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Used vehicle imports: Court backs call for change

Organisations representing used vehicle importers and dealers say a High Court ruling backs their call for change in the way Land Transport New Zealand administers vehicle compliance rules.

LTNZ has lost a landmark case based on its insistence that used vehicle importers obtain compliance statements from manufacturers' agents to show each imported vehicle meets approved standards.

Both the Independent Motor Vehicle Dealers Association (IMVDA) and the Motor Trade Association (MTA) are calling for LTNZ officials to meet with them to develop a sensible approach that reflects the High Court judgment.

IMVDA chief executive David Vinsen said the court decision highlighted the fact the government agency's requirements "allow vehicle manufacturers to use compliance rules to selectively shut out used-import competition".

Although the case involved an expensive Ferrari, it was typical of situations applying to more mainstream vehicles and urgently needed changing.

"Consumers are paying thousands of dollars more than they should for near-new vehicles as a result of manufacturers' manipulation of the rules," he said.

"Land Transport NZ must ensure used imports are safe. However, it is inequitable and anti-competitive for new vehicle distributors to control the situation by refusing to supply statements of compliance.

"As a result of this court decision, LTNZ should take a new approach and accept whole vehicle model ranges meet compliance standards instead of applying vehicle-by-vehicle scrutiny to used imports."

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MTA communications manager Andy Cuming said LTNZ must address the issue in the process it used.

"It is our belief that removal of this impediment to open competition will benefit the consumer," he said.

LTNZ sought a High Court review of a District Court ruling which reversed its refusal to register a 1999 Ferrari 360 Modena imported by Jerry Clayton's Kiwi Auto Exports PTE Ltd.

In a reserved decision, Justice David Baragwanath confirmed the District Court was entitled to overturn LTNZ's refusal and awarded costs against LTNZ.

Earlier this year District Court Judge Ann Kiernan ruled Mr Clayton had shown the vehicle complied with safety rules based on a number of factors, including that the model was type-compliant and LTNZ had accepted a manufacturer's statement of compliance in the past for the same model.

Judge Ann Kiernan also awarded costs against LTNZ.

She said compliance laws allowed manufacturers to control the market in their own interests.

"Because of the structure of the legislation and regulations it is clear that vehicle manufacturers' representatives can pursue their own commercial interests in declining to provide other entities, private or commercial, with certificates of compliance which would be accepted by the respondent (LTNZ)."

"Until that procedure is altered by amendment to the statutory scheme, the only commercial interests being protected currently are those of vehicle manufacturers' representatives", she said.

Mr Clayton, a former new vehicle dealer now importing second-hand vehicles through Singapore, has spent more than $70,000 on the case in a bid to have the used-imports industry and its customers treated the same as new vehicles.

"New car dealers want to control the market by what amounts to a restrictive trade practice," he said.

"This case shows the courts don't support LTNZ's pedantic approach.

"The question now is how long will LTNZ continue to use taxpayers' money to force importers to fight it car-by-car while it grants blanket approvals to whole model ranges of new vehicles?"

Steve Ward, head of odometer certification firm Optimech, has fought and won similar cases against LTNZ and assisted Mr Clayton in the latest case.

"Used imports were supposed to make vehicles more affordable for the average New Zealand consumer, and also safer and more environment-friendly by reducing the age of our fleet."

"But instead, the government and the bureaucrats are allowing their own regulations to be mis-used to protect the commercial interests of manufacturers and new vehicle distributors."

Mr Ward said individuals and businesses throughout the motor industry had pledged more than $150,000 to a fighting fund aimed at "either having the bureaucrats see sense, or getting the law itself changed".


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