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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of motor vehicle dealers, manufacturers, |
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and distributors. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 2301.263, Occupations Code, is amended |
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to read as follows: |
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Sec. 2301.263. LICENSE ISSUED SUBJECT TO NEW LAW AND RULES. |
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Notwithstanding any other law and regardless of the renewal date of |
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a franchise agreement, a [A] license issued under this chapter is |
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subject to each provision of this chapter and board rule in effect |
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on the date the license is issued or renewed and each provision of |
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this chapter and board rule that takes effect during the term of the |
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license. |
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SECTION 2. Section 2301.405, Occupations Code, is amended |
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by adding Subsection (c) to read as follows: |
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(c) A manufacturer or distributor may not directly or |
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indirectly recover from a dealer an amount paid to the dealer under |
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this subchapter: |
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(1) by imposing a surcharge on the dealer; or |
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(2) in any manner other than by a chargeback as |
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provided by this section. |
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SECTION 3. Section 2301.4651, Occupations Code, is amended |
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by amending Subsections (a) and (b) and adding Subsection (i) to |
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read as follows: |
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(a) This section applies to a manufacturer, distributor, or |
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representative that[:
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[(1)
terminates or discontinues a franchise by any
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means without complying with Section 2301.453; or
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[(2)
regardless of whether the manufacturer,
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distributor, or representative complies with Section 2301.453,] |
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terminates or discontinues a franchise by: |
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(1) [(A)] discontinuing a line-make; |
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(2) [(B)] ceasing to do business in this state; or |
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(3) [(C)] changing the distributor or method of |
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distribution of its products in this state. |
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(b) In addition to the duties placed on a manufacturer, |
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distributor, or representative by Section 2301.465, a |
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manufacturer, distributor, or representative to whom this section |
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applies shall pay to the franchised dealer the following amounts as |
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applicable: |
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(1) either: |
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(A) the dealer's construction costs for a new |
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dealership completed in the two years preceding the date of the |
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termination or discontinuance described by Subsection (a); or |
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(B) if the dealer does not have any costs |
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described by Paragraph (A), the fair monthly rental value of the |
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dealership payable in cash each month beginning on the first day of |
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the first month following the date of the termination or |
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discontinuance described by Subsection (a) and ending on the |
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earlier of: |
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(i) the first anniversary of the |
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termination or discontinuance date; or |
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(ii) the date on which the dealer no longer |
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owns the dealership; |
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(2) the dealer's costs for upgrading or substantially |
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altering a dealership if the upgrades or alterations were completed |
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or added in the two years preceding the date of the termination or |
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discontinuance described by Subsection (a); and |
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(3) an amount equal to the value of the goodwill |
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associated with the franchise calculated [as it existed on the day
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before the earlier of]: |
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(A) without consideration of the effect of the |
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announcement of any termination; and [the date of the termination
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or discontinuance described by Subsection (a); or] |
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(B) as if the franchise were still in effect and |
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products associated with the franchise were still available [the
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date on which the manufacturer, distributor, or representative
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announced its intention to terminate or discontinue the franchise
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in a manner described by Subsection (a)]. |
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(i) Except as specifically provided by this section, this |
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section does not affect the rights granted, duties imposed, and |
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procedures established under Sections 2301.453 and 2301.465. |
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SECTION 4. Sections 2301.467(b), (b-1), and (b-2), |
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Occupations Code, are amended to read as follows: |
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(b) Notwithstanding the terms of any franchise, a |
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manufacturer, distributor, or representative may not unreasonably |
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require a franchised dealer to relocate, or to replace or |
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substantially change, alter, or remodel the dealer's |
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facilities. Except as provided by Subsection [Subsections] (b-1) |
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[and (b-2)], an act is reasonable if it is justifiable in light of |
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current and reasonably foreseeable projections of economic |
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conditions, financial expectations, and the market for new motor |
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vehicles in the relevant market area. |
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(b-1) Except as necessary to comply with health or safety |
