{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/46.2-1569.1.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/46.2-1569.1.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/46.2-1569.1.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/46.2-1569.1.html"}],"law_id":57658,"edition_id":1,"section_id":57658,"structure_id":15134,"section_number":"46.2-1569.1","catch_line":"Manufacturer or distributor right of first refusal","history":"1994, c. 809; 2003, c. 298; 2019, cc. 738, 739; 2025, cc. 546, 558.","full_text":"A\n\nNotwithstanding the terms of any franchise agreement, in the event of a proposed sale or transfer of a dealership, the manufacturer or distributor shall be permitted to exercise a right of first refusal to acquire the new vehicle dealer’s assets or ownership, if such sale or transfer is conditioned upon the manufacturer’s or dealer’s entering into a dealer agreement with the proposed new owner or transferee, only if all the following requirements are met:1\n\nTo exercise its right of first refusal, the manufacturer or distributor must notify the dealer in writing within 45 days of its receipt of the notice for the proposed sale or transfer submitted as required by subdivision 3 of § 46.2-1569;2\n\nThe exercise of the right of first refusal will result in the dealer’s and dealer’s owner’s receiving the same or greater consideration as they have contracted to receive in connection with the proposed change of ownership or transfer; and3\n\nThe manufacturer or distributor agrees to pay the reasonable expenses, including attorney’s fees which do not exceed the usual, customary, and reasonable fees charged for similar work done for other clients, incurred by the proposed new owner and transferee prior to the manufacturer’s or distributor’s exercise of its right of first refusal in negotiating and implementing the contract for the proposed sale or transfer of the dealership or dealership assets. Notwithstanding the foregoing, no payment of such expenses and attorney’s fees shall be required if the dealer has not submitted or caused to be submitted an accounting of those expenses within 30 days of the dealer’s receipt of the manufacturer’s or distributor’s written request for such an accounting. Such accounting may be requested by a manufacturer or distributor before exercising its right of first refusal.B\n\nA manufacturer or distributor shall not exercise or enforce a right of first refusal if (i) the proposed sale or transfer is to a dealer licensed in the United States as a dealer holding a franchise from any manufacturer or distributor licensed as a manufacturer or distributor in the Commonwealth unless the manufacturer or distributor has a formal written program to increase the number of minority dealers and a minority dealer will obtain at least 51 percent ownership and control of the dealership’s assets after the exercise of the right of first refusal consistent with subdivision 2 of § 46.2-1572 or (ii) the proposed sale or transfer of the dealership’s assets involves the transfer or sale to a member or members of the family of one or more dealer owners, or to a qualified manager or a partnership, limited liability company, corporation, or other entity controlled by such persons.C\n\nThe provisions of clause (i) of subsection B shall not apply to any manufacturer or distributor, together with any of its parents, subsidiaries or affiliates that as of January 1, 2019, (i) produced or distributed at least 1,000 motor vehicles in the immediately preceding 12 months, at least 51 percent of which had a gross vehicle weight rating of at least 16,000 pounds and (ii) was on January 1, 2019 a party, including that party’s parents, subsidiaries and affiliates, to federal litigation arising from rights and obligations created by § 46.2-1569.1.","order_by":null,"text":{"0":{"id":211231,"text":"Notwithstanding the terms of any franchise agreement, in the event of a proposed sale or transfer of a dealership, the manufacturer or distributor shall be permitted to exercise a right of first refusal to acquire the new vehicle dealer’s assets or ownership, if such sale or transfer is conditioned upon the manufacturer’s or dealer’s entering into a dealer agreement with the proposed new owner or transferee, only if all the following requirements are met:","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"A1"},"1":{"id":211232,"text":"To exercise its right of first refusal, the manufacturer or distributor must notify the dealer in writing within 45 days of its receipt of the notice for the