Florida Senate - 2015 PROPOSED COMMITTEE SUBSTITUTE
Bill No. CS for SB 1048
Ì654822'Î654822
595-03383-15
Proposed Committee Substitute by the Committee on Rules
(Appropriations Subcommittee on Transportation, Tourism, and
Economic Development)
1 A bill to be entitled
2 An act relating to motor vehicle manufacturer
3 licenses; amending s. 320.64, F.S.; providing that a
4 motor vehicle dealer who received approval of a
5 facility from an applicant or licensee within a
6 specified timeframe is deemed to be in full compliance
7 with facility-related requirements; providing that
8 such motor vehicle dealer is entitled to certain
9 benefits under certain circumstances; providing
10 applicability; conforming a cross-reference; revising
11 provisions related to an applicant or licensee who has
12 undertaken or engaged in an audit of service-related
13 payments or incentive payments; reducing the timeframe
14 for the performance of such audits; defining the term
15 “incentive”; authorizing an applicant or licensee to
16 deny or charge back only the portion of a service
17 related claim or incentive claim which the applicant
18 or licensee has proven to be false or fraudulent or
19 for which the dealer failed to substantially comply
20 with certain procedures; prohibiting an applicant or
21 licensee from taking adverse action against a motor
22 vehicle dealer under certain circumstances;
23 prohibiting an applicant or licensee from failing to
24 make any payment due a motor vehicle dealer that
25 substantially complies with the terms of a certain
26 contract between the two parties regarding
27 reimbursement for temporary replacement vehicles under
28 certain circumstances; authorizing a motor vehicle
29 dealer to purchase goods or services from a vendor
30 chosen by the motor vehicle dealer, subject to certain
31 requirements; defining the term “goods or services”;
32 prohibiting an applicant or licensee from requiring a
33 motor vehicle dealer to pay for certain advertising or
34 marketing, or to participate in or affiliate with a
35 dealer advertising or marketing entity; prohibiting an
36 applicant or licensee from taking or threatening to
37 take any adverse action against a motor vehicle dealer
38 who refuses to join or participate in such entity;
39 defining the term “adverse action”; providing that an
40 applicant or licensee may not require a dealer to
41 participate in, or may not preclude only a number of
42 its motor vehicle dealers in a designated market area
43 from establishing, a voluntary motor vehicle dealer
44 advertising or marketing entity; providing that an
45 applicant or licensee is not required to fund such an
46 entity under certain circumstances; providing for
47 retroactive applicability under certain circumstances;
48 providing an effective date.
49
50 Be It Enacted by the Legislature of the State of Florida:
51
52 Section 1. Present paragraph (h) of subsection (10) of
53 section 320.64, Florida Statutes, is redesignated as paragraph
54 (i), a new paragraph (h) is added to that subsection, present
55 paragraph (h) of subsection (10) and subsections (25) and (26)
56 of that section are amended, and subsections (39), (40), and
57 (41) are added to that section, to read:
58 320.64 Denial, suspension, or revocation of license;
59 grounds.—A license of a licensee under s. 320.61 may be denied,
60 suspended, or revoked within the entire state or at any specific
61 location or locations within the state at which the applicant or
62 licensee engages or proposes to engage in business, upon proof
63 that the section was violated with sufficient frequency to
64 establish a pattern of wrongdoing, and a licensee or applicant
65 shall be liable for claims and remedies provided in ss. 320.695
66 and 320.697 for any violation of any of the following
67 provisions. A licensee is prohibited from committing the
68 following acts:
69 (10)
70 (h) If an applicant or licensee offers any bonus,
71 incentive, rebate, or other program, standard, or policy that is
72 available to a motor vehicle dealer in this state and that is
73 premised, wholly or in part, on dealer facility improvements,
74 renovations, expansions, remodeling, alterations, or
75 installations of signs or other image elements, a motor vehicle
76 dealer who completes an approved facility in reliance upon such
77 offer shall be deemed to be in full compliance with all of the
78 applicant’s or licensee’s requirements related to facility,
79 sign, and image for the duration of a 10-year period following
80 such completion. If, during the 10-year period, the applicant or
81 licensee establishes a program, standard, or policy that offers
82 a new bonus, incentive, rebate, or other benefit, a motor
83 vehicle dealer that completed an approved facility in reliance
84 upon the prior program, standard, or policy but does not comply
85 with the provisions related to facility, sign, or image under
86 the new program, standard, or policy, except as hereinafter
87 provided, may not be eligible for benefits under the provisions
88 related to facility, sign, or image of the new program,
89 standard, or policy, but shall remain entitled to all the
90 benefits under the older program, standard, or policy, plus any
91 increase in the benefits between the old and new programs,
92 standards, or policies during the remainder of the 10-year
93 period. Nothing contained in this subsection shall in any way
94 obviate, affect, or alter the provisions of subsection (38).
