The bill amends Chapter 31-5.1 of the General Laws, which regulates business practices among motor vehicle manufacturers, distributors, and dealers. A significant addition is the new section 31-5.1-4.1, which allows a designated family member of a deceased or incapacitated dealership owner to succeed to ownership, provided they notify the manufacturer, distributor, or factory branch within 120 days and agree to the franchise terms. If a manufacturer, distributor, or factory branch refuses this succession, they must provide written notice of the grounds for refusal within 60 days.

Additionally, section 31-5.1-4.2 introduces requirements for manufacturers, distributors, or factory branches to notify existing dealers about the establishment or relocation of dealerships, allowing for protests against such actions.

The bill also enhances the regulatory framework by ensuring fair compensation for dealers regarding labor and parts related to recalls and warranty repairs, aligning compensation with retail rates. It prohibits manufacturers, distributors, or factory branches from imposing burdensome methods for establishing retail rates and from recovering costs through price increases related to warranty reimbursements.

New obligations for warranty audits and chargebacks are introduced to protect dealers from penalties for minor clerical errors, with established timelines for claim approvals and disapprovals. The provisions aim to ensure equal treatment for all dealers in a market area concerning promotional activities and incentives. The act is set to take effect on October 1, 2026.