1-1 AN ACT
1-2 relating to the duties and authority of the Texas Motor Vehicle
1-3 Board and to the regulation of the sale of motor vehicles.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 1.03, Texas Motor Vehicle Commission Code
1-6 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
1-7 read as follows:
1-8 Sec. 1.03. DEFINITIONS. In this Act:
1-9 (1) "Ambulance" means a vehicle used exclusively for
1-10 providing emergency medical care to an injured or ill person or
1-11 transporting an injured or ill person, if the vehicle provides:
1-12 (A) a driver's compartment;
1-13 (B) a compartment to accommodate an emergency
1-14 medical care technician or paramedic and two injured or ill persons
1-15 so positioned that one of the injured or ill persons can be given
1-16 intensive life-support during transit;
1-17 (C) equipment and supplies for emergency care of
1-18 an injured or ill person where the ill person is located or at the
1-19 scene of an injury-producing incident as well as in transit;
1-20 (D) two-way radio communication capability; and
1-21 (E) equipment for light rescue or extrication
1-22 procedures.
1-23 (2) "Board" means the Motor Vehicle Board of the Texas
1-24 Department of Transportation.
2-1 (3) "Broker" means a person who, for a fee,
2-2 commission, or other valuable consideration, arranges or offers to
2-3 arrange a transaction involving the sale of a new motor vehicle,
2-4 and who is not:
2-5 (A) a franchised dealer or bona fide employee of
2-6 a franchised dealer when acting on behalf of a franchised dealer;
2-7 (B) a representative or bona fide employee of a
2-8 representative when acting on behalf of a representative;
2-9 (C) a distributor or bona fide employee of a
2-10 distributor when acting on behalf of a distributor; or
2-11 (D) at any point in the transaction the bona
2-12 fide owner of the vehicle involved in the transaction.
2-13 (4) "Chassis manufacturer" means a person who
2-14 manufactures and produces the frame upon which is mounted the body
2-15 of a motor vehicle.
2-16 (5) "Conversion" means a motor vehicle, other than a
2-17 motor home, ambulance, or fire-fighting vehicle, which has been
2-18 substantially modified by a person other than the manufacturer or
2-19 distributor of the chassis of the motor vehicle and which has not
2-20 been the subject of a retail sale.
2-21 (6) "Converter" means a person who prior to the retail
2-22 sale of a motor vehicle, assembles, installs, or affixes a body,
2-23 cab, or special equipment to a chassis, or who substantially adds,
2-24 subtracts from, or modifies a previously assembled or manufactured
2-25 motor vehicle other than a motor home, ambulance, or fire-fighting
2-26 vehicle.
2-27 (7) "Dealer" means a person who holds a general
3-1 distinguishing number issued by the Department pursuant to the
3-2 terms of Chapter 503, Transportation Code.
3-3 (8) "Dealership" means the physical premises and
3-4 business facilities on which a franchised dealer operates his
3-5 business, including the sale and repair of motor vehicles. The
3-6 term includes premises or facilities at which a person engages only
3-7 in the repair of motor vehicles if repairs are performed pursuant
3-8 to the terms of a franchise and a motor vehicle manufacturer's
3-9 warranty.
3-10 (9) "Department" means the Texas Department of
3-11 Transportation.
3-12 (10) "Director" means the director of the board.
3-13 (11) "Distributor" means any person who distributes
3-14 and/or sells new motor vehicles to franchised dealers and who is
3-15 not a manufacturer.
3-16 (12) "Executive Director" means the Executive Director
3-17 of the Texas Department of Transportation.
3-18 (13) "Fire-fighting vehicle" means a motor vehicle
3-19 which has as its sole purpose transporting fire fighters to the
3-20 scene of a fire and providing equipment to fight the fire, if the
3-21 vehicle is built on a truck chassis with a gross carrying capacity
3-22 of at least 10,000 pounds, to which the following have been
3-23 permanently affixed or mounted:
3-24 (A) a water tank with a minimum combined
3-25 capacity of 500 gallons; and
3-26 (B) a centrifugal water pump with a minimum
3-27 capacity of not less than 750 gallons per minute at 150 pounds per
4-1 square inch net pump pressure.
4-2 (14) "Franchise" means one or more contracts between a
4-3 franchised dealer as franchisee, and either a manufacturer or a
4-4 distributor as franchisor under which (A) the franchisee is granted
4-5 the right to sell and service new motor vehicles manufactured or
4-6 distributed by the franchisor or only service motor vehicles
4-7 pursuant to the terms of a franchise and a manufacturer's warranty;
4-8 (B) the franchisee as an independent business is a component of
4-9 franchisor's distribution system; (C) the franchisee is
4-10 substantially associated with franchisor's trademark, tradename and
4-11 commercial symbol; (D) the franchisee's business is substantially
4-12 reliant on franchisor for a continued supply of motor vehicles,
4-13 parts, and accessories for the conduct of its business; or (E) any
4-14 right, duty, or obligation granted or imposed by this Act is
4-15 affected. The term includes a written communication from a
4-16 franchisor to a franchisee by which a duty is imposed on the
4-17 franchisee.
4-18 (15) "Franchised dealer" means any person who holds a
4-19 franchised motor vehicle dealer's license [general distinguishing
4-20 number] issued by the Department pursuant to the terms of Chapter
4-21 503, Transportation Code, and who is engaged in the business of
4-22 buying, selling, or exchanging new motor vehicles and servicing or
4-23 repairing motor vehicles pursuant to the terms of a franchise and a
4-24 manufacturer's warranty at an established and permanent place of
4-25 business pursuant to a franchise in effect with a manufacturer or
4-26 distributor.
4-27 (16) "General distinguishing number" means a dealer
5-1 license issued by the Department pursuant to the terms of Chapter
5-2 503, Transportation Code.
5-3 (17) "Lease" means a transfer of the right to
5-4 possession and use of a motor vehicle for a term in excess of 180
5-5 days in return for consideration.
5-6 (18) "Lease facilitator" means a person, other than a
5-7 franchised dealer or a bona fide employee of a dealer, or a vehicle
5-8 lessor or a bona fide employee of a vehicle lessor, who:
5-9 (A) holds himself out to any person as a "motor
5-10 vehicle leasing company" or "motor vehicle leasing agent" or uses
5-11 a similar title, for the purpose of soliciting or procuring a
5-12 person to enter into a contract or agreement to become the lessee
5-13 of a vehicle that is not, and will not be, titled in the name of
5-14 and registered to the lease facilitator; or
5-15 (B) otherwise solicits a person to enter into a
5-16 contract or agreement to become a lessee of a vehicle that is not,
5-17 and will not be, titled in the name of and registered to the lease
5-18 facilitator, or who is otherwise engaged in the business of
5-19 securing lessees or prospective lessees of motor vehicles that are
5-20 not, and will not be, titled in the name of and registered to the
5-21 facilitator.
