Successor manufacturer, restrictions on line-make franchise offers
When a new company takes over a car brand from an old company, the new company cannot offer a dealership to someone new in the same area where the old company ended a deal with a former dealer. For two years after the takeover, the new company has to first offer that dealership spot to the former dealer for free — unless one of three exceptions applies: the old company merged that car brand with another brand that already had a dealer in the area, the former dealer was already paid fair market value for their dealership, or the old company ended the deal for specific legal reasons. The value of the former dealer's business is figured at whichever date gives the highest value — when the old company announced the ending, when it became final, or twelve months before the announcement.
407.819. , on offers — calculation. — 1. any in a franchise to the contrary, no successor manufacturer shall, for a period of two years from the date of acquisition of control by that successor manufacturer of a line-make from a , offer a franchise to any person for a line-make of a predecessor manufacturer in any portion of the in which the predecessor manufacturer previously , terminated, , failed to renew, or otherwise ended a with a who had a franchise facility in that relevant market area without first offering the franchise to the former franchisee at no cost, unless:
(1) Within sixty days of the former franchisee's , , , or , the predecessor manufacturer had the line-make with another of its line-makes for which the predecessor manufacturer had a franchisee with a then-existing franchise facility in that relevant market area;
(2) The successor manufacturer has paid the former franchisee the fair market value of the former franchisee's motor vehicle in accordance with this section;
(3) The predecessor manufacturer successfully terminated the former franchisee under (5) of section 407.825.
2. For purposes of this section, the fair market value of a former franchisee's motor vehicle dealership shall be calculated as of the date of the following that yields the highest fair market value: the date the predecessor manufacturer announced the that resulted in the cancellation, termination, noncontinuance, or nonrenewal; the date the action that resulted in cancellation, termination, noncontinuance, or nonrenewal became ; or the date twelve months prior to the date that the predecessor manufacturer announced the action that resulted in the cancellation, termination, noncontinuance, or nonrenewal.
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Source & history notes
(L. 2010 H.B. 2198)
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