Arkansas Code of 1987 (2023) › Title 4 - BUSINESS AND COMMERCIAL LAW (§§ 4-1-101 — 4-119-105) › Subtitle 6 - BUSINESS PRACTICES (§§ 4-70-101 — 4-76-108) › Chapter 72 - FRANCHISES (§§ 4-72-201 — 4-72-603) › Subchapter 5 - PETROLEUM PRODUCTS SUPPLIERS, DEALERS, AND DISTRIBUTORS (§§ 4-72-501 — 4-72-503) › Section 4-72-502 - Franchise - Cancellation or termination

(a)
A petroleum products supplier or a petroleum products distributor shall not cancel, refuse to renew, or otherwise terminate a franchise with a petroleum products dealer except as prescribed in this section.
(b)
(1)
If a petroleum products supplier or a petroleum products distributor proposes to cancel, to fail to renew, or to otherwise terminate a franchise with any petroleum products dealer, he or she shall so notify the dealer by certified mail at least thirty (30) days prior to the date on which he or she proposes to cancel, to fail to renew, or to terminate the franchise.
(2)
The notice shall include a statement of the grounds upon which the supplier or distributor bases his or her right to cancel, refuse to renew, or terminate the franchise.
(c)
Only the following matters shall be included in the franchise as grounds for a petroleum products supplier or petroleum products distributor to cancel or terminate the franchise of a petroleum products dealer:
(1)
Criminal misconduct or violation of law relating to the business or premises of the dealer;
(2)
Fraud;
(3)
Failure of the dealer to pay taxes and to obtain and maintain all licenses, permits, and other authority necessary to conduct business as a dealer;
(4)
Abandonment or unattendance of the business or premises of the dealer for such period of time as may be specified in the franchise;
(5)
Bankruptcy or insolvency of the dealer;
(6)
The failure by the dealer to pay the supplier or distributor for petroleum products purchased or received on consignment from the supplier or distributor within the time and in the manner prescribed in the franchise;
(7)
Nonpayment of rent or the loss by the refiner or distributor of its legal right to grant a dealer possession of the leased premises at which the business is located;
(8)
Death or incapacity of the dealer or the termination or dissolution of a partnership or corporation;
(9)
Adulteration or misrepresentation of products;
(10)
Force majeure, condemnation, or other public taking; or
(11)
Failure to comply with the provisions of the marketing agreement regarding the responsibility of the dealer to maintain the premises in a safe, clean, and attractive condition.
(d)
However, if a dealer abandons the business or premises for a period of time specified in the marketing agreement or violates one (1) or more provisions of subdivisions (c)(1)-(9) of this section, the supplier or distributor having the right to terminate the marketing agreement may do so immediately.
(e)
A petroleum products supplier or distributor may not fail to renew a franchise unless:
(1)
One (1) or more provisions of subsection (c) of this section are met;
(2)
The supplier or distributor and the dealer fail to agree to reasonable changes or reasonable additions to the terms of the franchise;
(3)
The supplier or distributor withdraws from the sale of motor fuels for sale other than resell in the state, one (1) or more counties thereof, or metropolitan areas;
(4)
The supplier or distributor intends to relinquish ownership or leasehold interest in the real estate premises on which the dealer conducts business; however, where two (2) or more separate noncontiguous real estate premises are involved, the franchise shall not be renewed as to the operations of the franchise related to the premises to be relinquished;
(5)
The real estate premises are to be used for purposes other than the sale or distribution of motor fuels;
(6)
The supplier or distributor intends to materially alter, add to, or replace improvements on the real estate premises;
(7)
The supplier or distributor received repeated consumer complaints concerning the conduct of a dealer's operation of a retail outlet; or
(8)
The supplier and dealer agree to mutually terminate the franchise.
Acts 1975, No. 471, § 2; A.S.A. 1947, § 53-1102.