Notwithstanding the terms, provisions, or conditions of any agreement or franchise, the following shall not be considered facts supporting a finding of good cause for the termination or noncontinuation of a franchise, or for entering into a franchise for the establishment of an additional dealership in a community for the same line-make:
 1. The sole fact that franchiser desires further penetration of the market.

Terms Used In Iowa Code 322A.11

  • Community: means the franchisee's area of responsibility as stipulated in the franchise. See Iowa Code 322A.1
  • following: when used by way of reference to a chapter or other part of a statute mean the next preceding or next following chapter or other part. See Iowa Code 4.1
  • Franchise: includes a separate written agreement between the franchisee and the franchiser which materially affects the franchise, whether entered into prior to the date of the franchise, contemporaneously with the franchise, or subsequent to the date of the franchise. See Iowa Code 322A.1
  • Franchisee: means a person who receives motor vehicles from the franchiser under a franchise and who offers and sells such motor vehicles to the general public. See Iowa Code 322A.1
  • Franchiser: means a person who manufactures or distributes motor vehicles and who may enter into a franchise as hereinafter defined. See Iowa Code 322A.1
  • Substantially detrimental: means that, by a preponderance of the evidence, the market share of the franchiser's motor vehicles in the community will be significantly reduced in comparison to the franchiser's historical market share in the community. See Iowa Code 322A.1
  • Vehicle: means any vehicle as defined in chapter 321. See Iowa Code 321H.2
 2. The change of ownership of the franchisee‘s dealership or the change of executive management of the franchisee’s dealership, unless the franchiser, having the burden of proof, proves that such change of ownership or executive management will be substantially detrimental to the distribution of the franchiser’s motor vehicles in the community and that good cause for the termination or noncontinuation of the franchise or for the establishment of an additional dealership otherwise exists.
 3. The fact that the franchisee refused to purchase or accept delivery of any motor vehicle or vehicles, parts, accessories or any other commodity or service not ordered by the franchisee.
 4. The fact that the dealership moved to another facility and location within the dealership’s community which are equal to or superior to the dealership’s former location and facility or the fact that the dealership added an additional line-make to the dealership if the dealership’s facility is adequate to accommodate the additional line-make.
 5. The fact that the dealership does not meet an index or standard established by the franchiser, unless the franchiser proves that the failure of the dealership to meet the index or standard will be substantially detrimental to the distribution of the franchiser’s motor vehicles in the community and that good cause for the termination or noncontinuation of the franchise or for the establishment of an additional dealership otherwise exists.
  Previous section
Next section  
 Chapter 322A Contents