Florida Senate - 2009                             CS for SB 2630
       
       
       
       By the Committee on Transportation; and Senator Haridopolos
       
       
       
       
       596-03407-09                                          20092630c1
    1                        A bill to be entitled                      
    2         An act relating to motor vehicle dealerships; amending
    3         s. 320.64, F.S.; revising provisions prohibiting
    4         certain acts by a motor vehicle manufacturer, factory
    5         branch, distributor, or importer licensed under
    6         specified provisions; revising conditions and
    7         procedures for certain audits; removing a presumption
    8         that a dealer had no actual knowledge that a customer
    9         intended to export or resell a motor vehicle;
   10         clarifying a dealer’s eligibility requirements for
   11         licensee-offered program bonuses, incentives, and
   12         other benefits; requiring certain payments if a
   13         termination, cancellation, or nonrenewal of a dealer’s
   14         franchise is the result of bankruptcy or
   15         reorganization; amending s. 320.642, F.S.; revising
   16         provisions for establishing an additional motor
   17         vehicle dealership in or relocating an existing dealer
   18         to a location within a community or territory where
   19         the same line-make vehicle is presently represented by
   20         a franchised motor vehicle dealer or dealers; revising
   21         notice requirements; revising provisions for denial of
   22         an application for a motor vehicle dealer license in
   23         any community or territory; revising provisions for
   24         evidence to be considered by the Department of Highway
   25         Safety and Motor Vehicles when evaluating the
   26         application; revising provisions under which a dealer
   27         has standing to protest a proposed additional or
   28         relocated motor vehicle dealer; revising provisions
   29         for a proposed addition or relocation concerning a
   30         dealership that performs only service; amending s.
   31         320.643, F.S.; revising provisions for a transfer,
   32         assignment, or sale of franchise agreements;
   33         prohibiting rejection of proposed transfer of interest
   34         in a motor vehicle dealer entity to a trust or other
   35         entity, or a beneficiary thereof, which is established
   36         for estate-planning purposes; prohibiting placing
   37         certain conditions on such transfer; revising
   38         provisions for a hearing by the department or a court
   39         relating to a proposed transfer; amending s. 320.696,
   40         F.S.; eliminating one of the methods for determining
   41         warranty labor and parts reimbursement and more
   42         particularly describing exceptions to such
   43         calculations; providing for severability; providing an
   44         effective date.
   45  
   46  Be It Enacted by the Legislature of the State of Florida:
   47  
   48         Section 1. Subsection (5), paragraphs (a), (b), (c), (d),
   49  and (f) of subsection (10), and subsections (25), (26), and (36)
   50  of section 320.64, Florida Statutes, are amended, and paragraph
   51  (h) is added to subsection (10) of that section,to read:
   52         320.64 Denial, suspension, or revocation of license;
   53  grounds.—A license of a licensee under s. 320.61 may be denied,
   54  suspended, or revoked within the entire state or at any specific
   55  location or locations within the state at which the applicant or
   56  licensee engages or proposes to engage in business, upon proof
   57  that the section was violated with sufficient frequency to
   58  establish a pattern of wrongdoing, and a licensee or applicant
   59  shall be liable for claims and remedies provided in ss. 320.695
   60  and 320.697 for any violation of any of the following
   61  provisions. A licensee is prohibited from committing the
   62  following acts:
   63         (5) The applicant or licensee has coerced or attempted to
   64  coerce any motor vehicle dealer into ordering or accepting
   65  delivery of any motor vehicle or vehicles or parts or
   66  accessories therefor or any other commodities which have not
   67  been ordered voluntarily by the dealer or are in excess of that
   68  number which the motor vehicle dealer considers as reasonably
   69  required to adequately represent the licensee’s line-make in
   70  order to meet current and foreseeable market demand.
   71         (10)(a) The applicant or licensee has attempted to enter,
   72  or has entered, into a franchise agreement with a motor vehicle
   73  dealer who does not, at the time of the franchise agreement,
   74  have proper facilities to provide the services to his or her
   75  purchasers of new motor vehicles which are covered by the new
   76  motor vehicle warranty issued by the applicant or licensee.
   77  Notwithstanding any provision of a franchise, a licensee may not
   78  require a motor vehicle dealer, by franchise agreement, program,
   79  policy, standard, or otherwise, to relocate, to make substantial
   80  changes, alterations, or remodeling to, or to replace a motor
   81  vehicle dealer’s sales or service facilities unless the licensee
   82  can demonstrate that the licensee’s requirements are reasonable
   83  and justifiable in light of the current and reasonably
   84  foreseeable projections of economic conditions, financial
   85  expectations, and the motor vehicle dealer’s market for the
   86  licensee’s motor vehicles.
   87         (b) A licensee may, however, provide to a motor vehicle
   88  dealer a written commitment to supply allocate additional
   89  vehicles, consistent with the licensee’s allocation obligations
   90  at law and with the licensee’s commitment to other same line
   91  make motor vehicle dealers, or to provide a lump sum, or a loan,
   92  or a grant of money as an inducement for the motor vehicle
   93  dealer to relocate, expand, improve, remodel, alter, or renovate
   94  its facilities if the licensee delivers an assurance to the
   95  dealer that it will offer to supply to the dealer a sufficient
   96  quantity of new motor vehicles, consistent with its allocation
   97  obligations at law and to its other same line-make motor vehicle
   98  dealers, which will economically justify such relocation,
   99  expansion, improvement, remodeling, renovation, or alteration,
  100  in light of reasonably current and reasonably projected market
  101  and economic conditions. the provisions of the commitment
  102  increase in vehicle allocation, the loan or grant and the
  103  assurance, and the economic and market reasons and basis for
  104  them are must be contained in a written agreement voluntarily
  105  entered into by the dealer and must be made available, on
  106  substantially similar terms, to any of the licensee’s other same
  107  line-make dealers in this state who voluntarily agree to make a
  108  substantially similar facility expansion, improvement,
  109  remodeling, alteration, or renovation with whom the licensee
  110  offers to enter into such an agreement.
