There’s been a lot of talk recently about Motor Vehicle Block Exemption Regulations (MVBER), but how many of us can honestly say we know what they are and could confidently explain the implications for our subsector of the aftermarket?
Block exemption regulations effectively ban anti-competitive practices – and in relation to motor vehicles, they’re designed to enable parts distribution and repair companies to compete directly with the vehicle manufacturer network.
But the OEMs have deep pockets and a lot of power, and it’s a tall order for independent workshops, bodyshops and ATFs to go up against them.
Fortunately, LKQ Euro Car Parts, alongside its partners at the major trade federations, uses its size and influence to stand up for our sector’s rights.
ATF Professional spoke exclusively to LKQ Euro Car Parts CEO Andy Hamilton, to find out what ATFs should be concerned about, the action that’s being taken, what we can do to help.
So, Andy, why is everyone talking about MVBER all of a sudden?
The EU has already been speaking to industry about what will replace the current Motor Vehicle Block Exemption Regulations (MVBER) when they expire in 2023.
But in the UK, our concern is that the CMA has been slow with the start of its consultation – which could indicate that a lack of awareness of the anti-competitive practices that are already rife in the automotive aftermarket, and that have the potential to get worse if they’re not legislated against.
And that’s why we’re turning up the volume and campaigning on behalf of the sector.
What are the potential dangers for ATFs?
While at face value, MVBER governs the distribution of new parts – and so you could argue that recycled parts are exempt – OEMs are increasingly retaining control over parts throughout their lifetimes, whoever’s hands they fall into.
Over the past decade, as vehicles have taken on more new technology, OEMs have already been exploiting the gaps that have opened in MVBER’s coverage. This is creating mini monopolies of so-called ‘captive parts’ that must be reprogrammed before they’ll work in another vehicle via a connection to the manufacturer’s server.
And OEMs are withholding access to bulk repair and maintenance information (RMI), effectively locking repairers and recyclers out of their vehicles and limiting the extent to which parts can be replaced and repurposed outside of the franchised dealer network.
And what’s being done about it?
We are one of the founding members of UKAFCAR, the British arm of AFCAR, which is the European-wide Association for the Freedom of Car Repair. We’re here to represent the independent aftermarket in the UK MVBER consultation when it gets going.
We’re calling for full access to all RMI and data generated by vehicle systems for the independent aftermarket – the customers of ATFs. The quality, price and availability of this essential information must be controlled by an independent authority, totally separate from vehicle manufacturers. It should also supervise access to vehicle security and other ‘cybersecure’ systems. And this independent authority must have the power to take action on abuse, issuing warnings and/or fines to OEMs that fail to comply with the new regulations.
The new regulations also need some in-built flexibility to allow for future innovation that we can’t even conceive at this point, to eliminate the potential for loopholes to open up and be exploited as they have in the past. And we want the regulations to actively support independent operators by asking for QR codes on parts that repairers and recyclers can scan to find out which vehicles a part fits and how to go about fitting it.
How can we help?
The CMA needs to hear from the broad cross-section of businesses working in the aftermarket about how critical MVBER is to safeguarding their ability to trade – and also about how it needs updating.
We fear that because there’s very little litigation taking place, in which independent garages, workshops and ATFs seek legal recourse from abuse by the automotive giants, the CMA may believe there’s no problem to legislate for. This is often what they look out for when evaluating anti-competitive behaviours in markets.
We’d urge anyone that’s been at the sharp end of captive parts or other unfair competitive behaviours to get in touch with UKAFCAR. We can use these examples to show the CMA why change is needed – to develop new regulations that are fit for purpose, now and in the future.