STAND. COM. REP. NO.261

Honolulu, Hawaii

, 2003

RE: S.B. No. 1201

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Transportation, Military Affairs and Government Operations, to which was referred S.B. No. 1201 entitled:

"A BILL FOR AN ACT RELATING TO MOTOR VEHICLE FRANCHISES,"

begs leave to report as follows:

The purpose of this measure is to require a license to operate in this State as a motor vehicle distributor or manufacturer.

Testimony in support of this measure was received from the Department of Commerce and Consumer Affairs (DCCA), Motor Vehicle Industry Licensing Board, Big Island Toyota, Inc., Midpac Auto Center, Hawaii Automobile Dealers Association, Orchid Isle Auto Center, and five franchised new car dealers. Comments were received from Ford Motor Company.

This measure applies to motor vehicle distributors the same procedures, protections, rights, and remedies extended to motor vehicle dealers. The problems addressed are the purported coercion of dealers by distributors and manufacturers with regard to business practices, and other acts that inhibit the business of dealers.

Your Committee notes the testimony of the DCCA that motor vehicle manufacturers, factory branches, factory representatives, distributors, distributor branches, and distributor representatives were previously licensed under chapter 437, Hawaii Revised Statutes, but were removed from the law in 1996. Since that time, a number of motor vehicle franchise laws have been enacted on the state and federal levels, such that at the present time there are specific motor vehicle franchise laws in forty-nine other states. Therefore, Hawaii is apparently the only state without such a law.

Your Committee also notes the testimony of Ford Motor Company that it needs more time to come to consensus with the Hawaii Automobile Dealers Association with regard to the language of this measure. Further discussion and consideration is necessary before this measure is enacted.

Accordingly, your Committee has amended this measure by changing the effective date to July 1, 2050.

As affirmed by the record of votes of the members of your Committee on Transportation, Military Affairs and Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1201, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1201, S.D. 1, and be referred to the Committee on Commerce, Consumer Protection and Housing.

Respectfully submitted on behalf of the members of the Committee on Transportation, Military Affairs and Government Operations,

____________________________

CAL KAWAMOTO, Chair