2006 Code of Virginia § 46.2-1568 - Coercion of retail dealer by manufacturer or distributor with respect to retail installment sales c...

46.2-1568. Coercion of retail dealer by manufacturer or distributor withrespect to retail installment sales contracts, extended service contracts orextended maintenance plans, financing, or leasing prohibited; penalty.

A. It shall be unlawful for any manufacturer or distributor, or any officer,agent, or representative of either, to coerce or attempt to coerce any retailmotor vehicle dealer or prospective retail motor vehicle dealer in theCommonwealth to (i) offer to sell or sell any extended service contract orextended maintenance plan offered, sold, backed by, or sponsored by themanufacturer or distributor or (ii) sell, assign, or transfer any retailinstallment sales contract or lease obtained by the dealer in connection withthe sale or lease by him in the Commonwealth of motor vehicles manufacturedor sold by the manufacturer or distributor, to a specified finance company orclass of finance companies, leasing company or class of leasing companies, orto any other specified persons by any of the following:

1. By any statement, suggestion, promise, or threat that the manufacturer ordistributor will in any manner benefit or injure the dealer, whether thestatement, suggestion, threat, or promise is express or implied or madedirectly or indirectly.

2. By any act that will benefit or injure the dealer.

3. By any contract, or any express or implied offer of contract, madedirectly or indirectly to the dealer, for handling the motor vehicle on thecondition that the dealer shall offer to sell or sell any extended servicecontract or extended maintenance plan offered, sold, backed by, or sponsoredby the manufacturer or distributor or that the dealer sell, assign, ortransfer his retail installment sales contract on or lease of the vehicle, inthe Commonwealth, to a specified finance company or class of financecompanies, leasing company or class of leasing companies, or to any otherspecified person.

4. By any express or implied statement or representation made directly orindirectly that the dealer is under any obligation whatsoever to offer tosell or sell any extended service contract or extended maintenance planoffered, sold, backed by, or sponsored by the manufacturer or distributor orto sell, assign, or transfer any of his retail sales contracts or leases inthe Commonwealth on motor vehicles manufactured or sold by the manufactureror distributor to a finance company or class of finance companies, leasingcompany or class of leasing companies, or other specified person, because ofany relationship or affiliation between the manufacturer or distributor andthe finance company or companies, leasing company or leasing companies, orthe specified person or persons.

B. Any such statements, threats, promises, acts, contracts, or offers ofcontracts, when their effect may be to lessen or eliminate competition ortend to create a monopoly, are declared unfair trade practices and unfairmethods of competition and are prohibited.

C. To further avoid any acts or practices, the effect of which may be tolessen or eliminate competition, it shall be unlawful for any manufacturer ordistributor, or any officer, agent, or representative thereof, or any personor company affiliated therewith, to condition the provision of leadinformation to a dealer upon the agreement of the dealer to sell or lease avehicle to the prospective customer only if the financing or leasingconnected with the transaction is effected through a specified financecompany or class of finance companies or leasing company or class of leasingcompanies. For the purposes of this section, "lead information" meansinformation concerning a prospective customer who contacts or is contacted bythe manufacturer or distributor or any person or company affiliated therewithconcerning the manufacturer's or distributor's products. The provisions ofthis subsection, however, shall not prohibit a manufacturer or distributorfrom so conditioning the provision of lead information concerning anyprospective customer who qualifies for any manufacturer-sponsored ordistributor-sponsored factory employee, factory retiree, or factory vendornew vehicle purchase program.

D. Any person aggrieved by an action prohibited by this section may seek ahearing, pursuant to 46.2-1573, against any manufacturer or distributorlicensed under this title.

E. Nothing contained in this section shall prohibit a manufacturer ordistributor from offering or providing incentive benefits or bonus programsto a retail motor vehicle dealer or prospective retail motor vehicle dealerin the Commonwealth who makes the voluntary decision to offer to sell or sellany extended service contract or extended maintenance plan offered, sold,backed, or sponsored by the manufacturer or distributor or to sell, assign,or transfer any retail installment sale or lease by him in the Commonwealthof motor vehicles manufactured or sold by the manufacturer or distributor toa specified finance company or leasing company controlled by or affiliatedwith the manufacturer or distributor.

(1988, c. 865, 46.1-550.5:26; 1989, c. 727; 1995, cc. 767, 816; 2001, c.149; 2005, c. 906.)