2017 South Carolina Code of Laws
Title 39 - Trade and Commerce
CHAPTER 6 - FAIR PRACTICES OF FARM, CONSTRUCTION, INDUSTRIAL, AND OUTDOOR POWER EQUIPMENT MANUFACTURERS, DISTRIBUTORS, WHOLESALERS, AND DEALERS
Section 39-6-70. Manufacturer prohibited from owning or competing with dealerships; exceptions.

(A)(1) It is unlawful for a manufacturer, distributor, or wholesaler or any parent, affiliate, wholly or partially owned subsidiary, officer, or representative of a manufacturer, distributor, or wholesaler to:

(a) own, operate, or control or to participate in the ownership, operation, or control of a new equipment dealer in this State;

(b) establish in this State an additional dealer or dealership in which that person or entity has an interest; or

(c) own, operate, or control, directly or indirectly, an interest in a dealer or dealership in this State.

(2) This subsection does not prohibit the making of a loan by a manufacturer, distributor, or wholesaler to any person or entity for the purpose of acquiring a dealer or dealership, nor does it prohibit the ownership, operation, or control of a new equipment dealer by a manufacturer, distributor, or wholesaler:

(a) for a temporary period, not to exceed three years, during the transition from one owner or operator to another;

(b) if a prospective new equipment dealer is not available to own or operate the dealership within a particular geographic market area not serviced by an existing dealer and the manufacturer, distributor, or wholesaler contracts with or employs a third party to open or operate a dealership owned or controlled by the manufacturer, distributor, or wholesaler pursuant to a bona fide written agreement or plan giving a third party ownership of the new equipment dealer or dealership over time;

(c) during the period the new equipment dealer is being sold pursuant to a bona fide contract, shareholder agreement, or purchase option to the operator of the dealership; or

(d) if the manufacturer, distributor, or wholesaler is an owner, operator, or controller as of January 1, 2000, of a dealership that has been engaged in the retail sale of equipment within the same geographical market area for a continuous two-year period of time immediately before January 1, 2000, and a prospective new equipment dealer is not available to own or operate the dealership in a manner consistent with the public interest.

(B) It is unlawful for a manufacturer, distributor, or wholesaler or any parent, affiliate, wholly or partially owned subsidiary, officer, or representative of a manufacturer, distributor, or wholesaler to compete unfairly with a new equipment dealer of the same product line or make of new equipment operating pursuant to a dealership agreement or sales agreement in this State. Except as otherwise provided in this section, the mere ownership, operation, or control of a new equipment dealer by a manufacturer, distributor, or wholesaler is not a violation of this section.

HISTORY: 2000 Act No. 369, Section 1, eff June 14, 2000.