§ 44-20-425 — Independent control of dealer - definitions

Colorado § 44-20-425

• Jurisdiction: Colorado
• Title 44: Revenue -
• Art.: Sale of Self-propelled Vehicles

Text

(1) Except as
otherwise provided in this section, no powersports vehicle manufacturer shall own,
operate, or control any powersports vehicle dealer or used powersports vehicle
dealer in Colorado.

(2) Notwithstanding subsection (1) of this section, the following activities are
not prohibited:

(a) Operation of a powersports vehicle dealer for a temporary period, not to
exceed twelve months, during the transition from one owner or operator to another
independent owner or operator; except that the executive director may extend the
period, not to exceed twenty-four months, upon a showing by the manufacturer or
distributor of the need to operate the dealership for such time to achieve a
transition from an owner or operator to another independent third-party owner or
operator;

(b) Ownership or control of a powersports vehicle dealer while the dealer is
being sold under a bona fide contract or purchase option to the operator of the
dealer;

(c) Participation in the ownership of the powersports vehicle dealer solely for
the purpose of providing financing or a capital loan that will enable the dealer to
become the majority owner of the dealer in less than seven years; and

(d) Operation of a powersports vehicle dealer if the powersports vehicle
manufacturer has no other franchised dealers of the same line-make in this state.

(3) As used in this section:

(a) Control means to possess, directly, the power to direct or cause the
direction of the management or policies of a person, whether through the
ownership of voting securities, by contract, or otherwise; except that control does
not include the relationship between a powersports vehicle manufacturer and a
powersports vehicle dealer under a franchise agreement.

(b) Operate means to directly or indirectly manage a powersports vehicle
dealer.

(c) Own means to hold any beneficial ownership interest of one percent or
more class of equity interest in a powersports vehicle dealer, whether as a
shareholder, partner, limited liability company member, or otherwise. To hold an
ownership interest means to have possession of, title to, or control of the ownership
interest, either directly or through a fiduciary or agent.

(d) Powersports vehicle manufacturer means a powersports vehicle
manufacturer, distributor, or manufacturer representative.

Legislative History

Source: L. 2018: Entire article added with relocations, (SB 18-030), ch. 7, p. 128, � 2, effective October 1.