New York State Franchise Law For New Car Dealers

HIGHLIGHTS

• Requires a franchisor to identify with specificity the reason for rejecting or rebutting a dealer’s declaration of the retail rate. • Provides a dealer with the opportunity to resubmit, within 60 days, a full and corrected declaration addressing any alleged error. Requires a franchisor to response to a resubmission within 60 days. Stays the requirement of submitting repair orders within 180 days of completing a repair from the date of initial submission of a claim. • Places on the franchisor the burden of proving the unreasonableness of declared retail rate and the reasonableness of any adjustment. • Requires franchisors to approve or disapprove warranty or sales incentive claims within thirty (30) days of their submission. • Restricts the franchisor from auditing or charging back any warranty payment, or any sales, advertising or marketing incentive payment more than one year after the date of payment, unless there is fraud. • Requires franchisors to provide dealers with notice of a chargeback, or some system that allows dealers to access information about errors or problems with their warranty, sales, advertising or marketing incentive claims. • Protects dealers from chargebacks of all warranty claims in a single submission where a dealer fails to properly document only one repair job. • Prohibits manufacturers from denying a claim solely due to a dealer’s incidental failure to comply with a specific claim processing requirement, a clerical error, or other administrative technicality, provided the claim is legitimate and the dealer corrects the claim. • Requires franchisors to meet with or call their dealers to explain any chargeback and to allow dealers to explain their position. Warranty and Sales Incentive Audits and Chargebacks – 465(3)-(7)

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