2023 South Carolina Code of Laws › Title 56 - Motor Vehicles › Chapter 15 - Regulation Of Manufacturers, Distributors And Dealers › Section 56-15-46. Notice of intent to establish or relocate competing dealership; injunction.

(A) A franchisor that intends to establish a new dealership or to relocate a current dealership for a particular line-make motor vehicle within the relevant market area of an existing dealership of the same line-make motor vehicle shall give at least sixty-days' prior written notice of that intent by certified mail to the existing dealership. The notice must include the:
(1) specific location of the additional or relocated dealership;
(2) date of commencement of operation of the additional or relocated dealership at the new location;
(3) identities of all existing dealerships located in the market area of the new or relocated dealership; and
(4) names and addresses of the dealer and principals in the new or relocated dealership.
(B) If a franchisor intends to establish a new dealership or to relocate an existing dealership within the relevant market area of an existing dealership, then that existing dealership may petition the court, within sixty days of the receipt of the notice, to enjoin or prohibit the establishment of the new or relocated dealership within the relevant market area of the existing dealership. The court shall enjoin or prohibit the establishment of the new or relocated dealership within the relevant market area of the protesting dealership unless the franchisor shows by a preponderance of the evidence that the existing dealership is not providing adequate representation of the line-make motor vehicle and that the new or relocated dealership is necessary to provide the public with reliable and convenient sales and service within that area. The burden of proof in establishing adequate representation is on the franchisor. In determining if the existing dealership is providing adequate representation and if the new or relocated dealership is necessary, the court may consider, but is not limited to, considering:
(1) the impact the establishment of the new or relocated dealership will have on consumers, the public interest, and the protesting dealership, except that financial impact may be considered only with respect to the protesting dealership;
(2) the size and permanency of investment reasonably made and the reasonable obligations incurred by the protesting dealership to perform its obligation pursuant to the dealership's franchise agreement;
(3) the reasonably expected market penetration of the line-make motor vehicle, after consideration of all factors which may affect the penetration including, but not limited to, demographic factors such as age, income, education, size class preference, product popularity, retail lease transactions, and other factors affecting sales to consumers;
(4) actions by the franchisor in denying its existing dealership of the same line make the opportunity for reasonable growth, market expansion, or relocation, including the availability of line-make motor vehicles in keeping with reasonable expectations of the franchisor in providing an adequate number of dealerships;
(5) attempts by the franchisor to coerce the protesting dealership into consenting to an additional or relocated dealership of the same line make within a ten-mile radius of the protesting dealership;
(6) distance, travel time, traffic patterns, and accessibility between the protesting dealership of the same line make and the location of the proposed new or relocated dealership;
(7) the likelihood of benefits to consumers from the establishment or relocation of the dealership, which benefits may not be obtained by other geographic or demographic changes or other expected changes within a ten-mile radius of the protesting dealership;
(8) if the protesting dealership is in substantial compliance with its franchise agreement;
(9) if there is adequate interbrand and intrabrand competition with respect to the line-make motor vehicles, including the adequacy of sales and service facilities;
(10) if the establishment or relocation of the proposed dealership appears to be warranted and justified based on economic and market conditions pertinent to dealerships competing within a ten-mile radius of the protesting dealership, including anticipated changes; and
(11) the volume of registrations and service business transacted by the protesting dealership.
(C) This section does not apply to the:
(1) relocation of an existing new motor vehicle dealer within two miles of the existing site of the new motor vehicle dealership if the franchise has been operating on a regular basis from the existing site for a minimum of three years immediately preceding the relocation; or
(2) relocation of an existing new motor vehicle dealer if the proposed site of the relocated new motor vehicle dealership is further away from all other new motor vehicle dealers of the same line make in that relevant market area.
HISTORY: 2000 Act No. 287, Section 2; 2021 Act No. 31 (S.510), Section 6, eff August 4, 2021.
Editor's Note
2021 Act No. 31, Section 14, provides as follows:
"SECTION 14. This act takes effect ninety days after approval by the Governor and applies to all current and future franchises and other agreements in existence between any franchisee located in this State and a franchisor as of the effective date of this act."
Effect of Amendment
2021 Act No. 31, Section 6, rewrote the section.