Bill No.: HB0141 Drafter: DKG

LSO No.: 06LSO-0424 Effective Date: 7/1/2006

Enrolled Act No.: HEA0040

Chapter No.: 107

Prime Sponsor: Representative Cohee

Catch Title: Fair practices of equipment dealers.

Subject: This bill provides for the regulation of trade practices within the farm equipment industry.

Summary/Major Elements:

· This bill regulates relationships between farm equipment manufacturers, wholesalers and dealers. Among other restrictions the bill:

o Prohibits suppliers from coercing dealers to take equipment not ordered, to purchase goods and services in order to receive equipment or repair parts, from delaying delivery of equipment advertised as available for immediate delivery, to discriminate in pricing if it lessens competition, to prevent dealers from changing ownership or capital structuring unless the limitation was previously agreed to.

o For non-single line dealer agreements - Allows a dealer to terminate a dealer agreement without cause. Prohibits a supplier from terminating an agreement without cause. Defines what constitutes good cause for that purpose.

o For a single line dealer – A supplier may not terminate without cause. Sets out specific incidences for when good cause exists.

o Requires that a supplier shall provide a dealer at least one hundred eighty (180) days prior written notice of termination of a dealer agreement. Provides specific procedures for curing a deficiency. Provides specific procedures if a dealer dies or if the dealer transfers ownership.

o Provides procedures for incidences of when a single line dealer dies and has an agreement with a single line supplier.

o Allows for and sets out the procedure for reimbursement of warranty work.

o Provides for a procedure that will allow for repurchase obligations of a supplier upon cancellation or discontinuance of a dealer agreement.

o Sets guidelines for when repurchase of repair parts, equipment or inventory from a dealer is not required.

o Allows a dealer to bring an action against a supplier, if the supplier violates any provisions of this chapter. Also provides a number of remedies that are available to dealers.