Friday, December 07, 2007
NEW CALIFORNIA LAW CONCERNING AGREEMENTS BETWEEN DEALERS AND MANUFACTURERS EFFECTIVE JANUARY 1, 2008
(Dec. 7, 2007) -- A reminder was issued advising of the new California law requiring a written agreement for transactions between manufacturers and dealers, that will be effective on January 1, 2008.
RVIA
RESTON, Va. – A new law drafted and supported by the California RV Dealers Association makes it unlawful upon a mutual agreement of the parties to enter into a dealer agreement for a manufacturer, licensed manufacturer, manufacturer branch, distributor, or distributor branch to refuse or fail to provide a recreational vehicle dealer a written dealer agreement that complies with California’s statutory franchise requirements. The bill does not require an RV dealer to accept or sign a written agreement. The bill will become an effective law on January 1, 2008.
This law requires the agreement between the manufacturer and the recreational vehicle dealer to include, but not be limited to, provisions regarding dealership transfer, dealership termination, sales territory, and reimbursement for costs incurred by the dealer for work related to the manufacturer's warranty for each line-make of recreational vehicle covered by the agreement as required in the California RV franchise law.
Existing law prohibits a manufacturer, manufacturer branch, distributor, or distributor branch that is licensed under the Vehicle Code from engaging in certain conduct involving a dealer having a franchise for the sale of new vehicles or vehicle parts. A violation of the Vehicle Code is a crime.
For a dealer and manufacturer agreement involving recreational vehicles, this bill would additionally prohibit, upon mutual agreement of the parties to enter into a dealer agreement, a licensed manufacturer, manufacturer branch, distributor, or distributor branch from failing or refusing to provide a written dealer agreement that complies with statutory franchise requirements.
The agreement would be required to include provisions regarding dealership transfer and termination, sales territory, and reimbursement for dealer costs for work related to the manufacturer’s warranty for each line-make of recreational vehicle covered by the agreement.
Following is the California Legislative Counsel’s Digest of the new law along with the precise legislative language of the new requirement. Please contact RVIA’s government affairs department if you have any questions about the new requirement.
RVIA
RESTON, Va. – A new law drafted and supported by the California RV Dealers Association makes it unlawful upon a mutual agreement of the parties to enter into a dealer agreement for a manufacturer, licensed manufacturer, manufacturer branch, distributor, or distributor branch to refuse or fail to provide a recreational vehicle dealer a written dealer agreement that complies with California’s statutory franchise requirements. The bill does not require an RV dealer to accept or sign a written agreement. The bill will become an effective law on January 1, 2008.
This law requires the agreement between the manufacturer and the recreational vehicle dealer to include, but not be limited to, provisions regarding dealership transfer, dealership termination, sales territory, and reimbursement for costs incurred by the dealer for work related to the manufacturer's warranty for each line-make of recreational vehicle covered by the agreement as required in the California RV franchise law.
Existing law prohibits a manufacturer, manufacturer branch, distributor, or distributor branch that is licensed under the Vehicle Code from engaging in certain conduct involving a dealer having a franchise for the sale of new vehicles or vehicle parts. A violation of the Vehicle Code is a crime.
For a dealer and manufacturer agreement involving recreational vehicles, this bill would additionally prohibit, upon mutual agreement of the parties to enter into a dealer agreement, a licensed manufacturer, manufacturer branch, distributor, or distributor branch from failing or refusing to provide a written dealer agreement that complies with statutory franchise requirements.
The agreement would be required to include provisions regarding dealership transfer and termination, sales territory, and reimbursement for dealer costs for work related to the manufacturer’s warranty for each line-make of recreational vehicle covered by the agreement.
Following is the California Legislative Counsel’s Digest of the new law along with the precise legislative language of the new requirement. Please contact RVIA’s government affairs department if you have any questions about the new requirement.