  111         (c)1. A licensee may shall not withhold a bonus, incentive,
  112  or other benefit that is available to its other same line-make
  113  franchised dealers in this state from, or take or threaten to
  114  take any action that is unfair, discriminatory, or adverse to a
  115  dealer who does not enter into an agreement with the licensee
  116  pursuant to paragraph (b).
  117         2.This subsection does not require a licensee to provide
  118  financial support for a relocation of a motor vehicle dealer
  119  because such support was previously provided to other of the
  120  licensee’s same line-make dealers who relocated.
  121         (d) Except for a program, bonus, incentive, or other
  122  benefit offered by a licensee to its dealers in a market area
  123  where the licensee’s unrealized sales potential or other market
  124  conditions, compared to its competitors’ sales of motor
  125  vehicles, justifies the licensee’s offers, a licensee may not
  126  refuse to offer a program, bonus, incentive, or other benefit,
  127  in whole or in part, to a dealer in this state which it offers
  128  generally to its other same line-make dealers nationally or in
  129  the licensee’s zone or region in which this state is included.
  130  Neither may a licensee it discriminate against a dealer in this
  131  state with respect to any program, bonus, incentive, or other
  132  benefit. For purposes of this chapter, a licensee may not
  133  establish this state alone as a zone, region, or territory by
  134  any other designation.
  135         (f) A licensee may offer any program for a bonus,
  136  incentive, or other benefit to its motor vehicle dealers in this
  137  state which contains rules, criteria, or eligibility
  138  requirements relating to a motor vehicle dealer’s facilities and
  139  nonfacility-related eligibility provisions. However, if any
  140  portion of a licensee-offered program for a bonus, incentive, or
  141  other benefit contains any qualifying rule, criteria, or
  142  eligibility requirement that relates to a motor vehicle dealer’s
  143  that, in whole or in part, is based upon or aimed at inducing a
  144  dealer’s relocation, expansion, improvement, remodeling,
  145  renovation, or alteration of the dealer’s sales or service
  146  facility, or both, each of the licensee’s motor vehicle dealers
  147  in this state, upon complying with all such qualifying
  148  provisions, is entitled to obtain the entire bonus, incentive,
  149  or other benefit offered. A motor vehicle dealer who does not
  150  comply with the facility-related rules, criteria, or eligibility
  151  requirements, but complies with the other program’s rules,
  152  criteria, or eligibility requirements, is entitled to receive a
  153  reasonable licensee-predetermined percentage of the bonus,
  154  incentive, or other benefit under the program which is unrelated
  155  to the motor vehicle dealer’s facilities. The licensee’s
  156  predetermined percentage unrelated to facilities is presumed
  157  “reasonable” if it is not less than 75 percent of the total
  158  bonus, incentive, or other benefit offered under is void as to
  159  each of the licensee’s motor vehicle dealers in this state who,
  160  nevertheless, shall be eligible for the entire amount of the
  161  bonuses, incentives, or benefits offered in the program upon
  162  compliance with the other eligibility provisions in the program.
  163         (h)A violation of paragraphs (b) through (g) is not a
  164  violation of s. 320.70 and does not subject any licensee to any
  165  criminal penalty under s. 320.70.
  166         (25) The applicant or licensee has undertaken an audit of
  167  warranty, maintenance, and other service-related payments or
  168  incentive payments, including payments to a motor vehicle dealer
  169  under any licensee-issued program, policy, or other benefit,
  170  which previously have been paid to a motor vehicle dealer in
  171  violation of this section, or has failed to comply with any of
  172  its obligations under s. 320.696. An applicant or licensee may
  173  reasonably and periodically audit a motor vehicle dealer to
  174  determine the validity of paid claims as provided in s. 320.696.
  175  Audits Audit of warranty, maintenance, and other service-related
  176  payments shall only be performed by an applicant or licensee
  177  only during for the 1-year period immediately following the date
  178  the claim was paid. Audits Audit of incentive payments shall
  179  only be performed by an applicant or licensee only during for an
  180  18-month period immediately following the date the incentive was
  181  paid. After those time periods have elapsed, all warranty,
  182  maintenance, and other service-related payments and incentive
  183  payments shall be deemed final and incontrovertible for any
  184  reason recognized under any applicable law and the motor vehicle
  185  dealer is not subject to any charge-back or repayment. An
  186  applicant or licensee may deny a claim or, as a result of a
  187  timely conducted audit, impose a charge-back against a motor
  188  vehicle dealer for warranty, maintenance, or other service
  189  related payments or incentive payments only if An applicant or
  190  licensee shall not deny a claim or charge a motor vehicle dealer
  191  back subsequent to the payment of the claim unless the applicant
  192  or licensee can show that the warranty, maintenance, or other
  193  service-related claim or incentive claim was false or fraudulent
  194  or that the motor vehicle dealer failed to substantially comply
  195  with the reasonable written and uniformly applied procedures of
  196  the applicant or licensee for such repairs or incentives. An
  197  applicant or licensee may not charge a motor vehicle dealer back
  198  subsequent to the payment of a warranty, maintenance, or
  199  service-related claim or incentive claim unless, within 30 days
  200  after a timely conducted audit, a representative of the
  201  applicant or licensee first meets in person, by telephone, or by
  202  video teleconference with an officer or employee of the dealer
  203  designated by the motor vehicle dealer. At such meeting the
  204  applicant or licensee must provide a detailed explanation, with
  205  supporting documentation, as to the basis for each of the claims
  206  for which the applicant or licensee proposed a charge-back to
  207  the dealer and a written statement containing the basis upon
  208  which the motor vehicle dealer was selected for audit or review.