5-22 (19) "Lessor" means a person who, pursuant to the
5-23 terms of a lease, transfers to another person the right to
5-24 possession and use of a motor vehicle titled in the name of the
5-25 lessor.
5-26 (20) "Licensee" means a person who holds a license or
5-27 general distinguishing number issued by the Board under the terms
6-1 of this Act or Chapter 503, Transportation Code.
6-2 (21) "Manufacturer" means any person who manufactures
6-3 or assembles new motor vehicles.
6-4 (22) "Manufacturer's statement of origin" means a
6-5 certificate on a form prescribed by the Department showing the
6-6 original transfer of a new motor vehicle from the manufacturer to
6-7 the original purchaser.
6-8 (23) "Motor home" means a motor vehicle which is
6-9 designed to provide temporary living quarters and which:
6-10 (A) is built onto as an integral part of, or is
6-11 permanently attached to, a motor vehicle chassis; and
6-12 (B) contains at least four of the following
6-13 independent life support systems if each is permanently installed
6-14 and designed to be removed only for purposes of repair or
6-15 replacement and meets the standards of the American National
6-16 Standards Institute, Standards for Recreational Vehicles:
6-17 (i) a cooking facility with an on-board
6-18 fuel source;
6-19 (ii) a gas or electric refrigerator;
6-20 (iii) a toilet with exterior evacuation;
6-21 (iv) a heating or air conditioning system
6-22 with an on-board power or fuel source separate from the vehicle
6-23 engine;
6-24 (v) a potable water supply system that
6-25 includes at least a sink, a faucet, and a water tank with an
6-26 exterior service supply connection;
6-27 (vi) a 110-125 volt electric power supply.
7-1 (24) "Motor home manufacturer" means a person other
7-2 than the manufacturer of the chassis of a motor vehicle who, prior
7-3 to the retail sale of the motor vehicle, performs modifications on
7-4 the chassis that result in the finished product being classified as
7-5 a motor home.
7-6 (25) "Motor vehicle" means:
7-7 (A) every fully self-propelled vehicle which has
7-8 as its primary purpose the transport of a person or persons, or
7-9 property, on a public highway, and having two or more wheels;
7-10 (B) every two or more wheeled fully
7-11 self-propelled, titled vehicle which has as its primary purpose the
7-12 transport of a person or persons or property and is not
7-13 manufactured for use on public streets, roads, or highways;
7-14 (C) an engine, transmission, or rear axle
7-15 manufactured for installation in a vehicle having as its primary
7-16 purpose the transport of a person or persons or property on a
7-17 public highway and having a gross vehicle weight rating of more
7-18 than 16,000 pounds, whether or not attached to a vehicle chassis;
7-19 or
7-20 (D) a towable recreational vehicle.
7-21 (26) "New motor vehicle" means a motor vehicle which
7-22 has not been the subject of a "retail sale" without regard to the
7-23 mileage of the vehicle.
7-24 (27) "Nonfranchised dealer" means a person who holds
7-25 an independent motor vehicle dealer's general distinguishing number
7-26 or a wholesale motor vehicle dealer's general distinguishing number
7-27 issued by the Department pursuant to the terms of Chapter 503,
8-1 Transportation Code.
8-2 (28) "Party" means each person or agency named or
8-3 admitted as a party and whose legal rights, duties, or privileges
8-4 are to be determined by the board after an opportunity for
8-5 adjudicative hearing.
8-6 (29) "Person" means a natural person, partnership,
8-7 corporation, association, trust, estate, or any other legal entity.
8-8 (30) "Relocation" means the transfer of an existing
8-9 dealership operation to facilities at a different location,
8-10 including a transfer which results in a consolidation or dualing of
8-11 an existing dealer's operation.
8-12 (31) "Representative" means any person who is or acts
8-13 as an agent, employee or representative of a manufacturer,
8-14 distributor, or converter who performs any duties in this State
8-15 relating to promoting the distribution and/or sale of new motor
8-16 vehicles or contacts dealers in this State on behalf of a
8-17 manufacturer, distributor, or converter.
8-18 (32) "Retail sale" means the sale of a motor vehicle
8-19 except:
8-20 (A) a sale in which the purchaser acquires a
8-21 vehicle for the purpose of resale; or
8-22 (B) a sale of a vehicle that is operated under
8-23 and in accordance with Section 503.061, Transportation Code.
8-24 (33) "Rule" means a statement by the board of general
8-25 and future applicability that implements, interprets, or prescribes
8-26 law or policy or describes the organization or procedural practice
8-27 requirements of the board. The term includes the amendment or
9-1 repeal of a prior rule, but does not include statements concerning
9-2 only the internal management of the board which do not affect the
9-3 rights of a person not connected with the board.
9-4 (34) "Towable recreational vehicle" means a
9-5 nonmotorized vehicle originally designed and manufactured for the
9-6 primary purpose of providing temporary human habitation in
9-7 conjunction with recreational, camping, or seasonal use and:
9-8 (A) is titled and registered with the Texas
9-9 Department of Transportation as a travel trailer through the county
9-10 tax assessor-collector;
9-11 (B) is permanently built on a single chassis;
9-12 (C) contains one or more life support systems;
9-13 and
9-14 (D) is designed to be towable by another motor
9-15 vehicle.
9-16 (35) "Transportation Commission" means the Texas
9-17 Transportation Commission of the Texas Department of
9-18 Transportation.
9-19 (36) "Warranty work" means parts, labor, and any other
9-20 expenses incurred by a franchised dealer in complying with the
9-21 terms of a manufacturer's or distributor's warranty.
9-22 SECTION 2. Section 2.03, Texas Motor Vehicle Commission Code
9-23 (Article 4413(36), Vernon's Texas Civil Statutes), is amended by
9-24 amending Subsections (b) and (c) and by adding Subsection (d) to
9-25 read as follows:
9-26 (b) Except as provided by this section, the office of a
9-27 member is automatically vacated and shall be filled as any other
10-1 vacancy, if:
10-2 (1) the member becomes a licensee under this Act;
10-3 (2) the member acquires an interest in a business that
10-4 manufactures, distributes, converts, leases, or sells motor
10-5 vehicles;
10-6 (3) the member becomes an [officer,] employee[,] or
10-7 paid consultant of a trade association in the motor vehicle
10-8 industry; or
10-9 (4) a person related to the member within the first
10-10 degree by consanguinity or affinity, as determined under Chapter
10-11 573, Government Code, becomes an [officer,] employee[,] or paid
10-12 consultant of a trade association in the motor vehicle industry,
10-13 becomes a licensee under this Act, or acquires an interest in a
10-14 business that manufactures, distributes, converts, leases, or sells
10-15 motor vehicles.
