Bill > HB0516

This bill amends Utah's automobile franchise laws by making numerous technical and substantive changes to regulate the relationships between automobile manufacturers (franchisors) and automobile dealers (franchisees). The bill updates definitions and expands protections for franchisees by prohibiting franchisors from engaging in various potentially unfair practices, such as: requiring dealers to purchase unnecessary inventory, coercing dealers into facility renovations or advertising programs, imposing unreasonable performance standards, discriminating between dealers, restricting dealers' business operations, or improperly taking control of dealer funds. The bill introduces a new definition of "affiliate" and modifies existing definitions related to dealers, manufacturers, and motor vehicles. It establishes specific procedures for resolving disputes between franchisors and franchisees, including mediation and binding arbitration processes for warranty audits and other financial claims. The bill also includes provisions limiting a franchisor's ability to own or control dealerships, with some exceptions for diversity initiatives and temporary ownership. Additionally, the bill requires franchisors to provide certain disclosures about vehicle features and compensate dealers for specific services. The legislation aims to create more balanced and transparent relationships in the automobile dealership industry, protecting dealers from potential abusive practices by manufacturers. The bill is set to take effect on May 7, 2025.

Business and Industry

https://le.utah.gov/~2025/bills/static/HB0516.html