13-35-302. Issuance of additional franchises — Relocation of existing franchisees.
(1)
Terms Used In Utah Code 13-35-302
board: means the Utah Powersport Vehicle Franchise Advisory Board created in Section 13-35-103. See Utah Code 13-35-102
Dealership: means a site or location in this state:
(a)
at which a franchisee conducts the business of a new powersport vehicle dealer; and
(b)
that is identified as a new powersport vehicle dealer's principal place of business for registration purposes under Section 13-35-105. See Utah Code 13-35-102
Executive director: means the executive director of the Department of Commerce. See Utah Code 13-35-102
Franchisee: means a person with whom a franchisor has agreed or permitted, in writing or in practice, to purchase, sell, or offer for sale new powersport vehicles manufactured, produced, represented, or distributed by the franchisor. See Utah Code 13-35-102
Franchisor: means a person who has, in writing or in practice, agreed with or permits a franchisee to purchase, sell, or offer for sale new powersport vehicles manufactured, produced, represented, or distributed by the franchisor, and includes:
(i)
the manufacturer or distributor of the new powersport vehicles;
(ii)
an intermediate distributor;
(iii)
an agent, officer, or field or area representative of the franchisor; and
(iv)
a person who is affiliated with a manufacturer or a representative or who directly or indirectly through an intermediary is controlled by, or is under common control with the manufacturer. See Utah Code 13-35-102
Line-make: means the powersport vehicles that are offered for sale, lease, or distribution under a common name, trademark, service mark, or brand name of the franchisor, or manufacturer of the powersport vehicle. See Utah Code 13-35-102
notify: includes both traditional written communications and all reliable forms of electronic communication unless expressly prohibited by statute or rule. See Utah Code 13-35-102
Powersport vehicle: means :
(i)
an all-terrain type I, type II, or type III vehicle "ATV" defined in Section 41-22-2;
for a powersport dealership in a county that has a population of less than 225,000:
(i)
the county in which the powersport dealership exists or is to be established or relocated; and
(ii)
in addition to the county described in Subsection (13)(a)(i), the area within a 15-mile radius from the site of the existing, new, or relocated dealership; or
(b)
for a powersport dealership in a county that has a population of 225,000 or more, the area within a 10-mile radius from the site of the existing, new, or relocated dealership. See Utah Code 13-35-102
Except as provided in Subsection (2), a franchisor shall comply with Subsection (1)(b) if the franchisor seeks to:
(i)
enter into a franchise establishing a powersport vehicledealership within a relevant market area where the same line-make is represented by another franchisee; or
(ii)
relocate an existing powersport vehicle dealership.
(b)
(i)
If a franchisor seeks to take an action listed in Subsection (1)(a), prior to taking the action, the franchisor shall in writingnotify the advisory board and each franchisee in that line-make in the relevant market area that the franchisor intends to take an action described in Subsection (1)(a).
(ii)
The notice required by Subsection (1)(b)(i) shall:
(A)
specify the good cause on which it intends to rely for the action; and
(B)
be delivered by registered or certified mail or by any form of reliable delivery through which receipt is verifiable.
(c)
Within 45 days of receiving notice required by Subsection (1)(b), any franchisee that is required to receive notice under Subsection (1)(b) may protest to the advisory board the establishing or relocating of the dealership. When a protest is filed, the department shall inform the franchisor that:
(i)
a timely protest has been filed;
(ii)
a hearing is required;
(iii)
the franchisor may not establish or relocate the proposed dealership until the advisory board has held a hearing; and
(iv)
the franchisor may not establish or relocate a proposed dealership if the executive director determines that there is not good cause for permitting the establishment or relocation of the dealership.
(d)
If multiple protests are filed under Subsection (1)(c), hearings may be consolidated to expedite the disposition of the issue.
(2)
Subsection (1) does not apply to the relocation of a franchisee’s dealership:
(a)
less than two miles from the existing location of the franchisee’s dealership; or
(b)
farther away from all powersport dealerships that are:
(i)
of the same line-make as the franchisee’s dealership; and
(ii)
in the franchisee’s existing dealership’s relevant market area.
(3)
For purposes of this section:
(a)
relocation of an existing franchisee’s dealership in excess of one mile from its existing location is considered the establishment of an additional franchise in the line-make of the relocating franchise;
(b)
the reopening in a relevant market area of a dealership that has not been in operation for one year or more is considered the establishment of an additional powersport vehicle dealership; and
(c)
(i)
except as provided in Subsection (3)(c)(ii), the establishment of a temporary additional place of business by a powersport vehicle franchisee is considered the establishment of an additional powersport vehicle dealership; and
(ii)
the establishment of a temporary additional place of business by a powersport vehicle franchisee is not considered the establishment of an additional powersport vehicle dealership if the powersport vehicle franchisee is participating in a trade show where three or more powersport vehicle dealers are participating.