10-16 (c) Notwithstanding the terms of Subsection (b) of this
10-17 section, the office of a member appointed to the board pursuant to
10-18 the terms of Section 2.02(b)(1) [2.02(c)(1)] of this Act is not
10-19 vacated by virtue of the fact that the member, or a person related
10-20 to the member within the first degree by consanguinity or affinity,
10-21 as determined under Chapter 573, Government Code, subsequently
10-22 acquires an interest in a dealership.
10-23 (d) Notwithstanding the terms of this section, a person is
10-24 not disqualified to be appointed to or serve on the board because
10-25 that person, or another person, owns, directly or indirectly,
10-26 shares of stock in a publicly traded company that manufactures or
10-27 distributes motor vehicles, if the ownership interest is not
11-1 substantial.
11-2 SECTION 3. Section 2.08(d), Texas Motor Vehicle Commission
11-3 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
11-4 to read as follows:
11-5 (d) A member of the board appointed pursuant to the terms of
11-6 Section 2.02(b) [2.02(c)] of this Act may not vote on an issue
11-7 involving a dispute in which both a dealer and a manufacturer are
11-8 named parties.
11-9 SECTION 4. Section 2.12(c), Texas Motor Vehicle Commission
11-10 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
11-11 to read as follows:
11-12 (c) With regard to each complaint filed by the board for the
11-13 purpose of enforcing this Act [with the Commission], the board
11-14 [Commission] shall keep the following information:
11-15 (1) the date the complaint is filed;
11-16 (2) the name of the person filing the complaint;
11-17 (3) the subject matter of the complaint;
11-18 (4) a record of each person contacted in relation to
11-19 the complaint;
11-20 (5) a summary of the results of the review or
11-21 investigation of the complaint; and
11-22 (6) if the Commission takes no action on the
11-23 complaint, an explanation of the reasons that no action was taken.
11-24 SECTION 5. Section 3.01(a), Texas Motor Vehicle Commission
11-25 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
11-26 to read as follows:
11-27 (a) The board has the exclusive, [general and] original
12-1 [power and] jurisdiction to regulate those [all] aspects of the
12-2 distribution, sale, and leasing of motor vehicles as governed by
12-3 this Act and to do all things, whether specifically designated in
12-4 this Act or implied herein, or necessary or convenient to the
12-5 exercise of this power and jurisdiction, including the original
12-6 jurisdiction to determine questions of its own jurisdiction. In
12-7 addition to the other duties placed on the board by this Act, the
12-8 board shall enforce and administer the terms of Chapter 503,
12-9 Transportation Code.
12-10 SECTION 6. Section 3.03, Texas Motor Vehicle Commission Code
12-11 (Article 4413(36), Vernon's Texas Civil Statutes), is amended to
12-12 read as follows:
12-13 Sec. 3.03. GENERAL BOARD [COMMISSION] POWERS. (a) The board
12-14 [Commission] shall have and may, in its discretion and
12-15 notwithstanding any other provision of law that is inconsistent
12-16 with this Act, exercise the powers set forth in this Act, and shall
12-17 have all other powers necessary, incidental, or convenient to carry
12-18 out its duties and effectuate its express powers and duties. These
12-19 powers and duties include the power to initiate and conduct
12-20 proceedings, investigations, and hearings, administer oaths,
12-21 receive evidence and pleadings, issue subpoenas to compel the
12-22 attendance of any person, order the production of any tangible
12-23 property, including papers, records, and documents, make findings
12-24 of fact on all factual issues arising out of any proceeding
12-25 initiated under this Act, specify, govern, and control appearance,
12-26 practice, and procedure before the Commission, issue rules,
12-27 conclusions of law, decisions, including declaratory decisions or
13-1 orders, enter into contracts or execute instruments, retain
13-2 counsel, utilize the services of the Attorney General of the State
13-3 of Texas and thereafter institute and direct the conduct of legal
13-4 proceedings in any forum or obtain other professional services as
13-5 may be necessary and convenient, sanction for contempt, assess and
13-6 collect fees and costs including attorney's fees, issue, suspend,
13-7 and revoke licenses, prohibit and regulate acts and practices in
13-8 connection with the distribution and sale of motor vehicles and
13-9 warranty performance obligations, issue cease and desist orders in
13-10 the nature of temporary and permanent injunctions, and levy civil
13-11 penalties. The board has the authority to enforce its order. The
13-12 authority vested in the board by this section includes the
13-13 authority to enter an order requiring that a person:
13-14 (1) pay costs and expenses of a party in connection
13-15 with an order entered pursuant to the authority of Section
13-16 5.02(b)(16);
13-17 (2) perform an act other than the payment of money; or
13-18 (3) refrain from performing an act.
13-19 (b) The board may conduct hearings in contested cases
13-20 brought pursuant to, and as provided by, Chapter 503,
13-21 Transportation Code. The procedures applicable to a hearing
13-22 conducted under this Subsection, and the disposition of a final
13-23 order after a hearing conducted under this Subsection, are those
13-24 applicable to a hearing conducted as provided by Section 6.07(e)(2)
13-25 of this Act. A decision or final order issued under this
13-26 Subsection is final, and no appeal may, as a matter of right, be
13-27 made to the Texas Transportation Commission. The board
14-1 [department] may adopt rules applicable to procedures, hearings,
14-2 and enforcement proceedings in an action brought pursuant to this
14-3 Subsection.
14-4 SECTION 7. Section 3.05(a), Texas Motor Vehicle Commission
14-5 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
14-6 to read as follows:
14-7 (a) Whenever the Board has reason to believe, through
14-8 receipt of a complaint or otherwise, that a violation of this Act
14-9 or a Board rule, order, or decision has occurred or is likely to
14-10 occur, the Board shall conduct an investigation unless it
14-11 determines that a complaint is frivolous or for the purpose of
14-12 harassment. If the Board's investigation establishes that a
14-13 violation of this Act or a Board rule, order, or decision has
14-14 occurred or is likely to occur, the Board shall institute
14-15 proceedings as it deems appropriate to enforce this Act or its
14-16 rules, orders, and decisions. Notwithstanding other provisions of
14-17 this Act, the Board is not required to pay a filing fee when filing
14-18 a complaint or other enforcement action.
14-19 SECTION 8. Section 3.08, Texas Motor Vehicle Commission Code
14-20 (Article 4413(36), Vernon's Texas Civil Statutes), is amended by
14-21 adding Subsection (k) to read as follows:
14-22 (k) Except as provided by this subsection, a licensee may
14-23 not file an action with the board after the expiration of four
14-24 years after the date the action accrues. The limitations period
14-25 provided by this subsection may be extended for a period not to
14-26 exceed 180 days on a showing that the failure timely to commence an
14-27 action was caused by reliance on fraudulent statements or
15-1 inducements made by a party for the purpose of inducing a party to
15-2 refrain from bringing an action. This subsection does not apply
15-3 to:
15-4 (1) an action with respect to which this code or rules
15-5 of the board establish specific procedural time limits; or
15-6 (2) an action brought under Subsection (i) of this
15-7 section.
