Wednesday, 16 December 2015
European Parliament set to hold inquiry into car industry regulation
Car dealer sued after traded-in pickup ends up in hands of jihadists - Car Dealer Magazine
Unfortunately for the plumber, a photo of the truck in its new existence appeared on the Internet and went viral, resulting in a lot of grief for him and his business in the form of nasty phone calls and the like - as if he would have actually endorsed what had happened. So what did he do? Sued the dealer who took it in part-exchange, on the basis that they should have peeled the decals off. Only in America ...
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Tuesday, 15 December 2015
EU Commission sues Germany over Daimler car coolant - BBC News
Friday, 11 December 2015
Tuesday, 24 November 2015
U.S. delays 'quiet car' rules for hybrids, electric cars | Reuters
According to the National Highway Traffic Safety Administration, the chances of a quiet vehicle being involved in a pedestrian crash are 19 percent higher than a conventional vehicle using an internal combustion engine. The proposal would mean 2,800 fewer pedestrian and cyclist injuries annually, NHTSA reckons. But vehicle manufacturers say the alerts are too loud and complicated, and that they should be required only at lower speeds. NHTSA said in 2013 that it expected the rules to cost the industry some $23 million in the first year, because of the need to add an external waterproof speaker.
Congress passed a law in 2010 requiring NHTSA to finalise the regulations by January 2014. In July NHTSA said they would be ready by November, but now the agency says it will not be able to meet that deadline though it has not elaborated on the reasons for this. The Transportation Department said in a document posted on its website that "additional coordination is necessary."
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Wednesday, 11 November 2015
Licence checking companies report surge in business
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Monday, 19 October 2015
Less than half of countries apply minimum UN car safety standards - Global Ncap
The World Health Organisation (WHO) is calling on governments around the world to apply the UN’s most important vehicle safety regulations. In its 2015 Global Status Report on Road Safety (published 19 October) the WHO reveals “worrying data showing that less than half of countries implement minimum standards” and warns that “Governments have a responsibility to take the steps needed to ensure their citizens have access to safe vehicles”.
Using seven priority vehicle safety standards recommended by Global NCAP, the WHO has carried out a unique survey on how they are currently being applied by governments around the world. The seven standards are from the UN’s World Forum for Harmonisation of Vehicle Regulations and cover seat belts, seat belt anchorages, front and side impact, electronic stability control, pedestrian protection and child seats. The results show that they are being fully applied by only 40 out of a total of 193 UN Member States and overwhelmingly by high-income countries. The Report argues that “there is an urgent need for these minimum vehicle standards to be implemented by every country”.
The WHO is worried that “these standards are notably absent in many of the large middle income countries that are major car manufacturers” now responsible for almost 50% of world passenger car production which reached a record level of 67 million units last year.
For example the WHO shows that the most important crash-worthiness regulations helping to protect occupants withstand front and side impact crashes “are poorly implemented globally”.
According to the report just 49 countries (27%) apply the UN frontal impact test regulation and 47 (26%) apply the side impact test regulation. Again these are predominantly high-income countries. The WHO is concerned that “in the absence of appropriate standards automobile companies are able to sell old designs no longer legal in well-regulated countries. Alternatively, they may “de-specify” life-saving technologies in newer models sold in countries where regulations are weak or non-existent”.
Citing the example of Electronic Stability Control (ESC) the WHO is concerned that global car manufacturers who are required to fit the system in high-income countries “can sell the same model to markets without this life saving technology if the country does not apply the ESC regulation”. To avoid such de-specification of safety technologies the WHO says ESC “should be mandatory in all vehicles”. Noting that the system is also effective in commercial vehicles (such as trucks, coaches and mini-buses) the WHO comments that “there is enormous life-saving potential for this technology across the world’s entire vehicle fleet that has yet to be tapped globally.”
The Status Report also highlights the role of New Car Assessment Programmes (NCAPs) in driving demand for safer cars. WHO says that NCAPs “are highly successful in promoting supply and demand for safer vehicles” and describes the work of the nine different organisations active in safety rating activities around the world. The WHO also spotlights Global NCAP’s support for new programmes in the rapidly motorising regions of Asia and Latin America.
The Status Report confirms that each year 1.25 million people die as a result of road traffic crashes. The WHO notes that the level of fatalities is stabilising but their Director General Dr Margaret Chan is concerned that “the pace of change is too slow”. In a foreword to the report Dr Chan warns “that across many measures, countries have not done enough to implement what we know works. As an example of inadequate policies, Dr Chan includes “vehicles sold in the majority of the world’s countries do not meet minimum safety standards”.
Commenting on the WHO’s Report, David Ward, the Secretary General of Global NCAP said:
“Global NCAP warmly welcomes the WHO’s call for action by governments to apply the most important vehicle safety standards. This is needed to democratise car safety so that car buyers everywhere have access to the same minimum levels of safety.
We also strongly endorse the WHO’s recognition of the life-saving potential of electronic stability control and support their call for its mandatory fitment. This vital crash avoidance system is a key focus of our new #STOPTHECRASH Partnership.
