Sen. Ram Villivalam

Filed: 3/3/2023

 

 


 

 


 
10300SB2051sam001LRB103 27188 SPS 58387 a

1
AMENDMENT TO SENATE BILL 2051

2    AMENDMENT NO. ______. Amend Senate Bill 2051 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Motor Vehicle Franchise Act is amended by
5changing Section 4 as follows:
 
6    (815 ILCS 710/4)  (from Ch. 121 1/2, par. 754)
7    Sec. 4. Unfair competition and practices.
8    (a) The unfair methods of competition and unfair and
9deceptive acts or practices listed in this Section are hereby
10declared to be unlawful. In construing the provisions of this
11Section, the courts may be guided by the interpretations of
12the Federal Trade Commission Act (15 U.S.C. 45 et seq.), as
13from time to time amended.
14    (b) It shall be deemed a violation for any manufacturer,
15factory branch, factory representative, distributor or
16wholesaler, distributor branch, distributor representative or

 

 

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1motor vehicle dealer to engage in any action with respect to a
2franchise which is arbitrary, in bad faith or unconscionable
3and which causes damage to any of the parties or to the public.
4    (c) It shall be deemed a violation for a manufacturer, a
5distributor, a wholesaler, a distributor branch or division, a
6factory branch or division, or a wholesale branch or division,
7or officer, agent or other representative thereof, to coerce,
8or attempt to coerce, any motor vehicle dealer:
9        (1) to accept, buy or order any motor vehicle or
10    vehicles, appliances, equipment, parts or accessories
11    therefor, or any other commodity or commodities or service
12    or services which such motor vehicle dealer has not
13    voluntarily ordered or requested except items required by
14    applicable local, state or federal law; or to require a
15    motor vehicle dealer to accept, buy, order or purchase
16    such items in order to obtain any motor vehicle or
17    vehicles or any other commodity or commodities which have
18    been ordered or requested by such motor vehicle dealer;
19        (2) to order or accept delivery of any motor vehicle
20    with special features, appliances, accessories or
21    equipment not included in the list price of the motor
22    vehicles as publicly advertised by the manufacturer
23    thereof, except items required by applicable law; or
24        (3) to order for anyone any parts, accessories,
25    equipment, machinery, tools, appliances or any commodity
26    whatsoever, except items required by applicable law.

 

 

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1    (c-5) A manufacturer, a distributor, a wholesaler, a
2distributor branch or division, a factory branch or division,
3or a wholesale branch or division, or officer, agent, or other
4representative thereof may not:
5        (1) require a motor vehicle dealer to offer a
6    secondary product; or
7        
8        (2) prohibit a motor vehicle dealer from offering a
9    secondary product, including, but not limited to:
10            (A) service contracts;
11            (B) maintenance agreements;
12            (C) extended warranties;
13            (D) protection product guarantees;
14            (E) guaranteed asset protection waivers;
15            (F) insurance;
16            (G) replacement parts;
17            (H) vehicle accessories;
18            (I) oil; or
19            (J) supplies.
20    It is not a violation of this subsection to offer an
21incentive program to motor vehicle dealers to encourage them
22to sell or offer to sell a secondary product approved,
23endorsed, sponsored, or offered by the manufacturer,
24distributor, wholesaler, distributor branch or division,
25factory branch or division, wholesale branch or division, or
26officer, agent, or other representative thereof, provided the

 

 

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1program does not provide vehicle sales or service incentives.
2    It is not a violation of this subsection to prohibit a
3motor vehicle dealer from using secondary products for any
4repair work paid for under the terms of a warranty, recall,
5service contract, extended warranty, maintenance plan, or
6certified pre-owned vehicle program established or offered by
7the manufacturer, distributor, wholesaler, distributor branch
8or division, factory branch or division, or wholesale branch
9or division, or officer, agent, or other representative
10thereof.
11    As used in this subsection, "secondary product" means all
12products that are not new motor vehicles or original equipment
13manufacturer parts.
14    (d) It shall be deemed a violation for a manufacturer, a
15distributor, a wholesaler, a distributor branch or division,
16or officer, agent or other representative thereof:
17        (1) to adopt, change, establish or implement a plan or
18    system for the allocation and distribution of new motor
19    vehicles to motor vehicle dealers which is arbitrary or
20    capricious or to modify an existing plan so as to cause the
21    same to be arbitrary or capricious;
22        (2) to fail or refuse to advise or disclose to any
23    motor vehicle dealer having a franchise or selling
24    agreement, upon written request therefor, the basis upon
25    which new motor vehicles of the same line make are
26    allocated or distributed to motor vehicle dealers in the

 

 

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1    State and the basis upon which the current allocation or
2    distribution is being made or will be made to such motor
3    vehicle dealer;
4        (3) to refuse to deliver in reasonable quantities and
5    within a reasonable time after receipt of dealer's order,
6    to any motor vehicle dealer having a franchise or selling
7    agreement for the retail sale of new motor vehicles sold
8    or distributed by such manufacturer, distributor,
9    wholesaler, distributor branch or division, factory branch
10    or division or wholesale branch or division, any such
11    motor vehicles as are covered by such franchise or selling
12    agreement specifically publicly advertised in the State by
13    such manufacturer, distributor, wholesaler, distributor
14    branch or division, factory branch or division, or
15    wholesale branch or division to be available for immediate
16    delivery. However, the failure to deliver any motor
17    vehicle shall not be considered a violation of this Act if
18    such failure is due to an act of God, a work stoppage or
19    delay due to a strike or labor difficulty, a shortage of
20    materials, a lack of manufacturing capacity, a freight
21    embargo or other cause over which the manufacturer,
22    distributor, or wholesaler, or any agent thereof has no
23    control;
24        (4) to coerce, or attempt to coerce, any motor vehicle
25    dealer to enter into any agreement with such manufacturer,
26    distributor, wholesaler, distributor branch or division,

 

 

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1    factory branch or division, or wholesale branch or
2    division, or officer, agent or other representative
3    thereof, or to do any other act prejudicial to the dealer
4    by threatening to reduce his allocation of motor vehicles
5    or cancel any franchise or any selling agreement existing
6    between such manufacturer, distributor, wholesaler,
7    distributor branch or division, or factory branch or
8    division, or wholesale branch or division, and the dealer.
9    However, notice in good faith to any motor vehicle dealer
10    of the dealer's violation of any terms or provisions of
11    such franchise or selling agreement or of any law or
12    regulation applicable to the conduct of a motor vehicle
13    dealer shall not constitute a violation of this Act;
14        (5) to require a franchisee to participate in an
15    advertising campaign or contest or any promotional
16    campaign, or to purchase or lease any promotional
17    materials, training materials, show room or other display
18    decorations or materials at the expense of the franchisee;
19        (6) to cancel or terminate the franchise or selling
20    agreement of a motor vehicle dealer without good cause and
21    without giving notice as hereinafter provided; to fail or
22    refuse to extend the franchise or selling agreement of a
23    motor vehicle dealer upon its expiration without good
24    cause and without giving notice as hereinafter provided;
25    or, to offer a renewal, replacement or succeeding
26    franchise or selling agreement containing terms and

