CHAPTER 104. RESTRICTIONS ON CHARGES BY MOTOR FUEL FRANCHISORS

BUSINESS AND COMMERCE CODE

TITLE 5. REGULATION OF BUSINESSES AND SERVICES

SUBTITLE C. BUSINESS OPERATIONS

CHAPTER 104. RESTRICTIONS ON CHARGES BY MOTOR FUEL FRANCHISORS

Sec. 104.001. DEFINITIONS. In this chapter:

(1) "Franchise":

(A) includes:

(i) a contract under which a distributor or retailer is

authorized to occupy marketing premises in connection with the

sale, consignment, or distribution of motor fuel under a

trademark owned or controlled by a franchisor-refiner or by a

refiner who supplies motor fuel to a distributor who authorizes

the occupancy;

(ii) a contract relating to the supply of motor fuel to be sold,

consigned, or distributed under a trademark owned or controlled

by a refiner; and

(iii) the unexpired portion of any franchise transferred or

assigned under the franchise provisions or any applicable

provision of state or federal law authorizing the transfer or

assignment regardless of the franchise provisions; and

(B) does not include a contract:

(i) that is made in the distribution of motor fuels through a

card-lock or key-operated pumping system; and

(ii) to which a refiner or producer of the motor fuel is not a

party.

(2) "Franchisee" means a distributor or retailer who is

authorized under a franchise to use a trademark in connection

with the sale, consignment, or distribution of motor fuel.

(3) "Franchisor" means a refiner or distributor who authorizes

under a franchise the use of a trademark in connection with the

sale, consignment, or distribution of motor fuel.

(4) "Motor fuel" includes diesel fuel and gasoline:

(A) delivered to a service station by a franchisor; and

(B) usable as a propellant of a motor vehicle.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 104.002. PROHIBITED FEES, CHARGES, AND DISCOUNTS. (a) For

purposes of this section, wholesale price is computed by adding

to the invoice price or purchase price per gallon charged to a

franchisee who buys motor fuel any excise tax paid by the buyer

and any reasonable freight charges paid by the buyer, and

subtracting that portion of any refund, rebate, or subsidy not

designed to offset the fee, charge, or discount described by this

section.

(b) Except as provided by Subsection (c), a franchisor may not

require a franchisee to pay to the franchisor a fee, charge, or

discount for:

(1) honoring a credit card issued by the franchisor; or

(2) submitting to the franchisor, for payment or credit to the

franchisee's account, documents or other evidence of indebtedness

of the holder of a credit card issued by the franchisor.

(c) A franchisor may require a franchisee to pay the fee,

charge, or discount if the franchisor, in consideration of

competitive prices in the relevant market, has adjusted the

wholesale prices charged or rebates credited to franchisees for

motor fuel by amounts that on average for franchisees in this

state substantially offset the fee, charge, or discount.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 104.003. CIVIL ACTION. (a) A franchisee may bring a civil

action against a franchisor who violates Section 104.002, without

regard to the amount in controversy, in the district court in any

county in which the franchisor or franchisee transacts business.

An action under this section must be commenced and prosecuted not

later than the second anniversary of the date the cause of action

accrues against the franchisor.

(b) The court shall award to a franchisee who prevails in an

action under this section:

(1) the amount of actual damages;

(2) equitable relief as determined by the court to be necessary

to remedy the effects of the franchisor's violation of Section

104.002, including a declaratory judgment, permanent injunctive

relief, and temporary injunctive relief; and

(3) court costs and attorney's fees that are reasonable in

relation to the amount of work expended.

(c) In addition to the remedies provided under Subsection (b),

on finding that the defendant wilfully and knowingly committed

the violation, the trier of fact shall award not more than three

times the amount of actual damages.

(d) In an action under this section, the franchisor has the

burden of establishing the offset described by Section 104.002 as

an affirmative defense.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.