We are also pleased that the WHO recognises the contribution of NCAP’s as catalysts for action to improve vehicle safety supporting the UN’s Global Goals and the target to halve road deaths by 2020”.
Friday, 16 October 2015
Uber is legal in London
Sunday, 11 October 2015
Wednesday, 7 October 2015
DVSA fails to check MOT mileage accuracy | Auto Retail Network
The lack of checks on data capture accuracy at MOT test stations makes it difficult to identify which cars have been clocked. "
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VW SCANDAL: UK owners won't be hit with tax rise - Car Dealer Magazine
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Tuesday, 6 October 2015
US: Supreme court won’t hear dispute over Chrysler dealerships
The Supremes had previously declined to hear Fiat Chrysler's appeal against a ruling reinstating four former dealers. Both cases involve the important question (in the US system) of whether Federal law pre-empts state laws. Bankruptcy law is Federal while dealership laws are state laws.
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Friday, 2 October 2015
Litigation funder backs VW shareholder action | News | Law Society Gazette
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Monday, 21 September 2015
USA: 'Defeat device' recall ordered
Reports (such as the Financial Times's) say that campaign groups have long suspected that defeat devices were being used, but only now has the California Air Resources Board (CARB) detected the volation. It declined to say how it had done so.
In Europe, the testing regime is considered to be outdated and reform is taking place. In the UK, the Committee on Climate Change reported this month that average on-the-road emissions in Europe were about 35 per cent higher than the lab results advertised by manufacturers.
SOUTH KOREA: Hyundai designs leaked
One man has been reportedly been charged with leaking 71 bumper designs, though to whom is not clear. The other people accused were working for subcontractors.
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Sunday, 20 September 2015
Director sentenced to 6 months for criminal cartel - News stories - GOV.UK
The sentencing hearing at Southwark Crown Court followed a criminal cartel investigation by the Competition and Markets Authority (CMA).
Mr Snee, the former Managing Director of Franklin Hodge Industries, had previously pleaded guilty to dishonestly agreeing with others to fix prices, divide up customers and rig bids between 2005 and 2012 in respect of the supply in the UK of galvanised steel tanks for water storage.
The tanks are used to store water for sprinkler systems in buildings.
Mr Snee was arrested in 2012 at the start of an investigation begun by the CMA’s predecessor, the Office of Fair Trading.
Mr Snee cooperated with the investigation and, after pleading guilty to the cartel offence in January 2014, was a witness for the CMA at the subsequent trial of two further individuals, who were acquitted in June. As is usual in such cases, the extent of Mr Snee’s cooperation was reported to the trial judge in order that it could be taken into account in his sentencing decision.
In explaining the approach to sentencing, His Honour Judge Goymer remarked that “the economic damage done by cartels is such that those involved must expect prison sentences”.
The judge indicated that his starting point in this case was that a prison sentence of 2 years was appropriate. Taking into account Mr Snee’s early guilty plea, his personal mitigation and the extent of his voluntary cooperation as a witness, the Judge reduced his sentence by the “higher end” discount of 75%, and concluded that it was appropriate in the circumstances of this case for the resulting 6 month sentence to be suspended."
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Thursday, 3 September 2015
Volkswagen must sell shares in Suzuki, court decides
The decision, by the International Court of Arbitration of the International Chamber of Commerce in London, was announced by Suzuki [on 30 August] in a filing to the Tokyo Stock Exchange."
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Calif. dealers call Tesla referral deal illegal
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Suit against major car manufacturers alleging that keyless ignitions are deadly carbon monoxide hazards (CL&P Blog)
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Sunday, 23 August 2015
Dealers facing 'imminent HMRC crackdown' over demonstrators - Car Dealer Magazine
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Aftermarket unites to fight government's four-year MOT proposal - Car Dealer Magazine
The Automotive Aftermarket Liaison Group (AALG) discussed how to best fight the proposition and defend the UK’s impeccable safety record."
28 July
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‘Urgent’ structural review of English civil courts commissioned
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Stefan Quandt seeks to avoid forced BMW takeover bid
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Leaving the EU—impact on case law and legislation
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German prosecutors drop case against Porsche board
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VW faces NHTSA probe after Takata airbag incident
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Trade union GMB takes on taxi app provider Uber over driver rights and terms
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Have you been affected by MOT meltdown? Have your say in our forum - Car Dealer Magazine
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Sunday, 16 August 2015
Interim injunction granted in abuse of dominant position case
The Enterprise and Regulatory Reform Act 2013 amended section 35 of the Competition Act 1998, lowering the standard of proof for the granting of an interim injunction from “significant damage” to “serious, irreparable harm”.
Packet Media accused Telefonica (which operates the O2 network in the UK) of abusing their dominant position in the wholesale provision of access to call and SMS text origination. Packet Media relied on O2 providing and supporting their SIM cards, which enabled Packet Media to offer customers a low cost GSM gateway for calls and text messages. When O2 threatened to suspend this service, Packet Media sought an interim injunction in the High Court. They succeeded on the basis that Telefonica had a case to answer for a possible abuse of dominance, in breach of Part II of the Competition Act 1998.