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laws or to comply with technology requirements necessary to sell or |
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service a line-make, it is unreasonable for a manufacturer, |
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distributor, or representative to require a franchised dealer to |
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construct a new dealership or to substantially change, alter, or |
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remodel an existing dealership before the 10th anniversary of the |
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date: |
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(1) the construction of the dealership at that |
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location was completed if the construction was in substantial |
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compliance with standards or plans provided by a manufacturer, |
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distributor, or representative or through a subsidiary or agent of |
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the manufacturer, distributor, or representative; or[.] |
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(2) [(b-2)
Except as necessary to comply with health
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or safety laws or to comply with technology requirements necessary
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to sell or service a line-make, it is unreasonable for a
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manufacturer, distributor, or representative to require a
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franchised dealer to substantially change, alter, or remodel an
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existing dealership before the 10th anniversary of the date that] a |
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prior substantial change, alteration, or remodel of the dealership |
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at that location was completed if the change, alteration, or |
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remodel was in substantial compliance with standards or plans |
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provided by a manufacturer, distributor, or representative or |
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through a subsidiary or agent of the manufacturer, distributor, or |
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representative. |
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SECTION 5. Subchapter J, Chapter 2301, Occupations Code, is |
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amended by adding Section 2301.483 to read as follows: |
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Sec. 2301.483. SELECTION BY DEALER OF VENDOR OR MATERIALS |
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FOR DEALERSHIP IMPROVEMENT. (a) Except as provided by Subsection |
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(b), a manufacturer or distributor may not require a dealer to |
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purchase or use specific materials or to purchase goods or services |
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from a specific vendor when making an upgrade or improvement to the |
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dealer's dealership. |
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(b) If a manufacturer or distributor provides money |
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directly to a dealer to compensate the dealer for a specific upgrade |
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or improvement, the dealer may select the materials and vendors for |
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upgrade or improvement but shall select materials and vendors that |
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are of like kind and quality to those specified by the manufacturer |
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or distributor, if any. |
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SECTION 6. Section 2301.652, Occupations Code, is amended |
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by adding Subsection (d) to read as follows: |
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(d) For purposes of Subsection (b), a protesting dealer is |
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presumed to be in substantial compliance with the dealer's |
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franchise if the dealer is not the subject of a pending enforcement |
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proceeding by the board or department. The presumption created by |
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this subsection is rebuttable. |
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SECTION 7. Section 2301.6521(d), Occupations Code, is |
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amended to read as follows: |
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(d) A franchised dealer may not protest an application to |
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relocate a dealership under this section if the proposed relocation |
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site is not: |
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(1) more than two miles [or less] from the dealership's |
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current location; or |
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(2) closer to the franchised dealer than the site from |
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which the dealership is being relocated. |
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SECTION 8. Section 2301.702, Occupations Code, is amended |
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to read as follows: |
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Sec. 2301.702. CONFLICT WITH OTHER LAW; RULES GOVERNING |
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HEARINGS. (a) To the extent of a conflict between this chapter and |
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Chapter 2001, Government Code, this chapter controls. |
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(b) A board rule relating to the procedures for a hearing on |
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or the resolution of a dispute arising under this chapter applies to |
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the person conducting the hearing or dispute resolution proceeding, |
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regardless of whether that person is the board, the department, or |
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another person. |
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SECTION 9. (a) Section 10, Chapter 684 (H.B. 2640), Acts of |
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the 81st Legislature, Regular Session, 2009, is repealed. |
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(b) The changes in law made by Chapter 684 (H.B. 2640), Acts |
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of the 81st Legislature, Regular Session, 2009, apply to a license |
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issued under Chapter 2301, Occupations Code, regardless of the date |
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the license was issued or renewed. |
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(c) Section 16, Chapter 137 (S.B. 529), Acts of the 82nd |
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Legislature, Regular Session, 2011, is repealed. |
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(d) The changes in law made by Chapter 137 (S.B. 529), Acts |
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of the 82nd Legislature, Regular Session, 2011, apply to a license |
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issued under Chapter 2301, Occupations Code, regardless of the date |
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the license was issued or renewed. |
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SECTION 10. The changes in law made by this Act apply to a |
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license issued under Chapter 2301, Occupations Code, regardless of |
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the date the license is issued or renewed. |
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SECTION 11. This Act takes effect September 1, 2013. |