1.1                          A bill for an act 
  1.2             relating to commerce; regulating franchises; modifying 
  1.3             the definition of a franchise; amending Minnesota 
  1.4             Statutes 1997 Supplement, section 80C.01, subdivision 
  1.5             4. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 1997 Supplement, section 
  1.8   80C.01, subdivision 4, is amended to read: 
  1.9      Subd. 4.  "Franchise" means (a) a contract or agreement, 
  1.10  either express or implied, whether oral or written, for a 
  1.11  definite or indefinite period, between two or more persons: 
  1.12     (1) by which a franchisee is granted the right to engage in 
  1.13  the business of offering or distributing goods or services using 
  1.14  the franchisor's trade name, trademark, service mark, logotype, 
  1.15  advertising, or other commercial symbol or related 
  1.16  characteristics; 
  1.17     (2) in which the franchisor and franchisee have a community 
  1.18  of interest in the marketing of goods or services at wholesale, 
  1.19  retail, by lease, agreement, or otherwise; and 
  1.20     (3) for which the franchisee pays, directly or indirectly, 
  1.21  a franchise fee; or 
  1.22     (b) a contract, lease, or other agreement, either express 
  1.23  or implied, whether oral or written, for a definite or 
  1.24  indefinite period, between two or more persons, whereby the 
  1.25  franchisee is granted the right to market motor vehicle fuel 
  2.1   using the franchisor's trade name, trademark, service mark, 
  2.2   logotype, advertising, or other commercial symbol or related 
  2.3   characteristics for which the franchisee pays a franchise fee; 
  2.4   or 
  2.5      (c) the sale or lease of any products, equipment, chattels, 
  2.6   supplies, or services to the purchaser, other than the sale of 
  2.7   sales demonstration equipment, materials or samples for a total 
  2.8   price of $500 or less to any one person, for the purpose of 
  2.9   enabling the purchaser to start a business and in which the 
  2.10  seller:  
  2.11     (1) represents that the seller, lessor, or an affiliate 
  2.12  thereof will provide locations or assist the purchaser in 
  2.13  finding locations for the use or operation of vending machines, 
  2.14  racks, display cases, or similar devices, or currency operated 
  2.15  amusement machines or devices, on premises neither owned or 
  2.16  leased by the purchaser or seller; or 
  2.17     (2) represents that the seller will purchase any or all 
  2.18  products made, produced, fabricated, grown, bred, or modified by 
  2.19  the purchaser using, in whole or in part, the supplies, 
  2.20  services, or chattels sold to the purchaser; or 
  2.21     (3) guarantees that the purchaser will derive income from 
  2.22  the business which exceeds the price paid to the seller; or 
  2.23     (d) an oral or written contract or agreement, either 
  2.24  expressed or implied, for a definite or indefinite period, 
  2.25  between two or more persons, under which a manufacturer, selling 
  2.26  security systems through dealers or distributors in this state, 
  2.27  requires regular payments from the distributor or dealer as 
  2.28  royalties or residuals for products purchased and paid for by 
  2.29  the dealer or distributor.  
  2.30     (e) "Franchise" does not include any business which is 
  2.31  operated under a lease or license on the premises of the lessor 
  2.32  or licensor as long as such business is incidental to the 
  2.33  business conducted by the lessor or licensor on such premises, 
  2.34  including, without limitation, leased departments, licensed 
  2.35  departments, and concessions. 
  2.36     (f) "Franchise" does not include any contract, lease or 
  3.1   other agreement whereby the franchisee is required to pay less 
  3.2   than $100 on an annual basis, except those franchises identified 
  3.3   in paragraph (b). 
  3.4      (g) "Franchise" does not include a contract, lease or other 
  3.5   agreement between a new motor vehicle manufacturer, distributor, 
  3.6   or factory branch and a franchisee whereby the franchisee is 
  3.7   granted the right to market automobiles, motorcycles, trucks, 
  3.8   truck tractors, or self-propelled motor homes or campers if the 
  3.9   foregoing are designed primarily for the transportation of 
  3.10  persons or property on public highways. 
  3.11     (h) "Franchise" does not include a contract, lease, or 
  3.12  other agreement or arrangement between two or more air carriers, 
  3.13  or between one or more air carriers and one or more foreign air 
  3.14  carriers.  The terms "air carrier" and "foreign air carrier" 
  3.15  shall have the meanings assigned to them by the Federal Aviation 
  3.16  Act, United States Code Appendix, title 49, sections 1301(3) and 
  3.17  1301(22), respectively. 
  3.18     Sec. 2.  [EFFECTIVE DATE.] 
  3.19     Section 1 is effective on the day Laws 1997, chapter 222, 
  3.20  section 32, paragraph (h) was effective.