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| Block Exemption Explained Some of the explanations on the internet are very complicated, so we hope to clarify the basic idea behind Block Exemption and give you a clear understanding of what's going on! Background: The EU legislators continually work towards creating a fair market place so that competition can thrive and therefore create better deals for all consumers on almost all products. When it comes to car sales (and vans) it would appear that car manufacturers and their dealers have it all tied up. The dealers all have access to discount prices from manufacturers and no one other than a franchised dealership is allowed to sell to the public. It also used to be the case that to keep a car warranty valid you had to have it serviced at one of the manufacturers franchised dealers too, so servicing charges could effectively be set at anything the dealers wanted. In a fair EU market this would be totally unacceptable and in fact since 2002 it is now possible to have your car serviced at an independent garage and still maintain the warranty (provided the parts used and standard of work done is acceptable to the manufacturer). However the EU has so far stopped short of allowing a completely open market on car sales and the reason for that is that they recognise that the manufacturer/dealer has to invest a considerable amount in providing sales points, training for staff and overheads such as test driving, demo models, etc. Block Exemption: So that is where the 'Block Exemption Regulations' come in and allow car manufacturers and dealers to be exempt from normal fair trade rules that apply to most other products. But the current regulation is due to end in March 2010 and speculation is rife! We will try to keep you updated on the latest developments on Block Exemption as it happens! |
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