15-8 SECTION 9. Section 4.01(a), Texas Motor Vehicle Commission
15-9 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
15-10 to read as follows:
15-11 (a) Except as provided by this Section, no person shall
15-12 engage in business as, serve in the capacity of, or act as a
15-13 dealer, manufacturer, distributor, converter, representative,
15-14 lessor, or lease facilitator in this State or perform or offer to
15-15 perform repair services on a motor vehicle pursuant to the terms of
15-16 a franchise and a motor vehicle manufacturer's warranty, whether or
15-17 not the person sells or offers to sell motor vehicles at the same
15-18 location, without obtaining a license therefor as provided in this
15-19 Act and the rules of the board [Commission]. All new license
15-20 applications shall be reviewed and, in the discretion of the board
15-21 [Commission], investigated to determine compliance with the
15-22 provisions of this Act. License renewals may be administratively
15-23 granted unless protested. Licenses issued by the board
15-24 [Commission] shall expire one year from date of issuance. All
15-25 licenses and renewals thereof are issued subject to all provisions
15-26 of this Act and rules of the board [Commission] in effect upon the
15-27 date of issuance as well as all future provisions of this Act and
16-1 rules which may become effective during the term of the license. A
16-2 lessor or lease facilitator is not required to obtain a lessor or
16-3 lease facilitator license or pay a license fee under this code if
16-4 the lessor or lease facilitator is a state or federally chartered
16-5 financial institution or a regulated subsidiary of a state or
16-6 federally chartered financial institution. A trust or other entity
16-7 that owns an interest in a lease and the vehicle that is the
16-8 subject of the lease is not required to obtain a lessor license or
16-9 lease facilitator license or pay a license fee with respect to a
16-10 lease initiated, managed, serviced, and administered by a licensed
16-11 lessor. A franchised dealer licensed under this code is not
16-12 required to obtain a lessor or lease facilitator license or pay a
16-13 license fee under this code to engage in the business of leasing
16-14 motor vehicles, including new motor vehicles, that the dealer is
16-15 licensed to sell. The board may issue a duplicate license for any
16-16 license it issues, charge a fee for the issuance of a duplicate
16-17 license, and adopt rules applicable to the issuance of a duplicate
16-18 license.
16-19 SECTION 10. Section 4.02(a), Texas Motor Vehicle Commission
16-20 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
16-21 to read as follows:
16-22 (a) An application for a dealer license shall be on a form
16-23 prescribed by the board which shall include the information
16-24 required by Chapter 503, Transportation Code, and information on
16-25 the applicant's financial resources, business integrity, business
16-26 ability and experience, franchise agreement if applicable, physical
16-27 facilities, vehicle inventory, and other factors the board
17-1 considers necessary to determine an applicant's qualifications to
17-2 adequately serve the public. Notwithstanding other law or rule, a
17-3 request for an application is confidential, is not an open record,
17-4 and is not available for public inspection.
17-5 SECTION 11. Section 4.03(c), Texas Motor Vehicle Commission
17-6 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
17-7 to read as follows:
17-8 (c) Each application for a manufacturer's license shall
17-9 include an instrument setting forth the terms and conditions of all
17-10 warranty agreements in force and effect on the products it sells in
17-11 this State so that the board [Commission] may ascertain the degree
17-12 of protection afforded the retail purchasers of its products and
17-13 the obligations of its franchised dealers in connection therewith
17-14 as well as the basis for compensating its franchised dealers for
17-15 labor, parts and other expenses incurred in connection with such
17-16 manufacturer's warranty agreements. Each application shall include
17-17 a statement regarding the manufacturer's compliance with Sections
17-18 [Section] 5.02, 5.02A, 5.02B, and 5.02C of this Act. In addition,
17-19 each manufacturer's license application shall specify the delivery
17-20 and preparation obligations of its franchised dealers prior to
17-21 delivery of a new motor vehicle to a retail purchaser and the
17-22 schedule of compensation to be paid to its franchised dealers for
17-23 the work and service performed by them in connection with such
17-24 delivery.
17-25 SECTION 12. Section 4.05(a), Texas Motor Vehicle Commission
17-26 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
17-27 to read as follows:
18-1 (a) The annual license fees for licenses issued hereunder
18-2 shall be as follows:
18-3 (1) For each manufacturer and distributor, $900 plus
18-4 $20 for each individual dealer franchised by the manufacturer or
18-5 distributor.
18-6 (2) For each franchised dealer who sold 200 or fewer
18-7 new motor vehicles during the preceding calendar year, $175.
18-8 (3) For each franchised dealer who sold more than 200,
18-9 but not more than 400, new motor vehicles during the preceding
18-10 calendar year, $275.
18-11 (4) For each franchised dealer who sold more than 400,
18-12 but not more than 800, new motor vehicles during the preceding
18-13 calendar year, $400.
18-14 (5) For each franchised dealer who sold more than 800
18-15 but not more than 1,200 new motor vehicles during the preceding
18-16 calendar year, $500.
18-17 (6) For each franchised dealer who sold more than
18-18 1,200 but not more than 1,600 new motor vehicles during the
18-19 preceding calendar year, $625.
18-20 (7) For each franchised dealer who sold more than
18-21 1,600 new motor vehicles during the preceding calendar year, $750.
18-22 (8) For each location separate from his dealership at
18-23 which a franchised dealer offers no motor vehicle for sale, but
18-24 performs warranty service on vehicles the dealer is franchised and
18-25 licensed to sell, $100.
18-26 (9) For each amendment to a [dealer's] license, $25.
18-27 (10) For each representative, $100.
19-1 (11) For each converter, $375.
19-2 (12) For each lessor who leased 200 or fewer motor
19-3 vehicles during the preceding calendar year, $175.
19-4 (13) For each lessor who leased more than 200 but not
19-5 more than 400 motor vehicles during the preceding calendar year,
19-6 $275.
19-7 (14) For each lessor who leased more than 400 but not
19-8 more than 800 motor vehicles during the preceding calendar year,
19-9 $400.
19-10 (15) For each lessor who leased more than 800 but not
19-11 more than 1,200 motor vehicles during the preceding calendar year,
19-12 $500.
19-13 (16) For each lessor who leased more than 1,200 but
19-14 not more than 1,600 motor vehicles during the preceding calendar
19-15 year, $625.
19-16 (17) For each lessor who leased more than 1,600 motor
19-17 vehicles during the preceding calendar year, $750.
