A frequently asked question is: What does misleading advertising have to do with competition? The simple answer is: “Everything”. Competitors in a market cannot be allowed to increase their market share by making false claims about their products or their services. One sector in which competition has been growing rapidly in recent times in Jamaica is the motor vehicle sector – new and used. It is public knowledge that the fierce competition which exists in the used car industry has been accompanied by a consistently high level of complaints from consumers. The Fair Trading Commission has complaints not only against used car dealers, but also against new motor vehicles dealers.
Between September 1993, when the Commission first opened its doors and November 25, 2004 it received 793 complaints against motor vehicle dealers. January 2001 to the said November 25, 2004, accounts for 496 of that number, showing an average of 124 complaints per year for the three (3) year period. The commonest types of complaints were in relation to:
- defective vehicles – 115
- resistance towards honouring or failure to honour warranties – 118
- model year misrepresentation – 80
- misrepresentation about sale price – 89
- misrepresentation regarding features/accessories – 114
Used car dealers/brokers routinely accept deposits from consumers and later fail to provide the specific vehicles for which those deposits were paid.
Whereas the Commission was able to obtain redress for consumers in the large majority of matters, it has encountered severe difficulty in dealing with complaints about model year discrepancies. It became aware of the fact that there was no established or legislated standards to which it could refer, in its efforts to investigate complaints; and there was no authority vested with the specific responsibility to determine the model year of motor vehicles being imported into Jamaica.
The FTC engaged itself for years in advocacy with the Ministries of Commerce, Science & Technology and Transport & Works and their agencies with the purpose of having this matter addressed.
Subsequent to these efforts the Country’s Motor Vehicle Import Policy was amended to address a number of issues, including the model year issue. The Motor Vehicle Import Policy document now sets out “approved methods for Determining Model Year” and in that context refers to The ISO Standard (International Export Standard); and The JIS Standard (Japanese International Standard) and the Age Verification Manual. Model Year is determinable by reference to certain alphabetical or numerical characters in the chassis number of the relevant vehicle. Where a vehicle is manufactured specifically for the Japanese domestic market and not intended for export, the manufacturer does not conform to the international export standard and therefore the model year will be based on the vehicle’s serial number and determined by reference to the Japanese Automobile Age Verification Manual. Hundreds of such vehicles are imported into Jamaica every year.
The Island Traffic Authority has now been designated The Competent Authority for determining and adjudicating on matters relating to the model year of any motor vehicle which is imported into Jamaica. It must also be noted that under the amended policy, the Island Traffic Authority may use any information available to it to determine a model year, where the ISO, JIS and the Age Verification Manual are not applicable.
There is no doubt that a very troubling area of the work of the Fair Trading Commission will be greatly facilitated by the provisions highlighted herein.
While the lodging of a complaint does not necessarily mean that a breach can be established, it does indicate that there is consumer dissatisfaction and therefore reason to be concerned about the industry. Aided by the establishment of a competent Authority to address the model year issue, the FTC will aggressively address behaviour within the motor vehicle industry to ensure compliance with the Fair Competition Act.
A survey of the 496 complaints which reached the Commission during the three (3) year period under review indicates that 21 of the 126 registered motor vehicle dealers account for 237 or 47.7% of the total number of complaints for the period; and each of these 21 dealers is the subject of at least 5 complaints.
In an environment such as the one which the data seems to support, consumers are enjoined to behave with a heightened sense of responsibility:- choose dealers carefully; equip themselves with sufficient information about the transaction into which they are entering before parting with their money; understand what every term of the relevant agreement means; examine vehicles properly before purchase even if it means paying for the services of a qualified mechanic. Buying a motor vehicle is a huge investment.
Consumers must therefore act with due care.