§ 2301.472 — ADDITION OF LINE-MAKE.

Texas § 2301.472

• Jurisdiction: Texas
• Code OC: Occupations Code

Text

Sec. 2301.472. ADDITION OF LINE-MAKE. (a) Notwithstanding the terms of any franchise, a manufacturer, distributor, or representative may not deny or withhold approval of a franchised dealer's application to add a line-make or parts or products related to that line-make unless:
(1) the manufacturer or distributor provides written notice of the denial or withholding of approval to the applicant not later than the 60th day after the date the application is received; and
(2) if the applicant files a protest under this section, the board upholds the denial or withholding of approval.
(b) After receiving notice under Subsection (a)(1), a dealer may file a protest with the board.
(c) If the dealer files a protest, the board may uphold the manufacturer's or distributor's decision to deny or withhold approval of the addition of the line-make only if the manufacturer or distributor establishes by a preponderance of the evidence that the denial or withholding of approval was reasonable.
(d) In determining whether a manufacturer or distributor has established that the denial or withholding of approval is reasonable, the board shall consider all existing circumstances, including:
(1) the dealer's sales in relation to the sales in the market;
(2) the dealer's investment and obligations;
(3) injury or benefit to the public;
(4) the adequacy of the dealer's sales and service facilities, equipment, parts, and personnel in relation to those of other dealers of new motor vehicles of the same line-make;
(5) whether warranties are being honored by the dealer agreement;
(6) the parties' compliance with the franchise, except to the extent that the franchise conflicts with this chapter;
(7) the enforceability of the franchise from a public policy standpoint, including issues of the reasonableness of the franchise's terms, oppression, adhesion, and the parties' relative bargaining power;
(8) whether the dealer complies with reasonable capitalization requirements or will be able to comply with reasonable capitalization requirements within a reasonable time;
(9) any harm to the manufacturer or distributor if the denial or withholding of approval is not upheld;
(10) any harm to the dealer if the denial or withholding of approval is upheld;
(11) the manufacturer's or distributor's investment and obligations; and
(12) whether the denial or withholding of approval is justified in light of current and reasonably foreseeable projections of economic conditions, financial expectations, and the market for new motor vehicles in the relevant market area.

Legislative History

Added by Acts 2001, 77th Leg., ch. 1421, Sec. 5, eff. June 1, 2003. Amended by: Acts 2009, 81st Leg., R.S., Ch. 684 (H.B. 2640 ), Sec. 6, eff. September 1, 2009.