Unusually, this is a ‘stand-alone’ case: there has been no earlier finding (for example, by the CMA or European Commission) that an abuse had been committed. Packet Media will have a harder job securing a permanent injunction, which will require it to prove fault. But at least it has shown that the amended law on interim injunctions can be helpful to smaller players who depend on large suppliers.
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Thursday, 13 August 2015
USA: TrueCar says it considers U.S. antitrust probe to be closed | Reuters
Read the report here.
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Wednesday, 12 August 2015
New consumer ombudsman to handle car complaints | Auto Express
Clearly, to be credible, an organisation like this needs good links with the sectors where the complaints come from. It has sound-looking credentials in utilities areas, and also in copyright licensing, and the website suggests (without as far as I can see stating it expressly) that they have the approval or regulatory bodies. It will be interesting to see who in the motor sector has given approval to the new service.
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USA: TrueCar hit with another dealer lawsuit
Dealers facing 'imminent HMRC crackdown' over demonstrators - Car Dealer Magazine
Read more here.
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Tuesday, 11 August 2015
Law firm calls for Calais fines to be waived as hauliers face £4m bill
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Stefan Quandt seeks exemption from BMW takeover offer
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Motoring law: Hundreds of drivers lose licence following increased police powers for roadside eye tests - Find Laws, Legal Information, News & Solicitors - Findlaw UK
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Monday, 10 August 2015
So.. is jailed car dealer planning The Great Escape? - Car Dealer Magazine
More importantly, the dealer in question had sold a Nissan Terrano for £1,400. The Birmingham Mail reports. It was badly corroded and potentially dangerous (aren't all vehicles potentially dangerous, depending on what the driver does with them?). He was sent down for 5 months.
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Thursday, 6 August 2015
UK car dealers back EU proposals to ban mileage correction firms
UK car dealers are backing EU proposals to introduce legislation outlawing mileage correction firms by May 2018.
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Wednesday, 5 August 2015
Chrysler Hit with Class-Action Lawsuit in Wake of Jeep Hack
There's more to read if you follow the link - what I have quoted should qualify as fair dealing ...
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Tuesday, 28 July 2015
Monday, 27 July 2015
Ford, IBM defeat appeal over apartheid abuses -U.S. court | Reuters
The latest judgment was an appeal court decision, and an appeal to the Supreme Court is under consideration.
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Sunday, 26 July 2015
US: Fiat Chrysler to face $105m record fine over recall failure - FT.com
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The benefits of TTIP to the industry - from the US side
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Friday, 24 July 2015
US: FCA recalls 1.4 million vehicles to install anti-hacking software
Many times I have looked at computer contracts with slight amusement where they obediently (as required by the Unfair Contract Terms Act) exclude from any limitations on liability defects attributable to their negligence that cause death or personal injury. Nowadays, software is perfectly capable of producing those results.
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Thursday, 23 July 2015
Wednesday, 22 July 2015
Monday, 20 July 2015
Citizens Advice impact truly remarkable | Citizens Advice blog
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BMW settles suit over demo vehicle warranties
The case was settled by mediation, with BMW agreeing to extend the warranty for three months and to reimburse customers who had to pay for repair costs which would have been covered.
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Sunday, 19 July 2015
Volvo Cars North American Introduces "Pay Once and Never Pay Again" Lifetime Parts & Labor Warranty
The closest I have found to this new idea is Vauxhall's lifetime warranty, which was on the car rather than parts (though obviously they got covered too) - but that has apparently been discontinued, and in any case only protected the first owner (so, a very narrow definition of "lifetime"). Volvo Cars of North America Media Newsroom say in their press release:
Volvo Cars of North America will now offer a lifetime parts and labor warranty for all Volvo vehicles serviced after the factory warranty at any Volvo retailer. Volvo customers can expect to pay once and never pay again for replacement Volvo parts and labor, excluding accessories and wear items, for as long as they own their car.A pretty obvious way to drive business to authorised workshops, but perhaps a rather expensive one. Let's see how long it lasts, and whether anyone else imitates it. Commentators in the US appear to think that it's what Volvo need to do to address some quality problems they have had in recent years ...
This addition to the Volvo Service Advantage program is part of the company’s definition of premium service, a philosophy that is designed around the customer’s needs and lifetime love of Volvo Cars. All Volvo owners can expect to receive the premium service experience when servicing at their local Volvo retailer. In addition to the lifetime parts and labor warranty, customers will receive free software updates, complimentary diagnostics, personal service, alternative transportation and a complimentary car wash.
“We look forward to redefining the way manufacturers service and support their vehicles” says Scott Doering, Vice President of Customer Service, Volvo Cars of North America, “the lifetime parts and labor warranty is a best in class offer from a luxury automaker.”
All Volvo owners are invited to experience this new definition of luxury service at their local Volvo retailer. All Volvo models are eligible for the Volvo Service Advantage program and the new lifetime parts and labor warranty.
