HB 1065 Summary

• Revises definition of "common entity" to include persons controlling more than 40% of voting equity interests or sharing directors/officers with manufacturers, and expands manufacturer definition to include entities administering motor vehicle warranties and service contracts bearing manufacturer brand names.

• Prohibits licensees from selling motor vehicles or accessories to retail consumers except through franchised dealers, with exceptions for employee sales, charitable organizations, and federal government; allows remote sales of accessories if dealer receives at least 25% of gross price.

• Adds prohibitions against entering franchise agreements that exclude existing or subsequent vehicle models of the line-make and against failing to offer bonus, incentive, or benefit programs to dealers unless justified by substantially different economic or market considerations.

• Establishes that common entities acting on behalf of manufacturers are agents subject to all franchise agreement restrictions and penalties; manufacturers remain bound by franchise agreements executed by their agents.

• Clarifies that rebadging or changes to motor vehicles do not invalidate franchise agreements, and restricts manufacturer/distributor ownership of dealerships unless for temporary ownership transitions, dealer diversity initiatives, or other limited circumstances.

• Takes effect July 1, 2021.