proposed sale or transfer submitted as required by subdivision 3 of § 46.2-1569;","type":"section","prefixes":["A","1"],"prefix":"1","entire_prefix":"A1","prefix_anchor":"A1","level":2,"prior_prefix":"A","next_prefix":"A2"},"2":{"id":211233,"text":"The exercise of the right of first refusal will result in the dealer’s and dealer’s owner’s receiving the same or greater consideration as they have contracted to receive in connection with the proposed change of ownership or transfer; and","type":"section","prefixes":["A","2"],"prefix":"2","entire_prefix":"A2","prefix_anchor":"A2","level":2,"prior_prefix":"A1","next_prefix":"A3"},"3":{"id":211234,"text":"The manufacturer or distributor agrees to pay the reasonable expenses, including attorney’s fees which do not exceed the usual, customary, and reasonable fees charged for similar work done for other clients, incurred by the proposed new owner and transferee prior to the manufacturer’s or distributor’s exercise of its right of first refusal in negotiating and implementing the contract for the proposed sale or transfer of the dealership or dealership assets. Notwithstanding the foregoing, no payment of such expenses and attorney’s fees shall be required if the dealer has not submitted or caused to be submitted an accounting of those expenses within 30 days of the dealer’s receipt of the manufacturer’s or distributor’s written request for such an accounting. Such accounting may be requested by a manufacturer or distributor before exercising its right of first refusal.","type":"section","prefixes":["A","3"],"prefix":"3","entire_prefix":"A3","prefix_anchor":"A3","level":2,"prior_prefix":"A2","next_prefix":"B"},"4":{"id":211235,"text":"A manufacturer or distributor shall not exercise or enforce a right of first refusal if (i) the proposed sale or transfer is to a dealer licensed in the United States as a dealer holding a franchise from any manufacturer or distributor licensed as a manufacturer or distributor in the Commonwealth unless the manufacturer or distributor has a formal written program to increase the number of minority dealers and a minority dealer will obtain at least 51 percent ownership and control of the dealership’s assets after the exercise of the right of first refusal consistent with subdivision 2 of § 46.2-1572 or (ii) the proposed sale or transfer of the dealership’s assets involves the transfer or sale to a member or members of the family of one or more dealer owners, or to a qualified manager or a partnership, limited liability company, corporation, or other entity controlled by such persons.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A3","next_prefix":"C"},"5":{"id":211236,"text":"The provisions of clause (i) of subsection B shall not apply to any manufacturer or distributor, together with any of its parents, subsidiaries or affiliates that as of January 1, 2019, (i) produced or distributed at least 1,000 motor vehicles in the immediately preceding 12 months, at least 51 percent of which had a gross vehicle weight rating of at least 16,000 pounds and (ii) was on January 1, 2019 a party, including that party’s parents, subsidiaries and affiliates, to federal litigation arising from rights and obligations created by § 46.2-1569.1.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B"}},"ancestry":[{"id":15134,"edition_id":1,"name":"Franchises","identifier":"7","label":"article","depth":4,"order_by":1,"parent_id":13356,"metadata":{},"date_created":"2026-06-26 03:52:26","date_modified":"2026-06-26 03:52:26","permalink":{"id":231519,"object_type":"structure","relational_id":15134,"identifier":"7","token":"46.2\/IV\/15\/7","url":"\/46.2\/IV\/15\/7\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13356,"edition_id":1,"name":"Motor Vehicle Dealers","identifier":"15","label":"chapter","depth":3,"order_by":1,"parent_id":13355,"metadata":{},"date_created":"2026-06-26 03:44:42","date_modified":"2026-06-26 03:44:42","permalink":{"id":231067,"object_type":"structure","relational_id":13356,"identifier":"15","token":"46.2\/IV\/15","url":"\/46.2\/IV\/15\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13355,"edition_id":1,"name":"Dealers and Driver Training Schools","identifier":"IV","label":"subtitle","depth":2,"order_by":1,"parent_id":12770,"metadata":{},"date_created":"2026-06-26 03:44:42","date_modified":"2026-06-26 03:44:42","permalink":{"id":231065,"object_type":"structure","relational_id":13355,"identifier":"IV","token":"46.2\/IV","url":"\/46.2\/IV\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12770,"edition_id":1,"name":"Motor Vehicles","identifier":"46.