Brussels, 20/02/2002 (Agence Europe) - In the context of consultation procedure foreseen further to the Commission's adoption of the new draft Regulation on automobile distribution, Commissioner Mario Monti expressed his views on Tuesday evening before the EP Committee on Economic and Monetary Affairs. He recalled the main lines of the project that he had already presented to the EP when it was adopted, on 5 February (see EUROPE of 6 February, p;9), and stressed the need for the Commission to reform a system in which "consumers do not benefit from a liberalised internal market". He thus pointed a finger at the failings of the current system: - a single distribution model is an obstacle to other sales methods, dealers are under the obligation to provide after-sales services, independent repairers have difficult access, not guaranteed, to technical information, and there are obstacles to parallel trade. "The new system should provide greater competition on the sales and after-sales market, provide greater flexibility for the dealers (while guaranteeing) safe standards safeguarding environmental norms", said Mr Monti. He recalled the advantages of the new project. They are: - flexibility and freedom of choice for the dealer who will now have the possibility to open sales points outside his territory, the possibility for the dealer to do active selling, and to sell several makes, and the obligation for the seller to put forward valid reasons should a contract be broken, or the link between sales and after-sales disappear. On this last point, Mr Monti specified that the lack of obligation for the dealer to provide clients with after-sales services should not be to the detriment of the consumers, which should still be able to benefit from high quality services. Thus, "each manufacturer should establish qualitative criteria in the choice of repairers that should meet such criteria". By way of conclusion, the Commissioner seems determined to stick to the current project which will be officially adopted before the summer, but admits the possibility of introducing several changes ("amendments may be introduced if sufficiently weighty arguments are made"). In response to an MEP who questioned him about the Commission's attitude towards the bad welcome the project received from some Member States, Mr Monti said: "the Commission takes the opinions of Member States into account, but it is up to the Commission to decide competition rules (…) It will not change what is essential".
Rapporteur Christoph Konrad (German Christian Democrat) felt that, on the whole, the EP had given the project a good welcome although some points still remain controversial: - "the proposal meets 80% of our demands (…) It will strengthen competition that will become fiercer (…), but there are still points to be discussed". He thus expresses concern about the structural changes that would be engendered by over-rapid liberalisation and calls on the Commission to envisage sufficient time to allow the sector to organise itself. Like Generoso Andria (Forza Italia), Mr Konrad stressed the need to work towards more tax harmonisation in order to close the gap in price differences between cars sold in different Member States. Mr Monti replied that a transitional period is foreseen until 2010 to allow the sector to find its points of reference. He recognised the importance of tax aspects saying that "the risk of price increases with the new regime must not be overestimated". There are of course tax elements that come into play in the price differences, but the former Regulation had its shortcomings". Brice Hortefeux (EPP-ED, France) expressed concern that, with the elimination of the locality clause, there was a concentration of powerful dealers to the detriment of SMEs. Furthermore, he fears that the disappearance of the link between sales and after-sales will prevent consumers from climbing the chain of responsibility in the event of problem. Professor Monti replied that the project would, on the contrary, give dealers greater commercial possibilities. Regarding the liability issue, he replied that the Commission "remained logical" and that its intention to bring prices down did not mean it had lost sight of the need to meet safety and quality criteria. He thus replied at the same time to Benedetto Della Vedova (Lista Bonino), who asked him to dismiss the perplexity felt by consumers' associations who believe the project does not go far enough. "Consumers' interest towards the automobile has several facets which are not just to do with the purchase price", he stressed. Furthermore, in answer to questions from Salvador Garriga (Partido Popular) on the impact the new rules would have on employment, Mr Monti pointed out that they would have a positive effect, with greater profitability of after-sales services. In his view, the greater freedoms granted to dealers would allow "a positive balancing effect on employment". Danish Liberal Karin Riis-Joergensen said, on the other hand, she was somewhat disappointed by the project which "is not ambitious enough". In her view, too much complexity in the rules will be to the advantage of the strongest. Alluding to Mr Monti's watchword, "putting the consumer in the driving seat", she said there was "not enough petrol in the tank".