13-14-101 - Title -- Legislative purpose. - Utah Statutes

13-14-101. Title -- Legislative purpose.
(1) This chapter shall be cited as the "New Automobile Franchise Act."
(2) The Legislature finds that:
(a) The distribution and sales of new motor vehicles through franchise arrangements inthe state vitally affects the general economy of the state, the public interest, and the publicwelfare. A substantial inequality of bargaining power between motor vehicle franchisors andmotor vehicle franchisees enables a franchisor:
(i) to compel a franchisee to execute agreements that contain terms and conditions that afranchisee generally would not be agreed to absent the compulsion and duress that arise out of theinequality of bargaining power; and
(ii) in some cases to terminate a franchise without good cause, or to force a franchisee outof business by the use of unfair practices.
(b) Termination of franchises, without good cause or by unfair means:
(i) diminishes competition and, as a result, leads to higher retail prices and fewerpurchase options;
(ii) adversely affects communities that depend on a franchisee to make available motorvehicles for sale or lease and to provide warranty work and other services related to vehicles; and
(iii) undercuts expectations of consumers concerning the availability of future servicesincluding warranty work from the franchisee.
(c) To promote the public welfare and in the exercise of the state's police powers, it isnecessary to establish statutory guidelines regulating the relationship between franchisors andfranchisees in the motor vehicle industry.

Enacted by Chapter 277, 1996 General Session