Section 51-07-02.3 - Prohibited actsA manufacturer, wholesaler, or distributor of automobiles or trucks, or parts of the automobiles or trucks, that enters a contract with any person engaged in the business of selling or retailing automobiles, trucks, or parts for the automobiles or trucks, may not:
1. Coerce or attempt to coerce the retailer into accepting delivery of automobiles, trucks, parts, or accessories that the retailer has not ordered voluntarily.2. Condition or attempt to condition the sale of automobiles or trucks on a requirement that the automobile or truck retailer purchase other goods or services, except that the manufacturer, wholesaler, or distributor may require a retailer to purchase all parts reasonably necessary to maintain the quality of operation and telecommunications necessary to communicate with the manufacturer, wholesaler, or distributor.3. Implement or establish a system of motor vehicle allocation or distribution to one or more of its dealers that is unfair, inequitable, or unreasonably discriminatory. As used in this subsection, "unfair" includes requiring a dealer to accept new vehicles not ordered by the dealer or the refusal or failure to offer to any dealer all models offered to any of its other same line-make dealers in this state. The failure to deliver any motor vehicle is not a violation of this section if failure is due to any cause over which the manufacturer does not have control.4. Require a dealer to pay all or any part of the cost of an advertising campaign or contest or purchase any promotional material, showroom, or other display decoration or material at the expense of the dealer.5. Coerce or attempt to coerce an automobile or truck retailer into not carrying dual lines or into maintaining separate facilities as long as the retailer's facilities otherwise satisfy the reasonable requirements of the manufacturer, wholesaler, or distributor.6. Require a retailer to either establish or maintain exclusive facilities, personnel, or display space or to abandon an existing franchise relationship with another manufacturer in order to continue, renew, reinstate, or enter a franchise agreement or to participate in any program discount, credit, rebate, or sales incentive. This subsection does not apply to a program that is in effect with more than one dealer in this state on April 20, 2011, or to a renewal or modification of the program.7. Unreasonably prevent or refuse to approve the relocation of a dealership to another site within the dealer's relevant market area. The dealer shall provide the manufacturer or distributor with notice of the proposed address and a reasonable site plan of the proposed location. The manufacturer or distributor shall approve or deny the request in writing within sixty days after receipt of the request, and failure to deny the request within sixty days is deemed approval.8. Require the retailer to unreasonably remodel, renovate, or recondition the retailer's facilities, change the location of the facilities, or make unreasonable alterations to the dealership premises.9. Discriminate in the prices charged for automobiles or trucks of like grade and quality sold by automobile or truck manufacturers to similarly situated automobile or truck retailers. This prohibition does not prevent the use of differentials that solely make due allowance for differences in the cost of manufacture, sale, or delivery or for differing methods or quantities in which the automobiles or trucks are sold or delivered by the manufacturer, wholesaler, or distributor.10. Refuse or fail to offer any incentive program, bonus payment, holdback margin, or any other mechanism that effectively lowers the net cost of a vehicle to any franchised dealer in this state if the incentive, bonus, or holdback is available or made to one or more same line-make dealers in this state.11. Attempt or threaten to terminate, cancel, or fail to renew, or substantially change the competitive circumstances of the dealership contracts for any reason other than the failure of the automobile or truck retailer to comply with the terms of the contract between the parties, if the attempt or threat is based on the results of a circumstance beyond the retailer's control, including a natural disaster in the dealership market area or a labor dispute.12. Require a dealer in this state to enter any agreement to assent to a release, assignment, novation, waiver, or estoppel in which a dealer relinquishes any rights under this state's law, or which would relieve any person from liability imposed by this state's law unless done in connection with a settlement agreement to resolve a matter between a manufacturer and the dealer. The settlement agreement must be entered voluntarily for separate and valuable consideration, and the renewal, reinstatement, or continuation of a franchise agreement alone does not constitute separate and valuable consideration.13. Require any dealer in this state to enter any agreement with the manufacturer or any other party which requires the law of another jurisdiction to apply to any dispute between the dealer and manufacturer, requires that the dealer bring an action against the manufacturer in a venue outside of this state, in any way purports to waive any dealer's right to have all of this state's statutory and common law apply, shortens or otherwise modifies or eliminates any dealer's right to resolve any dispute with a manufacturer in a state or federal court in this state, or requires the dealer to agree to arbitration or waive its rights to bring a cause of action against the manufacturer, unless done in connection with a settlement agreement to resolve a matter or pending dispute between a manufacturer and the dealer. This settlement agreement must be entered voluntarily for separate and valuable consideration and renewal, reinstatement, or continuation of a franchise agreement alone is not separate and valuable consideration.Amended by S.L. 2011, ch. 372 (SB 2236),§ 2, eff. 4/20/2011.