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ID H0128
Bill
Status
3/24/2023
Primary Sponsor
Transportation and Defense Committee
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AI Summary
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Manufacturers cannot terminate, cancel, or fail to renew franchise agreements without good cause and proper notice: 90 days for standard situations, 15 days for insolvency/bankruptcy/license revocation/criminal conviction, and 180 days when discontinuing a product line.
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Establishes mandatory mediation before dealers can file protests, with parties having 20 days to select a mediator and attempt resolution; filing a mediation demand stays the time for filing formal protests.
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Creates formal protest hearing procedures through the office of administrative hearings where manufacturers bear the burden of proving good cause, with hearing officers issuing decisions within 60 days and manufacturers prohibited from taking action until all appeals are exhausted.
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Specifies factors that do NOT constitute good cause for termination, including dealers owning competing franchises (if established before January 1, 1997), refusing to purchase unordered vehicles, or failing to expand facilities without guaranteed supply commitments.
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Requires manufacturers to repurchase dealer inventory (vehicles, parts, equipment, signs) within 90 days at net cost or fair market value, and reimburse lease/rental costs for one year if franchise is terminated for performance failures or line discontinuation.
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Establishes standing for dealers and dealer associations to pursue administrative proceedings, mediation, or civil court actions, with prevailing parties entitled to actual damages, attorney's fees, and treble damages for willful violations.
Legislative Description
Amends and adds to existing law to revise provisions regarding termination, cancellation, and renewal of franchise agreements and related protests, hearings, and costs.
DEALERS AND SALESMEN LICENSING
Last Action
Reported Signed by Governor on March 23, 2023 Session Law Chapter 122 Effective: 03/23/2023
3/24/2023