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Update on Motor Vehicle Block Exemption Regulation (MVBER)
From its headquarters in Brussels, the European federation of the automotive aftermarket distributors, Figiefa, monitors and accompanies the development of European and International legislation affecting the automotive aftermarket. Figiefa represents the interests of its members towards European and international institutions. In a series of articles in this newsletter, Figiefa and ADI, who is assisting Figiefa in various dedicated working groups, intend to give you an executive overview of key topics that are bound to affect tomorrow’s IAM playing field. In this editon: the Motor Vehicle Block
Exemption Regulation.
Executive summary Mid-January 2022, the European Commission has announced its intention to extend the “core legislation”, the Motor Vehicle Block Exemption Regulation (MVBER) itself “as is” by five years, and to update its Supplementary Guidelines to reflect technological developments. FIGIEFA therefore welcomes in principle the European Commission’s announcement, which tends to indicate that the sector specific regime will be maintained, hence in any case not be abandoned, which is already a very positive signal, compared to the option of abandoning the MVBER. FIGIEFA will suggest proposals for improvements needed in view of recent technical and market developments. Background The sector-specific competition framework consists of Motor Vehicle Block Exemption 461/2010 and a set of Supplementary Guidelines, both of which date from 2010 and were set to expire in 2023. The framework helps to ensure access to spare parts and technical information, by outlawing restrictive covenants between vehicle manufacturers and their authorised repairers or OE parts manufacturers. The framework includes essential guidance on warranties, dual branding and the ability of independent wholesalers to sell original/matching quality parts to authorised repairers. Without these rules, vehicle manufacturers could also impose greater restrictions on the ability of OE parts manufacturers to sell their products as spare parts to the entire aftermarket. The European Commission’s Evaluation Report of May 2021 cites market
evidence showing that the MVBER has been quite useful, i.a. to facilitate the trade in original and matching quality spare parts as well as access to technical information, and to prevent anticompetitive warranty terms. As the current rules are approaching their expiration date, the European Commission consulted with the EU Member States and stakeholders since 2019 (Roadmap), in 2020 (Ernst & Young Study), and the “backwards looking” public consultation was in 2021. Among the policy options of the EC were: (a) letting the sector-specific rules expire altogether, (b) allowing the Block Exemption Regulation to expire and replacing it with non-binding guidelines, and (c) continue with a robust framework consisting of a sector-specific Block Exemption Regulation as well as Supplementary Guidelines.
FIGIEFA advocated that the sector-specific competition framework consisting of a Regulation as well as Guidelines should be maintained to protect competition in the
automotive aftermarket, i.e. between vehicle manufacturers and their contracted networks on the one hand and independent, multibrand operators on the other. FIGIEFA shared this message with the European Commission through its contribution to public consultations, its own FIGIEFA Evaluation Report (with examples gathered through the FIGIEFA Working Group), co-ordination with other stakeholders and meetings with officials. FIGIEFA would like to thank all associations, companies and individuals who contributed to these efforts.
Next steps FIGIEFA is of the opinion that the current framework needs indeed an update, and this not only for the Guidelines, but also for the MVBER itself. However, the European Commission has indicated a willingness to consider limited updates to the guidelines, and announced that it intends to “extend” the MVBER, implying that changes to the MVBER itself are likely to be very difficult to obtain. Nevertheless, even a “simple” extension of the MVBER accompanied by an upgrade of the Supplementary Guidelines is a first positive step forward, as some stakeholders had begun to question the continued need for sector-specific rules. As said, the European Commission’s recent statement indicates a willingness to update the Supplementary Guidelines. These guidelines contain essential and very concrete provisions on the trade of spare parts, access to technical information, and servicing of vehicles under warranty. The revision of these guidelines is aimed in particular at taking into consideration recent technological developments.
FIGIEFA intends to contribute to the upcoming public consultation with concrete, practical proposals to make this essential legislation fit for both today’s and tomorrow’s challenges. Depending on market-based evidence and regulatory developments, FIGIEFA will insist on the following points to upgrade the Supplementary Guidelines:
TRADE OF PARTS. FIGIEFA is reflecting on submitting additional provisions in order to improve wholesale access to
OEM captive parts to lower the anti-competitive impact of selective distribution channels as they are currently used. ACCESS TO TECHNICAL INFORMATION. In view of new technological practices, FIGIEFA agrees that a review and modernisation of the rules on accessing technical information (abbreviated as “repair and maintenance information”
RMI) is absolutely necessary. In close cooperation with AF-
CAR, and in particular with ADPA, FIGIEFA is reflecting on substantiated demand to make sure that the full range of technical information is made available to independent operators, irrelevant of what authorised repairers receive or not. These proposals include for example provisions on
RMI for new types of powertrains, or RMI being embedded in proprietary OEM diagnostic tools and not available to IOs. ACCESS TO IN-VEHICLE GENERATED DATA. The European
Commission might want to refer to this issue in the framework of the MVBER, but this has not yet been confirmed. The
EU type approval rules and the EU’s Data Act (to be unveiled on 23 February) will also influence the coherence and completeness of the future competition framework. If DG COMP intended to include access to in-vehicle data, it should be emphasised that independent operators don’t need “the same as what authorised networks get from the vehicle manufacturers”, but require proper and independent access to what the vehicle sustains (hence what the VMs have at their availability) to be able to provide competitive and innovative services and solutions.
SERVICING OF VEHICLES UNDER WARRANTY. FIGIEFA reflects on how updated guidance could be provided on restrictive warranty terms. The objective is in particular to better capture misleading practices, such as the (ab)use of extended warranties, and the burden of proof lying with the vehicle manufacturers or their authorised networks when warranty is denied following the use of an independent service or part.
