II

Calendar No. 210

107TH CONGRESS

1ST SESSION S. 1140

To amend chapter 1 of title 9, United States Code, to provide for greater

fairness in the arbitration process relating to motor vehicle franchise

contracts.

IN THE SENATE OF THE UNITED STATES

JUNE 29, 2001

Mr. HATCH (for himself, Mr. FEINGOLD, Mr. GRASSLEY, Mr. LEAHY, Mr.

WARNER, Mr. BREAUX, Mr. BURNS, Mr. REID, Mr. CRAIG, Mr.

TORRICELLI, Mr. BENNETT, Ms. SNOWE, Mr. DEWINE, Mr. THOMAS,

Mr. HUTCHINSON, Mr. DOMENICI, Mr. COCHRAN, Mr. DURBIN, Mrs.

HUTCHISON, Mr. ALLEN, Mr. CRAPO, Mr. JEFFORDS, Mr. BIDEN, Mrs.

LINCOLN, Mr. EDWARDS, Mr. DASCHLE, Mr. GREGG, Mr. DORGAN, Ms.

COLLINS, Mr. LOTT, Mr. ENZI, Mr. INOUYE, Mr. BINGAMAN, Mr. HOLLINGS, Mr. AKAKA, Mr. ENSIGN, Mr. HAGEL, Mr. INHOFE, Mr. HELMS,

Mr. CLELAND, and Ms. LANDRIEU) introduced the following bill; which

was read twice and referred to the Committee on the Judiciary

OCTOBER 31, 2001

Reported by Mr. LEAHY, without amendment

A BILL

To amend chapter 1 of title 9, United States Code, to provide

for greater fairness in the arbitration process relating

to motor vehicle franchise contracts.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
2

S 1140 RS

1 SECTION 1. SHORT TITLE.

2 This Act may be cited as the ‘‘Motor Vehicle Fran3 chise Contract Arbitration Fairness Act of 2001’’.

4 SEC. 2. ELECTION OF ARBITRATION.

5 (a) MOTOR VEHICLE FRANCHISE CONTRACTS.—

6 Chapter 1 of title 9, United States Code, is amended by

7 adding at the end the following:

8 ‘‘§ 17. Motor vehicle franchise contracts

9 ‘‘(a) For purposes of this section, the term—

10 ‘‘(1) ‘motor vehicle’ has the meaning given such

11 term under section 30102(6) of title 49; and

12 ‘‘(2) ‘motor vehicle franchise contract’ means a

13 contract under which a motor vehicle manufacturer,

14 importer, or distributor sells motor vehicles to any

15 other person for resale to an ultimate purchaser and

16 authorizes such other person to repair and service

17 the manufacturer’s motor vehicles.

18 ‘‘(b) Whenever a motor vehicle franchise contract

19 provides for the use of arbitration to resolve a controversy

20 arising out of or relating to the contract, arbitration may

21 be used to settle such controversy only if after such con22 troversy arises both parties consent in writing to use arbi23 tration to settle such controversy.

24 ‘‘(c) Whenever arbitration is elected to settle a dis25 pute under a motor vehicle franchise contract, the arbi26 trator shall provide the parties to the contract with a writ-
3

S 1140 RS

1 ten explanation of the factual and legal basis for the

2 award.’’.

3 (b) TECHNICAL AND CONFORMING AMENDMENT.—

4 The table of sections for chapter 1 of title 9, United States

5 Code, is amended by adding at the end the following:

‘‘17. Motor vehicle franchise contracts.’’.

6 SEC. 3. EFFECTIVE DATE.

7 The amendments made by section 2 shall apply to

8 contracts entered into, amended, altered, modified, re9 newed, or extended after the date of the enactment of this

10 Act.
Calendar No. 210

107TH CONGRESS

1ST SESSION S. 1140

A BILL

To amend chapter 1 of title 9, United States Code,

to provide for greater fairness in the arbitrationprocess relating to motor vehicle franchise contracts.

OCTOBER 31, 2001

Reported without amendment