Motor Vehicle Distribution (Hansard, 19 September 2002)

§ Mr. Hoyle
To ask the Secretary of State for Trade and Industry if she will make a statement on the location ban clause in the European Commission's proposal for motor vehicle block exemption for motor vehicle distribution.[71363]

§ Mr. Wilson
The European Commission adopted a new cars block exemption regulation on 17 July. The regulation will come into force on 1 October this year, but with a transitional period of one year for all provisions except that on the location clause ban. The introduction of this provision has been delayed until 1 October 2005.

§ Mr. Hoyle
To ask the Secretary of State for Trade and Industry if she will make a statement on progress with the European Commission's proposals for a new motor vehicle block exemption for motor vehicle distribution.[71362]

§ Mr. Wilson
The European Commission agreed a new block exemption for the sale of new cars and car servicing on Wednesday, 17 July. The new block exemption will replace the existing one, which is due to expire on 30 September this year, but will be subject to transitional arrangements.
The Government has welcomed this improvement on the current regime. The reform should mean more choice and fairer prices for consumers, and greater competition and innovation in both the retail and after-sales sectors. The new block exemption is also good for business, with dealers being freer to determine how they run their businesses.
While we very much welcome the changes on new car sales and on car servicing and repair, the delay in the introduction of the freedom for dealers to open in new locations, which will not come into effect until 2005, is disappointing. We would have liked this to happen sooner, as we made clear to the Commission. Nevertheless, we welcome the fact that it will happen automatically in 2005, without a further review.

§ Miss McIntosh
To ask the Secretary of State for Trade and Industry for what reason an explanatory memorandum on the new block exemption in relation to motor vehicle distribution was not produced before it was adopted by the Commission. [71655]

§ Mr. Wilson
The motor vehicle block exemption is a European Commission regulation, not a Council of Ministers regulation. The Scrutiny Committees do not routinely scrutinise Commission measures, so documents relating to proposals for Commission legislation are not automatically deposited, and Departments are not expected to produce explanatory memoranda in every case. In this particular case, the Chairman of the House of Commons European Scrutiny Select Committee requested an explanatory memorandum on 3 July, and this was submitted to the Committee on 10 July.