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OregonHB 21272025 Regular SessionHouse

Relating to motor vehicle dealer franchises.

Sponsored By: Sponsor information unavailable

Signed by Governor

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Bill Overview

Analyzed Economic Effects

10 provisions identified: 9 benefits, 0 costs, 1 mixed.

Limits on recurring vehicle feature fees

Vehicle makers, distributors, and importers cannot charge retail customers recurring fees for certain already-installed features needing no ongoing support. The ban also covers convenience and safety functions. Exceptions include offers through dealers, promotions, charitable offers, emergency roadside service, and free trials. Wireless systems and listed network-based services, including navigation and driver assistance, are outside the ban. Lease payments and retail installment payments are also excluded.

Dealers gain facility vendor choices

Dealers can ask in writing to use a different facility vendor with substantially similar quality and design. The maker, distributor, or importer must respond in writing within 20 business days. Without a written rejection by that deadline, the request is approved. This choice does not apply when that company funds all or a substantial part of the upgrade.

Dealers gain protected recall repair payments

For franchises entered into or renewed on or after the law's effective date, manufacturers must pay for required recall labor and parts. Payments follow Oregon's dealer claim standards and procedures. An equal-or-better qualifying national recall program or a different agreement can alter that requirement. Manufacturers cannot cut compensation or incentives solely because dealers claim or receive recall payments. They can still change programs prospectively, make ordinary business decisions, and dispute payment amounts through the claim process.

Dealers gain protections when transferring ownership

These protections apply to franchises entered into or renewed on or after the law's effective date. Dealers must notify the franchisor of ownership or management transfers and provide required applications, information, and deal agreements. The franchisor has 60 days to respond by certified mail with reasons for denial; silence counts as approval. It cannot unreasonably reject buyers of good character meeting written, reasonable experience, performance, and financial standards. A contractual first-refusal right applies only to transfers exceeding 50% of franchise ownership, with certified-mail notice within 60 days. The franchisor must match or improve the proposed terms and pay the prospective buyer's reasonable expenses, including lawyer fees, before exercising that right. Specified family, qualified manager, family-controlled entity, and trust transfers are exempt; bad-faith use or threats are banned.

Dealers gain warranty claim protections

Dealers have 30 days after a labor or parts claim denial to correct and resubmit it. Companies cannot deny covered claims solely because customers drove more miles while unavailable parts delayed repairs. They cannot cut payments solely using national market averages or limit repairs using national failure-rate averages. Companies can require reasonable claim records, but generally must audit within one year after payment and finish within 60 days. Chargebacks require unsupported, false, or fraudulent claims; audits after one year require reasonable fraud grounds and allow recovery only of proven fraud.

Fairer vehicle allocations for dealers

Company-controlled sales and leasing systems must assign vehicles using customers' dealer choices or other objective rules. Makers, distributors, and importers must share reservation rules and changes at least 30 days before use. They cannot pressure dealers into installing public charging stations or accepting unfair vehicle, parts, or accessory delivery plans. Banned pressure includes threats, withheld supplies, higher supply prices, and denied incentives compared with other same-brand dealers. Dealers can request written allocation explanations; voluntary charging incentives, necessary sales and service standards, and fair, uniform incentive qualifications remain allowed.

Fairer warranty repair pay for dealers

Makers, distributors, and importers must fairly pay dealers for pre-delivery and warranty diagnosis, repairs, parts, and labor. They must allow reasonable repair time and cannot unreasonably deny documented written requests for additional or adjusted time. Dealers can propose higher hourly rates or parts payments once yearly, subject to the claim review and dispute process. For same-brand warranty parts supplied without sale to the dealer, payment generally equals the dealer's average markup percentage times current catalog price. Entire engine assemblies, propulsion engine assemblies, entire transmission assemblies, and electric batteries instead receive 30% of the applicable catalog price.

Franchisors cover certain dealer legal costs

For franchises entered into or renewed on or after the law's effective date, franchisors must cover specified dealer claim costs. Coverage includes reasonable damages, lawyer fees, court costs, and related expenses for current dealers, former dealers, and successors. Covered claims involve vehicle defects, required service methods, protected dealer data, existing cost-sharing rights, and certain unlawful required-system uses. Service-method claims require proper use following the franchisor's training or instructions. Required electronic-system coverage excludes willful or intentional unlawful use by dealers, their agents, or employees.

