BMW April 2022

The National Consumer Commission in January published a gazetted invitation to supply comment on the existing code of conduct for the Automotive Aftermarket and we publish our take on items for consideration.

We are not averse to the setting of the MIOSA or their role, however, our appointment covers the first point of escalation for the consumer whereas the proposed code provides for is a review of their constitution and mandate – but does not cover all the intended guidelines for conduct as the introduction states. The Code (will) regulate the interactions between persons conducting business in the automotive industry and their interactions with consumers.

Consumers are for purposes of trade set primarily with the consumer or public. However, entities such as service providers with the primary role of restoration to accident damaged motor vehicles are also determined consumers whilst transacting with Short Term motor Insurers and OEMs for example, as for the supply of replacement parts used in the provision of these services.

The Code should relate to the conduct with detail of conformance for the supply of goods and services by the Automotive Industry and consumers within the Republic of South Africa and focuses on consumer protection, supplier guidance and fair business practises. In support hereof reference to the Consumer Protection Act which has been in regulation for some time and has provided a great understanding in the industry and more specifically section 15 covers the conduct in depth. 

Further the Code should cover interpretation of these further regulations as included in the content from clause 3:

3.1.1 Individuals and businesses operating within the Automotive Industry are required to follow the purpose and policy of the Act, to refrain from prohibited conduct and particularly to, in their dealings with consumers, protect consumers from:

3.1.1.1 unconscionable conduct;

3.1.1.2 unfair, unreasonable, unjust contracts and contractual terms;

3.1.1.3 unfair, unreasonable, unjust or otherwise improper trade practices; and

3.1.1.4 deceptive, misleading, unfair or fraudulent conduct.

Collision Repairers Association (CRA) find it imperative that we create an escalation for consideration with a view to establishing the methodology of regulation whether voluntary or by enforcement through gazette in defining the objectives as explained in the excerpts as above.

More recently and rather unfortunately the South African Insurance Association (SAIA) were motivated in setting collaborative rules under the motor transformation and sustainability forum, but which has now been shelved and is of concern in furthering best practice business contact and conduct between Motor Body repairers (MBRs), Short Term Motor Insurers and OEMs. All the hard work of years of interaction have not continued and priorities for rules such as transformation, opening doors to barriers of entry for previously disadvantaged communities and safety through standards of qualified repair, all have importance to the further development and sustainable continuity of this industry sector, but have not been actively continued for best practice. 

This is a very high level and can simply be extended to provide support to the Competition Commission issue of the Right to Repair guidelines for positive change. We trust the adoption does become effective, but the principle of voluntary participation from July 2021 has seen very little change in the landscape of business outcome.

Certain interim measures were agreed to but the realm at present appears to be fear through intimidation and draconian enforcement of measures such as anti-competitive price fixing, supply collusion and commercial terms of non-sustainable offers, which are in some areas required daily. This creates animosity for disruption.

All we ask for is the issue of rules to support the ability to create synergy for equal input and output and protection of rights in business conduct. These are all easily debateable with the inclusion of subject matter expert workshops from the Department of Trade and Industry, SAIA, OEMs and The Associations representing the majority of MBRs in the automotive aftermarket.

To continue with all aspects of inclusion in this document it may take time and break from the importance of this escalation. A workshop of relevant stakeholders will be the best base for collaboration on what inclusionary terms and considerations should be mandated.

Thank you in advance of your consideration to this submission and we await a reply as to creating what probably will be the long awaited rules for establishing growth and relationships of the best synergy for now and the future.