“The lifetime parts and labor warranty is a commitment to both quality vehicles and quality customer relationships,” says Lex Kerssemakers, President and CEO of Volvo Cars of North America, “everyone should feel confident that Volvo is here to support our customers throughout the ownership of their vehicle.”
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New car-buying website - how will it affect dealers?
Bemoaning the fact that the Internet has never taken off as a platform for selling new cars, while for second-hand cars it it suggests that the Internet is very widely-used, the FT mentions the deterrent effect of the 14-day cooling-off period for distance selling transactions. Given the enormous drop in value of a car the instant it is first registered, then driven away from the dealer's premises, this is more than a deterrent: it must be almost a complete block. Add to that the fact that people still, rather quaintly, like to look at cars, sit in them, and take test drives - none of these matters for which the Internet is well-adapted - and I think you have your reason. That's not to say that online sales will never take off, just that they will remain a small proportion, for the time being at least.
Anyway, even for second-hand cars it must be true to say that the Internet is used as an advertising medium rather than an e-commerce platform, and on that basis the new-car market isn't far behind. The FT article notes other changes in the market, citing "Apple-style" outlets where consumers can look at the cars and engage with non-sales staff to learn about them before buying online (thus creating the distance-selling problems that dealers are understandably worried about).
The dealer system as we know it might be a long way from perfect, and there are surely more efficient ways to get cars to buyers, but it still seems to be the best choice for a way to handle new car sales. Will Carwow make much difference? Actually, it looks as if it might help the present dealer network model, perhaps even giving it a boost which will help it to stave off a shift towards full e-commerce. So long, of course, as it doesn't get too carried away like TrueCar in the States.
* The FT is usually a model of sober reporting, but the headline-writer has got a bit carried away here, like his or her predecessor (it can't have been the same person, it's too long ago, 30 years to be precise) who headed an editorial comment on the block exemption "Feather beds on wheels". Obviously very memorable, if it has stuck this long in mine!
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Saturday, 18 July 2015
Friday, 17 July 2015
Rescission or damages in a misrep case?
The car suffered from a classic congeries of small defects, and a year after buying it the owner purported to reject it, later issuing proceedings and taking it off the road. In May 2011 - a couple of years after proceedings were issued, and nearly 4 years after the purchase - Stratstone disclosed documents that revealed that the car had not been new when sold, and the claimant amended his claim accordingly. The district judge decided that he could not order rescission under the Misrepresentation Act 1967, because the parties could not be restored to their original position: there had been too much use of the car, and too much time had elapsed. He also took into account that the car could not be restored to unregistered condition, which seems a rather unrealistic condition to apply: it would surely make rescission unavailable in any new car case. He awarded damages, based on the value of the car at the time of the sale and the sale price. HHJ Charles Harris, to whom the first appeal went, differed from this assessment and ordered rescission. (He also awarded the claimant his costs, later amending the award so costs were to be on a more generous indemnity basis because the claimant had offered to accept £4000 in settlement.)
On appeal to the Court of Appeal, it was noted that the question of whether section 2(1) of the 1967 Act was available at all if there were a bar to rescission was "open" at the CA level - there were authorities both ways. The court concluded that the correct view was that if rescission were not available, damages could not be awarded because they were in lieu of rescission: and in lieu of nothing must mean nothing (my words, not the court's, but you see what I mean). The Court of Appeal held that restitution was indeed possible and therefore rescission was the appropriate remedy, that damages could not adequately compensate the claimant, and that the delay was not a problem especially as it was only on disclosure that the nature of the claim became clear. All of which seems to make good sense, unfortunately for Stratstone whose employee had made such an optimistic claim about the car in the first place. It points to a need for training and caution more than anything else.
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Wednesday, 15 July 2015
Honda's U.S. auto finance arm to pay $24 million over loan pricing problems | Reuters
This has been a controversial matter for some time, and the size of the penalty surely indicates that the authorities consider this behaviour unacceptable.
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TVR Automotive v OHMI - TVR Italia (TVR ITALIA) (Judgment) [2015] EUECJ T-398/13 (15 July 2015)
The true successor to TVR's business opposed the application, and the Italian company demanded evidence of use. The opposition was rejected in relation to the goods for which use had been shown - which was not all the goods in the application, but it was the important ones. The Italian company appealed, and then filed for revocation. The appeal was stayed while that was sorted out. The Cancellation Division rejected the application for revocation on the grounds that genuine use had been shown, and the Italian company appealed against that, but out of time so the opposition proceedings then went ahead: the appeal was upheld, on the basis that genuine use from 28 January 2003 to 27 January 2008 had not been proved.
The case was based on the non-use of the TVR trade mark, although there appears to be no allegation that such non-use had lasted for five years: and in any case one of the trade marks involved had not even been registered for five years at the time. It received short shrift from the Court, which took a rather different view of what constitutes "genuine use" in relation to specialised, low-volume motor cars, making me wonder how the case ever got to Luxembourg in the first place.