  209  Thereafter, the applicant or licensee must provide the motor
  210  vehicle dealer’s representative a reasonable period after the
  211  meeting within which to respond to the proposed charge-backs,
  212  with such period to be commensurate with the volume of claims
  213  under consideration, but in no case less than 45 days after the
  214  meeting. The applicant or licensee is prohibited from changing
  215  or altering the basis for each of the proposed charge-backs as
  216  presented to the motor vehicle dealer’s representative following
  217  the conclusion of the audit unless the applicant or licensee
  218  receives new information affecting the basis for one or more
  219  charge-backs and that new information is received within 60 days
  220  after the conclusion of the timely conducted audit. If the
  221  applicant or licensee claims the existence of new information,
  222  the dealer must be given the same right to a meeting within 30
  223  days after the applicant’s or licensee’s receipt of the new
  224  information and right to respond as when the charge-back was
  225  originally presented.
  226         (26) Notwithstanding the terms of any franchise agreement,
  227  including any licensee’s program, policy, or procedure, the
  228  applicant or licensee has refused to allocate, sell, or deliver
  229  motor vehicles; charged back or withheld payments or other
  230  things of value for which the dealer is otherwise eligible under
  231  a sales promotion, program, or contest; prevented a motor
  232  vehicle dealer from participating in any promotion, program, or
  233  contest; or has taken or threatened to take any adverse action
  234  against a dealer, including charge-backs, reducing vehicle
  235  allocations, or terminating or threatening to terminate a
  236  franchise because the dealer sold or leased a motor vehicle to a
  237  customer who exported the vehicle to a foreign country or who
  238  resold the vehicle, unless the licensee proves that the dealer
  239  had actual knowledge that the customer intended to export or
  240  resell the motor vehicle. There is a conclusive presumption that
  241  the dealer had no actual knowledge if the vehicle is titled or
  242  registered in any state in this country.
  243         (36)(a) Notwithstanding the terms of any franchise
  244  agreement, in addition to any other statutory or contractual
  245  rights of recovery after the voluntary or involuntary
  246  termination of a franchise, failing to pay the motor vehicle
  247  dealer, within 90 days after the effective date of the
  248  termination, cancellation, or nonrenewal, the following amounts:
  249         1. The net cost paid by the dealer for each new car or
  250  truck in the dealer’s inventory with mileage of 2,000 miles or
  251  less, or a motorcycle with mileage of 100 miles or less,
  252  exclusive of mileage placed on the vehicle before it was
  253  delivered to the dealer.
  254         2. The current price charged for each new, unused,
  255  undamaged, or unsold part or accessory that:
  256         a. Is in the current parts catalogue and is still in the
  257  original, resalable merchandising package and in an unbroken
  258  lot, except that sheet metal may be in a comparable substitute
  259  for the original package; and
  260         b. Was purchased by the dealer directly from the
  261  manufacturer or distributor or from an outgoing authorized
  262  dealer as a part of the dealer’s initial inventory.
  263         3. The fair market value of each undamaged sign owned by
  264  the dealer which bears a trademark or trade name used or claimed
  265  by the applicant or licensee or its representative which was
  266  purchased from or at the request of the applicant or licensee or
  267  its representative.
  268         4. The fair market value of all special tools, data
  269  processing equipment, and automotive service equipment owned by
  270  the dealer which:
  271         a. Were recommended in writing by the applicant or licensee
  272  or its representative and designated as special tools and
  273  equipment;
  274         b. Were purchased from or at the request of the applicant
  275  or licensee or its representative; and
  276         c. Are in usable and good condition except for reasonable
  277  wear and tear.
  278         5. The cost of transporting, handling, packing, storing,
  279  and loading any property subject to repurchase under this
  280  section.
  281         6.If the termination, cancellation, or nonrenewal of the
  282  dealer’s franchise is the result of the bankruptcy or
  283  reorganization of a licensee or its common entity, or the
  284  termination, elimination, or cessation of the line-make, in
  285  addition to the above payments to the dealer, the licensee, or
  286  if it is unable to do so, its common entity, is liable to the
  287  motor vehicle dealer for the following:
  288         a.An amount at least equal to the fair market value of the
  289  franchise for the line-make, which shall be the greater of the
  290  value determined as of the day the licensee announces the action
  291  that results in the termination, cancellation, or nonrenewal,
  292  and the value determined on the day that is 12 months before
  293  that date. In determining the fair market value of a franchise
  294  for a line-make, if the line-make is not the only line-make for
  295  which the dealer holds a franchise in its dealership facilities,
  296  the dealer is also entitled to compensation for the contribution
  297  of the line-make to payment of the rent or to covering the
  298  dealer’s obligation for the fair rental value of the dealership
  299  facilities for the period described in sub-subparagraph b. Fair
  300  market value of the franchise for the line-make includes only
  301  the goodwill value of the dealer’s franchise for that line-make
  302  in the dealer’s community or territory.
  303         b.If the line-make is the only line-make for which the
  304  dealer holds a franchise in the dealership facilities, the
  305  licensee, or its common entity if the licensee is unable to pay,
  306  also shall pay to the dealer with respect to the dealership
  307  facilities leased or owned by the dealership or its principal
  308  owner a sum equal to the rent for the unexpired term of the
  309  lease or 3 years’ rent, whichever is less, or, if the dealer or
  310  its principal owner owns the dealership facilities, a sum equal
  311  to the reasonable fair rental value of the dealership facilities
  312  for a period of 3 years as if the franchise were still in
  313  existence at the facilities, if the motor vehicle dealer uses
  314  reasonable commercial efforts to mitigate this liability by
  315  attempting, in good faith, to lease or sell the facilities
  316  within a reasonable time on terms that are consistent with local
  317  zoning requirements to preserve the facilities’ right to sell
  318  and service motor vehicles.