 

 

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1    provisions the effect of which is to substantially change
2    or modify the sales and service obligations or capital
3    requirements of the motor vehicle dealer arbitrarily and
4    without good cause and without giving notice as
5    hereinafter provided notwithstanding any term or provision
6    of a franchise or selling agreement.
7            (A) If a manufacturer, distributor, wholesaler,
8        distributor branch or division, factory branch or
9        division or wholesale branch or division intends to
10        cancel or terminate a franchise or selling agreement
11        or intends not to extend or renew a franchise or
12        selling agreement on its expiration, it shall send a
13        letter by certified mail, return receipt requested, to
14        the affected franchisee at least 60 days before the
15        effective date of the proposed action, or not later
16        than 10 days before the proposed action when the
17        reason for the action is based upon either of the
18        following:
19                (i) the business operations of the franchisee
20            have been abandoned or the franchisee has failed
21            to conduct customary sales and service operations
22            during customary business hours for at least 7
23            consecutive business days unless such closing is
24            due to an act of God, strike or labor difficulty or
25            other cause over which the franchisee has no
26            control; or

 

 

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1                (ii) the conviction of or plea of nolo
2            contendere by the motor vehicle dealer or any
3            operator thereof in a court of competent
4            jurisdiction to an offense punishable by
5            imprisonment for more than two years.
6            Each notice of proposed action shall include a
7        detailed statement setting forth the specific grounds
8        for the proposed cancellation, termination, or refusal
9        to extend or renew and shall state that the dealer has
10        only 30 days from receipt of the notice to file with
11        the Motor Vehicle Review Board a written protest
12        against the proposed action.
13            (B) If a manufacturer, distributor, wholesaler,
14        distributor branch or division, factory branch or
15        division or wholesale branch or division intends to
16        change substantially or modify the sales and service
17        obligations or capital requirements of a motor vehicle
18        dealer as a condition to extending or renewing the
19        existing franchise or selling agreement of such motor
20        vehicle dealer, it shall send a letter by certified
21        mail, return receipt requested, to the affected
22        franchisee at least 60 days before the date of
23        expiration of the franchise or selling agreement. Each
24        notice of proposed action shall include a detailed
25        statement setting forth the specific grounds for the
26        proposed action and shall state that the dealer has

 

 

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1        only 30 days from receipt of the notice to file with
2        the Motor Vehicle Review Board a written protest
3        against the proposed action.
4            (C) Within 30 days from receipt of the notice
5        under subparagraphs (A) and (B), the franchisee may
6        file with the Board a written protest against the
7        proposed action.
8            When the protest has been timely filed, the Board
9        shall enter an order, fixing a date (within 60 days of
10        the date of the order), time, and place of a hearing on
11        the protest required under Sections 12 and 29 of this
12        Act, and send by certified mail, return receipt
13        requested, a copy of the order to the manufacturer
14        that filed the notice of intention of the proposed
15        action and to the protesting dealer or franchisee.
16            The manufacturer shall have the burden of proof to
17        establish that good cause exists to cancel or
18        terminate, or fail to extend or renew the franchise or
19        selling agreement of a motor vehicle dealer or
20        franchisee, and to change substantially or modify the
21        sales and service obligations or capital requirements
22        of a motor vehicle dealer as a condition to extending
23        or renewing the existing franchise or selling
24        agreement. The determination whether good cause exists
25        to cancel, terminate, or refuse to renew or extend the
26        franchise or selling agreement, or to change or modify

 

 

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1        the obligations of the dealer as a condition to offer
2        renewal, replacement, or succession shall be made by
3        the Board under subsection (d) of Section 12 of this
4        Act.
5            (D) Notwithstanding the terms, conditions, or
6        provisions of a franchise or selling agreement, the
7        following shall not constitute good cause for
8        cancelling or terminating or failing to extend or
9        renew the franchise or selling agreement: (i) the
10        change of ownership or executive management of the
11        franchisee's dealership; or (ii) the fact that the
12        franchisee or owner of an interest in the franchise
13        owns, has an investment in, participates in the
14        management of, or holds a license for the sale of the
15        same or any other line make of new motor vehicles.
16            (E) The manufacturer may not cancel or terminate,
17        or fail to extend or renew a franchise or selling
18        agreement or change or modify the obligations of the
19        franchisee as a condition to offering a renewal,
20        replacement, or succeeding franchise or selling
21        agreement before the hearing process is concluded as
22        prescribed by this Act, and thereafter, if the Board
23        determines that the manufacturer has failed to meet
24        its burden of proof and that good cause does not exist
25        to allow the proposed action;
26        (7) notwithstanding the terms of any franchise

 

 

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1    agreement, to fail to indemnify and hold harmless its
2    franchised dealers against any judgment or settlement for
3    damages, including, but not limited to, court costs,
4    expert witness fees, reasonable attorneys' fees of the new
5    motor vehicle dealer, and other expenses incurred in the
6    litigation, so long as such fees and costs are reasonable,
7    arising out of complaints, claims, or lawsuits, including,
8    but not limited to, strict liability, negligence,
9    misrepresentation, warranty (express or implied), or
10    rescission of the sale as defined in Section 2-608 of the
11    Uniform Commercial Code, to the extent that the judgment
12    or settlement relates to the alleged defective or
13    negligent manufacture, assembly or design of new motor
14    vehicles, parts or accessories or other functions by the
15    manufacturer, beyond the control of the dealer; provided
16    that, in order to provide an adequate defense, the
17    manufacturer receives notice of the filing of a complaint,
18    claim, or lawsuit within 60 days after the filing;
19        (8) to require or otherwise coerce a motor vehicle
20    dealer to underutilize the motor vehicle dealer's
21    facilities by requiring or otherwise coercing the motor
22    vehicle dealer to exclude or remove from the motor vehicle
23    dealer's facilities operations for selling or servicing of
24    any vehicles for which the motor vehicle dealer has a
25    franchise agreement with another manufacturer,
26    distributor, wholesaler, distribution branch or division,

 

 

