Monopoly or a free market in the automotive industry!

26 Aug 2020

A breakthrough moment is coming, as the deadline for changing the regulation limiting monopolistic activities in the automotive industry, commonly known as MV-BER, approaches.

Let us remind that this EU legislation allows for servicing cars that are under warranty in the repair stations selected by drivers. This gives drivers the right to choose and allows independent repairers (IAM) to compete with authorized repairers (OES).

The MV-BER Regulation (the abbreviation comes from the name of the European Commission’s “Motor Vehicle Block Exemption Regulation”, number 461/2010), is a set of rules that ware created to protect and support the automotive market against the monopolistic practices of car manufacturers. Since this regulation only applies to motor vehicles repairs until 31 May 2023, the European Commission is already working on the shape of the next regulation.

– Consultation and subsequent evaluation of the effectiveness of the current rules may yield good results. The provisions of the regulation allow vehicle manufacturers to bypass them on the line between customer and repairer, as well as at the interface between business and automotive parts manufacturers. However, when reviewing the regulations still in force, the most important thing is that the new solutions do not worsen the current situation – adds Alfred Franke, MotoFocus Group expert.

How the intentions of the authors of the regulation work in real life? it’s a separate and sometimes different issue. Car companies have different ways of maintaining a monopoly, and disputes sometimes have to be resolved in court.

The EU Commission considered that fair competition between authorized and independent repairers should be an appropriate solution. This is only possible if two basic conditions are met: that the independent market has access to the technical information necessary for servicing and that spare parts are freely available and usable.

However, one of the changes that the MV-BER has brought about is of major importance. The debate that accompanied the introduction of these regulations years ago has caused changes in the awareness of politicians, and also of millions of drivers. They found out that 80% of the parts of which a newly manufactured car is composed come from independent manufacturers and not from motor vehicle manufacturers.

The terms “original” and “matching quality” parts have therefore acquired a completely new meaning.

Parts of matching quality are provided by the 2010 EU Commission guidelines. For parts to be considered as ”matching quality parts”, their quality must be high enough so that the use of such parts does not endanger the reputation of the vehicle manufacturers’ authorized networks. The burden of providing proof that the parts are not of sufficient quality lies with the vehicle manufacturer or the authorized distributor.

The mere fact of performing service and possible repair of the vehicle during the warranty period by an independent repairer cannot be treated as a loss of warranty. The vehicle manufacturer may refuse to accept the warranty for repairs carried out by an independent repairer, but only if he proves that the repairs were carried out incorrectly, and that this had a direct effect on the failure reported under the warranty.

Please note that in order to maintain the warranty, it is necessary to carry out the repair according as per manufacturer’s Guideline, make an appropriate entry in the service book and document the parts and service purchase bills.

-Unfortunately, MV-BER regulations are not everywhere and always respected. Despite the guidelines in this area, which even indicate the types of parts that can be used for repair, there is no shortage of violations of the MV-BER Regulation in many European countries. Fortunately, many judgments have already been given against illegal practices, although the industry still has a lot to do in this field,” adds Franke.

Depending on the final assessment of the current legislation, expected in May 2021, the European Commission will consider or will not consider to extend the MV-BER Regulation.

This is why it is now so important to present to the public opinion the reprehensible practices that have taken place during the current Regulation. Therefore, in the interest of the free market and fair competition, please send to the editorial office described and documented cases of such reprehensible practices.


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