19-18 (18) For each lease facilitator, $375.
19-19 (19) For each duplicate license, $50.
19-20 SECTION 13. Section 4.06(a), Texas Motor Vehicle Commission
19-21 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
19-22 to read as follows:
19-23 (a) The board may deny an application for a license, revoke
19-24 or suspend an outstanding license, or place on probation a person
19-25 whose license has been suspended, or reprimand a licensee, for any
19-26 of the following reasons:
19-27 (1) Unfitness of an applicant or licensee under
20-1 standards set out in this Act or in board rules.
20-2 (2) Material misrepresentation in any application or
20-3 other information filed under this Act or board rules.
20-4 (3) Failure to comply with this Act or any board rule
20-5 or order promulgated by the board.
20-6 (4) Failure to maintain the qualifications for a
20-7 license.
20-8 (5) Willfully defrauding any [retail] buyer.
20-9 (6) Violation of any law relating to the sale,
20-10 distribution, financing, or insuring of motor vehicles.
20-11 (7) Any act or omission by an officer, director,
20-12 partner, trustee, or other person acting in a representative
20-13 capacity for a licensee which act or omission would be cause for
20-14 denying, revoking, or suspending a license to an individual
20-15 licensee.
20-16 (8) Failure to fulfill written agreements between the
20-17 licensee and a retail buyer of a motor vehicle.
20-18 SECTION 14. Section 5.02(b), Texas Motor Vehicle Commission
20-19 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
20-20 to read as follows:
20-21 (b) It is unlawful for any manufacturer, distributor, or
20-22 representative to:
20-23 (1) Require or attempt to require any dealer to order,
20-24 accept delivery of or pay anything of value, directly or
20-25 indirectly, for any motor vehicle, appliance, part, accessory or
20-26 any other commodity unless voluntarily ordered or contracted for by
20-27 such dealer.
21-1 (2) Refuse or fail to deliver, in reasonable
21-2 quantities and within a reasonable time, to a dealer having a
21-3 franchise agreement for the retail sale of any motor vehicles sold
21-4 or distributed by such manufacturer, distributor, or
21-5 representative, any new motor vehicle or parts or accessories to
21-6 new motor vehicles as are covered by such franchise if such
21-7 vehicle, parts or accessories are publicly advertised as being
21-8 available for delivery or are actually being delivered; provided,
21-9 however, this provision is not violated if such failure is caused
21-10 by acts of God, work stoppage or delays due to strikes or labor
21-11 disputes, freight embargoes or other causes beyond the control of
21-12 the manufacturer, distributor, or representative.
21-13 (3) Notwithstanding the terms of any franchise
21-14 agreement:
21-15 (A) Terminate or refuse to continue any
21-16 franchise with a dealer or directly or indirectly force or attempt
21-17 to force a dealer to relocate or discontinue a line-make or parts
21-18 or products related to that line-make unless all of the following
21-19 conditions are met:
21-20 (i) the dealer and the board have received
21-21 written notice by registered or certified mail from the
21-22 manufacturer, distributor, or representative not less than 60 days
21-23 before the effective date of termination or noncontinuance setting
21-24 forth the specific grounds for termination or noncontinuance; and
21-25 (ii) the written notice contains on the
21-26 first page thereof a conspicuous statement which reads as follows:
21-27 "NOTICE TO DEALER: YOU MAY BE ENTITLED TO FILE A PROTEST WITH THE
22-1 TEXAS MOTOR VEHICLE BOARD IN AUSTIN, TEXAS, AND HAVE A HEARING IN
22-2 WHICH YOU MAY PROTEST THE PROPOSED TERMINATION OR NONCONTINUANCE OF
22-3 YOUR FRANCHISE UNDER THE TERMS OF THE TEXAS MOTOR VEHICLE
22-4 COMMISSION CODE IF YOU OPPOSE THIS ACTION."; and
22-5 (iii) the manufacturer, distributor, or
22-6 representative has received the informed, written consent of the
22-7 affected dealer or the appropriate period for the affected dealer
22-8 to protest the proposed franchise termination or noncontinuance has
22-9 lapsed; or
22-10 (iv) if the affected dealer files a
22-11 protest with the board within the greater of (1) 60 days after
22-12 receiving its 60-day notice of proposed termination or
22-13 noncontinuance or (2) the time specified in such notice, the board
22-14 determines that the party seeking to terminate or not continue a
22-15 dealer's franchise has established by a preponderance of the
22-16 evidence, at a hearing called by the board, that there is good
22-17 cause for the proposed termination or noncontinuance.
22-18 (v) Notwithstanding Subdivisions (3)(A)(i)
22-19 and (3)(A)(iv) of this section, notice may be made not less than 15
22-20 days prior to the effective date of termination or noncontinuance
22-21 if a licensed dealer fails to conduct its customary sales and
22-22 service operations during its customary business hours for seven
22-23 consecutive business days unless such failure is caused by an act
22-24 of God, work stoppage or delays due to strikes or labor disputes,
22-25 an order of the board, or other causes beyond the control of the
22-26 dealer.
22-27 (B) Whenever a dealer files a timely protest to
23-1 a proposed franchise termination or noncontinuance, the board shall
23-2 notify the party seeking to terminate or to not continue the
23-3 protesting dealer's franchise that a timely protest has been filed,
23-4 that a hearing is required in accordance with this Act, and that
23-5 the party who gave the dealer notice of termination or
23-6 noncontinuance of the franchise may not terminate or refuse to
23-7 continue the franchise until the board issues its final decision or
23-8 order.
23-9 (C) If a franchise is terminated or not
23-10 continued, another franchise in the same line-make will be
23-11 established within a reasonable time unless it is shown to the
23-12 board by a preponderance of the evidence that the community or
23-13 trade area cannot reasonably support such a dealership. If this
23-14 showing is made, no dealer license shall be thereafter issued in
23-15 the same area unless a change in circumstances is established.
23-16 (4) Notwithstanding the terms of any franchise
23-17 agreement, modify or replace a franchise if the modification or
23-18 replacement would adversely affect, to a substantial degree, the
23-19 dealer's sales, investment, or obligations to provide service to
23-20 the public, unless the manufacturer, distributor, or representative
23-21 has first given the board and each affected dealer written notice
23-22 by registered or certified mail of any such action 60 days in
23-23 advance of the modification or replacement. The written notice
23-24 shall contain on the first page thereof a conspicuous statement
23-25 which reads as follows: "NOTICE TO DEALER: YOU MAY BE ENTITLED TO
23-26 FILE A PROTEST WITH THE TEXAS MOTOR VEHICLE BOARD IN AUSTIN, TEXAS,
23-27 AND HAVE A HEARING IN WHICH YOU MAY PROTEST THE PROPOSED
24-1 MODIFICATION OR REPLACEMENT OF YOUR FRANCHISE UNDER THE TERMS OF
24-2 THE TEXAS MOTOR VEHICLE COMMISSION CODE IF YOU OPPOSE THIS ACTION."