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1    or officer, agent, or other representative thereof;
2    provided, however, that, in light of all existing
3    circumstances, (i) the motor vehicle dealer maintains a
4    reasonable line of credit for each make or line of new
5    motor vehicle, (ii) the new motor vehicle dealer remains
6    in compliance with any reasonable facilities requirements
7    of the manufacturer, (iii) no change is made in the
8    principal management of the new motor vehicle dealer, and
9    (iv) the addition of the make or line of new motor vehicles
10    would be reasonable. The reasonable facilities requirement
11    set forth in item (ii) of subsection (d)(8) shall not
12    include any requirement that a franchisee establish or
13    maintain exclusive facilities, personnel, or display
14    space. Any decision by a motor vehicle dealer to sell
15    additional makes or lines at the motor vehicle dealer's
16    facility shall be presumed to be reasonable, and the
17    manufacturer shall have the burden to overcome that
18    presumption. A motor vehicle dealer must provide a written
19    notification of its intent to add a make or line of new
20    motor vehicles to the manufacturer. If the manufacturer
21    does not respond to the motor vehicle dealer, in writing,
22    objecting to the addition of the make or line within 60
23    days after the date that the motor vehicle dealer sends
24    the written notification, then the manufacturer shall be
25    deemed to have approved the addition of the make or line;
26        (9) to use or consider the performance of a motor

 

 

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1    vehicle dealer relating to the sale of the manufacturer's,
2    distributor's, or wholesaler's vehicles or the motor
3    vehicle dealer's ability to satisfy any minimum sales or
4    market share quota or responsibility relating to the sale
5    of the manufacturer's, distributor's, or wholesaler's new
6    vehicles in determining:
7            (A) the motor vehicle dealer's eligibility to
8        purchase program, certified, or other used motor
9        vehicles from the manufacturer, distributor, or
10        wholesaler;
11            (B) the volume, type, or model of program,
12        certified, or other used motor vehicles that a motor
13        vehicle dealer is eligible to purchase from the
14        manufacturer, distributor, or wholesaler;
15            (C) the price of any program, certified, or other
16        used motor vehicle that the dealer is eligible to
17        purchase from the manufacturer, distributor, or
18        wholesaler; or
19            (D) the availability or amount of any discount,
20        credit, rebate, or sales incentive that the dealer is
21        eligible to receive from the manufacturer,
22        distributor, or wholesaler for the purchase of any
23        program, certified, or other used motor vehicle
24        offered for sale by the manufacturer, distributor, or
25        wholesaler;
26        (10) to take any adverse action against a dealer

 

 

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1    pursuant to an export or sale-for-resale prohibition
2    because the dealer sold or leased a vehicle to a customer
3    who either exported the vehicle to a foreign country or
4    resold the vehicle in violation of the prohibition, unless
5    the export or sale-for-resale prohibition policy was
6    provided to the dealer in writing either electronically or
7    on paper, prior to the sale or lease, and the dealer knew
8    or reasonably should have known of the customer's intent
9    to export or resell the vehicle in violation of the
10    prohibition at the time of the sale or lease. If the dealer
11    causes the vehicle to be registered and titled in this or
12    any other state, and collects or causes to be collected
13    any applicable sales or use tax to this State, a
14    rebuttable presumption is established that the dealer did
15    not have reason to know of the customer's intent to resell
16    the vehicle;
17        (11) to coerce or require any dealer to construct
18    improvements to his or her facilities or to install new
19    signs or other franchiser image elements that replace or
20    substantially alter those improvements, signs, or
21    franchiser image elements completed within the past 10
22    years that were required and approved by the manufacturer
23    or one of its affiliates. The 10-year period under this
24    paragraph (11) begins to run for a dealer, including that
25    dealer's successors and assigns, on the date that the
26    manufacturer gives final written approval of the facility

 

 

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1    improvements or installation of signs or other franchiser
2    image elements or the date that the dealer receives a
3    certificate of occupancy, whichever is later. For the
4    purpose of this paragraph (11), the term "substantially
5    alter" does not include routine maintenance, including,
6    but not limited to, interior painting, that is reasonably
7    necessary to keep a dealer facility in attractive
8    condition; or
9        (12) to require a dealer to purchase goods or services
10    to make improvements to the dealer's facilities from a
11    vendor selected, identified, or designated by a
12    manufacturer or one of its affiliates by agreement,
13    program, incentive provision, or otherwise without making
14    available to the dealer the option to obtain the goods or
15    services of substantially similar quality and overall
16    design from a vendor chosen by the dealer and approved by
17    the manufacturer; however, approval by the manufacturer
18    shall not be unreasonably withheld, and the dealer's
19    option to select a vendor shall not be available if the
20    manufacturer provides substantial reimbursement for the
21    goods or services offered. "Substantial reimbursement"
22    means an amount equal to or greater than the cost savings
23    that would result if the dealer were to utilize a vendor of
24    the dealer's own selection instead of using the vendor
25    identified by the manufacturer. For the purpose of this
26    paragraph (12), the term "goods" does not include movable

 

 

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1    displays, brochures, and promotional materials containing
2    material subject to the intellectual property rights of a
3    manufacturer. If signs, other than signs containing the
4    manufacturer's brand or logo or free-standing signs that
5    are not directly attached to a building, or other
6    franchiser image or design elements or trade dress are to
7    be leased to the dealer by a vendor selected, identified,
8    or designated by the manufacturer, the dealer has the
9    right to purchase the signs or other franchiser image or
10    design elements or trade dress of substantially similar
11    quality and design from a vendor selected by the dealer if
12    the signs, franchiser image or design elements, or trade
13    dress are approved by the manufacturer. Approval by the
14    manufacturer shall not be unreasonably withheld. This
15    paragraph (12) shall not be construed to allow a dealer or
16    vendor to impair, infringe upon, or eliminate, directly or
17    indirectly, the intellectual property rights of the
18    manufacturer, including, but not limited to, the
19    manufacturer's intellectual property rights in any
20    trademarks or trade dress, or other intellectual property
21    interests owned or controlled by the manufacturer. This
22    paragraph (12) shall not be construed to permit a dealer
23    to erect or maintain signs that do not conform to the
24    manufacturer's intellectual property rights or trademark
25    or trade dress usage guidelines.
26    (e) It shall be deemed a violation for a manufacturer, a

 

 

