, or another person who engages in those sales. The
2-1 term does not include a refinery selling directly or through a
2-2 broker to a person who sells the motor fuel to the public at a
2-3 service facility.
2-4 (4) "Motor fuel" means gasoline and diesel fuel of a
2-5 type distributed for use as a fuel in self-propelled vehicles
2-6 designed primarily for use on public streets, roads, and highways.
2-7 (5) "Retail price" means the price per gallon at which
2-8 motor fuel is sold to the public at a service facility. If the
2-9 motor fuel is sold or offered at different prices for a cash
2-10 transaction than for a credit transaction, the retail price is the
2-11 lower of the prices, adjusted for the cost of consumer credit. If
2-12 the motor fuel is sold with another item or service at a combined
2-13 price, the retail price is the price per gallon adjusted to include
2-14 an amount that reflects the price per gallon of the other item or
2-15 service less the cost per gallon of the item or service.
2-16 (6) "Sale" includes a transfer, gift, product
2-17 exchange, and offer or advertisement for sale made in any manner or
2-18 by any means.
2-19 (7) "Service facility" means a facility at which motor
2-20 fuel is sold to the public, including motorists or other end-users.
2-21 (8) "Transfer price" means a price equal to:
2-22 (A) the price a person charges for motor fuel
2-23 sold to a distributor at the distribution point nearest to the
2-24 person's service facility; or
2-25 (B) if a person does not sell motor fuel to
2-26 distributors, the average selling price for motor fuel sold to
2-27 distributors at the distribution point nearest to the person's
3-1 service facility, computed without including the highest and lowest
3-2 selling price for distributors at that distribution point.
3-3 (9) "Transportation cost" means the cost of
3-4 transporting motor fuel by a highway vehicle as prescribed by a
3-5 common carrier tariff of the Railroad Commission of Texas.
3-6 Sec. 20.02. PRESUMED COST. (a) The presumed cost per
3-7 gallon of motor fuel is an amount equal to:
3-8 (1) the transfer price per gallon of motor fuel of the
3-9 same or similar grade or quality as the motor fuel for which the
3-10 presumption is made at the distribution point closest to the
3-11 service facility from which, and on the date that, the motor fuel
3-12 for which the presumption is made was sold;
3-13 (2) applicable taxes and fees paid per gallon required
3-14 to be paid to the state, the United States, or another governmental
3-15 agency or instrumentality; and
3-16 (3) the transportation cost per gallon for the motor
3-17 fuel.
3-18 (b) For the purpose of this section, motor fuel is of the
3-19 same or similar grade or quality if one motor fuel contains an
3-20 additive that does not change its octane or cetane rating to more
3-21 than one point above the rating of the other.
3-22 Sec. 20.03. LIBERAL CONSTRUCTION. This chapter is remedial
3-23 legislation and shall be liberally construed.
3-24 (Sections 20.04-20.10 reserved for expansion
3-25 SUBCHAPTER B. PROHIBITED MARKETING
3-26 PRACTICES; ENFORCEMENT
3-27 Sec. 20.11. PROHIBITED MARKETING PRACTICES; DEFENSES. (a)
4-1 A person may not engage in the sale of motor fuel at a service
4-2 facility at a retail price that is less than the person's presumed
4-3 cost if the person's intent or the effect of the sale is to injure
4-4 a competitor or destroy competition.
4-5 (b) It is a defense to an action brought under this chapter
4-6 that the sale was made:
4-7 (1) as part of a promotional activity ending not later
4-8 than the 30th day after the date of the seller's initial market
4-9 area entry;
4-10 (2) in an isolated transaction and not in the usual
4-11 course of business;
4-12 (3) as part of a complete final liquidation of a
4-13 business;
4-14 (4) for charitable purposes;
4-15 (5) in a good faith effort to meet the equally low or
4-16 lower legal price of a competitor; or
4-17 (6) at a retail price greater than the defendant's
4-18 actual cost.
4-19 (c) A person is presumed to be a competitor for purposes of
4-20 Subsection (b)(5) of this section if the person sells motor fuel at
4-21 a service facility located within a radius of one mile from the
4-22 service facility at which a sale in violation of Subsection (a) of
4-23 this section is alleged to have been made. This presumption may be
4-24 rebutted by clear and convincing evidence of a larger relevant
4-25 competitive market for motor fuel than the one described by this
4-26 subsection.
4-27 Sec. 20.12. CIVIL PENALTY. A person who violates this
5-1 chapter is liable to the state for a civil penalty of not more than
5-2 $5,000 for each sale in violation. The attorney general may sue to
5-3 collect the penalty.
5-4 Sec. 20.13. PRIVATE ACTION FOR DAMAGES. A person who
5-5 violates this chapter is liable to a person, including a
5-6 competitor, injured in the person's business or property for:
5-7 (1) actual damages;
5-8 (2) an amount equal to the greater of:
5-9 (A) three times the actual damages sustained by
5-10 the claimant; or
5-11 (B) the sum of $5,000 for each sale in violation
5-12 of this chapter;
5-13 (3) court costs; and
5-14 (4) reasonable attorney's fees and expert witness
5-15 fees.
5-16 Sec. 20.14. ADDITIONAL EQUITABLE RELIEF. The attorney
5-17 general or a person threatened with loss or damage by a violation
5-18 of this chapter may sue for and obtain injunctive relief under this
5-19 chapter. The court may grant equitable relief as the court
5-20 determines necessary to remedy the effects of a violation,
5-21 including a declaratory judgment, mandatory or prohibitive
5-22 injunctive relief, and interim equitable relief.
5-23 SECTION 2. This Act applies only to sales of motor fuel that
5-24 occur on or after the effective date of this Act.
5-25 SECTION 3. The importance of this legislation and the
5-26 crowded condition of the calendars in both houses create an
5-27 emergency and an imperative public necessity that the
6-1 constitutional rule requiring bills to be read on three several
6-2 days in each house be suspended, and this rule is hereby suspended,
6-3 and that this Act take effect and be in force from and after its
6-4 passage, and it is so enacted.