24-3 Within the greater of (1) 60 days after receipt of such notice or
24-4 (2) the time specified in such notice, a dealer may file a protest
24-5 with the board and the modification or replacement shall not become
24-6 effective unless and until the board determines that the party
24-7 seeking to modify or replace a franchise has demonstrated by a
24-8 preponderance of the evidence that there is good cause for the
24-9 modification or replacement. The prior franchise shall continue in
24-10 effect until the protest is resolved by the board.
24-11 (5) Notwithstanding the terms of any franchise
24-12 agreement, in determining whether good cause has been established
24-13 for modifying, replacing, terminating, or refusing to continue a
24-14 franchise, or for forcing or attempting to force a dealer to
24-15 relocate or discontinue a line-make or parts or products related to
24-16 that line-make, the board shall consider all the existing
24-17 circumstances including, without limitation by the enumeration
24-18 herein, all the following:
24-19 (A) the dealer's sales in relation to the sales
24-20 in the market;
24-21 (B) the dealer's investment and obligations;
24-22 (C) injury or benefit to the public;
24-23 (D) the adequacy of the dealer's service
24-24 facilities, equipment, parts, and personnel in relation to those of
24-25 other dealers of new motor vehicles of the same line-make;
24-26 (E) whether warranties are being honored by the
24-27 dealer;
25-1 (F) the parties' compliance with their franchise
25-2 agreement except to the extent that the franchise agreement is in
25-3 conflict with this Act; and
25-4 (G) the enforceability of the franchise
25-5 agreement from a public policy standpoint, including, without
25-6 limitation, issues of the reasonableness of the franchise
25-7 agreement's terms, oppression, adhesion, and the relative
25-8 bargaining power of the parties.
25-9 Good cause shall not be shown solely by the desire of a
25-10 manufacturer, distributor, or representative for market
25-11 penetration.
25-12 (6) Use any false, deceptive or misleading
25-13 advertising.
25-14 (7) Notwithstanding the terms of any franchise
25-15 agreement, prevent any dealer from reasonably changing the capital
25-16 structure of his dealership or the means by or through which he
25-17 finances the operation thereof, provided that the dealer meets
25-18 reasonable capital requirements.
25-19 (8) Notwithstanding the terms of any franchise
25-20 agreement, fail to give effect to or attempt to prevent any sale or
25-21 transfer of a dealer, dealership or franchise or interest therein
25-22 or management thereof except as provided by Section 5.01B.
25-23 (9) Notwithstanding the terms of any franchise
25-24 agreement, require or attempt to require that a dealer assign to or
25-25 act as an agent for any manufacturer, distributor or representative
25-26 in the securing of promissory notes and security agreements given
25-27 in connection with the sale or purchase of new motor vehicles or
26-1 the securing of policies of insurance on or having to do with the
26-2 operation of vehicles sold.
26-3 (10) Notwithstanding the terms of any franchise
26-4 agreement, fail or refuse, after complaint and hearing, to perform
26-5 the obligations placed on the manufacturer in connection with the
26-6 delivery, preparation and warranty of a new motor vehicle as
26-7 provided in the manufacturer's warranty, preparation, and delivery
26-8 agreements on file with the board.
26-9 (11) Notwithstanding the terms of any franchise
26-10 agreement or provision of law in conflict with this section, the
26-11 dealer's delivery, preparation, and warranty obligations as filed
26-12 with the board shall constitute the dealer's sole responsibility
26-13 for product liability as between the dealer and manufacturer or
26-14 distributor, and, except for a loss caused by the dealer's failure
26-15 to adhere to these obligations, a loss caused by the dealer's
26-16 negligence or intentional misconduct, or a loss caused by the
26-17 dealer's modification of a product without manufacturer or
26-18 distributor authorization, the manufacturer or distributor shall
26-19 reimburse the dealer for all loss incurred by the dealer, including
26-20 legal fees, court costs, and damages, as a result of the dealer
26-21 having been named a party in a product liability action.
26-22 (12) Operate as a manufacturer, distributor, or
26-23 representative without a currently valid license from the board or
26-24 otherwise violate this Act or rules promulgated by the board
26-25 hereunder.
26-26 (13) Notwithstanding the terms of any franchise
26-27 agreement, to prevent or refuse to honor the succession to a
27-1 dealership by any legal heir or devisee under the will of a dealer
27-2 or under the laws of descent and distribution of this State unless
27-3 it is shown to the board, after notice and hearing, that the result
27-4 of such succession will be detrimental to the public interest and
27-5 to the representation of the manufacturer or distributor; provided,
27-6 however, nothing herein shall prevent a dealer, during his
27-7 lifetime, from designating any person as his successor dealer, by
27-8 written instrument filed with the manufacturer or distributor.
27-9 (14) Notwithstanding the terms of any franchise
27-10 agreement, require that a dealer pay or assume, directly or
27-11 indirectly, any part of any refund, rebate, discount, or other
27-12 financial adjustment made by the manufacturer, distributor, or
27-13 representative to, or in favor of, any customer of a dealer, unless
27-14 voluntarily agreed to by such dealer.
27-15 (15) Notwithstanding the terms of any franchise
27-16 agreement, deny or withhold approval of a written application to
27-17 relocate a franchise unless (A) the applicant has received written
27-18 notice of the denial or withholding of approval within 60 days
27-19 after receipt of the application containing information reasonably
27-20 necessary to enable the manufacturer or distributor to adequately
27-21 evaluate the application, and if (B) the applicant files a protest
27-22 with the board and the manufacturer or distributor establishes by a
27-23 preponderance of the evidence at a hearing called by the board that
27-24 the grounds for the denial or withholding of approval of the
27-25 relocation are reasonable.
