Bill Summary for S 438 (2011-2012)

Summary date: 

Jun 2 2011

Bill Information:

View NCGA Bill Details2011-2012 Session
Senate Bill 438 (Public) Filed Monday, March 28, 2011
Intro. by Apodaca.

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Bill summary

Senate committee substitute makes the following changes to 1st edition.
Amends new subsection (g) to GS 20-301, to expand its provisions regarding resolving disputes with respect to the dealer’s rights or obligations related to franchise or franchise-related form agreement to apply to any manufacturer, factory branch, distributor, or distributor branch in addition to any franchised new motor vehicle dealer. Makes additional conforming changes to the act making provisions, where relevant, applicable to any manufacturer, factory branch, distributor, or distributor branch in addition to any franchised new motor vehicle dealer.
Amends GS 20-301.1(a), to provide that it is unlawful for any manufacturer, factory branch, distributor, or distributor branch to charge or assess a NC franchised motor vehicle dealer for merchandise, tools, or equipment, or other charges or amounts which total more than $5,000 (was, other charges or amounts which individually or collectively total more than $250) other than as specifically excepted. Directs the required prior written notice to include any charges or amounts that total over $5,000.
Makes conforming changes to amend the provisions of GS 20-305(4), making it unlawful for any manufacturer, factory branch, distributor, or distributor branch to prevent or refuse to approve the relocation or change in use of an existing facility to provide for the sales or service of one or more additional line-makes of new motor vehicles.
Amends GS 20-305(6)d.3. to make the manufacturer or distributor liable to the dealer for an amount at least equivalent to the fair market value of the franchise on the day 18 months (was, 3 years) prior to the date on which the notice of termination, cancellation, or nonrenewal, as defined, is issued, or on one of the other dates existing under current law, whichever is higher. Effective January 1, 2014.
Amends GS 20-305(14) to provide that sales objectives established for any franchised dealer in this state must be reasonable. Makes clarifying changes to the manner in which every manufacturer, factory branch, distributor, and distributor branch must allocate its products within this state. Makes it an unfair and deceptive trade practice to willfully or maliciously engage in a vehicle allocation process that forces or coerces a NC dealer to close or sell the franchise, causes the dealer financial distress, or causes the dealer to relocate, update, or renovate the existing facility. Makes conforming changes.
Deletes amendments to GS 20-305(39) in previous edition, and instead makes a clarifying change.
Amends proposed subdivision (43) to GS 20-305, making it unlawful to require, coerce, or attempt to coerce any new motor vehicle dealer to change dealership location or make substantial alterations if the dealer has changed locations or made substantial alterations to the facilities at the written request of the manufacturer, factory branch, distributor, or distributor branch within the preceding seven years (was, preceding 10 years) at a cost of more than $500,000 (was, more than $100,000). Makes it unlawful to deny a franchised dealer the right to return any unsold part after 15 months (was, within 12 months) as detailed, provided the dealer returns the part within 60 days (was, within 90 days) of eligibility.
Amends GS 20-305.1 to include the retail rate for labor in provisions governing automobile dealer warranty obligations. Amends GS 20-305.7 to strengthen existing provisions that protect customer data collected and maintained by dealers. Prohibits manufacturers or distributors or third parties acting on behalf of manufacturers or distributors from requesting the data except under limited circumstances. Makes additional clarifying changes.

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