GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1993

S	1 

SENATE BILL 343

Short Title:  Amend/Motor Fuel Marketing Act.	(Public)
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Sponsors: Senators Smith, Hunt; and Parnell.
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Referred to:  Judiciary I.
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February 24, 1993

A BILL TO BE ENTITLED
AN ACT TO AMEND THE MOTOR FUEL MARKETING ACT.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 75-81 reads as rewritten:
"§ 75-81.  Definitions.
	 " 	 " 	 " " 	 " " 			 " 	" 	 " 	 " 	 " 	 " 	 " The following definitions apply in this Article:
(1)	Affiliate. – Any person who, other than by means of a franchise, controls, is controlled by, or is under common control with any other person.
(2)	Area of Effective Competition. – The area in which a motor fuel outlet competes with other motor fuel outlets.  It shall be presumed that a motor fuel outlet within three miles of another motor fuel outlet is in competition with that motor fuel outlet.
(3)	Controlled Motor Fuel Outlet. – A motor fuel outlet where a refiner, a refiner's affiliate, or a distributor determines the consumer retail price of motor fuel sold to the public.
(4)	Cost. – The lowest price, less all discounts received, of a grade or blend of motor fuel charged to the wholesale class of trade at the terminal used by the refiner, distributor, or dealer in the normal course of business to obtain the motor fuel in question within five days prior to a sale alleged to be in violation of G.S. 75-82, plus the following expenses directly attributable to the sale of motor fuel at the motor fuel outlet in question:
a.	Transportation expenses, including freight expenses, incurred and not otherwise included in the amount charged for the motor fuel.
b.	Inspection fees incurred and not otherwise included in the amount charged for the motor fuel.
c.	Operating expenses.
	For purposes of determining the lowest price to the wholesale class of trade, the lowest price shall include only those prices offered which resulted in bona fide sales made to independent purchasers not affiliated with the seller.
(5)	Dealer. – A person who purchases motor fuel from a refiner, a distributor, or any other bulk seller of motor fuel for resale to the public at a motor fuel outlet.  A person who owns, operates, or otherwise controls more than two motor fuel outlets shall be deemed a distributor and not a dealer.
(6)	Discount. – A reduction from the posted price, including any rebate and any allowance for payment within a specified time.  A reduction does not include discounts for cash made to the motoring public at motor fuel outlets.
(7)	Distributor. – A person, other than a refiner, who purchases motor fuel in bulk from a refiner or any other bulk seller of motor fuels for distribution through its own motor fuel outlets, for distribution through consignment accounts, for distribution through commercial accounts, for resale to other distributors, or for resale to a dealer.
(8)	Freight. – The per gallon rate at which a third party, unaffiliated petroleum carrier will deliver motor fuel in tank truck quantities.  The per gallon rate shall be established by reference to a published common carrier rate within the particular geographic area.
(9)	Motor Fuel. – A refined or blended petroleum product, including any additives, used for the propulsion of self-propelled motor vehicles.  The term includes 'motor fuel' as defined in G.S. 105-430 and 'fuel' as defined in G.S. 105-449.2.
(10)	Motor Fuel Merchant. – A person who sells motor fuel to the public.
(11)	Motor Fuel Outlet. – A retail facility where motor fuel is sold to the motoring public.
(12)	Operating Expenses. – All expenses directly attributable to the sale of motor fuel at a motor fuel outlet as calculated for the prior fiscal year.  The term includes accounting, advertising, cash shortages, credit, depreciation, inventory, labor, licenses, maintenance, payroll, promotions, property taxes and other operating taxes, refuse removal, rent, repair, supplies, and utilities expenses.  Operating expenses will be allocated to motor fuel sales and sales of other products and services based on the percentage of retail revenue each accounts for at a motor fuel outlet.  (Retail motor fuel revenue divided by total retail revenue equals the percentage of operating expenses attributable to motor fuel.)
(13)	Person. – An individual, a firm, a partnership, an association, a corporation, or any other organization or group acting as a unit.
(14)	Price. – The amount charged by a refiner or distributor for motor fuel, plus motor fuel taxes and less all discounts.
(15)	Refiner. – A person and any affiliate of a person engaged in the production or refining of motor fuel from crude oil, whether the production or refining occurs in this State or elsewhere.
(16)	Sale. – Selling, offering for sale or advertising for sale.
