(REPRINTED WITH ADOPTED AMENDMENTS)
FIRST REPRINT


Assembly Bill No. 384-Assemblymen Cegavske, Carpenter, Gustavson, Sandoval, Manendo, Koivisto, Hickey, Hettrick, Anderson, Giunchigliani, Chowning, Mortenson, Lee, Collins, Price, Nolan, Evans, Arberry, Williams, Tiffany, Marvel, Von Tobel, Lambert, Humke, Amodei, Berman, Parks, Herrera, Close, Goldwater, Segerblom, Buckley, Ohrenschall, Bache, Neighbors, Krenzer, Dini, de Braga, Braunlin, Freeman, Ernaut and Perkins

April 18, 1997
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Referred to Committee on Commerce

SUMMARY--Revises provisions governing operation of franchises. (BDR 52-1167)

FISCAL NOTE: Effect on Local Government: No.
Effect on the State or on Industrial Insurance: No.

EXPLANATION - Matter in italics is new; matter in brackets [ ] is material to be omitted.

AN ACT relating to franchises; providing that certain provisions in a franchise agreement, or a document that is ancillary to that agreement, are void; prohibiting a franchisor from restricting the rights of a franchisee to associate with certain persons; and providing other matters properly relating thereto.

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1 Chapter 597 of NRS is hereby amended by adding thereto the provisions set forth as sections 2 to 8, inclusive, of this act.
Sec. 2 As used in sections 2 to 8, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 3, 4 and 5 of this act have the meanings ascribed to them in those sections.
Sec. 3 "Franchise" means an arrangement which is evidenced in an oral or written agreement, express or implied, which:
1. Grants the right to a franchisee to distribute goods or provide services under a marketing plan prescribed or suggested in substantial part by a franchisor.
2. Requires the franchisee to pay a franchise fee to the franchisor or his affiliate.
3. Allows the franchise to be substantially associated with a trade-mark, service mark, trade name, logo, advertisement or other commercial symbol or designation of the franchisor or his affiliate.
Sec. 4 "Franchisee" means a person to whom a franchise is granted.
Sec. 5 "Franchisor" means a person who grants a franchise or an affiliate of such a person.
Sec. 6 1. A provision in a franchise agreement, or a document that is ancillary to a franchise agreement, which:
(a) Restricts jurisdiction or venue to a forum other than this state; or
(b) Requires a dispute to be submitted to arbitration outside this state,
is void.
2. A franchisor and franchisee may, at the time a dispute is submitted to arbitration, agree to conduct the arbitration outside this state.
Sec. 7 A franchisor or any officer, agent or employee of a franchisor shall not:
1. Restrict a franchisee from associating with other franchisees or from forming or participating in a trade association; or
2. Retaliate or discriminate against a franchisee for engaging in such activities.
Sec. 8 The provisions of sections 2 to 8, inclusive, of this act do not:
1. Limit any liability that exists pursuant to any other specific statute or at common law; or
2. Apply to any legal action based on facts which occurred before October 1, 1997, or to any franchise agreement entered into, last amended or renewed before October 1, 1997.

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