2023 CODE OF GEORGIA › Title 10 - COMMERCE AND TRADE (§§ 10-1-1 — 10-15-7) › Chapter 1 - SELLING AND OTHER TRADE PRACTICES (§§ 10-1-1 — 10-1-945) › Article 22 - MOTOR VEHICLE FRANCHISE PRACTICES (§§ 10-1-620 — 10-1-670) › Part 3 - MOTOR VEHICLE WARRANTY PRACTICES (§§ 10-1-640 — 10-1-645) › Section 10-1-645 - Uniform warranty reimbursement agreement amongst dealers

(a)
Any manufacturer or franchisor and at least a majority of its dealers of the same line make may agree to a uniform warranty reimbursement agreement in an express written contract executed by a dealer principal or authorized designee of the dealer principal that specifically cites this Code section. The agreement shall only involve either reimbursement for parts used in warranty repairs or the use of a uniform time standards manual, or both. Reimbursement for parts under the agreement shall be used instead of the dealers' prevailing retail rate charged by that dealer for the same parts as defined in Code Section
10-1-641
to calculate compensation due from the franchisor for parts used in warranty repairs. This Code section does not authorize a franchisor and its dealers to establish a uniform hourly labor reimbursement.
(b)
A manufacturer or franchisor that proposes a uniform reimbursement agreement must provide all of its line make dealers a minimum of 30 days to consider such proposal which shall be in writing and provided to the dealer principal or authorized designee of the dealer principal via certified mail or other trackable delivery method, including electronic transmission, to which a notice containing the following language in all capital letters shall be affixed:
GEORGIA LAW ALLOWS TWO ALTERNATIVE METHODS OF WARRANTY REIMBURSEMENT:
1.
DEALERS MAY SUBMIT A REQUEST TO RECEIVE RETAIL RATE PURSUANT TO O.C.G.A. SECTION
10-1-641
; OR
2.
A MAJORITY OF LINE MAKE DEALERS MAY AGREE TO A UNIFORM WARRANTY REIMBURSEMENT AGREEMENT, AS PROPOSED WITH THIS NOTICE.
IN THE EVENT A MAJORITY OF THE SAME LINE MAKE DEALERS AGREE TO THE ATTACHED UNIFORM WARRANTY REIMBURSEMENT AGREEMENT, DEALERS THAT OPT TO SEEK RETAIL RATE PURSUANT TO O.C.G.A. SECTION
10-1-641
MAY BE SUBJECT TO A COST RECOVERY SURCHARGE ON ALL NEW VEHICLE INVOICES.
(c)
Each franchisor shall only have one such agreement with each line make. Any such agreement shall:
(1)
Establish a uniform parts reimbursement rate. The uniform parts reimbursement rate shall be not less than the greater of the nationally established rate set forth in the franchisor's sales and service agreement or other warranty manual or policy or the franchisor's national average warranty parts reimbursement rate at the time such agreement becomes effective;
(2)
Apply to all warranty repair orders written during the period that the agreement is effective;
(3)
Be available, during the period it is effective, to any dealer of the same line make at any time and on the same terms; and
(4)
Be for a term not to exceed three years so long as any party to the agreement may terminate the agreement upon the annual anniversary of the agreement and with 30 days' prior written notice; however, the agreement shall remain in effect for the term of the agreement regardless of the number of dealers of the same line make that may terminate the agreement.
(d)
(1)
As used in this subsection, the term "costs" means the difference between the uniform reimbursement rate set forth in an agreement entered into pursuant to this Code section and the retail rate received by an individual dealer pursuant to Code Section
10-1-641
.
(2)
A manufacturer or franchisor that enters into a uniform warranty reimbursement agreement as provided in this Code section may seek to recover its costs from only those dealers that are receiving their retail rate pursuant to Code Section
10-1-641
as follows:
(A)
The costs shall be recovered only by increasing the invoice price on new vehicles received by those dealers not a party to an agreement under this Code section; and
(B)
Price increases imposed for the purpose of recovering costs under this Code section may vary from time to time and from model to model but shall apply to all dealers of the same line make in the State of Georgia that have requested reimbursement for warranty repairs at their prevailing retail rate.
(e)
If a manufacturer or franchisor enters into a uniform reimbursement agreement with its dealers, the manufacturer or franchisor shall, within 60 days of entering into such agreement, certify under oath to the Department of Revenue that a majority of the dealers of that line make have entered into such an agreement and shall file a sample copy of the agreement, the required notice, a list of the line make dealers that have agreed to the uniform warranty reimbursement, and the date upon which such agreement was made. On an annual basis, the manufacturer shall certify under oath to the department that the parts warranty reimbursement in the agreement is no less than the greater of the franchisor's nationally established rate or the national average parts reimbursement rate and that the reimbursement costs it recovers under subsection (d) of this Code section do not exceed the amounts authorized by subsection (d) of this Code section. The manufacturer or franchisor shall maintain for a period of three years a file that contains the information upon which its certification is based.
(f)
If a manufacturer or franchisor and its dealers do not enter into an agreement pursuant to this Code section, and for any matter that is not the subject of an agreement, this Code section shall have no effect whatsoever.
(g)
For purposes of this Code section, a uniform time standard manual is a document created by a franchisor that establishes the time allowances for the diagnosis and performance of warranty work and service. The allowances shall be reasonable and adequate for the work and service to be performed. Each franchisor shall have a reasonable and fair process that allows a dealer to request a modification or adjustment of a standard or standards included in such a manual.
Amended by 2019 Ga. Laws 157,§ 4, eff. 7/1/2019.
Amended by 2005 Ga. Laws 68,§ 4-3, eff. 7/1/2005.
Added by 2003 Ga. Laws 189, § 1, eff. 7/1/2003.