Payments for dealers holding recalled vehicles

For franchises entered into or renewed on or after the law's effective date, manufacturers must compensate dealers holding qualifying recalled inventory. Coverage requires a federal safety or emissions recall and a manufacturer stop-sale or do-not-drive order. Dealers must be authorized to sell and service new vehicles of that brand. Vehicles must be held for sale and already in inventory when ordered stopped, or later taken as a consumer trade-in. A necessary part or fix must remain unavailable for 30 days after the initial recall notice. Payments start 30 days after the order, at a prorated minimum of 1.5% of vehicle value per month. Payments stop when the fix becomes available or the vehicle is disposed of, and cannot exceed its value. Claims follow Oregon's dealer claim process, and this remedy cannot be added to other state or federal remedies.

More vehicle companies face franchise rules

Oregon's dealer franchise rules cover vehicle makers' and distributors' subsidiaries, affiliates, branches, and divisions. Distributors include businesses that sell or distribute vehicles to dealers. Manufacturers also include certain truck converters whose major work creates a complete vehicle they own. These definitions exclude motor homes.

Sponsors & Cosponsors

Sponsors

There is no primary sponsor on record.

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 148 • No: 1

House vote • 5/1/2025

House concurred in Senate amendments and repassed bill.

Yes: 54 • No: 0

Senate vote • 4/29/2025

Third reading. Carried by Bonham. Passed.

Yes: 27 • No: 1

Senate vote • 4/17/2025

Labor and Business: Heard and Reported Out with Amendments

Yes: 4 • No: 0

House vote • 4/10/2025

Third reading. Carried by Sosa. Passed.

Yes: 55 • No: 0

House vote • 4/1/2025

Commerce and Consumer Protection: Heard and Reported Out with Amendments

Yes: 8 • No: 0

Actions Timeline

  1. Chapter 50, (2025 Laws): Effective date January 1, 2026.

    6/6/2025House

  2. Governor signed.

    5/12/2025House

  3. President signed.

    5/5/2025Senate

  4. Speaker signed.

    5/5/2025House

  5. House concurred in Senate amendments and repassed bill.

    5/1/2025House

  6. Third reading. Carried by Bonham. Passed.

    4/29/2025Senate

  7. Carried over to 04-29 by unanimous consent.

    4/28/2025Senate

  8. Carried over to 04-28 by unanimous consent.

    4/24/2025Senate

  9. Carried over to 04-24 by unanimous consent.

    4/23/2025Senate

  10. Second reading.

    4/22/2025Senate

  11. Recommendation: Do pass with amendments to the A-Eng. bill. (Printed B-Eng.)

    4/21/2025Senate

  12. Work Session held.

    4/17/2025Senate

  13. Public Hearing held.

    4/15/2025Senate

  14. Referred to Labor and Business.

    4/10/2025Senate

  15. First reading. Referred to President's desk.

    4/10/2025Senate

  16. Third reading. Carried by Sosa. Passed.

    4/10/2025House

  17. Rules suspended. Carried over to April 10, 2025 Calendar.

    4/9/2025House

  18. Rules suspended. Carried over to April 9, 2025 Calendar.

    4/8/2025House

  19. Second reading.

    4/7/2025House

  20. Recommendation: Do pass with amendments and be printed A-Engrossed.

    4/4/2025House

  21. Work Session held.

    4/1/2025House

  22. Public Hearing held.

    2/4/2025House

  23. Referred to Commerce and Consumer Protection.

    1/17/2025House

  24. First reading. Referred to Speaker's desk.

    1/13/2025House

Bill Text

  • SLB Amendment -A3 (Adopted)

    4/17/2025

    PDF

  • HCCP Amendment -1 (Adopted)

    4/1/2025

    PDF

  • HCCP Amendment -1 (Proposed)

    3/27/2025

    PDF

  • HCCP Amendment -1 (Proposed)

    3/25/2025

    PDF

  • A-Engrossed

    PDF

  • B-Engrossed

    PDF

  • Enrolled

    PDF

  • House Amendments to Introduced

    PDF

  • Introduced

    PDF

  • Senate Amendments to A-Engrossed

    PDF

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