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:52","date_modified":"2026-06-26 03:43:52","permalink":{"id":225289,"object_type":"structure","relational_id":12770,"identifier":"46.2","token":"46.2","url":"\/46.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":81977,"structure_id":15134,"section_number":"46.2-1566","catch_line":"Filing of franchises","url":"\/46.2-1566\/","token":"46.2\/IV\/15\/7\/46.2-1566","metadata":false},{"id":75377,"structure_id":15134,"section_number":"46.2-1567","catch_line":"Exemption of franchises from Retail Franchising Act","url":"\/46.2-1567\/","token":"46.2\/IV\/15\/7\/46.2-1567","metadata":false},{"id":85096,"structure_id":15134,"section_number":"46.2-1568","catch_line":"Coercion of retail dealer by manufacturer or distributor with respect to retail installment sales contracts, extended service contracts or extended maintenance plans, financing, or leasing prohibited; penalty","url":"\/46.2-1568\/","token":"46.2\/IV\/15\/7\/46.2-1568","metadata":false},{"id":74199,"structure_id":15134,"section_number":"46.2-1568.1","catch_line":"Discrimination by manufacturers or distributors prohibited","url":"\/46.2-1568.1\/","token":"46.2\/IV\/15\/7\/46.2-1568.1","metadata":false},{"id":60913,"structure_id":15134,"section_number":"46.2-1569","catch_line":"Other coercion of dealers; transfer, grant, succession to and cancellation of dealer franchises; delivery of vehicles, parts, and accessories","url":"\/46.2-1569\/","token":"46.2\/IV\/15\/7\/46.2-1569","metadata":false},{"id":57658,"structure_id":15134,"section_number":"46.2-1569.1","catch_line":"Manufacturer or distributor right of first refusal","url":"\/46.2-1569.1\/","token":"46.2\/IV\/15\/7\/46.2-1569.1","metadata":false},{"id":85388,"structure_id":15134,"section_number":"46.2-1570","catch_line":"Discontinuation of distributors","url":"\/46.2-1570\/","token":"46.2\/IV\/15\/7\/46.2-1570","metadata":false},{"id":60902,"structure_id":15134,"section_number":"46.2-1571","catch_line":"Recall, warranty, maintenance and sales incentive obligations","url":"\/46.2-1571\/","token":"46.2\/IV\/15\/7\/46.2-1571","metadata":false},{"id":67472,"structure_id":15134,"section_number":"46.2-1572","catch_line":"Operation of dealership by manufacturer","url":"\/46.2-1572\/","token":"46.2\/IV\/15\/7\/46.2-1572","metadata":false},{"id":75339,"structure_id":15134,"section_number":"46.2-1572.1","catch_line":"Ownership of service facilities","url":"\/46.2-1572.1\/","token":"46.2\/IV\/15\/7\/46.2-1572.1","metadata":false},{"id":75995,"structure_id":15134,"section_number":"46.2-1572.2","catch_line":"Mediation of disputes","url":"\/46.2-1572.2\/","token":"46.2\/IV\/15\/7\/46.2-1572.2","metadata":false},{"id":65117,"structure_id":15134,"section_number":"46.2-1572.3","catch_line":"Waiver prohibited","url":"\/46.2-1572.3\/","token":"46.2\/IV\/15\/7\/46.2-1572.3","metadata":false},{"id":74526,"structure_id":15134,"section_number":"46.2-1572.4","catch_line":"Manufacturer or distributor use of performance standards","url":"\/46.2-1572.4\/","token":"46.2\/IV\/15\/7\/46.2-1572.4","metadata":false},{"id":69981,"structure_id":15134,"section_number":"46.2-1573","catch_line":"Hearings and other remedies; civil penalties","url":"\/46.2-1573\/","token":"46.2\/IV\/15\/7\/46.2-1573","metadata":false},{"id":84529,"structure_id":15134,"section_number":"46.2-1573.01","catch_line":"Recovery of attorney's fees","url":"\/46.2-1573.01\/","token":"46.2\/IV\/15\/7\/46.2-1573.01","metadata":false},{"id":67893,"structure_id":15134,"section_number":"46.2-1573.02","catch_line":"Limited right of dealers to sell new motor vehicles following termination of franchise","url":"\/46.2-1573.02\/","token":"46.2\/IV\/15\/7\/46.2-1573.02","metadata":false}],"previous_section":{"id":60913,"structure_id":15134,"section_number":"46.2-1569","catch_line":"Other coercion of dealers; transfer, grant, succession to and cancellation of dealer franchises; delivery of vehicles, parts, and accessories","url":"\/46.2-1569\/","token":"46.2\/IV\/15\/7\/46.2-1569","metadata":false},"next_section":{"id":85388,"structure_id":15134,"section_number":"46.2-1570","catch_line":"Discontinuation of distributors","url":"\/46.2-1570\/","token":"46.2\/IV\/15\/7\/46.2-1570","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/46.2-1569.1\/","history_text":"

