§ 39-6-80 — Notice of intent to establish new dealership or relocate dealership; petition for injunction; factors considered; exceptions.

(A) A manufacturer, distributor, or wholesaler who intends to establish a new dealer or dealership or to relocate a current dealer or dealership for a particular product line or make of new equipment within the geographic market area of an existing dealer of the same product line or make of new equipment shall give written notice of that intent by certified mail to the existing dealer. The notice must include the following information about the new or relocated dealer or ownership: (1) specific location; (2) date of commencement of operation at the new location; (3) identities of all existing dealers or dealerships located in its market area; and (4) names and addresses of the dealer and principals. (B) An existing dealer located in the geographic market area in which a manufacturer, distributor, or wholesaler intends to establish a new dealership or to relocate a current dealer may petition the court, within sixty days of the receipt of the notice, to enjoin or prohibit the establishment of the new or relocated dealer or dealership within the geographic market area of the existing dealer. The court may enjoin or prohibit the establishment of the new dealer or dealership or relocation of a current dealer within the geographic market area of the existing dealer if the dealer proves by a preponderance of the evidence that the existing dealer is providing adequate representation of the product line or make of new equipment in his geographic market area. In determining if the existing dealer is providing adequate representation and whether the new or relocated dealer or dealership is necessary, the court may consider, but is not limited to considering: (1) the impact the establishment of the new or relocated dealer or dealership will have on users of new equipment, the public, and the existing dealer, except that financial impact may be considered only with respect to the existing dealer; (2) the size and permanency of investment reasonably made and the reasonable obligations incurred by the existing dealer to perform its obligation pursuant to the dealership agreement or sales agreement; (3) the reasonably expected market penetration of the product line or make of equipment for the geographic market area, after consideration of all factors that may affect the penetration including, but not limited to, demographic factors such as age, income, education, size class preference, product popularity, retail lease transactions, and other factors affecting sales of equipment in the geographic market area; (4) actions by the manufacturer, distributor, or wholesaler in denying its existing dealer of the same product line or make of equipment the opportunity for reasonable growth, market expansion, or relocation including the availability of equipment in keeping with reasonable expectations of the manufacturer, distributor, or wholesaler in providing an adequate number of dealerships in the geographic market area; (5) attempts by the manufacturer, distributor, or wholesaler to coerce the existing dealer into consenting to an additional or relocated dealer or dealership of the same product line or make of new equipment in the geographic market area; (6) distance, travel time, traffic patterns, and accessibility between the existing dealer's place of business for the same product line or make of new equipment and location of the proposed new or relocated dealer or dealership; (7) the likelihood of benefits to users of new equipment from the establishment or relocation of the dealer or dealership, which may not be obtained by other demographic changes or other expected changes in the geographic market area; (8) if the existing dealer is in substantial compliance with its dealership agreement or sales agreement; (9) if there is adequate interbrand and intrabrand competition with respect to the product line or make of new equipment, including the adequacy of sales and service facilities; (10) if the establishment or relocation of the proposed dealer or dealership appears to be warranted and justified based on economic and market conditions pertinent to dealers competing in the geographic market area including anticipated changes; and (11) the volume of registrations and service business transacted by the existing dealer in the geographic market area of the proposed dealer or dealership. (C) This section does not apply to: (1) the addition of a new dealership at a location that is within a three- mile radius of a former dealership of the same product line or make of new equipment that has been closed for less than two years; (2) the relocation of an existing dealer to a new location that is farther away from the protesting dealer's location than the relocated dealer's previous location; (3) the relocation of an existing dealer to a new location that is within a three-mile radius of the dealer's current location, when it has been at the current location at least ten years; or (4) a retailer whose outdoor power equipment sales represent less than ten percent of the retailer's gross sales in the United States.

Legislative History

HISTORY: 2000 Act No. 369, SECTION 1, eff June 14, 2000.