2019 Indiana Code
Title 9. Motor Vehicles
Article 32. Dealer Services
Chapter 13. Unfair Practices
9-32-13-23. Unfair practices by manufacturer, distributor, officer, or agent
Sec. 23. (a) It is an unfair practice for a manufacturer, distributor, officer, or agent to do any of the following:
(1) Require, coerce, or attempt to coerce a new motor vehicle dealer in Indiana to:
(A) change the location of the dealership;
(B) make any substantial alterations to the use of franchises; or
(C) make any substantial alterations to the dealership premises or facilities;
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 requirements. However, a new motor vehicle dealer may elect to use for the facility alteration locally sourced materials or supplies that are substantially similar to those required by the manufacturer or distributor, subject to the approval of the manufacturer or distributor, which may not be unreasonably withheld.
(2) Require, coerce, or attempt to coerce a new motor vehicle dealer in Indiana to divest 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 for 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 has 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.
(4) Require a dealer, as a condition of granting or continuing a franchise, approving the transfer of ownership or assets of a new motor vehicle dealer, or approving a successor to a new motor vehicle dealer to:
(A) construct a new dealership facility;
(B) modify or change the location of an existing dealership; or
(C) grant the manufacturer or distributor control rights over any real property owned, leased, controlled, or occupied by the dealer.
(5) Prohibit a dealer from representing more than one (1) line make of motor vehicles from the same or a modified facility if:
(A) reasonable facilities exist for the combined operations;
(B) the dealer meets reasonable capitalization requirements for the original line make and complies with the reasonable facilities requirements of the manufacturer or distributor; and
(C) the prohibition is not justified by the reasonable business considerations of the manufacturer or distributor.
Subdivisions (3) through (5) do not apply to recreational vehicle manufacturer franchisors.
(b) This section does not prohibit the enforcement of a voluntary agreement between the manufacturer or distributor and the franchisee where separate and valuable consideration has been offered and accepted.
As added by P.L.92-2013, SEC.78. Amended by P.L.152-2013, SEC.2; P.L.2-2014, SEC.48; P.L.167-2016, SEC.4; P.L.174-2016, SEC.103.