95 (i)(h) A violation of paragraphs (b)-(h) (b) through (g) is
96 not a violation of s. 320.70 and does not subject any licensee
97 to any criminal penalty under s. 320.70.
98 (25) The applicant or licensee has undertaken or engaged in
99 an audit of warranty, maintenance, and other service-related
100 payments or incentive payments, including payments to a motor
101 vehicle dealer under any licensee-issued program, policy, or
102 other benefit, which previously have been paid to a motor
103 vehicle dealer in violation of this section or has failed to
104 comply with any of its obligations under s. 320.696. An
105 applicant or licensee may reasonably and periodically audit a
106 motor vehicle dealer to determine the validity of paid claims as
107 provided in s. 320.696. Audits of warranty, maintenance, and
108 other service-related payments shall be performed by an
109 applicant or licensee only during the 12-month 1-year period
110 immediately following the date the claim was paid. Audits Audit
111 of incentive payments shall only be performed only during the
112 12-month for an 18-month period immediately following the date
113 the incentive was paid. As used in this section, the term
114 “incentive” includes any bonus, incentive, or other monetary or
115 nonmonetary thing of value. After such time periods have
116 elapsed, all warranty, maintenance, and other service-related
117 payments and incentive payments shall be deemed final and
118 incontrovertible for any reason notwithstanding any otherwise
119 applicable law, and the motor vehicle dealer shall not be
120 subject to any charge-back or repayment. An applicant or
121 licensee may deny a claim or, as a result of a timely conducted
122 audit, impose a charge-back against a motor vehicle dealer for
123 warranty, maintenance, or other service-related payments or
124 incentive payments only if the applicant or licensee can show
125 that the warranty, maintenance, or other service-related claim
126 or incentive claim was false or fraudulent or that the motor
127 vehicle dealer failed to substantially comply with the
128 reasonable written and uniformly applied procedures of the
129 applicant or licensee for such repairs or incentives, but only
130 for that portion of the claim so shown. Notwithstanding the
131 terms of any franchise agreement, guideline, program, policy, or
132 procedure, an applicant or licensee may deny or charge back only
133 that portion of a warranty, maintenance, or other service
134 related claim or incentive claim which the applicant or licensee
135 has proven to be false or fraudulent or for which the dealer
136 failed to substantially comply with the reasonable written and
137 uniformly applied procedures of the applicant or licensee for
138 such repairs or incentives, as set forth in this subsection. An
139 applicant or licensee may not charge back a motor vehicle dealer
140 back subsequent to the payment of a warranty, maintenance, or
141 service-related claim or incentive claim unless, within 30 days
142 after a timely conducted audit, a representative of the
143 applicant or licensee first meets in person, by telephone, or by
144 video teleconference with an officer or employee of the dealer
145 designated by the motor vehicle dealer. At such meeting the
146 applicant or licensee must provide a detailed explanation, with
147 supporting documentation, as to the basis for each of the claims
148 for which the applicant or licensee proposed a charge-back to
149 the dealer and a written statement containing the basis upon
150 which the motor vehicle dealer was selected for audit or review.
151 Thereafter, the applicant or licensee must provide the motor
152 vehicle dealer’s representative a reasonable period after the
153 meeting within which to respond to the proposed charge-backs,
154 with such period to be commensurate with the volume of claims
155 under consideration, but in no case less than 45 days after the
156 meeting. The applicant or licensee is prohibited from changing
157 or altering the basis for each of the proposed charge-backs as
158 presented to the motor vehicle dealer’s representative following
159 the conclusion of the audit unless the applicant or licensee
160 receives new information affecting the basis for one or more
161 charge-backs and that new information is received within 30 days
162 after the conclusion of the timely conducted audit. If the
163 applicant or licensee claims the existence of new information,
164 the dealer must be given the same right to a meeting and right
165 to respond as when the charge-back was originally presented.