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1distributor, a wholesaler, a distributor branch or division or
2officer, agent or other representative thereof:
3        (1) to resort to or use any false or misleading
4    advertisement in connection with his business as such
5    manufacturer, distributor, wholesaler, distributor branch
6    or division or officer, agent or other representative
7    thereof;
8        (2) to offer to sell or lease, or to sell or lease, any
9    new motor vehicle to any motor vehicle dealer at a lower
10    actual price therefor than the actual price offered to any
11    other motor vehicle dealer for the same model vehicle
12    similarly equipped or to utilize any device including, but
13    not limited to, sales promotion plans or programs which
14    result in such lesser actual price or fail to make
15    available to any motor vehicle dealer any preferential
16    pricing, incentive, rebate, finance rate, or low interest
17    loan program offered to competing motor vehicle dealers in
18    other contiguous states. However, the provisions of this
19    paragraph shall not apply to sales to a motor vehicle
20    dealer for resale to any unit of the United States
21    Government, the State or any of its political
22    subdivisions;
23        (3) to offer to sell or lease, or to sell or lease, any
24    new motor vehicle to any person, except a wholesaler,
25    distributor or manufacturer's employees at a lower actual
26    price therefor than the actual price offered and charged

 

 

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1    to a motor vehicle dealer for the same model vehicle
2    similarly equipped or to utilize any device which results
3    in such lesser actual price. However, the provisions of
4    this paragraph shall not apply to sales to a motor vehicle
5    dealer for resale to any unit of the United States
6    Government, the State or any of its political
7    subdivisions;
8        (4) to prevent or attempt to prevent by contract or
9    otherwise any motor vehicle dealer or franchisee from
10    changing the executive management control of the motor
11    vehicle dealer or franchisee unless the franchiser, having
12    the burden of proof, proves that such change of executive
13    management will result in executive management control by
14    a person or persons who are not of good moral character or
15    who do not meet the franchiser's existing and, with
16    consideration given to the volume of sales and service of
17    the dealership, uniformly applied minimum business
18    experience standards in the market area. However, where
19    the manufacturer rejects a proposed change in executive
20    management control, the manufacturer shall give written
21    notice of his reasons to the dealer within 60 days of
22    notice to the manufacturer by the dealer of the proposed
23    change. If the manufacturer does not send a letter to the
24    franchisee by certified mail, return receipt requested,
25    within 60 days from receipt by the manufacturer of the
26    proposed change, then the change of the executive

 

 

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1    management control of the franchisee shall be deemed
2    accepted as proposed by the franchisee, and the
3    manufacturer shall give immediate effect to such change;
4        (5) to prevent or attempt to prevent by contract or
5    otherwise any motor vehicle dealer from establishing or
6    changing the capital structure of his dealership or the
7    means by or through which he finances the operation
8    thereof; provided the dealer meets any reasonable capital
9    standards agreed to between the dealer and the
10    manufacturer, distributor or wholesaler, who may require
11    that the sources, method and manner by which the dealer
12    finances or intends to finance its operation, equipment or
13    facilities be fully disclosed;
14        (6) to refuse to give effect to or prevent or attempt
15    to prevent by contract or otherwise any motor vehicle
16    dealer or any officer, partner or stockholder of any motor
17    vehicle dealer from selling or transferring any part of
18    the interest of any of them to any other person or persons
19    or party or parties unless such sale or transfer is to a
20    transferee who would not otherwise qualify for a new motor
21    vehicle dealers license under the Illinois Vehicle Code or
22    unless the franchiser, having the burden of proof, proves
23    that such sale or transfer is to a person or party who is
24    not of good moral character or does not meet the
25    franchiser's existing and reasonable capital standards
26    and, with consideration given to the volume of sales and

 

 

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1    service of the dealership, uniformly applied minimum
2    business experience standards in the market area. However,
3    nothing herein shall be construed to prevent a franchiser
4    from implementing affirmative action programs providing
5    business opportunities for minorities or from complying
6    with applicable federal, State or local law:
7            (A) If the manufacturer intends to refuse to
8        approve the sale or transfer of all or a part of the
9        interest, then it shall, within 60 days from receipt
10        of the completed application forms generally utilized
11        by a manufacturer to conduct its review and a copy of
12        all agreements regarding the proposed transfer, send a
13        letter by certified mail, return receipt requested,
14        advising the franchisee of any refusal to approve the
15        sale or transfer of all or part of the interest and
16        shall state that the dealer only has 30 days from the
17        receipt of the notice to file with the Motor Vehicle
18        Review Board a written protest against the proposed
19        action. The notice shall set forth specific criteria
20        used to evaluate the prospective transferee and the
21        grounds for refusing to approve the sale or transfer
22        to that transferee. Within 30 days from the
23        franchisee's receipt of the manufacturer's notice, the
24        franchisee may file with the Board a written protest
25        against the proposed action.
26            When a protest has been timely filed, the Board

 

 

10300SB2051sam001- 21 -LRB103 27188 SPS 58387 a

1        shall enter an order, fixing the date (within 60 days
2        of the date of such order), time, and place of a
3        hearing on the protest, required under Sections 12 and
4        29 of this Act, and send by certified mail, return
5        receipt requested, a copy of the order to the
6        manufacturer that filed notice of intention of the
7        proposed action and to the protesting franchisee.
8            The manufacturer shall have the burden of proof to
9        establish that good cause exists to refuse to approve
10        the sale or transfer to the transferee. The
11        determination whether good cause exists to refuse to
12        approve the sale or transfer shall be made by the Board
13        under subdivisions (6)(B). The manufacturer shall not
14        refuse to approve the sale or transfer by a dealer or
15        an officer, partner, or stockholder of a franchise or
16        any part of the interest to any person or persons
17        before the hearing process is concluded as prescribed
18        by this Act, and thereafter if the Board determines
19        that the manufacturer has failed to meet its burden of
20        proof and that good cause does not exist to refuse to
21        approve the sale or transfer to the transferee.
22            (B) Good cause to refuse to approve such sale or
23        transfer under this Section is established when such
24        sale or transfer is to a transferee who would not
25        otherwise qualify for a new motor vehicle dealers
26        license under the Illinois Vehicle Code or such sale

 

 

10300SB2051sam001- 22 -LRB103 27188 SPS 58387 a

1        or transfer is to a person or party who is not of good
2        moral character or does not meet the franchiser's
3        existing and reasonable capital standards and, with
4        consideration given to the volume of sales and service
5        of the dealership, uniformly applied minimum business
6        experience standards in the market area.
7        (7) to obtain money, goods, services, anything of
8    value, or any other benefit from any other person with
9    whom the motor vehicle dealer does business, on account of
10    or in relation to the transactions between the dealer and
11    the other person as compensation, except for services
12    actually rendered, unless such benefit is promptly
13    accounted for and transmitted to the motor vehicle dealer;
14        (8) to grant an additional franchise in the relevant
15    market area of an existing franchise of the same line make
16    or to relocate an existing motor vehicle dealership within
17    or into a relevant market area of an existing franchise of
18    the same line make. However, if the manufacturer wishes to
19    grant such an additional franchise to an independent
20    person in a bona fide relationship in which such person is
21    prepared to make a significant investment subject to loss
22    in such a dealership, or if the manufacturer wishes to
23    relocate an existing motor vehicle dealership, then the
24    manufacturer shall send a letter by certified mail, return
25    receipt requested, to each existing dealer or dealers of
26    the same line make whose relevant market area includes the

