HF 1748

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to commerce; motor vehicle fuel franchises; 
  1.3             changing the definition of a franchise; creating a 
  1.4             right of first refusal upon assignment or sale of 
  1.5             marketing premises; amending Minnesota Statutes 1998, 
  1.6             section 80C.01, subdivision 4; proposing coding for 
  1.7             new law in Minnesota Statutes, chapter 80C. 
  1.8   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.9      Section 1.  Minnesota Statutes 1998, section 80C.01, 
  1.10  subdivision 4, is amended to read: 
  1.11     Subd. 4.  (a) "Franchise" means (a) (1) a contract or 
  1.12  agreement, either express or implied, whether oral or written, 
  1.13  for a definite or indefinite period, between two or more persons:
  1.14     (1) (i) by which a franchisee is granted the right to 
  1.15  engage in the business of offering or distributing goods or 
  1.16  services using the franchisor's trade name, trademark, service 
  1.17  mark, logotype, advertising, or other commercial symbol or 
  1.18  related characteristics; 
  1.19     (2) (ii) in which the franchisor and franchisee have a 
  1.20  community of interest in the marketing of goods or services at 
  1.21  wholesale, retail, by lease, agreement, or otherwise; and 
  1.22     (3) (iii) for which the franchisee pays, directly or 
  1.23  indirectly, a franchise fee; or 
  1.24     (b) (2)(i) a contract, lease, or other agreement, either 
  1.25  express or implied, whether oral or written, for a definite or 
  1.26  indefinite period, between two or more persons, whereby the 
  2.1   franchisee is authorized, permitted, or granted the right to 
  2.2   market motor vehicle fuel using at retail under the franchisor's 
  2.3   trade name, trademark, service mark, logotype, advertising, or 
  2.4   other commercial symbol or related characteristics for which the 
  2.5   franchisee pays a franchise fee owned or controlled by the 
  2.6   franchisor; or 
  2.7      (ii) a contract, lease, or other agreement, either 
  2.8   expressed or implied, whether oral or written, for a definite or 
  2.9   indefinite period of time, between two or more persons whereby 
  2.10  the franchisee is authorized, permitted, or granted the right to 
  2.11  market motor vehicle fuel at a facility leased from or provided 
  2.12  by the franchisor or an affiliate, provided that the franchisee 
  2.13  receives at least 85 percent of its motor vehicle fuel 
  2.14  requirements from the franchisor; or 
  2.15     (c) (3) the sale or lease of any products, equipment, 
  2.16  chattels, supplies, or services to the purchaser, other than the 
  2.17  sale of sales demonstration equipment, materials or samples for 
  2.18  a total price of $500 or less to any one person, for the purpose 
  2.19  of enabling the purchaser to start a business and in which the 
  2.20  seller:  
  2.21     (1) (i) represents that the seller, lessor, or an affiliate 
  2.22  thereof will provide locations or assist the purchaser in 
  2.23  finding locations for the use or operation of vending machines, 
  2.24  racks, display cases, or similar devices, or currency operated 
  2.25  amusement machines or devices, on premises neither owned or 
  2.26  leased by the purchaser or seller; or 
  2.27     (2) (ii) represents that the seller will purchase any or 
  2.28  all products made, produced, fabricated, grown, bred, or 
  2.29  modified by the purchaser using, in whole or in part, the 
  2.30  supplies, services, or chattels sold to the purchaser; or 
  2.31     (3) (iii) guarantees that the purchaser will derive income 
  2.32  from the business which exceeds the price paid to the seller; or 
  2.33     (d) (4) an oral or written contract or agreement, either 
  2.34  expressed or implied, for a definite or indefinite period, 
  2.35  between two or more persons, under which a manufacturer, selling 
  2.36  security systems through dealers or distributors in this state, 
  3.1   requires regular payments from the distributor or dealer as 
  3.2   royalties or residuals for products purchased and paid for by 
  3.3   the dealer or distributor.  
  3.4      (e) (b) "Franchise" does not include any business which is 
  3.5   operated under a lease or license on the premises of the lessor 
  3.6   or licensor as long as such business is incidental to the 
  3.7   business conducted by the lessor or licensor on such premises, 
  3.8   including, without limitation, leased departments, licensed 
  3.9   departments, and concessions. 
  3.10     (f) (c) "Franchise" does not include any contract, lease or 
  3.11  other agreement whereby the franchisee is required to pay less 
  3.12  than $100 on an annual basis, except those franchises identified 
  3.13  in paragraph (b) clause (2), item (i). 
