Region 1 President optimistic on after-market service

Publication date: 13 March 2009

The Block Exemption Regulation forces vehicle manufacturers to disclose repair information on all motor vehicles. Region One President Werner Kraus told European Competition Commissioner Neelie Kroes and other high-level experts that the Regulation is vital for car drivers.

FIA Region 1 President, Werner Kraus was the sole voice representing car drivers at a recent high-level meeting in Brussels to discuss the future of the Motor Vehicle Block Exemption Regulation or “BER” in EU jargon. The complicated EU law regulates across the whole of the European Union, the way in which motor vehicles are distributed for sale, sold and the provision aftermarket services and repairs. It greatly benefits clubs in their provision of road patrol breakdown services. The BER is important for car drivers as it helps to ensure that motor vehicles remain affordable to purchase, maintain and repair thanks to healthy competition. The BER also guarantees that independent operators, including automotive clubs and other roadside assistance operators, have the same access as authorised repairers to information needed to access and re-programme the On-Board Diagnostics (OBD) systems of the vehicle when repairs are carried out. This keeps repair prices competitive.

Werner Kraus represented motoring consumer at the high level meeting organised by the European Commission on 09 February 2009

At the high level group meeting, Werner Kraus surrounded by top executives representing the vehicle manufacturers, parts suppliers, dealers and the after market, stressed key issues on behalf of motoring consumers and the automobile clubs. These included the need to ensure that purchasing, repairing and maintaining motor cars remains affordable, safe and environmentally friendly. He also underlined that if automobile clubs are to guarantee that members will be put back on the road rather than towed when they break down, open access to vehicle manufacturers’ technical information is vital. Affordable access to competitively priced spare parts needed for repair was also underlined.

The BER will, however, expire in 2010, if the Commission does not decide to act otherwise. After a period of opening up, we could even see decreased competition on the repairs market from 2010. Without current legislation, club patrols could be missing accurate repair information and unable to afford the diagnostic tools. “We are concerned that the current momentum at the European Commission for reform of the motor vehicle sector could remove much – valued and helpful sector – specific regulation to the detriment of both consumers and after-market service providers since it is regulation that is not adequately covered elsewhere” Kraus told the business leaders brought together by Competition Commissioner Neelie Kroes.

Stakeholders present at the meeting

Participants at the February meeting included leading figures from various stakeholder groups, including consumers, car manufacturers, dealers, roadside assistance operators and independent repairers. "It is clear that there are divergent views as to whether general or specific rules should apply to the sector, and as to what the content of those rules should be,” admitted Competition Commissioner Kroes. She sees the meeting as having cleared up the key issues. “We will now design our future policy to take account of the contributions from stakeholders, with a view to releasing a Commission Communication on the subject,” Kroes said following the meeting.

“FIA’s support for the Motor Vehicle Block Exemption Regulation stems largely from the essential consumer rights it upholds for consumers wishing to purchase, maintain or repair their vehicle which are not otherwise regulated elsewhere,” Kraus told the meeting. He listed some of those benefits for consumers as the right to buy a vehicle abroad and have it serviced in another country, the right to use independent garages without losing warranty claims and the right to use usually lower-priced non-original replacement parts for non warranty repairs.

Follow up

“If the Regulation expires without replacement of these consumers’ rights, they would not be so comprehensively covered by any other piece of EU legislation” Kraus warned. “Consumers will be left to rely on an unsatisfactory patchwork of legislation that is neither complete nor fully implemented” he said. “We need these essential consumer rights to be fixed in a suitable legal instrument for the benefit of automotive consumers everywhere in the EU. In the current climate of financial uncertainty, we must be able to offer consumers transparency, precise information, affordability and legal certainty if they are to be encouraged resume spending and thereby help to boost our ailing economies,” Kraus continued.

After meeting Commissioner Kroes, Werner Kraus indicated a more positive approach being taken by the Commission with a move away from wanting to simply let the BER passively expire in 2010. That was the position hinted at by top EU officials in a long technical report published in 2008. “Since last year, there appears to have been a change in the minds of those responsible for the issue. If there had been no change, we would not have had this high-level meeting” Kraus said. “I think Commissioner Kroes is aware of the needs of car drivers. If there is strong competition, it is good for car drivers. It is in her interest to get competition. It was also clear that most of the participants in this high level meeting – top executives from the vehicle manufacturers, parts suppliers, dealers and the after market – believe that there is a very real need for sector specific Regulation to be continued after 2010” he added.