  319         (b) This subsection does not apply to a termination,
  320  cancellation, or nonrenewal that is implemented as a result of
  321  the sale of the assets or corporate stock or other ownership
  322  interests of the dealer. The dealer shall return the property
  323  listed in this subsection to the licensee at the dealer’s place
  324  of business on a date selected by the dealer in the absence of
  325  an agreement with the licensee which is within 90 days after the
  326  effective date of the termination, cancellation, or nonrenewal.
  327  The licensee shall supply the dealer with reasonable
  328  instructions regarding the packing for transport method by which
  329  the dealer must return the property. The compensation for the
  330  property shall be paid by the licensee upon and simultaneously
  331  with within 60 days after the tender of inventory and other
  332  items, except when if the dealer does not have has clear title
  333  to the inventory and other items and is not in a position to
  334  convey that title to the licensee manufacturer or distributor.
  335  If the inventory or other items are subject to a security
  336  interest, The licensee shall may make payment jointly to the
  337  dealer and the holder of any the security interest.
  338  
  339  A motor vehicle dealer who can demonstrate that a violation of,
  340  or failure to comply with, any of the preceding provisions by an
  341  applicant or licensee will or can adversely and pecuniarily
  342  affect the complaining dealer, shall be entitled to pursue all
  343  of the remedies, procedures, and rights of recovery available
  344  under ss. 320.695 and 320.697.
  345         Section 2. Subsections (1), (2), (3), and (6) of section
  346  320.642, Florida Statutes, are amended to read:
  347         320.642 Dealer licenses in areas previously served;
  348  procedure.—
  349         (1) Any licensee who proposes to establish an additional
  350  motor vehicle dealership or permit the relocation of an existing
  351  dealer to a location within a community or territory where the
  352  same line-make vehicle is presently represented by a franchised
  353  motor vehicle dealer or dealers shall give written notice of its
  354  intention to the department. The Such notice shall state:
  355         (a) The specific location at which the additional or
  356  relocated motor vehicle dealership will be established.
  357         (b) The date on or after which the licensee intends to be
  358  engaged in business with the additional or relocated motor
  359  vehicle dealer at the proposed location.
  360         (c) The identity of all motor vehicle dealers who are
  361  franchised to sell the same line-make vehicle with licensed
  362  locations in the county and or any contiguous county to the
  363  county where the additional or relocated motor vehicle dealer is
  364  proposed to be located.
  365         (d) The names and addresses of the dealer-operator and
  366  principal investors in the proposed additional or relocated
  367  motor vehicle dealership.
  368  
  369  Immediately upon receipt of the such notice the department shall
  370  cause a notice to be published in the Florida Administrative
  371  Weekly. The published notice shall state that a petition or
  372  complaint by any dealer with standing to protest pursuant to
  373  subsection (3) must be filed not more than 45 30 days after from
  374  the date of publication of the notice in the Florida
  375  Administrative Weekly. The published notice shall describe and
  376  identify the proposed dealership sought to be licensed, and the
  377  department shall cause a copy of the notice to be mailed to
  378  those dealers identified in the licensee’s notice under
  379  paragraph (c).
  380         (2)(a) An application for a motor vehicle dealer license in
  381  any community or territory must shall be denied when:
  382         1. A timely protest is filed by a presently existing
  383  franchised motor vehicle dealer with standing to protest as
  384  defined in subsection (3); and
  385         2. The licensee fails to show that the existing franchised
  386  dealer or dealers who register new motor vehicle retail sales or
  387  retail leases of the same line-make in the community or
  388  territory of the proposed dealership are not providing adequate
  389  representation, adequate competition, and convenient customer
  390  service of such line-make motor vehicles in a manner beneficial
  391  to the public interest in such community or territory. The
  392  ultimate burden of proof in establishing inadequate
  393  representation, inadequate competition, and inconvenient
  394  customer service is shall be on the licensee. Any geographic
  395  area used for comparison to evaluate the performance of the
  396  line-make or of the existing motor vehicle dealer or dealers
  397  within the community or territory must be reasonably similar in
  398  demographic traits to the community or territory of the proposed
  399  site, including such factors as age, income, education, vehicle
  400  size, class, model preference, and product popularity, and the
  401  comparison area must not be smaller than the largest entire
  402  county in which any of the protesting dealers are located.
  403  Reasonably expected market sales or service penetration must be
  404  measured with respect to the community or territory as a whole
  405  and not with respect to any part thereof or any identifiable
  406  plot therein.
  407         (b) In determining whether the existing franchised motor
  408  vehicle dealer or dealers are providing adequate representation,
  409  adequate competition, and convenient customer service in the
  410  community or territory for the line-make, the department may
  411  consider evidence of any factor deemed material by the finder of
  412  fact in the unique circumstances, which may include, but is not
  413  limited to:
  414         1. The market share and return-on-investment impact of the
  415  establishment of the proposed or relocated dealer on the
  416  consumers, public interest, existing dealers, and the licensee;
  417  provided, however, that financial impact other than return on
  418  investment may only be considered only with respect to the
  419  protesting dealer or dealers.
  420         2. The size and permanency of investment reasonably made
  421  and reasonable obligations incurred by the existing dealer or
  422  dealers to perform their obligations under the dealer agreement,
  423  including requirements made by the licensee up to 5 years before
  424  the date of the publication of the notice.
  425         3. The reasonably expected market penetration of the line
  426  make motor vehicle for the community or territory involved,
  427  after consideration of all factors which may affect such said
  428  penetration, including, but not limited to, demographic factors
  429  such as age, income, education, vehicle size, class, model
  430  preference, line-make, product popularity, retail lease
  431  transactions, reasonably foreseeable economic projections,
  432  financial expectations, availability of reasonable terms,
  433  reasonable amounts of credit to prospective customers, or other
  434  factors affecting sales to consumers of the community or
  435  territory.
