Bill Text: OR HB3347 | 2013 | Regular Session | Enrolled
Bill Title: Relating to agreements with motor vehicle dealerships.
Sponsorship: Bipartisan Bill
Status: (Passed) 2013-06-06 - Chapter 329, (2013 Laws): Effective date January 1, 2014. [HB3347 Detail]
Download: Oregon-2013-HB3347-Enrolled.html
77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session
Enrolled
House Bill 3347
Sponsored by Representative HOYLE; Representative DAVIS
CHAPTER ................
AN ACT
Relating to agreements with motor vehicle dealerships; creating
new provisions; and amending ORS 650.158.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Section 2 of this 2013 Act is added to and made
a part of ORS 650.120 to 650.170. + }
SECTION 2. { + (1)(a) Except as provided in paragraph (b) of
this subsection, a manufacturer, distributor or importer may not
require a dealer to construct a new dealer facility or materially
alter or remodel an existing dealer facility within seven years
after the date on which the dealer previously constructed,
materially altered or remodeled the existing dealer facility if
the existing dealer facility complies with the manufacturer's,
distributor's or importer's approved brand image standards or
plans that existed at the time the dealer constructed, materially
altered or remodeled the existing dealer facility.
(b) A manufacturer, distributor or importer may require a
dealer to construct a new dealer facility or materially alter or
remodel an existing dealer facility within seven years after the
dealer constructed, materially altered or remodeled the existing
dealer facility:
(A) If the manufacturer, distributor or importer demonstrates
that the manufacturer's, distributor's or importer's requirement
is reasonable and justifiable in light of:
(i) The projected cost of the construction, material alteration
or remodel;
(ii) Existing and reasonably foreseeable economic conditions;
(iii) Financial expectations;
(iv) The availability of additional vehicle allocation; and
(v) The dealer's market for vehicle sales;
(B) In order to comply with a health or safety law or with a
technological requirement that is necessary to sell or service a
motor vehicle that the dealer sells or services under the terms
of the dealer's franchise; or
(C) By means of a written agreement separate from the franchise
agreement if the manufacturer, distributor or importer provides
money, credit, an allowance, an incentive or a reimbursement to
the dealer to compensate for all or a substantial portion of the
cost of constructing a new dealer facility or materially altering
or remodeling an existing dealer facility.
(c) Paragraph (a) of this subsection does not prohibit a dealer
from voluntarily agreeing with a manufacturer, distributor or
importer to construct a new dealer facility or materially alter
Enrolled House Bill 3347 (HB 3347-B) Page 1
or remodel an existing dealer facility in return for separate and
valuable consideration. For the purposes of this paragraph,
renewing a dealer's franchise is not separate and valuable
consideration.
(d) For purposes of this subsection:
(A) 'Materially alter' means a significant architectural or
structural modification to a dealer facility that is directly
related to effectively selling or servicing motor vehicles of the
type that the dealer's franchise agreement or license permits the
dealer to sell or service.
(B) 'Materially alter' does not include routine maintenance,
such as interior painting, that is reasonably necessary to keep a
dealer facility in attractive condition.
(2)(a) Except as provided in paragraph (b) of this subsection,
a manufacturer, distributor or importer may not require a dealer
to purchase goods or services for constructing, materially
altering or remodeling a dealer facility from a vendor that the
manufacturer, distributor or importer selects, identifies or
designates without giving the dealer an option to obtain goods or
services of substantially similar quality and design from a
vendor that the dealer chooses, subject to the manufacturer's,
distributor's or importer's approval in advance. The
manufacturer, distributor or importer may not withhold approval
unreasonably.
(b) A dealer may not select a vendor from which to obtain goods
and services for constructing a new dealer facility or materially
altering or remodeling an existing dealer facility if a
manufacturer, distributor or importer provides money, credit, an
allowance or a reimbursement to compensate for all or a
substantial portion of the cost of upgrading or improving a
dealer facility or for using a specific material, good or service
to upgrade or improve a dealer facility.
