§ 60-1438.01. Manufacturer or distributor; restrictions with respect to franchises and consumer care or service facilities.
AI-assisted research summary: Manufacturers or distributors are generally barred from owning, operating, or controlling franchises or consumer care/service facilities, with listed exceptions and limited temporary ownership periods.
(1) For purposes of this section, manufacturer or distributor includes (a) a factory representative or a distributor representative or (b) a person who is affiliated with a manufacturer or distributor or who, directly or indirectly through an intermediary, is controlled by, or is under common control with, the manufacturer or distributor. A person is controlled by a manufacturer or distributor if the manufacturer or distributor has the authority directly or indirectly, by law or by agreement of the parties, to direct or influence the management and policies of the person. A franchise agreement with a Nebraska-licensed dealer which conforms to and is subject to the Motor Vehicle Industry Regulation Act is not control for purposes of this section. (2) Except as provided in this section, a manufacturer or distributor shall not directly or indirectly: (a) Own an interest in a franchise, franchisee, or consumer care or service facility, except that a manufacturer or distributor may hold stock in a publicly held franchise, franchisee, or consumer care or service facility so long as the manufacturer or distributor does not by virtue of holding such stock operate or control the franchise, franchisee, or consumer care or service facility; (b) Operate or control a franchise, franchisee, or consumer care or service facility; (c) Act in the capacity of a franchisee or motor vehicle dealer; or (d) Own, operate, or control any consumer care or service facility or perform warranty or nonwarranty work on any vehicle manufactured by such manufacturer or distributor, unless such manufacturer or distributor: (i) Manufactures and distributes electric vehicles; and (ii) Is not nor has ever been a franchisor in this state. (3) A manufacturer or distributor may own an interest in a franchisee or otherwise control a franchise for a period not to exceed twelve months after the date the manufacturer or distributor acquires the franchise if: (a) The person from whom the manufacturer or distributor acquired the franchise was a franchisee; and (b) The franchise is for sale by the manufacturer or distributor. (4) For purposes of broadening the diversity of its franchisees and enhancing opportunities for qualified persons who lack the resources to purchase a franchise outright, but for no other purpose, a manufacturer or distributor may temporarily own an interest in a franchise if the manufacturer's or distributor's participation in the franchise is in a bona fide relationship with a franchisee and the franchisee: (a) Has made a significant investment in the franchise, which investment is subject to loss; (b) Has an ownership interest in the franchise; and (c) Operates the franchise under a plan to acquire full ownership of the franchise within a reasonable time and under reasonable terms and conditions. (5) On a showing of good cause by a manufacturer or distributor, the board may extend the time limit set forth in subsection (3) of this section. An extension may not exceed twelve months. An application for an extension after the first extension is granted is subject to protest by a franchisee of the same line-make whose franchise is located in the same community as the franchise owned or controlled by the manufacturer or distributor. (6) The prohibition in subdivision (2)(b) of this section shall not apply to any manufacturer of manufactured housing or trailers. (7) The prohibitions set forth in subsection (2) of this section shall not apply to a manufacturer that: (a) Does not own or operate more than two such dealers or dealership locations in this state; (b) Owned, operated, or controlled a warranty repair or service facility in this state as of January 1, 2016; (c) Manufactures engines for installation in a motor-driven vehicle with a gross vehicle weight rating of more than sixteen thousand pounds for which motor-driven vehicle evidence of title is required as a condition precedent to registration under the laws of this state, if the manufacturer is not otherwise a manufacturer of motor vehicles; and (d) Provides to dealers on substantially equal terms access to all support for completing repairs, including, but not limited to, parts and assemblies, training and technical service bulletins, and other information concerning repairs that the manufacturer provides to facilities owned, operated, or controlled by the manufacturer. History: Laws 2000, LB 1018, § 3; Laws 2010, LB816, § 84; Laws 2011, LB477, § 10; Laws 2016, LB977, § 27; Laws 2024, LB1200, § 56; Laws 2026, LB972, § 71.