Thursday, July 23, 2009
Trade associations respond to Block Exemption announcement
Plans to extend Block Exemption regulation for another three years has received a warm welcome from motor trade bodies.
The Society of Motor Manufacturers and Traders welcomed the European Commission's announcement which sets out the future legal framework for the sale of vehicles and aftersales services.
From 2013, new car sales and distribution will come under the general competition rules on vertical agreements.
The aftermarket will also be under the general rules, however the EC intends to apply these together with specific guidelines or a Block Exemption specific to the aftermarket.
Paul Everitt, SMMT chief executive said, “The Commission’s statement recognises the importance of a smooth transition of the current regulation and a welcome desire to find the optimum solution for the aftermarket.
“The Commission has recognised the high level of competition in the motor industry and this decision gives much needed reassurance and stability to the market during the current economic difficulties."
Sue Robinson, director of the Retail Motor Industry Federation said the decision enables the industry to continue to lobby for the continuation of a sector specific regulation.
Robinson said such an extension was one of the main subjects the RMIF discussed with the Commission and this positive move shows they listened to the RMIF.
She added: "We will be having further discussions with the commission on the implementation of any future regulation.
"We will be going through the report in detail over the next 24 hours and will be issuing a further statement when all details have been looked at."
John Lewis, chief executive of the British Vehicle Rental and Leasing Association, was pleased the EC had listened to their calls for a specific focus to improve competition in the after sales market.
He said: "It says it will ensure there are sector-specific provisions to prevent the use of agreements linking sales and aftersales services, which distort competition and curtail choice.
“The BVRLA will continue to fight to protect our members’ rights as the economic owner of their vehicles (so-called ‘end user’ status), which ensure they are not forced to provide commercially sensitive details to motor manufacturers.
“We will be formulating our formal response and responding to the EC proposals by 25 September.”
