Texas Occupations Code - Section 2301.476. Manufacturer Or Distributor Ownership, Operation, Or Control Of Dealership
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Texas Laws > Occupations Code > Texas Occupations Code - Section 2301.476. Manufacturer Or Distributor Ownership, Operation, Or Control Of Dealership
§ 2301.476. MANUFACTURER OR DISTRIBUTOR OWNERSHIP,
OPERATION, OR CONTROL OF DEALERSHIP. (a) In this section,
"manufacturer" includes:
(1) a representative; or
(2) a person who:
(A) is affiliated with a manufacturer or
representative; or
(B) directly or indirectly through an
intermediary, is controlled by, or is under common control with, a
manufacturer.
(b) For purposes of Subsection (a)(2)(B), a person is
controlled by a manufacturer if the manufacturer is directly or
indirectly authorized, by law or by agreement of the parties, to
direct or influence the person's management and policies.
(c) Except as provided by this section, a manufacturer or
distributor may not directly or indirectly:
(1) own an interest in a dealer or dealership;
(2) operate or control a dealer or dealership; or
(3) act in the capacity of a dealer.
(d) A manufacturer or distributor may own an interest in a
franchised dealer, or otherwise control a dealership, for a period
not to exceed 12 months from the date the manufacturer or
distributor acquires the dealership if:
(1) the person from whom the manufacturer or
distributor acquired the dealership was a franchised dealer; and
(2) the dealership is for sale by the manufacturer or
distributor at a reasonable price and on reasonable terms and
conditions.
(e) On a showing of good cause by a manufacturer or
distributor, the board may extend the time limit imposed under
Subsection (d) for a period not to exceed an additional 12 months.
An application for an extension after the first extension is
granted is subject to protest by a dealer of the same line-make
whose dealership is located in the same county as, or within 15
miles of, the dealership owned or controlled by the manufacturer or
distributor.
(f) For the purpose of determining compliance with
Subsection (d)(2), the price of a dealership and the other terms and
conditions of a contract for the sale of a dealership are reasonable
if the purchaser is a franchised dealer who:
(1) has made a significant investment in the
dealership, subject to loss;
(2) has an ownership interest in the dealership; and
(3) operates the dealership under a plan to acquire
full ownership of the dealership within a reasonable time and under
reasonable terms and conditions.
(g) For the purpose of broadening the diversity of its
dealer body and enhancing opportunities for qualified persons who
are part of a group that has been historically underrepresented in
its dealer body, or other qualified persons who lack the resources
to purchase a dealership outright, but for no other purpose, a
manufacturer or distributor may temporarily own an interest in a
dealership if the manufacturer's or distributor's participation in
the dealership is in a bona fide relationship with a franchised
dealer who:
(1) has made a significant investment in the
dealership, subject to loss;
(2) has an ownership interest in the dealership; and
(3) operates the dealership under a plan to acquire
full ownership of the dealership within a reasonable time and under
reasonable terms.
(h) A person who on June 7, 1995, held both a motor home
manufacturer's license and a motor home dealer's license issued
under this chapter may:
(1) continue to hold both licenses; and
(2) operate as both a manufacturer and dealer of motor
homes but of no other type of vehicle.
(i) Notwithstanding the terms of this chapter, and subject
to the limitations set forth in this subsection, a manufacturer or
distributor may own an interest in an entity that holds a general
distinguishing number if the entity:
(1) is primarily engaged in the business of renting to
other persons passenger vehicles or commercial motor vehicles that
the entity owns; and
(2) sells or offers for sale no vehicle other than a
vehicle that the entity:
(A) owns and has taken from service in its rental
fleet; or
(B) has taken in trade as part of a transaction
involving the sale of a vehicle taken from service in its rental
fleet.
Added by Acts 2001, 77th Leg., ch. 1421, § 5, eff. June 1, 2003.
Amended by Acts 2003, 78th Leg., ch. 503, § 1, eff. June 20,
2003; Acts 2003, 78th Leg., ch. 1276, § 14A.621(a), eff. Sept.
1, 2003.
Section: 2301.469 2301.470 2301.471 2301.472 2301.473 2301.474 2301.475 2301.476 2301.477 2301.478 2301.521 2301.522 2301.523 2301.524 2301.525
Last modified: August 11, 2007
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