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BVRLA calls for emergency braking action as safety rises up fleet agenda
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USA: contract dispute between Autonation and Truecar
Tuesday, 14 July 2015
1954 Ferrari Racer Pits Lingerie Tycoon Against Bonhams - Bloomberg Business
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Bodyshop fined by HSE for failure to comply with improvement notices
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CMA to review New Cars Order
Responses should be received by 5pm on Friday 28 August 2015, by email or in writing to:
Review of monopoly remedies
Competition and Markets Authority
7 th Floor North Victoria House
37 Southampton Row
London WC1B 4AD
Email: remedies.reviews@cma.gsi.gov.uk.
Let them know how you feel about it!
Thursday, 9 July 2015
New law to make complaints against car manufacturers easier | Auto Express
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Wednesday, 8 July 2015
AA welcomes move to simplify insurance legislation - Car Dealer Magazine
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US: Michigan Chevy store wins dispute with customer over $10,000 down payment
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Budget 2015: Vehicle Excise Duty reform for new cars - BBC News
Read the SMMT's take here. They express 'considerable concern' about the changes.
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France to unify electric vehicle-charging networks-paper | Reuters
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NFDA's dispute and resolution service receives accreditation - Car Dealer Magazine
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More than 10 million illegal tyres on British roads
"More than a quarter of drivers had an illegal tyre on their vehicle at the time they were replaced, according to results from a survey conducted by TyreSafe in partnership with Highways England."
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Transport Secretary signs new Uninsured Drivers’ Agreement
Agreement which will come into force for accidents occurring on or after 1 August 2015.
The 1999 Uninsured Drivers’ Agreement and prior Agreements still continue to be in force for accidents
occurring before 1 August 2015. The new one simplifies the arrangement and aligns it with EU law. The press release goes on:
The Uninsured Drivers’ Agreement provides a framework within which the MIB provides compensation
to innocent victims of accidents with uninsured drivers in Great Britain. The Agreement is made with
the Secretary of State for Transport and is reviewed periodically to incorporate any necessary changes.
The current Uninsured Drivers’ Agreement has been in operation for the past 16 years. A review was
carried out in partnership with the Department for Transport (DfT), which conducted a consultation in
2013 with a range of claimant and insurer stakeholders. The new Agreement now reflects:
Changes to domestic and EU law
Developments in case law
Changes in MIB working practices
A simplification or deletion of some clauses
Some of the principal changes are:
Simplified notice provisions, involving the mandatory joinder of MIB into proceedings as a
named party from the outset.
The passenger knowledge exclusions have been amended in several ways:
o The current wording “ought to have known” has been replaced by “had reason to
believe”. This better reflects the legal position following White v White and also follows
the wording in the Road Traffic Act 1988.
o The exclusion relating to passenger knowledge of use in furtherance of a crime is
deleted as a result of Delaney v Secretary of State 2015. In addition, the related clause dealing with knowledge of escaping from or avoiding lawful apprehension is also
removed.
The formal incorporation of the £1m property damage limit from the Supplementary
Agreement, together with wording as to how to apply the limit, if claims are received from an
accident which total more than the limit.
In the clause dealing with “other sources of recovery”, not only are true subrogated claims
excluded, but also claims where the claimant has other sources of redress available to him. If,
for example, the claimant has a comprehensive insurance policy available to cover the cost of
repair to his vehicle, then MIB will not be able to pay that cost.
The Agreement has been extended to recognise the common practise of settlement of a
claimants claim using a form of assignment.
Ashton West, Chief Executive at MIB commentated: “Following on from the review various changes and
improvements were made and the new Agreement is now easier to understand and better reflects the
world we live in today. Obviously there have been a myriad of changes over the past 16 years, in
particular to domestic and EU law. What hasn’t changed though is our promise to deliver a prompt,
open and fair service to everyone we deal with.
“We are now turning our attention to completing the review of the Untraced Agreement and working
with the DfT to produce a new text. In the meantime, a Supplementary Agreement comes into force for
accidents on or after 1 August 2015. This harmonises the two Agreements in relation to the issues dealt
with by the Delaney case, and also in respect of ‘other sources of recovery’.”
The supplementary Untraced Agreement, the new Uninsured Agreement, Notes for Guidance and a
Correlation Table easily highlighting the differences between the 1999 and new Agreement can be
found on the MIB’s website at www.mib.org.uk. The Government’s response to the consultation can be
found at www.gov.uk/government/consultations/review-of-the-uninsured-and-untraced-driversagreements
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Brazil watchdog names Takata, Autoliv in price-fixing probe | Reuters
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Monday, 6 July 2015
Chinese copies: now it's Porsche Macan - Automotive World
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Thursday, 2 July 2015
BMW v Deenik appears on BAILII after 16 years
Volume 14 number 10
Tuesday, 30 June 2015
Government considers targeting hands-free phone use
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Saturday, 27 June 2015
Ford can pursue lawsuit after Explorers wound up in China
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Thursday, 25 June 2015
German cartel office says fines automotive suppliers 75 mln eur | Reuters
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European Commission - PRESS RELEASES - Press release - Fighting cartels - Commission sanctions retail food packaging cartel and sends Statement of Objections in suspected car battery recycling cartel
The statements of objections allege that, from 2009 to 2012, these five companies agreed on prices for scrap lead-acid batteries in Germany, France, the Netherlands, and Belgium.