27-26 (16) Notwithstanding the terms of any franchise
27-27 agreement, fail to pay to a dealer or any lienholder in accordance
28-1 with their respective interest after the termination of a
28-2 franchise:
28-3 (A) the dealer cost of each new motor vehicle in
28-4 the dealer's inventory with mileage of 6,000 miles or less,
28-5 exclusive of mileage placed on the motor vehicle before it was
28-6 delivered to the dealer, reduced by the net discount value of each,
28-7 where "net discount value" is determined according to the following
28-8 formula: net cost multiplied by total mileage, exclusive of
28-9 mileage placed on the motor vehicle before it was delivered to the
28-10 dealer, divided by 100,000, and where "net cost" equals the dealer
28-11 cost plus any charges by the manufacturer, distributor, or
28-12 representative for distribution, delivery, and taxes, less all
28-13 allowances paid to the dealer by the manufacturer, distributor, or
28-14 representative for new, unsold, undamaged, and complete motor
28-15 vehicles of current model year or one year prior model year in the
28-16 dealer's inventory, except that if a vehicle cannot be reduced by
28-17 the net discount value, the manufacturer or distributor shall pay
28-18 the dealer the net cost of the vehicle;
28-19 (B) the dealer cost of each new, unused,
28-20 undamaged, and unsold part or accessory if the part or accessory is
28-21 in the current parts catalogue and is still in the original,
28-22 resalable merchandising package and in unbroken lots, except that
28-23 in the case of sheet metal, a comparable substitute for the
28-24 original package may be used, and if the part or accessory was
28-25 purchased by the dealer either directly from the manufacturer or
28-26 distributor or from an outgoing authorized dealer as a part of the
28-27 dealer's initial inventory;
29-1 (C) the fair market value of each undamaged sign
29-2 owned by the dealer which bears a trademark or tradename used or
29-3 claimed by the manufacturer, distributor, or representative if the
29-4 sign was purchased from or purchased at the request of the
29-5 manufacturer, distributor, or representative;
29-6 (D) the fair market value of all special tools,
29-7 data processing equipment, and automotive service equipment owned
29-8 by the dealer which were recommended in writing and designated as
29-9 special tools and equipment and purchased from or purchased at the
29-10 request of the manufacturer, distributor, or representative, if the
29-11 tools and equipment are in usable and good condition except for
29-12 reasonable wear and tear;
29-13 (E) the cost of transporting, handling, packing,
29-14 storing, and loading of any property subject to repurchase under
29-15 this section;
29-16 (F) except as provided by this subdivision, any
29-17 sums due as provided by Paragraph (A) of this subdivision within 60
29-18 days after termination of a franchise and any sums due as provided
29-19 by Paragraphs (B) through (E) of this subdivision within 90 days
29-20 after termination of a franchise. As a condition of payment, the
29-21 dealer is to comply with reasonable requirements with respect to
29-22 the return of inventory as are set out in the terms of the
29-23 franchise agreement. A manufacturer or distributor shall reimburse
29-24 a dealer for the dealer's cost for storing any property covered by
29-25 this subdivision beginning 90 days following termination. A
29-26 manufacturer or distributor shall reimburse a dealer for the
29-27 dealer's cost of storing any property covered by this subdivision
30-1 before the expiration of 90 days from the date of termination if
30-2 the dealer notifies the manufacturer or distributor of the
30-3 commencement of storage charges within that period. On receipt of
30-4 notice of the commencement of storage charges, a manufacturer or
30-5 distributor may immediately take possession of the property in
30-6 question by repurchasing the property as provided by this
30-7 subdivision. A manufacturer, distributor, or representative who
30-8 fails to pay those sums within the prescribed time or at such time
30-9 as the dealer and lienholder, if any, proffer good title prior to
30-10 the prescribed time for payment, is liable to the dealer for:
30-11 (i) the greatest of dealer cost, fair
30-12 market value, or current price of the inventory;
30-13 (ii) interest on the amount due calculated
30-14 at the rate applicable to a judgment of a court; and
30-15 (iii) reasonable attorney's fees and
30-16 costs.
30-17 (17) Notwithstanding the terms of any franchise
30-18 agreement, change its distributor, its method of distribution of
30-19 its products in this state, or its business structure or ownership
30-20 in a manner that results in the termination or noncontinuance of a
30-21 franchise without good cause. The manufacturer, distributor, or
30-22 representative shall issue the same notice to the dealer and to the
30-23 board as is provided in Subdivisions (3)(A) and (B) of this section
30-24 and said same procedures shall apply to the parties.
30-25 (18) Notwithstanding the terms of any franchise
30-26 agreement, require a dealer to submit to arbitration on any issue
30-27 unless the dealer and the manufacturer, distributor, or
31-1 representative and their respective counsel agree to arbitrate
31-2 after a controversy arises. The arbitrator shall apply the
31-3 provisions of this Act in resolving the pertinent controversy.
31-4 Either party may appeal to the board a decision of an arbitrator on
31-5 the ground that the arbitrator failed to apply this Act.
31-6 (19) Notwithstanding the terms of any franchise
31-7 agreement, require that a dealer join, contribute to, or affiliate
31-8 with, directly or indirectly, any advertising association.
31-9 (20) Notwithstanding the terms of a franchise
31-10 agreement:
31-11 (A) require adherence to unreasonable sales or
31-12 service standards;
31-13 (B) directly or indirectly, discriminate against
31-14 a dealer or otherwise treat dealers differently as a result of a
31-15 formula or other calculation or process intended to gauge the
31-16 performance of a dealership;
31-17 (C) unreasonably require that a dealer purchase
31-18 special tools or equipment; or
31-19 (D) fail to compensate a dealer for all costs
31-20 incurred by the dealer as required by the manufacturer in complying
31-21 with the terms of a product recall by the manufacturer or
31-22 distributor, including the costs, if any, incurred by the dealer in
31-23 notifying vehicle owners of the existence of the recall.
31-24 (21) Discriminate unreasonably between or among
31-25 franchisees in the sale of a motor vehicle owned by the
31-26 manufacturer or distributor.
31-27 (22) Directly or indirectly, or through a subsidiary
32-1 or agent, require, as a condition for obtaining financing for a
32-2 motor vehicle, the purchaser of a vehicle to purchase any product
32-3 other than the motor vehicle from the manufacturer or distributor,
32-4 or from an entity owned or controlled by the manufacturer or
32-5 distributor.
32-6 (23) Directly or indirectly, or through a subsidiary
32-7 or agent, require, as a condition of its or its subsidiary's
32-8 agreement to provide financing for a motor vehicle, that any
32-9 insurance policy or service contract purchased by the motor vehicle
32-10 purchaser be purchased from a specific source.
32-11 (24) Compel a dealer through a financing subsidiary of
32-12 the manufacturer or distributor to agree to unreasonable operating
32-13 requirements or directly or indirectly to terminate a dealer
32-14 through the actions of a financing subsidiary of the manufacturer
32-15 or distributor. This subdivision does not limit the right of a
32-16 financing entity to engage in business practices in accordance with
32-17 the usage of trade in retail and wholesale motor vehicle financing.
