April 3, 2007
SENATE BILL No. 181
DIGEST OF SB 181
(Updated March 29, 2007 11:40 am - DI 51)
Citations Affected: IC 9-23.
Synopsis: Factory owned franchise limitation. Specifies that it is not
an unfair labor practice for a manufacturer or distributor to establish or
acquire for less than two years a franchisor owned outlet within the
exclusive territory or market area of a franchisee.
Effective: July 1, 2007.
(HOUSE SPONSORS _ AUSTIN, SOLIDAY)
January 11, 2007, read first time and referred to Committee on Commerce, Public Policy
& Interstate Cooperation.
February 8, 2007, amended, reported favorably _ Do Pass.
February 12, 2007, read second time, ordered engrossed. Engrossed.
February 13, 2007, read third time, passed. Yeas 46, nays 0.
March 12, 2007, read first time and referred to Committee on Interstate and International
April 2, 2007, reported _ Do Pass.
April 3, 2007
First Regular Session 115th General Assembly (2007)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in this style type
, and deletions will appear in
this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type
. Also, the
will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type
this style type
between statutes enacted by the 2006 Regular Session of the General Assembly.
SENATE BILL No. 181
A BILL FOR AN ACT to amend the Indiana Code concerning
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 9-23-3-23; (07)ES0181.1.1. -->
SECTION 1. IC 9-23-3-23 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2007]: Sec. 23. It is an unfair
practice for a manufacturer, distributor, officer, or agent to do any of
(1) Require, coerce, or attempt to coerce any new motor vehicle
dealer in Indiana to:
(A) change location of the dealership;
(B) make any substantial alterations to the use of franchises;
(C) make any substantial alterations to the dealership premises
if to do so would be unreasonable or would not be justified by
current economic conditions or reasonable business
considerations. This subdivision does not prevent a manufacturer
or distributor from establishing and enforcing reasonable facility
(2) Require, coerce, or attempt to coerce any new motor vehicle
dealer in Indiana to divest its ownership of or management in
another line or make of motor vehicles that the dealer has
established in its dealership facilities with the prior written
approval of the manufacturer or distributor.
(3) Establish or acquire wholly or partially a franchisor owned
outlet engaged wholly or partially in a substantially identical
business to that of the franchisee within the exclusive territory
granted the franchisee by the franchise agreement or, if no
exclusive territory is designated, competing unfairly with the
franchisee within a reasonable market area. A franchisor is not
considered to be competing unfairly if operating:
(A) a business
either temporarily for a reasonable period of
time; less than two (2) years;
(B) in a bona fide retail operation that is for sale to any
qualified independent person at a fair and reasonable price; or
(C) in a bona fide relationship in which an independent person
or persons have made a significant investment subject to loss
in the business operation and can reasonably expect to acquire
majority ownership or managerial control of the business on
reasonable terms and conditions.
subsection subdivision shall not apply to recreational
vehicle manufacturer franchisors.