Unlike in most cartels where companies usually conspire to increase their sales prices, the companies in this case appear to have colluded to reduce their purchase prices.
This may seem like desirable outcome, as the companies' purpose was to cut input prices and to reduce price volatility. However, the preliminary conclusion of our investigation is that the main goal of the cartel members was in fact simply to maintain higher profit margins. The cartel members may have lowered the prices paid to scrap dealers, many of which are small and medium-sized companies. This would then feed through in lower prices for used batteries sold for scrap, ultimately to the detriment of sellers.
The result, the Commission alleges, was the same as in any price-fixing cartel: disrupting the normal functioning of the market and preventing competition on price.
Artificially fixing the price of lead from recycled batteries, as the Commission suspects, is a very serious matter because it interferes with the effective functioning of the recycling market.
Around 80% of lead scrap comes from waste lead-acid car batteries and practically all car batteries undergo recycling at their end of life. Recycling companies process the batteries in various steps to produce pure lead or lead alloys, most of which is used for making new car batteries.
The concept of the ‘circular economy’ refers to re-using, repairing, refurbishing and recycling existing materials and products. Car battery recycling essentially functions in a closed-loop cycle but the behaviour of these companies would interfere with this loop and affect the circular economy.
If the existence of the cartel were to be confirmed, putting an end to such price fixing would make the market for recycling lead from car batteries more efficient.
The parties now have the opportunity to reply to the Commission's allegations in the statement of objections.""
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Ireland: FTA backs Supreme Court motor tax appeal
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CMA statement following completion of criminal cartel prosecution - News stories - GOV.UK
One defendant had already pleaded guilty, so on the face of it there was a cartel with one member ... Actually the way the law works, the better view (nay, the correct view) is that there was a cartel with at least three members but only one of them was going about price-fixing, market-sharing and bid-rigging dishonestly. No, I don't understand either, and perhaps that change in the law is not as nonsensical as it looks. Or, at least, a one-person cartel is a bigger nonsense than an offence with no requirement for dishonesty, and perhaps price-fixing etc are simply not activities that can be undertaken honestly - though what about "crisis cartels" which have been permissible under general competition rules? The dishonesty requirement would have been a get-out for a crisis cartel, but now that helpful safety valve has been closed.
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Tuesday, 23 June 2015
Spain: CNMC penalises price-fixing cartel (with more still to come)
In the present decision, the CNMC identified seven different geographical cartels involving the three marques. Their illegal conduct included fixing maximum rebates and commercial conditions, and exchanging sensitive information. There were also enforcement mechanisms, imposing sanctions on dealers who failed to stick to the cartel rules: two firms of consultants who were involved in imposing sanctions and collecting 'fines' were also penalised.
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New online vehicle recall search tool to help motorists - SMMT
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In California, Uber driver is employee, not contractor: agency | Reuters
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CMA acts to maintain trust in online reviews and endorsements
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First ever motorist convicted for 'lane hogging' - Crime - UK - The Independent
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Friday, 19 June 2015
Another trip down memory lane: Richard Cound v BMW, Clover Leaf Cars v BMW
While I am on the topic of old law which we should not forget (a couple of weeks ago it was the Supply of New Cars Order), I thought it worth mentioning these two important Court of Appeal cases on the block exemption. The first one, that is, but potentially still relevant. The trouble is I don't have complete reports, but on the basis that something is better than nothing and I want to have a readily-accessible note of the cases I thought it worth writing as much as I could here.
Richard Cound Ltd v BMW (GB) Ltd [1997] Eu. L.R. 301 was decided on 10 May 1995. The judges in the Court of Appeal were Balcombe LJ, Pill LJ, and Sir Roger Parker. Clover Leaf Cars Ltd v BMW (GB) Ltd [1997] Eu LR 53 was decided in the Court of Appeal (Staughton LJ and Thorpe J) on 28 December 1995 (and at first instance in the Chancery Division, apparently on 20 December that year, by Rattee J). Given that the termination of the dealer agreement in the second case was to take effect on 31 December, one can see perhaps why the courts dealt with it so urgently. (I don't at present have information about the situation in the Cound case, but as I recall the same facts applied - BMW terminated the agreement from 31 December 1995 - but the case was brought a bit more promptly.) In the Clover Leaf case, and (subject to confirmation) in Cound too I think, the key fact was that the dealer had been taken over by a PLC and BMW did not want too many of them in its network, so it gave (as it was entitled to do) 12 months' notice.