  3.14     (g) (d) "Franchise" does not include a contract, lease or 
  3.15  other agreement between a new motor vehicle manufacturer, 
  3.16  distributor, or factory branch and a franchisee whereby the 
  3.17  franchisee is granted the right to market automobiles, 
  3.18  motorcycles, trucks, truck tractors, or self-propelled motor 
  3.19  homes or campers if the foregoing are designed primarily for the 
  3.20  transportation of persons or property on public highways. 
  3.21     (h) (e) "Franchise" does not include a contract, lease, or 
  3.22  other agreement or arrangement between two or more air carriers, 
  3.23  or between one or more air carriers and one or more foreign air 
  3.24  carriers.  The terms "air carrier" and "foreign air carrier" 
  3.25  shall have the meanings assigned to them by the Federal Aviation 
  3.26  Act, United States Code Appendix, title 49, sections 1301(3) and 
  3.27  1301(22), respectively. 
  3.28     (f) For purposes of this chapter, a person who sells motor 
  3.29  vehicle fuel at wholesale who does not, or is not an affiliate 
  3.30  of a person who, owns or controls the trademark, trade name, 
  3.31  service mark, logotype, or other commercial symbol or related 
  3.32  characteristics under which the motor vehicle fuel is sold at 
  3.33  retail, is not a franchisor or a franchisee, and is not 
  3.34  considered to be part of a franchise relationship. 
  3.35     (g) "Affiliate" means any person who controls, is 
  3.36  controlled by, or is under common control with, any other person.
  4.1   Affiliate includes, without limitation, partners, business 
  4.2   entities with common ownership, principals of any business 
  4.3   entity, and subsidiaries, parent companies, or holding companies 
  4.4   of any person. 
  4.5      Sec. 2.  [80C.147] [CHANGE IN OWNERSHIP OR CONTROL OF 
  4.6   MARKETING PREMISES.] 
  4.7      Subdivision 1.  [SALES, TRANSFERS, OR ASSIGNMENTS.] A motor 
  4.8   vehicle fuel franchisor, or an affiliate of the franchisor, who 
  4.9   determines to sell, transfer, or assign its interest in 
  4.10  marketing premises occupied by a franchisee, shall: 
  4.11     (1) make a bona fide offer to sell, transfer, or assign to 
  4.12  the franchisee the franchisor's or affiliate's interests in the 
  4.13  premises; or 
  4.14     (2) offer to the franchisee a right of first refusal of at 
  4.15  least 45 days' duration of an offer made by a third party to 
  4.16  purchase the franchisor's or affiliate's interest in the 
  4.17  premises. 
  4.18     Subd. 2.  [LEASE OR PURCHASE OPTIONS.] A motor vehicle fuel 
  4.19  franchisor, or an affiliate of the franchisor, who has an option 
  4.20  to purchase or an option to lease or extend a lease of marketing 
  4.21  premises occupied by the franchisee, who determines not to 
  4.22  exercise the option, shall offer to assign or otherwise transfer 
  4.23  the option to the franchisee.  The franchisor may charge the 
  4.24  franchisee a reasonable legal and administrative cost for 
  4.25  transfer of the option.  Options to purchase or to lease or 
  4.26  extend the lease of a marketing premises owned by a motor 
  4.27  vehicle fuel franchisor, or an affiliate of the franchisor, 
  4.28  created after the effective date of this subdivision shall be 
  4.29  assignable as a matter of law to the franchisee who occupies the 
  4.30  marketing premises.  If the franchisee exercises such an option, 
  4.31  the franchisor, or an affiliate of the franchisor, shall not, as 
  4.32  a matter of law, be liable for the performance of the franchisee 
  4.33  pursuant to the option or any underlying lease thereafter. 
  4.34     Subd. 3.  [DEFINITION.] "Affiliate" means any person who 
  4.35  controls, is controlled by, or is under common control with, any 
  4.36  other person.  Affiliate includes, without limitation, partners, 
  5.1   business entities with common ownership, principals of any 
  5.2   business entity, and subsidiaries, parent companies, or holding 
  5.3   companies of any person. 
  5.4      Sec. 3.  [EFFECTIVE DATE; APPLICATION.] 
  5.5      This act is effective the day following final enactment and 
  5.6   applies to franchises entered into, amended, or renewed on or 
  5.7   after that date.  Any franchise in existence on the effective 
  5.8   date of this act that has no expiration date is considered to be 
  5.9   renewed on August 1, 1999, for purposes of the application of 
  5.10  this act.