  436         4. Any actions by the licensee licensees in denying its
  437  existing dealer or dealers of the same line-make the opportunity
  438  for reasonable growth, market expansion, or relocation,
  439  including the availability of line-make vehicles by model, in
  440  keeping with the reasonable expectations of the licensee in
  441  providing an adequate number of dealers in the community or
  442  territory, and any actions by the licensee or its common entity
  443  in making credit available to the existing dealers in reasonable
  444  amounts and on reasonable terms or the existence of credit
  445  otherwise available to the dealers in reasonable amounts and on
  446  reasonable terms.
  447         5. Any attempts by the licensee to coerce the existing
  448  dealer or dealers into consenting to additional or relocated
  449  franchises of the same line-make in the community or territory.
  450         6. Distance, travel time, traffic patterns, and
  451  accessibility between the existing dealer or dealers of the same
  452  line-make and the location of the proposed additional or
  453  relocated dealer for prospective customers.
  454         7. Whether there will likely be a material positive impact
  455  and a material benefit benefits to consumers will likely occur
  456  from the establishment or relocation of the proposed dealership
  457  which will not cannot be obtained by other geographic or
  458  demographic changes or expected changes in the community or
  459  territory or by a material increase in advertising by the
  460  licensee.
  461         8. Whether the protesting dealer or dealers are in
  462  substantial compliance with their dealer agreement.
  463         9. Whether there is adequate interbrand and intrabrand
  464  competition with respect to such said line-make in the community
  465  or territory and adequately convenient consumer care for the
  466  motor vehicles of the line-make, including the adequacy of sales
  467  and service facilities.
  468         10. Whether the establishment or relocation of the proposed
  469  dealership is appears to be warranted and justified based on
  470  economic and marketing conditions pertinent to dealers competing
  471  in the community or territory, including anticipated future
  472  changes.
  473         11. The volume of registrations and service business
  474  transacted by the existing dealer or dealers of the same line
  475  make in the relevant community or territory of the proposed
  476  dealership.
  477         12.The past and reasonably foreseeable expected growth or
  478  decline in population, density of population, and new motor
  479  vehicle registrations in the community or territory of the
  480  proposed dealership for competing motor vehicles, and whether
  481  existing same line-make dealers will be unable to adjust their
  482  dealership operations to adequately deal with such changes.
  483         13.Whether the licensee has provided marketing and
  484  advertising support of its line-make in the community or
  485  territory on a basis comparable to its interbrand competitors.
  486         14.Whether the economic conditions reasonably forecasted
  487  by the licensee for the foreseeable future will enable all
  488  existing same line-make dealers and the proposed new or
  489  relocated dealership the opportunity for a reasonable return on
  490  their investment, including supplying an adequate number of
  491  every model of the licensee’s new motor vehicles to them.
  492         (3) An existing franchised motor vehicle dealer or dealers
  493  has shall have standing to protest a proposed additional or
  494  relocated motor vehicle dealer when where the existing motor
  495  vehicle dealer or dealers have a franchise agreement for the
  496  same line-make vehicle to be sold or serviced by the proposed
  497  additional or relocated motor vehicle dealer and are physically
  498  located so as to meet or satisfy any of the following
  499  requirements or conditions:
  500         (a) If the proposed additional or relocated motor vehicle
  501  dealer is to be located in a county with a population of less
  502  than 300,000 according to the most recent data of the United
  503  States Census Bureau or the data of the Bureau of Economic and
  504  Business Research of the University of Florida:
  505         1. The proposed additional or relocated motor vehicle
  506  dealer is to be located in the area designated or described as
  507  the area of responsibility, or such similarly designated area,
  508  including the entire area designated as a multiple-point area,
  509  in the franchise agreement or in any related document or
  510  commitment with the existing motor vehicle dealer or dealers of
  511  the same line-make as such agreement existed on or after the
  512  effective date of this act upon October 1, 1988;
  513         2. The existing motor vehicle dealer or dealers of the same
  514  line-make have a licensed franchise location within a radius of
  515  20 miles of the location of the proposed additional or relocated
  516  motor vehicle dealer; or
  517         3. Any existing motor vehicle dealer or dealers of the same
  518  line-make can establish that during any 12-month period of the
  519  36-month period preceding the filing of the licensee’s
  520  application for the proposed dealership, the such dealer or its
  521  predecessor made 25 percent of its retail sales of new motor
  522  vehicles to persons whose registered household addresses were
  523  located within a radius of 20 miles of the location of the
  524  proposed additional or relocated motor vehicle dealer; provided
  525  the such existing dealer is located in the same county or any
  526  county contiguous to the county where the additional or
  527  relocated dealer is proposed to be located.
  528         (b) If the proposed additional or relocated motor vehicle
  529  dealer is to be located in a county with a population of more
  530  than 300,000 according to the most recent data of the United
  531  States Census Bureau or the data of the Bureau of Economic and
  532  Business Research of the University of Florida:
  533         1. Any existing motor vehicle dealer or dealers of the same
  534  line-make have a licensed franchise location within a radius of
  535  15 12.5 miles of the location of the proposed additional or
  536  relocated motor vehicle dealer; or
  537         2. Any existing motor vehicle dealer or dealers of the same
  538  line-make can establish that during any 12-month period of the
  539  36-month period preceding the filing of the licensee’s
  540  application for the proposed dealership, such dealer or its
  541  predecessor made 20 25 percent of its retail sales of new motor
  542  vehicles to persons whose registered household addresses were
  543  located within a radius of 15 12.5 miles of the location of the
  544  proposed additional or relocated motor vehicle dealer, or
  545  performed repairs on the same line-make motor vehicles which
  546  constituted 15 percent of its total service department sales to
  547  persons whose registered addresses were located within a radius
  548  of 15 miles of the location of the proposed additional or
  549  relocated dealer; provided such existing dealer is located in
  550  the same county or any county contiguous to the county where the
  551  additional or relocated dealer is proposed to be located.
