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New regulatory framework for the automatic distribution and after-sales to take shape.
Following the recent increased anti-monopoly investigation and enforcement in the automotive industry China, there have been a number of new regulations passed by lawmakers in particular in the area of car distribution and after- sale, it is envisaged that a new regulatory framework for the automatic distribution and after-sales can take shape in the near future.
1 SAIC Abolishment Record-filing of the authorized dealers Auto brand.
On July 31, 2014, the State Administration for Industry and Commerce SAIC issued an announcement on the abolition of the implementation of the Record-deposit Automotive General Automotive Brand Distributor and dealer SAIC Abolishment notice According to the SAIC Abolishment opinion, the drop folder automotive general distributor and brand automobile authorized dealer with competent SAIC, which has been implemented for almost ten years, will be abolished from 1 October 2014 Meanwhile, in the license of an automotive distributor, description of its scope will be modified XX automobile brand distribution to a more general description car distribution.
Once SACI Abolishment notice takes effect, it is expected that the car dealer will be allowed to distribute several automobile brands in China, however, since there is no change of the implementation of measures for the administration of Automobile Brand distribution, issued jointly by the Ministry of commerce MOFCOM, national development and reform of the NDRC and SAIC in 2005 2005 measures distribution Brand, car dealers are still required to obtain authorization from manufacturers specific or general auto dealer auto distribute cars in accordance with the 2005 measures distribution Make despite the SAIC Notice Abolishment therefore removing the deposit registration with SAIC and the change in the description field of activity will not enough to change the status quo and reshape the current legal landscape.
2 Automobile independent maintenance and repair market.
On September 18, 2014, the Guidelines on promoting the transformation and upgrading of the Automotive Maintenance and repair industry has been published jointly by the NDRC, MOFCOM, SAIC and other relevant government authorities guidelines the guidelines focus on the establishment of a fair and transparent auto aftermarket in China and explicitly supports the promotion of brand names on the secondary automobile market of the guidelines provides, for the first time the concept of replacement same quality parts in order to eliminate discrimination against the spare parts that are not manufactured by the automaker or aftermarket parts supplier authorized This means the trend of policy and attitude government towards segregation aftermarket auto repair the car sales market and eliminate monopoly by authorized dealers in the sector aftermarket automotive highlights include the Guidelines.
Automakers, including car importers, their authorized dealers and repairers can not abuse the use of automotive maintenance clause interfere with or limit the consumer to choose repairers or repair services.
In practice, to encourage the distribution of spare parts manufacturing, automobile manufacturers and authorized brand dealers can ask consumers to obtain repair services authorized brand dealers or repairers allowed in contracts; otherwise, the guarantee of the quality of the car can be canceled The new principles set out the legal basis for consumers to get other auto repair services outside the dealership system authorized by car manufacturers.
The public disclosure of the auto repair technology.
From 1 January 2015, automakers are required to inform the automotive maintenance and repair technical information for newly launched cars to both dealers and independent repair operators, including repair companies, repair equipment manufacturers, repair information publications and repair training institutions without discrimination or undue delay by a convenient information channel and at reasonable prices; if the information of the maintenance technology are not properly made public within 3 months of the new launch of the car, the ad and 3C certification for the new car and automotive products automaker will be revoked manual of the product supplied to consumers must include the information of the automotive type certificate of verification, technical specifications maintenance emissions, manufacturer, type and duration of conservation control of key spare parts emissions.
In addition, the last maintenance and repair techniques all automotive information contained on the MIIT Automobile Manufacturers and Automotive Products ads before December 31, 2015 are also already required to be made public.
The Department of Transportation will take the lead in formulating the implementation of rules on car repairs disclosure to provide additional guidance on the disclosure of repair technology.
Mandatory disclosure of automotive repair technology is also widespread in the European Union and the United States of America as a measure to prevent the monopoly of the automakers due to serious security problems and maintenance with regard to the automobile, if the information of the auto repair technology is not publicly available, it will essentially weaken the credibility of repairers who are not authorized by the manufacturers of public access to information automotive repair technology provides the technical perspective for independent repairers to compete with dealers or repairers.
The two sides made the manufacturer and independent pieces made under the treasury markings shall be made available to the aftermarket automotive distributors authorized replacement parts and authorized maintenance companies are allowed to sell parts manufacturer made unauthorized repair businesses and consumers also all consumers and repairers have the right to use the same quality of spare parts.
Under the new parts procurement policy auto parts, the current barrier to the free movement of parts manufacturer between dealers and independent repairers will be eliminated probably a fair market for spare even quality parts produced by other companies that automobile manufacturers or their authorized spare parts suppliers will be trained This will further promote competition between parts manufacturer and the same quality of the spare parts and competition among dealers and repairers independent.