 

 

10300SB2051sam001- 23 -LRB103 27188 SPS 58387 a

1    proposed location of the additional or relocated franchise
2    at least 60 days before the manufacturer grants an
3    additional franchise or relocates an existing franchise of
4    the same line make within or into the relevant market area
5    of an existing franchisee of the same line make. Each
6    notice shall set forth the specific grounds for the
7    proposed grant of an additional or relocation of an
8    existing franchise and shall state that the dealer has
9    only 30 days from the date of receipt of the notice to file
10    with the Motor Vehicle Review Board a written protest
11    against the proposed action. Unless the parties agree upon
12    the grant or establishment of the additional or relocated
13    franchise within 30 days from the date the notice was
14    received by the existing franchisee of the same line make
15    or any person entitled to receive such notice, the
16    franchisee or other person may file with the Board a
17    written protest against the grant or establishment of the
18    proposed additional or relocated franchise.
19        When a protest has been timely filed, the Board shall
20    enter an order fixing a date (within 60 days of the date of
21    the order), time, and place of a hearing on the protest,
22    required under Sections 12 and 29 of this Act, and send by
23    certified or registered mail, return receipt requested, a
24    copy of the order to the manufacturer that filed the
25    notice of intention to grant or establish the proposed
26    additional or relocated franchise and to the protesting

 

 

10300SB2051sam001- 24 -LRB103 27188 SPS 58387 a

1    dealer or dealers of the same line make whose relevant
2    market area includes the proposed location of the
3    additional or relocated franchise.
4        When more than one protest is filed against the grant
5    or establishment of the additional or relocated franchise
6    of the same line make, the Board may consolidate the
7    hearings to expedite disposition of the matter. The
8    manufacturer shall have the burden of proof to establish
9    that good cause exists to allow the grant or establishment
10    of the additional or relocated franchise. The manufacturer
11    may not grant or establish the additional franchise or
12    relocate the existing franchise before the hearing process
13    is concluded as prescribed by this Act, and thereafter if
14    the Board determines that the manufacturer has failed to
15    meet its burden of proof and that good cause does not exist
16    to allow the grant or establishment of the additional
17    franchise or relocation of the existing franchise.
18        The determination whether good cause exists for
19    allowing the grant or establishment of an additional
20    franchise or relocated existing franchise, shall be made
21    by the Board under subsection (c) of Section 12 of this
22    Act. If the manufacturer seeks to enter into a contract,
23    agreement or other arrangement with any person,
24    establishing any additional motor vehicle dealership or
25    other facility, limited to the sale of factory repurchase
26    vehicles or late model vehicles, then the manufacturer

 

 

10300SB2051sam001- 25 -LRB103 27188 SPS 58387 a

1    shall follow the notice procedures set forth in this
2    Section and the determination whether good cause exists
3    for allowing the proposed agreement shall be made by the
4    Board under subsection (c) of Section 12, with the
5    manufacturer having the burden of proof.
6            A. (Blank).
7            B. For the purposes of this Section, appointment
8        of a successor motor vehicle dealer at the same
9        location as its predecessor, or within 2 miles of such
10        location, or the relocation of an existing dealer or
11        franchise within 2 miles of the relocating dealer's or
12        franchisee's existing location, shall not be construed
13        as a grant, establishment or the entering into of an
14        additional franchise or selling agreement, or a
15        relocation of an existing franchise. The reopening of
16        a motor vehicle dealership that has not been in
17        operation for 18 months or more shall be deemed the
18        grant of an additional franchise or selling agreement.
19            C. This Section does not apply to the relocation
20        of an existing dealership or franchise in a county
21        having a population of more than 300,000 persons when
22        the new location is within the dealer's current
23        relevant market area, provided the new location is
24        more than 7 miles from the nearest dealer of the same
25        line make. This Section does not apply to the
26        relocation of an existing dealership or franchise in a

 

 

10300SB2051sam001- 26 -LRB103 27188 SPS 58387 a

1        county having a population of less than 300,000
2        persons when the new location is within the dealer's
3        current relevant market area, provided the new
4        location is more than 12 miles from the nearest dealer
5        of the same line make. A dealer that would be farther
6        away from the new location of an existing dealership
7        or franchise of the same line make after a relocation
8        may not file a written protest against the relocation
9        with the Motor Vehicle Review Board.
10            D. Nothing in this Section shall be construed to
11        prevent a franchiser from implementing affirmative
12        action programs providing business opportunities for
13        minorities or from complying with applicable federal,
14        State or local law;
15        (9) to require a motor vehicle dealer to assent to a
16    release, assignment, novation, waiver or estoppel which
17    would relieve any person from liability imposed by this
18    Act;
19        (10) to prevent or refuse to give effect to the
20    succession to the ownership or management control of a
21    dealership by any legatee under the will of a dealer or to
22    an heir under the laws of descent and distribution of this
23    State unless the franchisee has designated a successor to
24    the ownership or management control under the succession
25    provisions of the franchise. Unless the franchiser, having
26    the burden of proof, proves that the successor is a person

 

 

10300SB2051sam001- 27 -LRB103 27188 SPS 58387 a

1    who is not of good moral character or does not meet the
2    franchiser's existing and reasonable capital standards
3    and, with consideration given to the volume of sales and
4    service of the dealership, uniformly applied minimum
5    business experience standards in the market area, any
6    designated successor of a dealer or franchisee may succeed
7    to the ownership or management control of a dealership
8    under the existing franchise if:
9                (i) The designated successor gives the
10            franchiser written notice by certified mail,
11            return receipt requested, of his or her intention
12            to succeed to the ownership of the dealer within
13            60 days of the dealer's death or incapacity; and
14                (ii) The designated successor agrees to be
15            bound by all the terms and conditions of the
16            existing franchise.
17        Notwithstanding the foregoing, in the event the motor
18    vehicle dealer or franchisee and manufacturer have duly
19    executed an agreement concerning succession rights prior
20    to the dealer's death or incapacitation, the agreement
21    shall be observed.
22            (A) If the franchiser intends to refuse to honor
23        the successor to the ownership of a deceased or
24        incapacitated dealer or franchisee under an existing
25        franchise agreement, the franchiser shall send a
26        letter by certified mail, return receipt requested, to