(17)	Wholesale Class of Trade. – The term includes both branded distributors purchasing motor fuel under a federally registered trademark of a refiner and distributors purchasing other motor fuel in bulk for redistribution or resale.  In the event a refiner does not regularly sell to distributors at a given terminal, the term includes dealers."
Sec. 2.  G.S. 75-82 reads as rewritten:
"§ 75-82. belowa 
		(a)	It shall be unlawful for a motor fuel merchant to sell at a motor fuel outlet any grade or blend of motor fuel for less than the cost of that grade or blend of motor fuel, as determined by G.S. 75-81.
(b)	If the method of delivery and the quantity of each delivery of motor fuel to the distributor or dealer and the controlled motor fuel outlet are comparable, it shall be unlawful for:
(1)	A refiner to sell at a controlled motor fuel outlet any grade or blend of motor fuel for less than the highest price charged on that same day by the refiner for that grade or blend of motor fuel to distributors or dealers in the same area of effective competition, plus the refiner's operating expenses at that motor fuel outlet.
(2)	A distributor to sell at a controlled motor fuel outlet any grade or blend of motor fuel for less than the highest price charged on that same day by the distributor for that grade or blend of motor fuel to dealers in the same area of effective competition, plus the distributor's operating expenses at that motor fuel outlet.
(c)	For purposes of this Article, motor fuel cost shall be computed separately for each grade or blend of each motor fuel at each location where the motor fuel is offered for sale.
(d)	Nothing in this Article shall prevent a refiner or distributor from giving volume discounts as long as the offer is made equally to all purchasers in a class of trade."
Sec. 3.  G.S. 75-83 reads as rewritten:
"§ 75-83. Unlawful inducement; civil penalty.
It shall be unlawful to knowingly violate any provision of this Article, or to knowingly induce or attempt to induce a violation of this Article, whether by otherwise lawful or unlawful means. In any action initiated by the Attorney General, anyone found to have violated this provision shall be subject to a civil penalty of up to five thousand dollars ($5,000).  Civil penalties assessed under this section shall be credited to the General Fund."
Sec. 4.  G.S. 75-84 reads as rewritten:
"§ 75-84. Separate offenses; injunctions.
Each act, for a day or part of a day, of selling motor fuel at a retail price in violation of this Article shall constitute a separate offense by the seller.  Upon a proper showing by the Attorney General or his delegate, further violations may be temporarily or permanently enjoined."
Sec. 5.  G.S. 75-85 reads as rewritten:
"§ 75-85. Investigations by Attorney General.
The Attorney General is authorized to investigate any allegation of a violation of this Article made by any person.  If an investigation discloses a violation, the Attorney General may exercise the authority under this Article to seek an injunction and he may also seek civil penalties. If the Attorney General prevails in an action under this Article, he shall recover all costs and reasonable attorneys' fees."
Sec. 6.  G.S. 75-86 reads as rewritten:
"§ 75-86. Enforcement actions.
(a)	Any person who is engaged in the sale of motor fuel for resale or consumption and who is directly or indirectly injured by a violation of this Article may bring an action in the superior court district or set of districts as defined in G.S. 7A-41.1, as the case may be, where the violation is alleged to have occurred. The court shall also grant such equitable relief as is proper, including a declaratory judgment and injunctive relief. Any action under this Article must be brought within three years of the alleged violation. 
(b)	A claimant who prevails in an action brought under this Article may recover any one or more of the following:
(1)	The actual damages suffered by the claimant, including, but not limited to, the difference between the legal price and the actual price charged.
(2)	Threefold the actual damages sustained in the case of a knowing violation of a provision of this Article or a willful disregard of a provision of this Article.
(3)	All costs and reasonable attorneys' fees.
(c)	There shall be a right of trial by jury in any action brought under this act."
Sec. 7.  G.S. 75-88 reads as rewritten:
"§ 75-88. Public disclosure and record keeping.
(a)	A refiner must disclose its prices to the wholesale class of trade, to motor fuel merchants, and to the Attorney General on request.  A refiner must also maintain records of all motor fuel sales at each terminal for a period of three years.
(b)	A motor fuel merchant who sells more than 360,000 gallons of motor fuel at a motor fuel outlet in the prior year must keep the records required under this subsection for that outlet in the subsequent year.  A motor fuel merchant subject to this subsection must maintain a record of its cost for motor fuel and its retail selling price of motor fuel.  The records must be kept for three years."
Sec. 8.  This act becomes effective July 1, 1993, and applies to acts occurring on or after that date.