  552         (6) When a proposed addition or relocation concerns a
  553  dealership that performs or is to perform only service, as
  554  defined in s. 320.60(16), and will not or does not sell or lease
  555  new motor vehicles, as defined in s. 320.60(15), the proposal
  556  shall be subject to notice and protest pursuant to the
  557  provisions of this section.
  558         (a) Standing to protest the addition or relocation of a
  559  service-only dealership shall be limited to those instances in
  560  which the applicable mileage requirement established in
  561  subparagraphs (3)(a)2. and (3)(b)1. or (3)(b)2. is met.
  562         (b) The addition or relocation of a service-only dealership
  563  shall not be subject to protest if:
  564         1. The applicant for the service-only dealership location
  565  is an existing motor vehicle dealer of the same line-make as the
  566  proposed additional or relocated service-only dealership;
  567         2. There is no existing dealer of the same line-make closer
  568  than the applicant to the proposed location of the additional or
  569  relocated service-only dealership; and
  570         3. The proposed location of the additional or relocated
  571  service-only dealership is at least 10 7 miles from all existing
  572  motor vehicle dealerships of the same line-make, other than
  573  motor vehicle dealerships owned by the applicant.
  574         (c) In determining whether existing franchised motor
  575  vehicle dealers are providing adequate representation, adequate
  576  competition, and convenient customer service representations in
  577  the community or territory for the line-make in question in a
  578  protest of the proposed addition or relocation of a service-only
  579  dealership, the department may consider the elements set forth
  580  in paragraph (2)(b), provided:
  581         1. With respect to subparagraph (2)(b)1., only the impact
  582  as it relates to service may be considered;
  583         2. Subparagraph (2)(b)3. shall not be considered;
  584         3. With respect to subparagraph (2)(b)9., only service
  585  facilities shall be considered; and
  586         4. With respect to subparagraph (2)(b)11., only the volume
  587  of service business transacted shall be considered.
  588         (d) If an application for a service-only dealership is
  589  granted, the department shall issue a license which permits only
  590  service, as defined in s. 320.60(16), and does not permit the
  591  selling or leasing of new motor vehicles, as defined in s.
  592  320.60(15). If a service-only dealership subsequently seeks to
  593  sell new motor vehicles at its location, the notice and protest
  594  provisions of this section shall apply.
  595         Section 3. Section 320.643, Florida Statutes, is amended to
  596  read:
  597         320.643 Transfer, assignment, or sale of franchise
  598  agreements.—
  599         (1)(a) Notwithstanding the terms of any franchise
  600  agreement, a licensee shall not, by contract or otherwise, fail
  601  or refuse to give effect to, prevent, prohibit, or penalize or
  602  attempt to refuse to give effect to, prohibit, or penalize any
  603  motor vehicle dealer from selling, assigning, transferring,
  604  alienating, or otherwise disposing of its franchise agreement to
  605  any other person or persons, including a corporation established
  606  or existing for the purpose of owning or holding a franchise
  607  agreement, unless the licensee proves at a hearing pursuant to a
  608  complaint filed by a motor vehicle dealer under this section
  609  that the such sale, transfer, alienation, or other disposition
  610  is to a person who is not, or whose controlling executive
  611  management is not, of good moral character or does not meet the
  612  written, reasonable, and uniformly applied standards or
  613  qualifications of the licensee relating to financial
  614  qualifications of the transferee and business experience of the
  615  transferee or the transferee’s executive management. A motor
  616  vehicle dealer who desires to sell, assign, transfer, alienate,
  617  or otherwise dispose of a franchise shall notify, or cause the
  618  proposed transferee to notify, the licensee, in writing, setting
  619  forth the prospective transferee’s name, address, financial
  620  qualifications, and business experience during the previous 5
  621  years. A licensee who receives such notice may, within 60 days
  622  following such receipt, notify the motor vehicle dealer, in
  623  writing, that the proposed transferee is not a person qualified
  624  to be a transferee under this section and setting forth the
  625  material reasons for such rejection. Failure of the licensee to
  626  notify the motor vehicle dealer within the 60-day period of such
  627  rejection shall be deemed an approval of the transfer. A No such
  628  transfer, assign, or sale is not shall be valid unless the
  629  transferee agrees in writing to comply with all requirements of
  630  the franchise then in effect.
  631         (b) A motor vehicle dealer whose proposed sale is rejected
  632  may, within 60 days following such receipt of such rejection,
  633  file with the department a complaint for a determination that
  634  the proposed transferee has been rejected in violation of this
  635  section. The licensee has the burden of proof with respect to
  636  all issues raised by the such complaint. The department shall
  637  determine, and enter an order providing, that the proposed
  638  transferee is either qualified or is not and cannot be qualified
  639  for specified reasons, or the order may provide the conditions
  640  under which a proposed transferee would be qualified. If the
  641  licensee fails to file such a response to the motor vehicle
  642  dealer’s complaint within 30 days after receipt of the
  643  complaint, unless the parties agree in writing to an extension,
  644  or if the department, after a hearing, renders a decision other
  645  than one disqualifying the proposed transferee, the franchise
  646  agreement between the motor vehicle dealer and the licensee is
  647  shall be deemed amended to incorporate such transfer or amended
  648  in accordance with the determination and order rendered,
  649  effective upon compliance by the proposed transferee with any
  650  conditions set forth in the determination or order.