32-18 (25) Notwithstanding the terms of a franchise
32-19 agreement, deny or withhold approval of a dealer's application to
32-20 add a line-make or parts or products related to that line-make
32-21 unless, within 60 days of receipt of the dealer's written
32-22 application to add the line-make, the manufacturer or distributor
32-23 gives the dealer written notice of the denial or withholding of
32-24 approval. After receipt of notice, the dealer may file a protest
32-25 with the board. If the dealer files a protest as provided by this
32-26 subdivision, the board may uphold the manufacturer's or
32-27 distributor's decision to deny or withhold approval of the addition
33-1 of the line-make only if the manufacturer or distributor proves by
33-2 a preponderance of the evidence that the denial or withholding of
33-3 approval was reasonable. In determining whether or not the
33-4 manufacturer or distributor has met its burden to show that its
33-5 denial or withholding of approval is reasonable, the board shall
33-6 consider all existing circumstances, including, without limitation,
33-7 the following:
33-8 (A) the dealer's sales in relation to the sales
33-9 in the market;
33-10 (B) the dealer's investment and obligations;
33-11 (C) injury or benefit to the public;
33-12 (D) the adequacy of the dealer's sales and
33-13 service facilities, equipment, parts, and personnel in relation to
33-14 those of other dealers of new motor vehicles of the same line-make;
33-15 (E) whether warranties are being honored by the
33-16 dealer agreement;
33-17 (F) the parties' compliance with their franchise
33-18 agreement to the extent that the franchise agreement is not in
33-19 conflict with this Act;
33-20 (G) the enforceability of the franchise
33-21 agreement from a public policy standpoint, including without
33-22 limitation, issues of the reasonableness of the franchise
33-23 agreement's terms, oppression, adhesion, and the relative
33-24 bargaining power of the parties;
33-25 (H) whether the dealer complies with reasonable
33-26 capitalization requirements or will be able to comply with
33-27 reasonable capitalization requirements within a reasonable time;
34-1 (I) the harm, if any, to the manufacturer if the
34-2 denial or withholding of approval is not upheld; and
34-3 (J) the harm, if any, to the dealer if the
34-4 denial or withholding of approval is upheld.
34-5 (26) Fail or refuse to offer to its same line-make
34-6 franchised dealers all models manufactured for that line-make, or
34-7 require a dealer to pay any extra fee, purchase unreasonable
34-8 advertising displays or other materials, or remodel, renovate, or
34-9 recondition the dealer's existing facilities as a prerequisite to
34-10 receiving a model or series of vehicles.
34-11 (27) Require a dealer to compensate the manufacturer
34-12 or distributor for any court costs, attorney's fees, or other
34-13 expenses incurred in an administrative or civil proceeding arising
34-14 under this Act, except that this subdivision does not prohibit a
34-15 manufacturer and dealer from entering into an agreement to share
34-16 costs in a proceeding in which the dealer and manufacturer have the
34-17 same or similar interests.
34-18 SECTION 15. Section 5.02C, Texas Motor Vehicle Commission
34-19 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
34-20 by adding a new Subsection (e) and relettering existing Subsections
34-21 (e)-(g) as Subsections (f)-(h) to read as follows:
34-22 (e) For purposes of determining compliance with Subsection
34-23 (d)(2), the price of a dealership and the other terms and
34-24 conditions of a contract for the sale of a dealership are
34-25 reasonable if the purchaser is a franchised dealer who:
34-26 (1) has made a significant investment in the
34-27 dealership, subject to loss;
35-1 (2) has an ownership interest in the dealership; and
35-2 (3) operates the dealership under a plan to acquire
35-3 full ownership of the dealership within a reasonable time and under
35-4 reasonable terms and conditions.
35-5 (f) [(e)] For the purpose of broadening the diversity of its
35-6 dealer body and enhancing opportunities for qualified persons who
35-7 are part of a group who have historically been underrepresented in
35-8 its dealer body, or other qualified persons who lack the resources
35-9 to purchase a dealership outright, but for no other purpose, a
35-10 manufacturer or distributor may temporarily own an interest in a
35-11 dealership if the manufacturer's or distributor's participation in
35-12 the dealership is in a bona fide relationship with a franchised
35-13 dealer who:
35-14 (1) has made a significant investment in the
35-15 dealership, subject to loss;
35-16 (2) has an ownership interest in the dealership; and
35-17 (3) operates the dealership under a plan to acquire
35-18 full ownership of the dealership within a reasonable time and under
35-19 reasonable terms and conditions.
35-20 (g) [(f)] On a showing by a manufacturer or distributor of
35-21 good cause, the board may extend the time limit set forth in
35-22 Subsection (d)(1). An extension under this subsection may not
35-23 exceed 12 months. An application for an extension after the first
35-24 extension is granted is subject to protest by a dealer of the same
35-25 line-make whose dealership is located in the same county as, or
35-26 within 15 miles of, the dealership owned or controlled by the
35-27 manufacturer or distributor.
36-1 (h) [(g)] Notwithstanding any other provision of this
36-2 section, a person who, on June 7, 1995, held both a motor home
36-3 dealer's license and a motor home manufacturer's license issued
36-4 under this Act may:
36-5 (1) hold both a motor home dealer's license and a
36-6 motor home manufacturer's license; and
36-7 (2) operate as both a manufacturer and dealer of motor
36-8 homes but of no other type of vehicle.
36-9 SECTION 16. The Texas Motor Vehicle Commission Code (Article
36-10 4413(36), Vernon's Texas Civil Statutes) is amended by adding
36-11 Section 5.02D to read as follows:
36-12 Sec. 5.02D. CERTAIN TIME LIMITS TOLLED UNDER CERTAIN
36-13 CIRCUMSTANCES. A time limit relating to board proceedings imposed
36-14 on the board or on a dealer by the terms of this Act is tolled
36-15 during the pendency of mandatory mediation proceedings required by
36-16 this Act or by a franchise agreement.
36-17 SECTION 17. Section 5.04(b), Texas Motor Vehicle Commission
36-18 Code (Article 4413(36), Vernon's Texas Civil Statutes), is amended
36-19 to read as follows:
36-20 (b) The "make" of a conversion, ambulance, or fire-fighting
36-21 vehicle is that of the chassis manufacturer and the "make" of a
36-22 motor home is that of the motor home manufacturer.
36-23 SECTION 18. This Act takes effect immediately if it receives
36-24 a vote of two-thirds of all the members elected to each house, as
36-25 provided by Section 39, Article III, Texas Constitution. If this
36-26 Act does not receive the vote necessary for immediate effect, this
36-27 Act takes effect September 1, 2001.
_______________________________ _______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1665 was passed by the House on March
29, 2001, by the following vote: Yeas 146, Nays 0, 2 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 1665 on May 3, 2001, by the following vote: Yeas 145, Nays 0,
1 present, not voting.
_______________________________
Chief Clerk of the House
I certify that H.B. No. 1665 was passed by the Senate, with
amendments, on May 1, 2001, by the following vote: Yeas 30, Nays
0, 1 present, not voting.
_______________________________
Secretary of the Senate
APPROVED: __________________________
Date
__________________________
Governor