166 After all internal dispute resolution processes provided through
167 the applicant or licensee have been completed, the applicant or
168 licensee shall give written notice to the motor vehicle dealer
169 of the final amount of its proposed charge-back. If the dealer
170 disputes that amount, the dealer may file a protest with the
171 department within 30 days after receipt of the notice. If a
172 protest is timely filed, the department shall notify the
173 applicant or licensee of the filing of the protest, and the
174 applicant or licensee may not take any action to recover the
175 amount of the proposed charge-back until the department renders
176 a final determination, which is not subject to further appeal,
177 that the charge-back is in compliance with the provisions of
178 this section. In any hearing pursuant to this subsection, the
179 applicant or licensee has the burden of proof that its audit and
180 resulting charge-back are in compliance with this subsection.
181 (26) Notwithstanding the terms of any franchise agreement,
182 including any licensee’s program, policy, or procedure, the
183 applicant or licensee has refused to allocate, sell, or deliver
184 motor vehicles; charged back or withheld payments or other
185 things of value for which the dealer is otherwise eligible under
186 a sales promotion, program, or contest; prevented a motor
187 vehicle dealer from participating in any promotion, program, or
188 contest; or has taken or threatened to take any adverse action
189 against a dealer, including charge-backs, reducing vehicle
190 allocations, or terminating or threatening to terminate a
191 franchise because the dealer sold or leased a motor vehicle to a
192 customer who exported the vehicle to a foreign country or who
193 resold the vehicle, unless the licensee proves that the dealer
194 knew or reasonably should have known that the customer intended
195 to export or resell the motor vehicle. There is a rebuttable
196 presumption that the dealer neither knew nor reasonably should
197 have known of its customer’s intent to export or resell the
198 vehicle if the vehicle is titled or registered in any state in
199 this country. A licensee may not take any action against a motor
200 vehicle dealer, including reducing its allocations or supply of
201 motor vehicles to the dealer, or charging back a dealer for an
202 incentive payment previously paid, unless the licensee first
203 meets in person, by telephone, or video conference with an
204 officer or other designated employee of the dealer. At such
205 meeting, the licensee must provide a detailed explanation, with
206 supporting documentation, as to the basis for its claim that the
207 dealer knew or reasonably should have known of the customer’s
208 intent to export or resell the motor vehicle. Thereafter, the
209 motor vehicle dealer shall have a reasonable period,
210 commensurate with the number of motor vehicles at issue, but not
211 less than 15 days, to respond to the licensee’s claims. If,
212 following the dealer’s response and completion of all internal
213 dispute resolution processes provided through the applicant or
214 licensee, the dispute remains unresolved, the dealer may file a
215 protest with the department within 30 days after receipt of a
216 written notice from the licensee that it still intends to take
217 adverse action against the dealer with respect to the motor
218 vehicles still at issue. If a protest is timely filed, the
219 department shall notify the applicant or licensee of the filing
220 of the protest, and the applicant or licensee may not take any
221 action adverse to the dealer until the department renders a
222 final determination, which is not subject to further appeal,
223 that the licensee’s proposed action is in compliance with the
224 provisions of this subsection. In any hearing pursuant to this
225 subsection, the applicant or licensee has the burden of proof on
226 all issues raised by this subsection. An applicant or licensee
227 may not take any adverse action against a motor vehicle dealer
228 because the dealer sold or leased a motor vehicle to a customer
229 who exported the vehicle to a foreign country or who resold the
230 vehicle unless the applicant or licensee provides written
231 notification to the motor vehicle dealer of such resale or
232 export within 12 months after the date the dealer sold or leased
233 the vehicle to the customer.
234 (39) Notwithstanding the terms of any agreement, program,
235 incentive, bonus, policy, or rule, an applicant or licensee
236 fails to make any payment pursuant to any of the foregoing for
237 any temporary replacement motor vehicle loaned, rented, or
238 provided by a motor vehicle dealer to or for its service or
239 repair customers, even if the temporary replacement motor
240 vehicle has been leased, rented, titled, or registered to the
241 motor vehicle dealer’s rental or leasing division or an entity
242 that is owned or controlled by the motor vehicle dealer,
243 provided that the motor vehicle dealer or its rental or leasing
244 division or entity complies with the written and uniformly
245 enforced vehicle eligibility, use, and reporting requirements
246 specified by the applicant or licensee in its agreement,
247 program, policy, bonus, incentive, or rule relating to loaner
248 vehicles.
