SB 724 Summary

• Comprehensively revises the Motor Vehicle Franchise Practices Act (MVFP Act) effective August 28, 2010, with new protections for motor vehicle franchisees and stricter requirements on franchisors

• Establishes trust fund requirements for customer payments, rebates, incentive credits, warranty payments, and other franchisor-owed funds; prohibits franchisors from granting security interests in these funds

• Expands prohibited franchisor conduct to include 45 specific unlawful practices such as unreasonable vehicle withholding, coercion, unfair termination, discriminatory pricing, and conditioning franchises on site control agreements

• Mandates Administrative Hearing Commission proceedings for franchise disputes with strict notice and cure periods (60-180 days depending on violation type) and shifts burden of proof to franchisors to demonstrate good cause for adverse actions

• Requires fair and reasonable compensation for warranty work, preparation, delivery services, and sales/service promotions; limits warranty claim audits to 6 months and establishes strict payment timelines of 15 days for claims approval