 

 

10300SB2051sam001- 28 -LRB103 27188 SPS 58387 a

1        the designated successor within 60 days from receipt
2        of a proposal advising of its intent to refuse to honor
3        the succession and to discontinue the existing
4        franchise agreement and shall state that the
5        designated successor only has 30 days from the receipt
6        of the notice to file with the Motor Vehicle Review
7        Board a written protest against the proposed action.
8        The notice shall set forth the specific grounds for
9        the refusal to honor the succession and discontinue
10        the existing franchise agreement.
11            If notice of refusal is not timely served upon the
12        designated successor, the franchise agreement shall
13        continue in effect subject to termination only as
14        otherwise permitted by paragraph (6) of subsection (d)
15        of Section 4 of this Act.
16            Within 30 days from the date the notice was
17        received by the designated successor or any other
18        person entitled to notice, the designee or other
19        person may file with the Board a written protest
20        against the proposed action.
21            When a protest has been timely filed, the Board
22        shall enter an order, fixing a date (within 60 days of
23        the date of the order), time, and place of a hearing on
24        the protest, required under Sections 12 and 29 of this
25        Act, and send by certified mail, return receipt
26        requested, a copy of the order to the franchiser that

 

 

10300SB2051sam001- 29 -LRB103 27188 SPS 58387 a

1        filed the notice of intention of the proposed action
2        and to the protesting designee or such other person.
3            The manufacturer shall have the burden of proof to
4        establish that good cause exists to refuse to honor
5        the succession and discontinue the existing franchise
6        agreement. The determination whether good cause exists
7        to refuse to honor the succession shall be made by the
8        Board under subdivision (B) of this paragraph (10).
9        The manufacturer shall not refuse to honor the
10        succession or discontinue the existing franchise
11        agreement before the hearing process is concluded as
12        prescribed by this Act, and thereafter if the Board
13        determines that it has failed to meet its burden of
14        proof and that good cause does not exist to refuse to
15        honor the succession and discontinue the existing
16        franchise agreement.
17            (B) No manufacturer shall impose any conditions
18        upon honoring the succession and continuing the
19        existing franchise agreement with the designated
20        successor other than that the franchisee has
21        designated a successor to the ownership or management
22        control under the succession provisions of the
23        franchise, or that the designated successor is of good
24        moral character or meets the reasonable capital
25        standards and, with consideration given to the volume
26        of sales and service of the dealership, uniformly

 

 

10300SB2051sam001- 30 -LRB103 27188 SPS 58387 a

1        applied minimum business experience standards in the
2        market area;
3        (11) to prevent or refuse to approve a proposal to
4    establish a successor franchise at a location previously
5    approved by the franchiser when submitted with the
6    voluntary termination by the existing franchisee unless
7    the successor franchisee would not otherwise qualify for a
8    new motor vehicle dealer's license under the Illinois
9    Vehicle Code or unless the franchiser, having the burden
10    of proof, proves that such proposed successor is not of
11    good moral character or does not meet the franchiser's
12    existing and reasonable capital standards and, with
13    consideration given to the volume of sales and service of
14    the dealership, uniformly applied minimum business
15    experience standards in the market area. However, when
16    such a rejection of a proposal is made, the manufacturer
17    shall give written notice of its reasons to the franchisee
18    within 60 days of receipt by the manufacturer of the
19    proposal. However, nothing herein shall be construed to
20    prevent a franchiser from implementing affirmative action
21    programs providing business opportunities for minorities,
22    or from complying with applicable federal, State or local
23    law;
24        (12) to prevent or refuse to grant a franchise to a
25    person because such person owns, has investment in or
26    participates in the management of or holds a franchise for

 

 

10300SB2051sam001- 31 -LRB103 27188 SPS 58387 a

1    the sale of another make or line of motor vehicles within 7
2    miles of the proposed franchise location in a county
3    having a population of more than 300,000 persons, or
4    within 12 miles of the proposed franchise location in a
5    county having a population of less than 300,000 persons;
6        (13) to prevent or attempt to prevent any new motor
7    vehicle dealer from establishing any additional motor
8    vehicle dealership or other facility limited to the sale
9    of factory repurchase vehicles or late model vehicles or
10    otherwise offering for sale factory repurchase vehicles of
11    the same line make at an existing franchise by failing to
12    make available any contract, agreement or other
13    arrangement which is made available or otherwise offered
14    to any person; or
15        (14) to exercise a right of first refusal or other
16    right to acquire a franchise from a dealer, unless the
17    manufacturer: (i) notifies the dealer in writing that it
18    intends to exercise a right of first refusal no later than
19    60 days after the manufacturer receives a notice of the
20    proposed transfer from the dealer and (ii) having the
21    burden of proof, proves that the dealer's proposed
22    transferee is a person who is not of good moral character
23    or does not meet the manufacturer's existing and
24    reasonable capital standards, and with consideration given
25    to the volume of sales and service of the dealership,
26    uniformly applied minimum business experience standards in

 

 

10300SB2051sam001- 32 -LRB103 27188 SPS 58387 a

1    the market area.
2        If a manufacturer satisfies the requirements of this
3    paragraph and exercises a right of first refusal, the
4    manufacturer must:
5            (A) notify notifies the dealer in writing that it
6            intends to exercise its right to acquire the
7            franchise not later than 60 days after the
8            manufacturer's or distributor's receipt of a
9            notice of the proposed transfer from the dealer
10            and all information and documents reasonably and
11            customarily required by the manufacturer or
12            distributor supporting the proposed transfer;
13            (B) pay pays to the dealer the same or greater
14        consideration as the dealer has contracted to receive
15        in connection with the proposed transfer or sale of
16        all or substantially all of the dealership assets,
17        stock, or other ownership interest, including the
18        purchase or lease of all real property, leasehold, or
19        improvements related to the transfer or sale of the
20        dealership. Upon exercise of the right of first
21        refusal or such other right, the manufacturer or
22        distributor shall have the right to assign the lease
23        or to convey the real property;
24            (C) assume assumes all of the duties, obligations,
25        and liabilities contained in the agreements that were
26        to be assumed by the proposed transferee and with

 

 

10300SB2051sam001- 33 -LRB103 27188 SPS 58387 a

1        respect to which the manufacturer or distributor
2        exercised the right of first refusal or other right to
3        acquire the franchise; and
4            (D) reimburse reimburses the proposed transferee
5        for all reasonable expenses incurred in evaluating,
6        investigating, and negotiating the transfer of the
7        dealership prior to the manufacturer's or
8        distributor's exercise of its right of first refusal
9        or other right to acquire the dealership. For purposes
10        of this paragraph, "reasonable expenses" includes the
11        usual and customary legal and accounting fees charged
12        for similar work, as well as expenses associated with
13        the evaluation and investigation of any real property
14        on which the dealership is operated. The proposed
15        transferee shall submit an itemized list of its
16        expenses to the manufacturer or distributor not later
17        than 30 days after the manufacturer's or distributor's
18        exercise of the right of first refusal or other right
19        to acquire the motor vehicle franchise. The
20        manufacturer or distributor shall reimburse the
21        proposed transferee for its expenses not later than 90
22        days after receipt of the itemized list. A
23        manufacturer or distributor may request to be provided
24        with the itemized list of expenses before exercising
25        the manufacturer's or distributor's right of first
26        refusal.