  651         (2)(a) Notwithstanding the terms of any franchise
  652  agreement, a licensee shall not, by contract or otherwise, fail
  653  or refuse to give effect to, prevent, prohibit, or penalize, or
  654  attempt to refuse to give effect to, prevent, prohibit, or
  655  penalize, any motor vehicle dealer or any proprietor, partner,
  656  stockholder, owner, or other person who holds or otherwise owns
  657  an interest therein from selling, assigning, transferring,
  658  alienating, or otherwise disposing of, in whole or in part, the
  659  equity interest of any of them in such motor vehicle dealer to
  660  any other person or persons, including a corporation established
  661  or existing for the purpose of owning or holding the stock or
  662  ownership interests of other entities, unless the licensee
  663  proves at a hearing pursuant to a complaint filed by a motor
  664  vehicle dealer under this section that the such sale, transfer,
  665  alienation, or other disposition is to a person who is not, or
  666  whose controlling executive management is not, of good moral
  667  character. A motor vehicle dealer, or any proprietor, partner,
  668  stockholder, owner, or other person who holds or otherwise owns
  669  an interest in the motor vehicle dealer, who desires to sell,
  670  assign, transfer, alienate, or otherwise dispose of any interest
  671  in such motor vehicle dealer shall notify, or cause the proposed
  672  transferee to so notify, the licensee, in writing, of the
  673  identity and address of the proposed transferee. A licensee who
  674  receives such notice may, within 60 days following such receipt,
  675  notify the motor vehicle dealer in writing that the proposed
  676  transferee is not a person qualified to be a transferee under
  677  this section and setting forth the material reasons for such
  678  rejection. Failure of the licensee to notify the motor vehicle
  679  dealer within the 60-day period of such rejection shall be
  680  deemed an approval of the transfer. Any person whose proposed
  681  sale of stock is rejected may file within 60 days of receipt of
  682  such rejection a complaint with the department alleging that the
  683  rejection was in violation of the law or the franchise
  684  agreement. The licensee has the burden of proof with respect to
  685  all issues raised by such complaint. The department shall
  686  determine, and enter an order providing, that the proposed
  687  transferee either is qualified or is not and cannot be qualified
  688  for specified reasons; or the order may provide the conditions
  689  under which a proposed transferee would be qualified. If the
  690  licensee fails to file a response to the motor vehicle dealer’s
  691  complaint within 30 days of receipt of the complaint, unless the
  692  parties agree in writing to an extension, or if the department,
  693  after a hearing, renders a decision on the complaint other than
  694  one disqualifying the proposed transferee, the transfer shall be
  695  deemed approved in accordance with the determination and order
  696  rendered, effective upon compliance by the proposed transferee
  697  with any conditions set forth in the determination or order.
  698         (b)Notwithstanding paragraph (a), a licensee or the
  699  department may not reject a proposed transfer of a legal,
  700  equitable, or beneficial interest in a motor vehicle dealer to a
  701  trust or other entity, or to any beneficiary thereof, which is
  702  established by an owner of any interest in a motor vehicle
  703  dealer for purposes of estate planning, if the controlling
  704  person of the trust or entity thereof, or the beneficiary, is of
  705  good moral character. A licensee or the department may not
  706  condition any proposed transfer under this section upon a
  707  relocation of, construction of any addition or modification to,
  708  or any refurbishing or remodeling of any dealership structure,
  709  facility, or building of the existing motor vehicle dealer, or
  710  upon any modification of the existing franchise agreement.
  711         (3) During the pendency of any such department or court
  712  hearing, the franchise agreement of the motor vehicle dealer
  713  shall continue in effect in accordance with its terms. The
  714  department or any court shall use reasonable efforts to expedite
  715  any determination requested under this section.
  716         (4) Notwithstanding the terms of any franchise agreement,
  717  the acceptance by the licensee of the proposed transferee shall
  718  not be unreasonably withheld, delayed, or conditioned. For the
  719  purposes of this section, the refusal by the licensee to accept,
  720  in a timely manner, a proposed transferee who satisfies the
  721  criteria set forth in subsection (1) or subsection (2) is
  722  presumed to be unreasonable.
  723         (5) It shall be a violation of this section for the
  724  licensee to reject, or withhold, delay, or condition approval of
  725  a proposed transfer unless the licensee can prove in any court
  726  of competent jurisdiction in defense of any claim brought
  727  pursuant to s. 320.697 that, in fact, the rejection or
  728  withholding of approval of the proposed transfer was not in
  729  violation of or precluded by this section and was reasonable.
  730  The determination of whether such rejection or withholding was
  731  reasonable shall be based on a preponderance of the evidence
  732  presented during the proceeding on an objective standard.
  733  Alleging the permitted statutory grounds by the licensee in the
  734  written rejection of the proposed transfer does shall not
  735  constitute a defense of the licensee, or protect the licensee
  736  from liability for violating this section.
  737         Section 4. Paragraphs (a) and (b) of subsection (3) and
  738  subsections (4) and (7) of section 320.696, Florida Statutes,
  739  are amended to read:
  740         320.696 Warranty responsibility.—
  741         (3)(a) A licensee shall compensate a motor vehicle dealer
  742  for parts used in any work described in subsection (1). The
  743  compensation may be an agreed percentage markup over the
  744  licensee’s dealer cost, but if an agreement is not reached
  745  within 30 days after a dealer’s written request, compensation
  746  for the parts is the greater of:
  747         1. The dealer’s arithmetical mean percentage markup over
  748  dealer cost for all parts charged by the dealer in 75 50
  749  consecutive retail customer repairs made by the dealer within a
  750  3-month period before the dealer’s written request for a change
  751  in reimbursement pursuant to this section, or all of the retail
  752  customer repair orders over that 3-month period if there are
  753  fewer than 50 retail customer repair orders in that period. The
  754  motor vehicle dealer shall give the licensee 10 days’ written
  755  notice that it intends to make a written request to the licensee
  756  for a warranty parts reimbursement increase and permit the
  757  licensee, within that 10-day period, to select the initial
  758  retail customer repair for the consecutive repair orders that
  759  will be attached to the written request used for the markup
  760  computation, provided that if the licensee fails to provide a
  761  timely selection, the dealer may make that selection. No repair
  762  order shall be excluded from the markup computation because it
  763  contains both warranty, extended warranty, certified pre-owned
  764  warranty, maintenance, recall, campaign service, or authorized
  765  goodwill work and a retail customer repair. However, only the
  766  retail customer repair portion of the repair order shall be
  767  included in the computation, and the parts described in
  768  paragraph (b) shall be excluded from the computation; or
  769         2. The licensee’s highest suggested retail or list price
  770  for the parts.; or
  771         3.An amount equal to the dealer’s markup over dealer cost
  772  that results in the same gross profit percentage for parts used
  773  in work done under subsection (1) as the dealer receives for
  774  parts used in the customer retail repairs, as evidenced by the
  775  average of said dealer’s gross profit percentage in the dealer’s
  776  financial statements for the 2 months preceding the dealer’s
  777  request.
