Old and written-off vehicles – suspected anti-competitive conduct
The CMA (Competition and Markets Authority) is looking into suspected anti-competitive conduct in relation to old and written-off vehicles in the UK.
The investigation began approximately a year ago, and we will outline an update that has already been published by the CMA at the end of last year in respect of a penalty notice that has been issued.
The car industry is massive, and there have been a number of scandals that it has been involved in in recent years, and it can be somewhat of a murky area in terms of consumer confidence. The CMA’s work in identifying if there have been any breaches of competition law is incredibly important. If any breaches are established, swift and effective action could be taken.
CMA looking into suspected anti-competitive conduct: old and written-off vehicles
In March 2022, the CMA – Competition and Markets Authority – formally launched an investigation into alleged suspected breaches of competition law in relation to old and written-off vehicles. According to the CMA, there were concerns in respect of potential breaches and infringements of the law involving several vehicle manufacturers and some industry bodies.
Between March and December 2022, the CMA engaged in its information-gathering period and an analysis of the suspected issues in relation to old and written-off vehicles.
As is often the case, the CMA is making no assumptions in respect of whether there have been any breaches of competition law at this stage yet or not. If they do establish that there has been some form of anti-competitive conduct involved, companies could face significant fines that can be considerable depending on the nature of the breaches committed. If any companies want to make light work of the CMA’s investigation and cooperate with them, if there has been any cheating behaviour, they may be able to benefit from leniency.
Penalty Notice issued
The latest update in respect of the CMA’s investigations into suspected anti-competitive conduct for old and written-off vehicles took a considerable turn in December 2022. On its website, the CMA published a notice of a penalty that has been imposed on Bayerische Motoren Werke AG (BMW AG).
The CMA confirmed that the reason for the penalty notice issued was because the company reportedly failed to comply with the CMA’s information request. Whilst this does not necessarily mean that the company has engaged in any kind of anti-competitive behaviour, the CMA has made clear that there has been no reasonable excuse provided in respect of why their information request has seemingly not been answered.
Wider motor vehicle industry issues
In recent years, the motor vehicle industry has been subject to a number of regulatory investigations, not just by the Competition and Markets Authority but also in respect of wider consumer concerns. There have been recent issues in respect of finance packages that have been pushed by retailers that may not have been in the best interest of the consumer and could have been in the best interests of the companies instead.
We also continue to be in the midst of the “Dieselgate” scandal where a number of vehicle manufacturers have been found to have fitted vehicles with software that could cheat emissions regulations.