 

 

10300SB2051sam001- 34 -LRB103 27188 SPS 58387 a

1        Except as provided in this paragraph (14), neither the
2    selling dealer nor the manufacturer or distributor shall
3    have any liability to any person as a result of a
4    manufacturer or distributor exercising its right of first
5    refusal.
6        For the purpose of this paragraph, "proposed
7    transferee" means the person to whom the franchise would
8    have been transferred to, or was proposed to be
9    transferred to, had the right of first refusal or other
10    right to acquire the franchise not been exercised by the
11    manufacturer or distributor.
12    (f) It is deemed a violation for a manufacturer, a
13distributor, a wholesaler, a distributor branch or division, a
14factory branch or division, or a wholesale branch or division,
15or officer, agent, broker, shareholder, except a shareholder
16of 1% or less of the outstanding shares of any class of
17securities of a manufacturer, distributor, or wholesaler which
18is a publicly traded corporation, or other representative,
19directly or indirectly, to own or operate a place of business
20as a motor vehicle franchisee or motor vehicle financing
21affiliate, except that, this subsection shall not prohibit:
22        (1) the ownership or operation of a place of business
23    by a manufacturer, distributor, or wholesaler for a
24    period, not to exceed 18 months, during the transition
25    from one motor vehicle franchisee to another;
26        (2) the investment in a motor vehicle franchisee by a

 

 

10300SB2051sam001- 35 -LRB103 27188 SPS 58387 a

1    manufacturer, distributor, or wholesaler if the investment
2    is for the sole purpose of enabling a partner or
3    shareholder in that motor vehicle franchisee to acquire an
4    interest in that motor vehicle franchisee and that partner
5    or shareholder is not otherwise employed by or associated
6    with the manufacturer, distributor, or wholesaler and
7    would not otherwise have the requisite capital investment
8    funds to invest in the motor vehicle franchisee, and has
9    the right to purchase the entire equity interest of the
10    manufacturer, distributor, or wholesaler in the motor
11    vehicle franchisee within a reasonable period of time not
12    to exceed 5 years; or
13        (3) the ownership or operation of a place of business
14    by a manufacturer that manufactures only diesel engines
15    for installation in trucks having a gross vehicle weight
16    rating of more than 16,000 pounds that are required to be
17    registered under the Illinois Vehicle Code, provided that:
18            (A) the manufacturer does not otherwise
19        manufacture, distribute, or sell motor vehicles as
20        defined under Section 1-217 of the Illinois Vehicle
21        Code;
22            (B) the manufacturer owned a place of business and
23        it was in operation as of January 1, 2016;
24            (C) the manufacturer complies with all obligations
25        owed to dealers that are not owned, operated, or
26        controlled by the manufacturer, including, but not

 

 

10300SB2051sam001- 36 -LRB103 27188 SPS 58387 a

1        limited to those obligations arising pursuant to
2        Section 6;
3            (D) to further avoid any acts or practices, the
4        effect of which may be to lessen or eliminate
5        competition, the manufacturer provides to dealers on
6        substantially equal terms access to all support for
7        completing repairs, including, but not limited to,
8        parts and assemblies, training, and technical service
9        bulletins, and other information concerning repairs
10        that the manufacturer provides to facilities that are
11        owned, operated, or controlled by the manufacturer;
12        and
13            (E) the manufacturer does not require that
14        warranty repair work be performed by a
15        manufacturer-owned repair facility and the
16        manufacturer provides any dealer that has an agreement
17        with the manufacturer to sell and perform warranty
18        repairs on the manufacturer's engines the opportunity
19        to perform warranty repairs on those engines,
20        regardless of whether the dealer sold the truck into
21        which the engine was installed.
22    (g) Notwithstanding the terms, provisions, or conditions
23of any agreement or waiver, it shall be deemed a violation for
24a manufacturer, a distributor, a wholesaler, a distributor
25branch or division, a factory branch or division, or a
26wholesale branch or division, or officer, agent or other

 

 

10300SB2051sam001- 37 -LRB103 27188 SPS 58387 a

1representative thereof, to directly or indirectly condition
2the awarding of a franchise to a prospective new motor vehicle
3dealer, the addition of a line make or franchise to an existing
4dealer, the renewal of a franchise of an existing dealer, the
5approval of the relocation of an existing dealer's facility,
6or the approval of the sale or transfer of the ownership of a
7franchise on the willingness of a dealer, proposed new dealer,
8or owner of an interest in the dealership facility to enter
9into a site control agreement or exclusive use agreement
10unless separate and reasonable consideration was offered and
11accepted for that agreement.
12    For purposes of this subsection (g), the terms "site
13control agreement" and "exclusive use agreement" include any
14agreement that has the effect of either (i) requiring that the
15dealer establish or maintain exclusive dealership facilities;
16or (ii) restricting the ability of the dealer, or the ability
17of the dealer's lessor in the event the dealership facility is
18being leased, to transfer, sell, lease, or change the use of
19the dealership premises, whether by sublease, lease,
20collateral pledge of lease, or other similar agreement. "Site
21control agreement" and "exclusive use agreement" also include
22a manufacturer restricting the ability of a dealer to
23transfer, sell, or lease the dealership premises by right of
24first refusal to purchase or lease, option to purchase, or
25option to lease if the transfer, sale, or lease of the
26dealership premises is to a person who is an immediate family

 

 