2 Background legislative changes and future prospects.
The automobile brand authorized dealer has been established under the automotive policy issued by the National Development and Reform NDRC in 2004 and 2005 retail brand Measures An authorized dealer brand or 4S shop incorporates the functions of the new car distribution with after-sales services, including sales, spare parts, service and most importantly investigations, the dealer operates in accordance with the requirements of automotive suppliers in the initial phase, the authorized dealer brand has played a positive role in the establishment of a motor specialized distribution network throughout the country and ensure the quality of automotive services, however, due to the absence of restrictions on the power of car manufacturers and regulatory oversight, the authorized dealer has integrated fault in granting excessive power to the automakers.
Under the authorized dealer of the brand, the automaker or the general distributor could decide whether a broker can distribute its automobile brand Article 6 of 2005 marks measures authorized states that planning one car brand network must be formulated and implemented by either the automaker or self general distributor in fact, most car manufacturers often use its subsidiary as General ATM authorized dealers are explicitly required to comply strictly with authorization contracts with the automaker or general distributor more importantly, 2005 marks measures authorized ask the automaker or the general distributor not to supply auto resources to companies that are not authorized dealers of the brand or who do not meet Thanks operating requirementsthe manufacturer's authorization and control of the supply chain, the automaker has influence and control over the political distribution, including the sale price, distribution and geographic source of spare parts and components This problem particularly serious, such as price inflation on automobiles and spare parts.
Another immediate effect of 2005 is authorized measures is the authorized dealer can not become exclusive distributor of a single automaker This leads to repetitive construction of 4S stores, which became waste of resources especially in cities becoming more populous China with the vehicle purchase restrictions.
In the market for spare parts, as car manufacturers are required not to provide auto resources to unauthorized companies, automakers exclusively supply the spare parts produced by manufacturers or authorized parts producers to dealers Dealers can procure spare parts manufacturers channels authorized This leads to price controls by manufacturers on the spare parts and competition hinders others on the market by parts suppliers that are not authorized by the manufacturers Thus, spare parts and services offered by authorized dealers are generally more expensive than those offered by independent repairers After the warranty period expires, the rising prices of aftermarket parts and services offered by dealers allowed lim you their ability to compete with independent channels for after-sales services on the other hand, since the spare parts are handcrafted distributed to the dealer SYST em, independent repairers have limited access to original parts and technical information required for the repair and maintenance and therefore can not guarantee quality services ultimately, customers are the ones to suffer as they must choose either the highest prices of quality services of authorized dealers or the cheapest services offered by independent repairers without warranty.
Since the adoption of the Law of the PRC Anti-monopoly in 2008, 2005 retail brand measures have been criticized as granting powers automakers to exert a vertical monopoly on vending machines and after-sales services Modification 2005 distribution measurements of the brand has been mentioned several times in a number of policy statements by way of illustration, in the opinion on promoting auto consumption jointly issued by MOFCOM, AIC, Ministry of Industry and information Technology MIIT and other relevant government authorities in 2009, he explicitly stated that the 2005 revision brand distribution measurements should be launched as soon as possible, and car distribution models should be diversified to to establish an automotive distribution network more profitable directors reviews the 12th Five developm ent year automobile distribution issued by MOFCOM in 2011 reiterated the same.
Although SAIC Abolishment opinion, by itself, is not enough to change the existing brand licensed car dealer, it is generally regarded as paving the way for the planned overhaul of the existing regulatory framework for car distribution The Guiding Principles on Auto aftermarket issued by almost all regulators in the automotive industry can be considered as the first important step in the reform of the automotive industry policy mandatory disclosure of information technologies car repair and the free movement of manufactured spare parts allow the formation of a secondary market for the independent automotive possible automakers.
He still does not know how 2005 marks measures authorized will be revised There are debates about whether the authorized dealer must still remain the basic system with restrictions on the powers of the automakers or a significant change should be made to dealer, one point is certain, after the reform, car manufacturers control over distributors and after-sales service providers will be relaxed, and market more transparent and fair competition will be trained in auto sales sectors services and market players in the automotive industry must be prepared to respond to radical changes in automotive manufacturers in the market, despite its strong market position, will start to reconsider its distribution model, strategy price of spare parts procurement strategy and planning; No regional auto dealers to survive in this highly competitive market, will reinforce its strengths and improve its services on the secondary car market, op portunities for large emerging names in the repair and car maintenance are on the horizon, we will keep track of any new changes in the legal landscape of the automotive industry.
New regulatory framework for the automatic distribution and after-sales to take shape China Law Insight, regulatory, framework, automotive, distribution.