13-14-302 - Issuance of additional franchises -- Relocation of existing franchisees.
13-14-302. Issuance of additional franchises -- Relocation of existing franchisees.
(1) Except as provided in Subsection (6), a franchisor shall provide the notice anddocumentation required under Subsection (2) if the franchisor seeks to:
(a) enter into a franchise agreement establishing a motor vehicle dealership within arelevant market area where the same line-make is represented by another franchisee; or
(b) relocate an existing motor vehicle franchisee.
(2) (a) If a franchisor seeks to take an action listed Subsection (1), prior to taking theaction, the franchisor shall, in writing, notify the advisory board and each franchisee in thatline-make in the relevant market area.
(b) The notice required by Subsection (2)(a) shall:
(i) specify the intended action described under Subsection (1);
(ii) specify the good cause on which it intends to rely for the action; and
(iii) be delivered by registered or certified mail or by any form of reliable deliverythrough which receipt is verifiable.
(3) (a) Except as provided in Subsection (3)(c), the franchisor shall provide to theadvisory board and each franchisee in that line-make in the relevant market area the followingdocuments relating to the notice described under Subsection (2):
(i) (A) any aggregate economic data and all existing reports, analyses, or opinions basedon the aggregate economic data that were relied on by the franchisor in reaching the decision toproceed with the action described in the notice; and
(B) the aggregate economic data under Subsection (3)(a)(i)(A) includes:
(I) motor vehicle registration data;
(II) market penetration data; and
(III) demographic data;
(ii) written documentation that the franchisor has in its possession that it intends to relyon in establishing good cause under Section 13-14-306 relating to the notice;
(iii) a statement that describes in reasonable detail how the establishment of a newfranchisee or the relocation of an existing franchisee will affect the amount of business transactedby other franchisees of the same line-make in the relevant market area, as compared to businessavailable to the franchisees; and
(iv) a statement that describes in reasonable detail how the establishment of a newfranchisee or the relocation of an existing franchisee will be beneficial or injurious to the publicwelfare or public interest.
(b) The franchisor shall provide the documents described under Subsection (3)(a) withthe notice required under Subsection (2).
(c) The franchisor is not required to disclose any documents under Subsection (3)(a) if:
(i) the documents would be privileged under the Utah Rules of Evidence;
(ii) the documents contain confidential proprietary information;
(iii) the documents are subject to federal or state privacy laws;
(iv) the documents are correspondence between the franchisor and existing franchisees inthat line-make in the relevant market area; or
(v) the franchisor reasonably believes that disclosure of the documents would violate:
(A) the privacy of another franchisee; or
(B) Section 13-14-201.
(4) (a) Within 45 days of receiving notice required by Subsection (2), any franchisee that
is required to receive notice under Subsection (2) may protest to the advisory board theestablishment or relocation of the dealership.
(b) When a protest is filed, the department shall inform the franchisor that:
(i) a timely protest has been filed;
(ii) a hearing is required;
(iii) the franchisor may not establish or relocate the proposed dealership until theadvisory board has held a hearing; and
(iv) the franchisor may not establish or relocate a proposed dealership if the executivedirector determines that there is not good cause for permitting the establishment or relocation ofthe dealership.
(5) If multiple protests are filed under Subsection (4), hearings may be consolidated toexpedite the disposition of the issue.
(6) Subsections (1) through (5) do not apply to a relocation of an existing or successordealer to a location that is:
(a) within the same county and less than two aeronautical miles from the existinglocation of the existing or successor franchisee's dealership; or
(b) further away from a dealership of a franchisee of the same line-make.
(7) For purposes of this section:
(a) relocation of an existing franchisee's dealership in excess of one mile from itsexisting location is considered the establishment of an additional franchise in the line-make ofthe relocating franchise;
(b) the reopening in a relevant market area of a dealership that has not been in operationfor one year or more is considered the establishment of an additional motor vehicle dealership;and
(c) (i) except as provided in Subsection (7)(c)(ii), the establishment of a temporaryadditional place of business by a recreational vehicle franchisee is considered the establishmentof an additional motor vehicle dealership; and
(ii) the establishment of a temporary additional place of business by a recreationalvehicle franchisee is not considered the establishment of an additional motor vehicle dealership ifthe recreational vehicle franchisee is participating in a trade show where three or morerecreational vehicle dealers are participating.
Amended by Chapter 33, 2010 General Session