(c) This subsection does not permit a dealer or vendor to:
(A) Directly or indirectly or in any way infringe upon,
eliminate or impair a manufacturer's, distributor's or importer's
intellectual property rights or reasonable business requirements;
or
(B) Erect or maintain signs that do not conform to the
manufacturer's, distributor's or importer's intellectual property
usage guidelines. + }
SECTION 3. ORS 650.158 is amended to read:
650.158. (1) Each manufacturer, distributor or importer shall
specify in writing to each of { - its - } { + the
manufacturer's, distributor's or importer's + } dealers in this
state:
(a) The dealer's obligations for predelivery preparation and
warranty service on { + the manufacturer's, distributor's or
importer's + } motor vehicles { - of the manufacturer,
distributor or importer - } ;
(b) The schedule of compensation { - to be paid - } { + the
manufacturer, distributor or importer will pay + } the dealer for
parts, work and service in connection with predelivery
preparation and warranty service; and
(c) The time allowances for { - the performance of the - }
{ + performing + } predelivery preparation and warranty
service.
(2) { + (a) + } A schedule of compensation { - shall - }
{ + must + } include reasonable compensation for diagnostic
work, repair service and labor. Time allowances for { - the
diagnosis and performance of - } { + diagnosing and
Enrolled House Bill 3347 (HB 3347-B) Page 2
performing + } predelivery and warranty service { - shall - }
{ + must + } be reasonable and adequate for the work to be
performed. { - The hourly rate paid to a dealer shall not
be - } { + A manufacturer, distributor or importer may not pay
an hourly rate to a dealer that is + } less than the rate
{ - charged by - } the dealer { + charges + } { - to - }
nonwarranty customers for nonwarranty service and repairs.
Reimbursement for parts, other than parts used to repair the
living facilities of motor homes, { - purchased by - } { +
that + } the dealer { + purchases + } for use in performing
predelivery and warranty service
{ - shall - } { + must + } be the amount { - charged by - }
the dealer { - to - } { + charges + } nonwarranty customers,
as long as { - that - } { + the + } amount is not
unreasonable.
{ + (b)(A) For purposes of this subsection and subject to
subparagraphs (B) and (C) of this paragraph, to determine
compensation under this subsection, a dealer shall propose an
hourly rate and an amount for parts that the dealer charges
nonwarranty customers by submitting to the manufacturer,
distributor or importer copies of 100 sequential nonwarranty
service repair invoices that customers paid or 90 consecutive
days' worth of nonwarranty service invoices that customers paid,
whichever is less, for repairs made not more than 180 days before
the dealer's submission. If the manufacturer, distributor or
importer does not contest the dealer's proposal and the dealer
otherwise complies with the provisions of this paragraph, the
dealer's proposal is presumed to be fair and reasonable.
(B) A manufacturer, distributor or importer may contest the
dealer's proposal with evidence that the dealer's proposal is not
accurate or on the basis that the dealer's proposal does not
reasonably conform with the hourly rate or the amount for parts
that other dealers charge nonwarranty customers in the same
line-make in market areas that are contiguous to the dealer's
market area or with other relevant evidence. In contesting a
dealer's proposal based on evidence from other dealers in the
contiguous market area, a manufacturer, distributor or importer
shall rely on evidence from at least three other dealers in the
contiguous market area or three dealers in an economically
similar market within the manufacturer's, distributor's or
importer's region.
(C) A dealer may not include in the dealer's proposal:
(i) Repairs for a manufacturer's, distributor's or importer's
specials, special events or promotional discounts for retail
customer repairs;
(ii) Parts sold at wholesale;
(iii) Routine maintenance that a retail customer warranty does
not cover, such as fluids, filters and belts that a dealer uses
in performing work other than repairs;
(iv) Nuts, bolts, fasteners and similar items that do not have
an individual part number; and
(v) Vehicle reconditioning.
