Dealer Monopoly Outlawed
MOTOR manufacturers used to have a monopoly – backed by European law – which prevented independent repair stations from carrying out work on their vehicles.
But not anymore.
Car makers were able to insist that repairs were carried out by their own dealers or warranties would be invalid.
But not anymore
The EU frowns on firms operating this type of trade restrictive practice and in most industries laws have long been in place to prevent it.
But in the motor trade a Block Exemption regulation allowed the practice to go on.
But not anymore.
In June 2010, new rules came into force abolishing the exemption for the repair and maintenance of vehicles. It does not affect car sales – new cars can still only be sold by main dealers.
To quote from the EU guidelines document below: “These rules aim, in particular, to increase competition in the market for repair and maintenance by improving access for the independent repair and servicing sector to the technical information needed for repairs and by making it easier to use alternative spare parts.”
The following paragraphs give detail on the legislation but to put it in plain English.
You no longer have to pay main dealer prices to repair your car .
EU Motor Vehicle Block Exemption Regulation
Key aspects and current status of the Motor Vehicle Block Exemption Regulation.
EU Motor Vehicle Block Exemption Regulation (EU) 461/2010 (MVBER)
The motor vehicle sector benefits from its own block exemption or ‘safe harbour’ from competition rules for agreements for the distribution and servicing of motor vehicles in the EU where it can be shown that there are efficiency benefits for business and consumers alike.
A revised MVBER ((EU) 461/2010) and accompanying guidelines came into force on 1 June 2010 and apply to repair and maintenance services only. The MVBER is valid until 2023 though the guidelines can be reviewed at anytime by the European Commission
Following public consultation, the European Commission considered that a specific block exemption is no longer warranted for the sale of new cars and commercial vehicles. The Commission has therefore provided for a three year transition period until 2013 during which the previous MVBER ((EC) 1400/2002) will continue to apply. After this transitional period, the general block exemption on vertical distribution agreements ((EU) 330/2010) only will apply to the sale of new cars and commercial vehicles.
An overview of the competition rules relating to agreements between vehicle manufacturers and their authorised dealers, repairers and spare parts distributors for the distribution and servicing of motor vehicles in the EU can be found at the following link:
These rules aim, in particular, to increase competition in the market for repair and maintenance by improving access for the independent repair and servicing sector to the technical information needed for repairs and by making it easier to use alternative spare parts.
The MVBER is directly enforced in the UK by the Office of Fair Trading, (OFT) who has responsibility for the enforcement of competition rules in the UK. The OFT can be approached for advice on any competition related complaint and can advise on any cross border issues.