This law was first created in 1994. The record of its establishment is cataloged in chapter 809<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. It has been modified 3 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 2003, chapter 298<\/a>; in 2019, chapters 738<\/a> and 739<\/a>; in 2025, chapters 546<\/a> and 558<\/a>.<\/p>","references":[{"id":60913,"section_number":"46.2-1569","catch_line":"Other coercion of dealers; transfer, grant, succession to and cancellation of dealer franchises; delivery of vehicles, parts, and accessories","order_by":null,"url":"\/46.2-1569\/"},{"id":57658,"section_number":"46.2-1569.1","catch_line":"Manufacturer or distributor right of first refusal","order_by":null,"url":"\/46.2-1569.1\/"}],"refers_to":[{"id":60913,"section_number":"46.2-1569","catch_line":"Other coercion of dealers; transfer, grant, succession to and cancellation of dealer franchises; delivery of vehicles, parts, and accessories","order_by":null,"url":"\/46.2-1569\/"},{"id":57658,"section_number":"46.2-1569.1","catch_line":"Manufacturer or distributor right of first refusal","order_by":null,"url":"\/46.2-1569.1\/"},{"id":67472,"section_number":"46.2-1572","catch_line":"Operation of dealership by manufacturer","order_by":null,"url":"\/46.2-1572\/"}],"permalink":{"id":231541,"object_type":"law","relational_id":57658,"identifier":"46.2-1569.1","token":"46.2\/IV\/15\/7\/46.2-1569.1","url":"\/46.2-1569.1\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/46.2-1569.1\/","token":"46.2\/IV\/15\/7\/46.2-1569.1","dublin_core":{"Title":"Manufacturer or distributor right of first refusal","Type":"Text","Format":"text\/html","Identifier":"\u00a7 46.2-1569.1","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> Notwithstanding the terms of any franchise<\/span> agreement, in the event of a proposed sale or transfer of a dealership, the manufacturer<\/span> or distributor<\/span> shall be permitted to exercise a right of first refusal to acquire the new<\/span> vehicle<\/span> dealer<\/span>’s assets<\/span> or ownership, if such sale or transfer is conditioned upon the manufacturer<\/span>’s or dealer<\/span>’s entering into a dealer<\/span> agreement with the proposed new<\/span> owner<\/span> or transferee, only if all the following requirements are met: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> To exercise its right of first refusal, the manufacturer<\/span> or distributor<\/span> must notify the dealer<\/span> in writing within 45 days of its receipt of the notice for the proposed sale or transfer submitted as required by subdivision 3 of § 46.2-1569<\/a>; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> The exercise of the right of first refusal will result in the dealer<\/span>’s and dealer<\/span>’s owner<\/span>’s receiving the same or greater consideration as they have contracted to receive in connection with the proposed change of ownership or transfer; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The manufacturer<\/span> or distributor<\/span> agrees to pay the reasonable expenses, including attorney’s fees which do not exceed the usual, customary, and reasonable fees charged for similar work done for other clients, incurred by the proposed new<\/span> owner<\/span> and transferee prior to the manufacturer<\/span>’s or distributor<\/span>’s exercise of its right of first refusal in negotiating and implementing the contract<\/span> for the proposed sale or transfer of the dealership or dealership assets<\/span>. Notwithstanding the foregoing, no payment of such expenses and attorney’s fees shall be required if the dealer<\/span> has not submitted or caused to be submitted an accounting of those expenses within 30 days of the dealer<\/span>’s receipt of the manufacturer<\/span>’s or distributor<\/span>’s written request for such an accounting. Such accounting may be requested by a manufacturer<\/span> or distributor<\/span> before exercising its right of first refusal. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> A manufacturer<\/span> or distributor<\/span> shall not exercise or enforce a right of first refusal if (i) the proposed sale or transfer is to a dealer<\/span> licensed in the United States as a dealer<\/span> holding a franchise<\/span> from any manufacturer<\/span> or distributor<\/span> licensed as a manufacturer<\/span> or distributor<\/span> in the Commonwealth unless the manufacturer<\/span> or distributor<\/span> has a formal written program to increase the number of minority dealers<\/span> and a minority dealer<\/span> will obtain at least 51 percent ownership and control of the dealership’s assets<\/span> after the exercise of the right of first refusal consistent with subdivision 2 of § 46.2-1572<\/a> or (ii) the proposed sale or transfer of the dealership’s assets<\/span> involves the transfer or sale to a member or members of the family of one or more dealer<\/span> owners<\/span>, or to a qualified manager or a partnership, limited liability company, corporation, or other entity controlled by such persons. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> The provisions of clause (i) of subsection B shall not apply to any manufacturer<\/span> or distributor<\/span>, together with any of its parents, subsidiaries or affiliates<\/span> that as of January 1, 2019, (i) produced or distributed at least 1,000 motor vehicles<\/span> in the immediately preceding 12 months, at least 51 percent of which had a gross vehicle<\/span> weight rating of at least 16,000 pounds and (ii) was on January 1, 2019 a party<\/span>, including that party<\/span>’s parents, subsidiaries and affiliates<\/span>, to federal litigation<\/span> arising from rights and obligations created by § 46.2-1569.1<\/a>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nMANUFACTURER OR DISTRIBUTOR RIGHT OF FIRST REFUSAL (\u00a7 46.2-1569.1)\n\nA. Notwithstanding the terms of any franchise agreement, in the event of a\nproposed sale or transfer of a dealership, the manufacturer or distributor shall\nbe permitted to exercise a right of first refusal to acquire the new vehicle\ndealer’s assets or ownership, if such sale or transfer is conditioned upon\nthe manufacturer’s or dealer’s entering into a dealer agreement with\nthe proposed new owner or transferee, only if all the following requirements are\nmet:\n\n 1. To exercise its right of first refusal, the manufacturer or distributor\n must notify the dealer in writing within 45 days of its receipt of the notice\n for the proposed sale or transfer submitted as required by subdivision 3 of\n § 46.2-1569;\n\n 2. The exercise of the right of first refusal will result in the\n dealer’s and dealer’s owner’s receiving the same or greater\n consideration as they have contracted to receive in connection with the\n proposed change of ownership or transfer; and\n\n 3. The manufacturer or distributor agrees to pay the reasonable expenses,\n including attorney’s fees which do not exceed the usual, customary, and\n reasonable fees charged for similar work done for other clients, incurred by\n the proposed new owner and transferee prior to the manufacturer’s or\n distributor’s exercise of its right of first refusal in negotiating and\n implementing the contract for the proposed sale or transfer of the dealership\n or dealership assets. Notwithstanding the foregoing, no payment of such\n expenses and attorney’s fees shall be required if the dealer has not\n submitted or caused to be submitted an accounting of those expenses within 30\n days of the dealer’s receipt of the manufacturer’s or\n distributor’s written request for such an accounting. Such accounting\n may be requested by a manufacturer or distributor before exercising its right\n of first refusal.\n\nB. A manufacturer or distributor shall not exercise or enforce a right of first\nrefusal if (i) the proposed sale or transfer is to a dealer licensed in the\nUnited States as a dealer holding a franchise from any manufacturer or\ndistributor licensed as a manufacturer or distributor in the Commonwealth unless\nthe manufacturer or distributor has a formal written program to increase the\nnumber of minority dealers and a minority dealer will obtain at least 51 percent\nownership and control of the dealership’s assets after the exercise of the\nright of first refusal consistent with subdivision 2 of § 46.2-1572 or (ii)\nthe proposed sale or transfer of the dealership’s assets involves the\ntransfer or sale to a member or members of the family of one or more dealer\nowners, or to a qualified manager or a partnership, limited liability company,\ncorporation, or other entity controlled by such persons.\n\nC. The provisions of clause (i) of subsection B shall not apply to any\nmanufacturer or distributor, together with any of its parents, subsidiaries or\naffiliates that as of January 1, 2019, (i) produced or distributed at least\n1,000 motor vehicles in the immediately preceding 12 months, at least 51 percent\nof which had a gross vehicle weight rating of at least 16,000 pounds and (ii)\nwas on January 1, 2019 a party, including that party’s parents,\nsubsidiaries and affiliates, to federal litigation arising from rights and\nobligations created by § 46.2-1569.1.\n\nHISTORY: 1994, c. 809; 2003, c. 298; 2019, cc. 738, 739; 2025, cc. 546, 558.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}