(c) The hourly rate or the amount for parts that a dealer
charges nonwarranty customers that the dealer proposes under
paragraph (b)(A) of this subsection becomes effective 30 days
after the manufacturer, distributor or importer approves the
hourly rate or the amount for parts. For purposes of this
paragraph, a manufacturer, distributor or importer approves the
dealer's proposal if the manufacturer, distributor or importer
Enrolled House Bill 3347 (HB 3347-B) Page 3
does not contest the proposed hourly rate or amount for parts
within 30 days after the dealer submits the proposal.
(d) If a manufacturer, distributor or importer successfully
contests a dealer's proposal, the manufacturer, distributor or
importer shall propose an adjustment to the dealer's proposal not
later than 30 days after the dealer submits the dealer's
proposal.
(e) Once per year, a manufacturer, distributor or importer may
verify the dealer's hourly rate or the amount for parts the
dealer charges nonwarranty customers. If the manufacturer,
distributor or importer finds that the dealer's hourly rate or
the amount for parts has decreased, the manufacturer, distributor
or importer may reduce the dealer's compensation under this
subsection prospectively. + }
(3) A manufacturer, distributor or importer shall include, in
written notices of vehicle recalls to motor vehicle owners and
dealers, the expected date by which necessary parts and equipment
will be available to the dealers { - for the correction of - }
{ + to correct + } the defect or defects. A manufacturer,
distributor or importer shall adequately compensate a dealer for
repair service
{ - performed - } { + the dealer performs + } under the
recall.
{ - (4) All claims made by dealers under this section for
labor and parts shall be paid or credited to the dealer within 30
days following their approval. All such claims shall be either
approved or disapproved within 30 days after their receipt in the
manner specified by the manufacturer, distributor or importer.
Any claim not specifically disapproved in writing or through
electronic communication within 30 days after receipt shall be
considered approved, and payment shall be made within 30 days.
The dealer shall be notified in writing of the grounds for
disapproval of any claim. - }
{ + (4) A manufacturer, distributor or importer shall:
(a) Pay or credit a dealer for labor or parts the dealer claims
under this section within 30 days after approving the dealer's
claim;
(b) Approve or disapprove, in the manner the manufacturer,
distributor or importer specifies, all claims that a dealer makes
for labor or parts within 30 days after receiving the claim;
(c) Treat as approved any claim that a manufacturer,
distributor or importer did not approve or disapprove within 30
days after the manufacturer, distributor or importer received the
claim and pay or credit the dealer for the claim within 60 days
after receiving the claim; and
(d) Notify the dealer in writing of the manufacturer's,
distributor's or importer's grounds for disapproving a claim. + }
SECTION 4. { + Section 2 of this 2013 Act and the amendments
to ORS 650.158 by section 3 of this 2013 Act apply to:
(1) Programs that dealers participate in under the terms of a
contract that the dealer and a manufacturer, distributor or
importer execute on or after the effective date of this 2013 Act;
(2) Claims for reimbursement for labor or parts that a dealer
makes under the terms of any contract or agreement that the
dealer enters into with a manufacturer, distributor or importer
on or after the effective date of this 2013 Act; and
(3) Other contracts or agreements that manufacturers,
distributors or importers enter into on or after the effective
date of this 2013 Act. + }
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Enrolled House Bill 3347 (HB 3347-B) Page 4
Passed by House May 15, 2013
.............................................................
Ramona J. Line, Chief Clerk of House
.............................................................
Tina Kotek, Speaker of House
Passed by Senate May 30, 2013
.............................................................
Peter Courtney, President of Senate
Enrolled House Bill 3347 (HB 3347-B) Page 5
Received by Governor:
......M.,............., 2013
Approved:
......M.,............., 2013
.............................................................
John Kitzhaber, Governor
Filed in Office of Secretary of State:
......M.,............., 2013
.............................................................
Kate Brown, Secretary of State
Enrolled House Bill 3347 (HB 3347-B) Page 6