10300SB2051sam001- 38 -LRB103 27188 SPS 58387 a

1member of the dealer. For the purposes of this subsection (g),
2"immediate family member" means a spouse, parent, son,
3daughter, son-in-law, daughter-in-law, brother, and sister.
4    If a manufacturer exercises any right of first refusal to
5purchase or lease or option to purchase or lease with regard to
6a transfer, sale, or lease of the dealership premises to a
7person who is not an immediate family member of the dealer,
8then (1) within 60 days from the receipt of the completed
9application forms generally utilized by a manufacturer to
10conduct its review and a copy of all agreements regarding the
11proposed transfer, the manufacturer must notify the dealer of
12its intent to exercise the right of first refusal to purchase
13or lease or option to purchase or lease and (2) the exercise of
14the right of first refusal to purchase or lease or option to
15purchase or lease must result in the dealer receiving
16consideration, terms, and conditions that either are the same
17as or greater than that which they have contracted to receive
18in connection with the proposed transfer, sale, or lease of
19the dealership premises.
20    Any provision contained in any agreement entered into on
21or after November 25, 2009 (the effective date of Public Act
2296-824) that is inconsistent with the provisions of this
23subsection (g) shall be voidable at the election of the
24affected dealer, prospective dealer, or owner of an interest
25in the dealership facility.
26    (h) For purposes of this subsection:

 

 

10300SB2051sam001- 39 -LRB103 27188 SPS 58387 a

1    "Successor manufacturer" means any motor vehicle
2manufacturer that, on or after January 1, 2009, acquires,
3succeeds to, or assumes any part of the business of another
4manufacturer, referred to as the "predecessor manufacturer",
5as the result of any of the following:
6        (i) A change in ownership, operation, or control of
7    the predecessor manufacturer by sale or transfer of
8    assets, corporate stock or other equity interest,
9    assignment, merger, consolidation, combination, joint
10    venture, redemption, court-approved sale, operation of law
11    or otherwise.
12        (ii) The termination, suspension, or cessation of a
13    part or all of the business operations of the predecessor
14    manufacturer.
15        (iii) The discontinuance of the sale of the product
16    line.
17        (iv) A change in distribution system by the
18    predecessor manufacturer, whether through a change in
19    distributor or the predecessor manufacturer's decision to
20    cease conducting business through a distributor
21    altogether.
22    "Former Franchisee" means a new motor vehicle dealer that
23has entered into a franchise with a predecessor manufacturer
24and that has either:
25        (i) entered into a termination agreement or deferred
26    termination agreement with a predecessor or successor

 

 

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1    manufacturer related to such franchise; or
2        (ii) has had such franchise canceled, terminated,
3    nonrenewed, noncontinued, rejected, nonassumed, or
4    otherwise ended.
5    For a period of 3 years from: (i) the date that a successor
6manufacturer acquires, succeeds to, or assumes any part of the
7business of a predecessor manufacturer; (ii) the last day that
8a former franchisee is authorized to remain in business as a
9franchised dealer with respect to a particular franchise under
10a termination agreement or deferred termination agreement with
11a predecessor or successor manufacturer; (iii) the last day
12that a former franchisee that was cancelled, terminated,
13nonrenewed, noncontinued, rejected, nonassumed, or otherwise
14ended by a predecessor or successor manufacturer is authorized
15to remain in business as a franchised dealer with respect to a
16particular franchise; or (iv) November 25, 2009 (the effective
17date of Public Act 96-824), whichever is latest, it shall be
18unlawful for such successor manufacturer to enter into a same
19line make franchise with any person or to permit the
20relocation of any existing same line make franchise, for a
21line make of the predecessor manufacturer that would be
22located or relocated within the relevant market area of a
23former franchisee who owned or leased a dealership facility in
24that relevant market area without first offering the
25additional or relocated franchise to the former franchisee, or
26the designated successor of such former franchisee in the

 

 

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1event the former franchisee is deceased or a person with a
2disability, at no cost and without any requirements or
3restrictions other than those imposed generally on the
4manufacturer's other franchisees at that time, unless one of
5the following applies:
6        (1) As a result of the former franchisee's
7    cancellation, termination, noncontinuance, or nonrenewal
8    of the franchise, the predecessor manufacturer had
9    consolidated the line make with another of its line makes
10    for which the predecessor manufacturer had a franchisee
11    with a then-existing dealership facility located within
12    that relevant market area.
13        (2) The successor manufacturer has paid the former
14    franchisee, or the designated successor of such former
15    franchisee in the event the former franchisee is deceased
16    or a person with a disability, the fair market value of the
17    former franchisee's franchise on (i) the date the
18    franchiser announces the action which results in the
19    termination, cancellation, or nonrenewal; or (ii) the date
20    the action which results in termination, cancellation, or
21    nonrenewal first became general knowledge; or (iii) the
22    day 12 months prior to the date on which the notice of
23    termination, cancellation, or nonrenewal is issued,
24    whichever amount is higher. Payment is due within 90 days
25    of the effective date of the termination, cancellation, or
26    nonrenewal. If the termination, cancellation, or

 

 

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1    nonrenewal is due to a manufacturer's change in
2    distributors, the manufacturer may avoid paying fair
3    market value to the dealer if the new distributor or the
4    manufacturer offers the dealer a franchise agreement with
5    terms acceptable to the dealer.
6        (3) The successor manufacturer proves that it would
7    have had good cause to terminate the franchise agreement
8    of the former franchisee, or the successor of the former
9    franchisee under item (e)(10) in the event that the former
10    franchisee is deceased or a person with a disability. The
11    determination of whether the successor manufacturer would
12    have had good cause to terminate the franchise agreement
13    of the former franchisee, or the successor of the former
14    franchisee, shall be made by the Board under subsection
15    (d) of Section 12. A successor manufacturer that seeks to
16    assert that it would have had good cause to terminate a
17    former franchisee, or the successor of the former
18    franchisee, must file a petition seeking a hearing on this
19    issue before the Board and shall have the burden of
20    proving that it would have had good cause to terminate the
21    former franchisee or the successor of the former
22    franchisee. No successor dealer, other than the former
23    franchisee, may be appointed or franchised by the
24    successor manufacturer within the relevant market area of
25    the former franchisee until the Board has held a hearing
26    and rendered a determination on the issue of whether the

 

 

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1    successor manufacturer would have had good cause to
2    terminate the former franchisee.
3    In the event that a successor manufacturer attempts to
4enter into a same line make franchise with any person or to
5permit the relocation of any existing line make franchise
6under this subsection (h) at a location that is within the
7relevant market area of 2 or more former franchisees, then the
8successor manufacturer may not offer it to any person other
9than one of those former franchisees unless the successor
10manufacturer can prove that at least one of the 3 exceptions in
11items (1), (2), and (3) of this subsection (h) applies to each
12of those former franchisees.
13(Source: P.A. 102-433, eff. 1-1-22.)
 
14    Section 99. Effective date. This Act takes effect upon
15becoming law.".