In each case, the important matter was not really whether the restrictions in the agreement on ownership were prohibited by Article 85(1) (as was, and in my mind often still is) and, if so, exempted by Regulation 123/85: the manufacturer's freedom to terminate without having to state a cause (to terminate for convenience) on 12 months' notice was enough to make the termination lawful. What was really interesting was the contention by the plaintiffs that the allegedly prohibited and therefore void provisions of the contract could be severed and the rest of the contract enforced without them. The court held that the issue of severance was governed by English law, following Chemidus Wavin Ltd v Societe pour la Transformation et l'Exploitation des Resines Industrielles SA [1978] 3 C.M.L.R. 514. The judge in Cound had been right to conclude that the effect of severance would have been to alter the character of the agreement and that the agreement did not permit the excision of void terms such as to alter its scope and intention entirely: Hinton & Higgs (UK) Ltd v Murphy 1988 S.C. 353. In Clover Leaf, the court was able to follow the judgment in the earlier Cound case.
Also noteworthy, I think, is the court's holding (in both cases) that the termination was to be viewed as unilateral conduct by the manufacturer, not as something that constituted an agreement.
Consumer Prepayments on Retailer Insolvency - Law Commission
"In a consultation paper published on 18 June 2015, the Law Commission considers whether prepaying consumers should be better protected in the event of company insolvency, either through improved voluntary mechanisms or required by law."
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Wednesday, 17 June 2015
London Taxi Maker Cries Foul Over Rival’s Green Cab Designs - Bloomberg Business
So far there appears only to have been a preliminary hearing, The London Taxi Corporation Ltd. v. Frazer Nash Research Ltd. & Anr, High Court of Justice, Chancery Division, HC14B01502. (It turns out, now that the judgment is available - see below - that it was an application relating to survey evidence, which the judge Spearman J was not inclined to allow.) Bloomberg reports that London Taxi alleges that Metrocab "breaches its trademarks", which they would not have written had they paid attention. The verb is "infringe" not "breach" and trade mark is two words ... But London Taxi Corporation has several registered trade marks covering the shape and appearance of their product (for example this one), so potentially there is infringement. Are the trade marks vulnerable to attack on the grounds that the design is generic, I wonder? And is the Metrocab similar enough for there to be a likelihood of confusion? It certainly looks significantly different to me, but I might not be an average user of London cabs.
Update: The London Taxi Corporation Ltd (t/a the London Taxi Company) v Frazer-Nash Research Ltd & Anor [2015] EWHC 1840 (Ch) (03 July 2015)
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Trading Standards sting leaves Halfords Autocentre site with £32,000 fine
Nothing new there: in fact, even the story is rather old because the sting took place in March last year and has taken this long to get to court - where Halfords unsurprisingly pleaded guilty. They also argued (though it doesn't help, except in the media I suppose) that their technician picked up a couple of faults (unspecified in the report) that Trading Standards hadn't been aware of, and that the faults that the technician missed were not "overtly dangerous". (Surely it's the "covertly dangerous" ones that are worst anyway?) The court was told that the missed faults (brake fluid level, missing or broken bulbs, faulty windscreen wipers, oil leaks, irregular tyre pressures) should all have been picked up during the "major service": and of course understanding what is and what is not included, and the garage's duty to go beyond what might be on the menu, is key to getting it right.
It does seem to me that there ought to be better ways to go about putting these things right. The defendant here was not a railway arch operation, although by the same token one might say that the consumer should be able to expect more of Halfords than the guy under the arch. Perhaps the most important lesson is the damage that one unreliable employee can cause to a respectable business.
Postscript: Auto Express adds to the story that two other garages hit in the same operation did significantly better, though quite properly we are not told their identities as they seem to have done well enough to avoid prosecution. The trading standards department identified three garages which seemed from their data and that of the old OFT to be disproportionately complained about.
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15 June 2015: Patents: Has Tesla Motors changed down a gear? - Reddie & Grose LLP
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USA: N.Y. targets dealerships' sale of credit-repair, identity-theft products
"High-volume New York dealership Paragon Honda and its two sister stores have agreed to a $13.5 million settlement with the New York attorney general’s office over the alleged unlawful sale of credit-repair and identity-theft prevention products."'via Blog this'
Ford's Patent Announcement Not so Groundbreaking | DuetsBlog
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Sunday, 14 June 2015
PCP clocking rise | Auto Retail Network
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Friday, 12 June 2015
Supreme Court holds against VAT scheme
As Lord Sumption remarked, it is a very technical matter, so I take that as reason enough not to do more than reproduce the Supreme Court's Press Summary here ...
BACKGROUND TO THE APPEAL
Normally, when a car distributor buys a demonstrator car from the manufacturer, it pays VAT on the full wholesale price (“input tax”). Then, when it eventually sells the car to a customer, it collects VAT on the full retail price (“output tax”). It accounts to HMRC for the output tax it has collected less the input tax it has paid. The Pendragon Group, the largest car sales group in Europe, used a scheme devised by KPMG to reduce its VAT liability on two occasions in late 2000 and early 2001. The KPMG scheme exploited three exceptions to the normal incidence of VAT so that Pendragon would only have to account for VAT in respect of the difference between the wholesale purchase price and the retail sale price of its demonstrator cars. The scheme worked as follows.
Step 1: Pendragon bought cars from a wholesaler, then sold them to four captive leasing companies (“CLCs”). Pendragon paid input tax on the wholesale purchase price but recovered it by accounting for output tax received when the cars were sold to the CLCs.
