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<section article="gcl" article_name="Commercial Law" number="11-1301" title_number="11" title_name="Trade Regulation" subtitle_number="13" subtitle_name="Maryland Fair Distributorship Act">
  <level label="a">
    <text>In this subtitle the following words have the meanings indicated.</text>
  </level>
  <level label="b">
    <text>“Agreement” means a contract or other agreement between a grantor and a distributor.</text>
  </level>
  <level label="c">
    <level label="1">
      <text>“Cancel” means to terminate an agreement prior to the natural expiration date of its term.</text>
    </level>
    <level label="2">
      <text>“Cancel” includes a de facto cancellation.</text>
    </level>
  </level>
  <level label="d">
    <text>“Commercial goods” means, as those terms are defined in the wholesale trade section of the 1987 edition of the federal Office of Management and Budget’s Standard Industrial Classification Manual, durable goods, except for:</text>
    <level label="1">
      <text>Motor vehicles and motor vehicle parts and supplies;</text>
    </level>
    <level label="2">
      <text>Furniture;</text>
    </level>
    <level label="3">
      <text>Office equipment, computers, computer peripheral equipment, and software; and</text>
    </level>
    <level label="4">
      <text>Prerecorded tapes, cassettes, film, and videos and books or other similar items for which copyright protection might be available.</text>
    </level>
  </level>
  <level label="e">
    <text>“De facto cancellation” means actions taken by the grantor that:</text>
    <level label="1">
      <text>Materially alter the competitive business and economic conditions of a distributor;</text>
    </level>
    <level label="2">
      <text>Are not applicable to similarly situated distributors of that grantor’s products; and</text>
    </level>
    <level label="3">
      <text>Are intended to be discriminatory and detrimental to the distributor.</text>
    </level>
  </level>
  <level label="f">
    <text>“Deficiency” means the failure of a distributor to comply substantially with the fair, reasonable, and material requirements imposed or sought to be imposed on the distributor by the grantor.</text>
  </level>
  <level label="g">
    <level label="1">
      <text>“Distributor” means a person:</text>
      <level label="i">
        <text>Whose primary business is the wholesale distribution of commercial goods for resale;</text>
      </level>
      <level label="ii">
        <text>Who maintains an inventory of commercial goods for resale;</text>
      </level>
      <level label="iii">
        <text>Who has been granted either expressly or implicitly the right to sell or distribute a grantor’s commercial goods in Maryland for resale to retailers or other resellers or to an industrial or commercial manufacturer; and</text>
      </level>
      <level label="iv">
        <text>Who conducts a substantial business in Maryland.</text>
      </level>
    </level>
    <level label="2">
      <text>“Distributor” does not include:</text>
      <level label="i">
        <text>A sales representative that does not maintain an inventory of commercial goods; or</text>
      </level>
      <level label="ii">
        <text>A direct seller whose work is exempt from covered employment under § 8-206(b) of the Labor and Employment Article.</text>
      </level>
    </level>
  </level>
  <level label="h">
    <text>“Grantor” means a person, including a manufacturer, that grants distribution and sales rights to a distributor.</text>
  </level>
</section>
