Establishment or transfer of an existing franchise, procedures for franchisor
When a car company (franchisor) wants to open a new dealership, reopen an old one, or move one to a new spot in the same area where another dealer of the same brand already exists, the car company has to send written notice to those existing dealers first. The existing dealers then have 30 days to challenge that decision if they think there is no good reason for it. A "relevant market area" is either 8 miles (in bigger counties over 100,000 people) or 15 miles (in smaller counties) from the new or moved dealership location.
407.817. or of an existing , procedures for . — 1. any of a franchise to the contrary, for purposes of the , "" means:
(1) For a proposed new motor vehicle or a new motor vehicle dealer who plans to locate or his or her place of business in a county having a population which is greater than one hundred thousand, the area within a radius of eight miles of the intended site of the proposed or relocated dealer. The eight-mile distance shall be determined by measuring the distance between the nearest surveyed boundary of the existing new motor vehicle dealer's and the nearest surveyed boundary line of the proposed or relocated new motor vehicle dealer's principal place of business; or
(2) For a proposed new motor vehicle dealer or a new motor vehicle dealer who plans to locate or relocate his or her place of business in a county having a population which is not greater than one hundred thousand, the area within a radius of fifteen miles of the intended site of the proposed or relocated dealer. The fifteen-mile distance shall be determined by measuring the distance between the nearest surveyed boundary line of the existing new motor vehicle dealer's principal place of business and the nearest surveyed boundary line of the proposed or relocated new motor vehicle dealer's principal place of business.
2. As used in this section, "relocate" and "" shall not include the relocation of a new motor vehicle dealer within two miles of its established place of business.
3. Before a franchisor enters into a franchise establishing an additional franchise, reopening a previously existing franchise, or relocating an existing franchise within a relevant market area where the same is represented, the franchisor shall give written notice to each of the same line-make in the relevant market area of its intention to establish an additional franchise, reopen a previously existing franchise, or relocate an existing franchise within that relevant market area. Such notice shall state:
(1) The specific location at which the additional, reopened, or relocated franchise will be established; and
(2) The date on or after which the franchisor intends to be engaged in business with the additional, reopened, or relocated franchise at the proposed location.
4. Within thirty days after receiving the notice provided for in 3 of this section, or within thirty days after the end of any procedure provided by the franchisor, a franchisee to whom notice was required in subsection 3 of this section may bring an section 407.822 to determine whether exists for establishing an additional franchise, reopening a previously existing franchise, or relocating an existing franchise.
5. This section shall not apply to the reopening or replacement in a relevant market area of a closed franchise that has been closed within the preceding year, if the established place of business of the reopened or replacement franchise is within two miles of the established place of business of the closed franchise and only if the reopened or replaced franchise is offered to the franchisee who had previously operated the closed franchise within the preceding year if that franchise had not been terminated under the of the MVFP act or had not voluntarily closed the franchise.
6. In determining whether good cause exists for establishing an additional franchise, reopening a previously existing franchise, or relocating a franchise for the same line-make, the shall take into all relevant circumstances, including, but not limited to, the following:
(1) The size and of the investment and obligations incurred by the existing franchisees of the same line-make in the relevant market area; and any damage that such existing franchisees may suffer from the establishment, reopening, or relocation of a franchise into the relevant market area;
(2) The effect on the motor vehicle business and the consuming public in the relevant market area;
(3) Whether it is injurious or beneficial to the public welfare;
(4) Whether the existing franchisees of the same line-make in that relevant market area are providing adequate competition and convenient care for the motor vehicles of that line-make in the relevant market area, including the adequacy of motor vehicle sales and qualified personnel;
(5) Whether the establishment, reopening, or relocation of a franchise would promote competition; and whether the benefits to the public and the franchisor from any such increased competition outweigh the harm to the existing franchisees in the relevant market area;
(6) Growth or decline of the population and the number of new motor vehicle registrations in the relevant market area; and
(7) The effect on the reopening or relocating franchisee of a of its relocation into the relevant market area.
7. The and available pursuant to this section are not and are in addition to those provided in section 407.835 or otherwise permitted by law or .
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Source & history notes
(L. 2001 H.B. 575, A.L. 2010 H.B. 2198) (2009) Section is sole and exclusive authority for challenging the establishment of a new motor vehicle dealership under the Motor Vehicle Franchise Practices Act. Parktown Imports v. Audi of America, 278 S.W.3d 670 (Mo.banc).
Legal information, not legal advice. Always confirm with the official source at revisor.mo.gov.