Step 2: The CLCs immediately leased the cars to Pendragon dealerships. The CLCs paid input tax on the purchase of the cars from Pendragon but recovered it by accounting for output tax paid by the Pendragon dealerships on their rental payments under the leases.
Step 3: The CLCs then assigned the leases and their title in the cars to the offshore bank Soc Gen Jersey (“SGJ”). They received approximately £20m (financed by SG London, which received a further assignment of the assets as security). The assignment to an offshore bank was not a supply for VAT purposes and so no VAT was payable.
Step 4: Some 30 to 45 days later, SGJ transferred as a going concern the lease agreements and title in the cars to Captive Co 5. It also sold as a business the hire of cars said to have been carried on by SGJ. The total consideration exceeded £18m, with £100,000 in respect of goodwill. The sale of the business as a going concern was not a supply for VAT purposes and so no VAT was payable.
Step 5: The demonstrator cars were sold to customers by the dealerships, acting as agents for Captive Co 5. Customers paid VAT only on Captive Co 5’s profit on the sale, rather than on the total sale price, under the “profit margin” scheme, which is available under domestic law where the goods were acquired as part of a business transferred as a going concern.
It is common ground that the scheme technically worked, in that the transactions at steps 3 and 4 satisfied the conditions for exemption from VAT, and the transaction at step 5 satisfied the conditions for the application of the margin scheme. However, VAT is an EU tax (governed at the time by the Sixth Directive) and subject to the EU law principle of abuse of law. The First Tier Tribunal held that the scheme was not abusive. The Upper Tier Tribunal held that it was. The Court of Appeal restored the decision of the First Tier Tribunal. HMRC now appeals to the Supreme Court. It argues that the scheme was abusive and that Pendragon should have to pay to it the VAT avoided under the scheme.
JUDGMENTS
The Supreme Court unanimously allows the appeal and holds that the scheme was abusive. Lord Sumption, with whom all members of the Court agree, gives the leading judgment. Lord Carnwath adds further comments on the role of the Upper Tribunal.
REASONS FOR THE JUDGMENTS
In Halifax plc v Customs and Excise Commissioners (Case C-255/02) [2006] STC 919, the Grand Chamber said that, in the sphere of VAT, an abusive practice can be found to exist only if two conditions are met. [7]
The first condition is that it must be shown that the transactions concerned result in a tax advantage which would be contrary to the purpose of the conditions laid down in the relevant EU Directive and implementing national legislation. One must assume that it is the purpose of the VAT Directives to accommodate normal commercial transactions. [11] This condition is satisfied. The purpose of VAT is to tax consumption. The direct purpose of the margin scheme is to grant relief to traders who have acquired goods from a supplier who had no right to deduct input tax in respect of their own acquisition of them. The indirect purpose of the margin scheme is thereby to avoid double taxation, since second-hand goods may already have been the subject of a net VAT charge at some earlier stage in their history. [14-20] In this case, a system designed to prevent double taxation has been exploited so as to prevent any taxation at all. [30]
The fact that the margin scheme will sometimes apply in cases where there was no earlier net VAT charge is simply the consequence of designing a workable scheme. [22-23] Even if the margin scheme is made available by domestic rather than EU law, the underlying purpose of the margin scheme remains the same, and general principles of EU law, including the abuse of law principle, still apply; in any event, it must have been intended that the abuse of law principle should apply even as a matter of English domestic law. [24-29]
The second condition is that it must be objectively apparent that the essential aim of the transactions is to obtain a tax advantage. Even if a transaction has a legitimate commercial purpose, it is open to challenge if the accrual of a tax advantage constitutes its principal aim. [12] The scheme should be assessed as a whole. [13] This condition is also satisfied. It is not in itself objectionable that Pendragon chose to enter into a transaction with an offshore bank. However, it was essential to the scheme that Captive Co 5 acquire the cars as part of a business as a going concern, and for that to be possible, it was essential that the transferor of the business have acquired the cars by assignment. These steps were manifestly included for the sole purpose of reducing VAT liability. [31-34]
Abusive transactions must be redefined so as to re-establish the situation which would have prevailed absent the abusive practice. [8] This transaction should be redefined by stripping out the five captive companies, so that the dealerships will be accountable for VAT on the full second-hand price. [41-42]
The Court of Appeal held that the Upper Tribunal exceeded its proper appellate role by substituting its own decision for a decision of the First Tier Tribunal based on an evaluation of competing factors. In Lord Sumption’s opinion, the Upper Tribunal was entitled to intervene because the First Tier Tribunal erred in law. [35-40] Lord Carnwath adds that the Tribunals, Courts and Enforcement Act 2007 now provides that, where the Upper Tribunal finds that the First Tier Tribunal has erred in law, it may itself remake the decision, including by making further findings of fact. It was appropriate for the Upper Tribunal to do so in this case in order to give guidance on the abuse principle. It was their decision rather than that of the First Tier Tribunal which should have been the main focus of the Court of Appeal’s consideration. [44-51]
References in square brackets are to paragraphs in the judgments
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