  778  
  779  If a licensee reduces the suggested retail or list price for any
  780  replacement part or accessory, it also shall reduce, by at least
  781  the same percentage, the cost to the dealer for the part or
  782  accessory. The dealer’s markup or gross profit percentage shall
  783  be uniformly applied to all of the licensee’s parts used by the
  784  dealer in performing work covered by subsection (1).
  785         (b) In calculating the compensation to be paid for parts by
  786  the arithmetical mean percentage markup over dealer cost method
  787  in paragraph (a), parts discounted by a dealer for repairs made
  788  in group, fleet, insurance, or other third-party payer service
  789  work; parts used in repairs of government agencies’ vehicle
  790  repairs for which volume discounts have been negotiated; parts
  791  used in bona fide special events, specials, or promotional
  792  discounts for retail customer repairs; parts sold at wholesale;
  793  parts used for internal repairs; engine assemblies and
  794  transmission assemblies; parts used in retail customer repairs
  795  for routine maintenance, such as fluids, filters and belts;
  796  nuts, bolts, fasteners, and similar items that do not have an
  797  individual part number; and tires shall be excluded in
  798  determining the percentage markup over dealer cost.
  799         (4)(a) A licensee shall compensate a motor vehicle dealer
  800  for labor performed in connection with work described in
  801  subsection (1) as calculated in this subsection.
  802         (b) Compensation paid by a licensee to a motor vehicle
  803  dealer may be an agreed hourly labor rate. If, however, an
  804  agreement is not reached within 30 days after the dealer’s
  805  written request, the compensation shall dealer may choose to be
  806  paid the greater of:
  807         1. the dealer’s hourly labor rate for retail customer
  808  repairs, determined by dividing the amount of the dealer’s total
  809  labor sales for retail customer repairs by the number of total
  810  labor hours that generated those sales for the month preceding
  811  the request, excluding the work in paragraph (c).; or
  812         2.An amount equal to the dealer’s markup over dealer cost
  813  that results in the same gross profit percentage for labor hours
  814  performed in work covered by subsection (1) as the dealer
  815  receives for labor performed in its customer retail repairs, as
  816  evidenced by the average of said dealer’s gross profit
  817  percentage in the dealer’s financial statements provided to the
  818  licensee for the 2 months preceding the dealer’s written
  819  request, if the dealer provides in the written request the
  820  arithmetical mean of the hourly wage paid to all of its
  821  technicians during that preceding month. The arithmetical mean
  822  shall be the dealer cost used in that calculation.
  823  
  824  After an hourly labor rate is agreed or determined, the licensee
  825  shall uniformly apply and pay that hourly labor rate for all
  826  labor used by the dealer in performing work under subsection
  827  (1). However, a licensee may shall not pay an hourly labor rate
  828  less than the hourly rate it was paying to the dealer for work
  829  done under subsection (1) on January 2, 2008. A licensee may
  830  shall not eliminate or decrease flat-rate times from or
  831  establish an unreasonable flat-rate time in its warranty repair
  832  manual, warranty time guide, or any other similarly named
  833  document, unless the licensee can prove that it has improved the
  834  technology related to a particular repair and thereby has
  835  lessened the average repair time. A licensee shall establish
  836  reasonable flat-rate labor times in its warranty repair manuals
  837  and warranty time guides for newly introduced model motor
  838  vehicles which are at least consistent with its existing
  839  documents. As used in this subsection, the terms “retail
  840  customer repair” and “similar work” are not limited to a repair
  841  to the same model vehicle or model year, but include prior
  842  repairs that resemble but are not identical to the repair for
  843  which the dealer is making a claim for compensation.
  844         (c) In determining the hourly labor rate calculated under
  845  subparagraph (b)1., a dealer’s labor charges for internal
  846  vehicle repairs; vehicle reconditioning; repairs performed for
  847  group, fleet, insurance, or other third-party payers; discounted
  848  repairs of motor vehicles for government agencies; labor used in
  849  bona fide special events, specials, or express service; and
  850  promotional discounts shall not be included as retail customer
  851  repairs and shall be excluded from such calculations.
  852         (7) A licensee may shall not require, influence, or attempt
  853  to influence a motor vehicle dealer to implement or change the
  854  prices for which it sells parts or labor in retail customer
  855  repairs. A licensee shall not implement or continue a policy,
  856  procedure, or program to any of its dealers in this state for
  857  compensation under this section which is inconsistent with this
  858  section.
  859         Section 5. If any provision of this act or the application
  860  thereof to any person or circumstance is held invalid, the
  861  invalidity does not affect other provisions or applications of
  862  the act which can be given effect without the invalid provision
  863  or application, and to this end the provisions of this act are
  864  severable.
  865         Section 6. This act shall take effect upon becoming a law.