By Swinford, Van de Putte                              H.B. No. 533

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to certain dealer agreements concerning off-road

 1-3     construction equipment.

 1-4           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-5           SECTION 1.  The heading of Chapter 19, Business & Commerce

 1-6     Code, is amended to read as follows:

 1-7            CHAPTER 19.  FARM, INDUSTRIAL, OFF-ROAD CONSTRUCTION,

 1-8                AND OUTDOOR POWER EQUIPMENT DEALER AGREEMENTS

 1-9           SECTION 2.  Section 19.01, Business & Commerce Code, is

1-10     amended by amending Subsections (5) and (8) and adding Subsection

1-11     (12) to read as follows:

1-12                 (5)  "Dealer" means a person in the business of the

1-13     retail sale of equipment.  The term dealer shall not include a

1-14     single line dealer primarily engaged in the retail sale and service

1-15     of off-road construction and earthmoving equipment.  [The term does

1-16     not include a person whose principal business is the sale of

1-17     off-road construction equipment.]

1-18                 (8)  "Equipment" means farm tractors, farm implements,

1-19     utility tractors, industrial tractors, off-road construction

1-20     equipment, and outdoor power equipment and the attachments to or

1-21     repair parts for those items.

1-22                 (12)  "Single line dealer" means a person, partnership,

1-23     or corporation which:

1-24                       (A)  has purchased 75 percent or more of the

 2-1     dealer's total new product inventory from a single supplier under

 2-2     all agreements with that supplier; and

 2-3                       (B)  has a total annual average sales volume for

 2-4     the three previous years with that single supplier in excess of

 2-5     $100 million for the territory for which that dealer is responsible

 2-6     within the state.

 2-7           SECTION 3.  Section 19.43(a), Business & Commerce Code, is

 2-8     amended to read as follows:

 2-9           (a)  If on termination of a dealer agreement the dealer

2-10     delivers to the supplier or a person designated by the supplier the

2-11     inventory that was purchased from the supplier and that is held by

2-12     the dealer on the date of the termination, the supplier shall pay

2-13     to the dealer:

2-14                 (1)  the dealer cost of new, unsold, undamaged, and

2-15     complete farm tractors, farm implements, utility tractors,

2-16     industrial tractors, forklifts, material-handling equipment,

2-17     outdoor power equipment, off-road construction equipment, and

2-18     attachments returned by the dealer;

2-19                 (2)  an amount equal to 85 percent of the current price

2-20     of new, undamaged repair parts returned by the dealer; and

2-21                 (3)  an amount equal to an additional five percent of

2-22     the current price of new, undamaged repair parts returned by the

2-23     dealer, unless the supplier performs the handling, packing, and

2-24     loading of the parts, in which case no additional amount is

2-25     required under this subdivision.

2-26           SECTION 4.  This Act takes effect September 1, 1997, and

2-27     applies only to an agreement entered into on or after that date.

 3-1     An agreement entered into before the effective date of this Act is

 3-2     governed by the law in effect on the date the agreement was entered

 3-3     into, and that law is continued in effect for that purpose.

 3-4           SECTION 5.  The importance of this legislation and the

 3-5     crowded condition of the calendars in both houses create an

 3-6     emergency and an imperative public necessity that the

 3-7     constitutional rule requiring bills to be read on three several

 3-8     days in each house be suspended, and this rule is hereby suspended.