249 (40) Notwithstanding the terms of any franchise agreement,
250 the applicant or licensee has required or coerced, or attempted
251 to require or coerce, a motor vehicle dealer to purchase goods
252 or services from a vendor selected, identified, or designated by
253 the applicant or licensee, or one of its parents, subsidiaries,
254 divisions, or affiliates, by agreement, standard, policy,
255 program, incentive provision, or otherwise, without making
256 available to the motor vehicle dealer the option to obtain the
257 goods or services of substantially similar design and quality
258 from a vendor chosen by the motor vehicle dealer. If the motor
259 vehicle dealer exercises such option, the dealer must provide
260 written notice of its desire to use the alternative goods or
261 services to the applicant or licensee, along with samples or
262 clear descriptions of the alternative goods or services that the
263 dealer desires to use. The licensee or applicant shall have the
264 opportunity to evaluate the alternative goods or services for up
265 to 30 days to determine whether it will provide a written
266 approval to the motor vehicle dealer to use said alternative
267 goods or services. Approval may not be unreasonably withheld by
268 the applicant or licensee. If the motor vehicle dealer does not
269 receive a response from the applicant or licensee within 30
270 days, approval to use the alternative goods or services shall be
271 deemed granted. If a dealer using alternative goods or services
272 complies with the terms of this subsection and has received
273 approval from the licensee or applicant, the dealer shall not be
274 ineligible for all benefits described in the agreement,
275 standard, policy, program, incentive provision, or otherwise
276 solely for having used such alternative goods or services. As
277 used in this subsection, the term “goods or services” is limited
278 to such goods and services used to construct or renovate
279 dealership facilities, or furniture and fixtures at the
280 dealership facilities. The term does not include:
281 (a) Any intellectual property of the applicant or licensee,
282 including signage incorporating the applicant’s or licensee’s
283 trademark or copyright, or facility or building materials to the
284 extent that the applicant’s or licensee’s trademark is displayed
285 thereon;
286 (b) Any special tool and training as required by the
287 licensee or applicant;
288 (c) Any part to be used in repairs under warranty
289 obligations of an applicant or licensee;
290 (d) Any good or service paid for entirely by the applicant
291 or licensee; or
292 (e) Any applicant’s or licensee’s design or architectural
293 review service.
294 (41)(a) The applicant or licensee, by agreement, policy,
295 program, standard, or otherwise, requires a motor vehicle
296 dealer, directly or indirectly, to advance or pay for, or to
297 reimburse the applicant or licensee for, any costs related to
298 the creation, development, showing, placement, or publication in
299 any media of any advertisement for a motor vehicle; requires a
300 motor vehicle dealer to participate in, contribute to, affiliate
301 with, or join a dealer advertising or marketing group, fund,
302 pool, association, or other entity; or takes or threatens to
303 take any adverse action against a motor vehicle dealer that
304 refuses to join or participate in such group, fund, pool,
305 association, or other entity. As used in this subsection, the
306 term “adverse action” includes, but is not limited to, reducing
307 allocations, charging fees for a licensee’s or dealer’s
308 advertising or a marketing group’s advertising or marketing,
309 terminating or threatening to terminate the motor vehicle
310 dealer’s franchise agreement, reducing any incentive for which
311 the motor vehicle dealer is eligible, or engaging in any action
312 that fails to take into account the equities of the motor
313 vehicle dealer.
314 (b) The applicant or licensee requires a dealer to
315 participate in, or precludes a number of its motor vehicle
316 dealers in a designated market area from establishing, a
317 voluntary motor vehicle dealer advertising or marketing group,
318 fund, pool, association, or other entity. Except as provided in
319 an agreement, if a motor vehicle dealer chooses to form an
320 independent advertising or marketing group, the applicant or
321 licensee is not required to fund such group.
322 (c) This subsection may not prohibit an applicant or
323 licensee from offering advertising or promotional materials to a
324 motor vehicle dealer for a fee or charge, as long as the use of
325 such advertising or promotional materials is voluntary for the
326 motor vehicle dealer.
327
328 A motor vehicle dealer who can demonstrate that a violation of,
329 or failure to comply with, any of the preceding provisions by an
330 applicant or licensee will or can adversely and pecuniarily
331 affect the complaining dealer, shall be entitled to pursue all
332 of the remedies, procedures, and rights of recovery available
333 under ss. 320.695 and 320.697.
334 Section 2. This act applies to all franchise agreements
335 entered into, renewed, or amended after October 1, 1988, except
336 to the extent that such application would impair valid
337 contractual agreements, in violation of the State Constitution
338 or the United States Constitution.
339 Section 3. This act shall take effect upon becoming a law.