Data-share code of practice nearing completion

FRANCHISED car dealers will soon know just how much of their existing business will be subject to increased competition under a new data-sharing code of practice.

Although no dates have been released, the Federal Chamber of Automotive Industries (FCAI) has told GoAuto the code is now in “the final stages of development”.

Under the code, car-makers will have to make available service and repair information that is currently reserved only for franchised dealers, allowing them to bid for business against franchised dealers.

However, while the development of the code has been sanctioned by the federal government, the car-makers and importers have yet to decide how much information will be made available and how much they will charge for it.

The FCAI has previously indicated that not all service and repair data will be made available under the code.

In a statement released to GoAuto, the FCAI pointed out that it has “a history of success” in developing industry-led solutions such as voluntary codes of practice.

“We are in the final stages of developing a draft code of practice for access to service and repair information, and are in discussions with representatives of the independent repair sector on the draft code,” a spokesman said.

“The Government is also aware of the significant progress the FCAI has made on this issue.” The Minister for Small Business Bruce Billson is following the issue closely in the wake of the recommendations by the Commonwealth Consumer Affairs Advisory Council in November last year.

In its final report on the issue, the CCAAC found that the market for vehicle repairs was competitive. It found there was no evidence of systemic consumer detriment.

However, the CCAAC found that the increasing complexity of vehicles meant that the accessibility to service and repair information had the potential to become a barrier to entry in the vehicle repair market in the future.

It encouraged the industry to speed up the process under which a system could be developed that gave independent operators access to service and repair information.

If the industry did not come up with an “effective, industry-led outcome in a reasonable period of time”, the CCAAC said there could be a case for government intervention – that is, compulsory sharing of information.

The CCAAC also recommended that a review of the system being developed should be conducted within 18 months.

FCAI chief executive Tony Weber has told GoAuto that not all information will be made available to independent repairers, indicating that there will still be some areas of service and repair that, for franchised dealers, will not be subject to competition from independent repairers.

“Safety information, environmental information and security information probably will not be released,” Mr Weber told GoAuto at the time, although he said the final decision rested with its members.

He said the issue around safety equipment revolved around liability if a repaired car was involved in another accident.

“So, if someone else touches the vehicle without appropriate training and does something to it, there still may be liability linked back to the manufacturer. These are all areas that we are looking at,” Mr Weber said.

The FCAI has not disclosed which representatives of the independent repair industry will be invited to discuss the draft code of practice When the CCAAC’s final report was released late last year, Mr Weber said the FCAI was not able to address one of the suggestions put forward.

Apart from recommending that the industry work out a voluntary data sharing, the CCAAC also suggested that an early start could be made by granting Australian repairers access to international websites, websites that currently freeze out Australian repairers.

“It’s not up to our members to flick that switch,” Mr Weber said. “Those websites belong to the parent companies of our members.” He also pointed out that the websites in question operated in jurisdictions that have already established regulatory controls to underpin the operation of the websites.

“The reason it is available over there, in whatever measure or form, is because it has got other things underpinning it within that market. “ An example was the regulatory system in the US that underpins the control and safeguarding of vehicle security systems to prevent or minimize opportunities for theft.

“The key thing here is that, for efficiency for the Australian industry, we need to be able to come up with a system that works for a smaller market.

“Those other markets, like America, for the security information, they’ve got a whole other system of regulatory controls and enforcement set up under that.

“I’m not sure the Australian market would be able to support that.“ The Australian Automotive Aftermarket Association (AAAA) is keen to see the draft code and comment on it on behalf of its membership, which includes a wide range of automotive businesses, from repair shops to retail shops, from service providers to parts makers.

The AAAA launched its Choice of Repairer campaign in 2009 in a bid to formalize a system under which its service and repair members could gain access to the data and information they needed to service their customers’ cars.

Up to now, the car-makers have been resisting requests from independent repairers for access to information. The independents believe this gives the franchised dealers with whom they compete an unfair advantage.

The AAAA met with the Minister for Small Business, Mr Billson, earlier this month and reported that the minister supported the creation of a code of practice.

“In a productive meeting on 16 January … the Minister indicated his intention to ensure that the recommendations made in the recent CCAAC inquiry into vehicle data sharing are fully implemented,” AAAA executive director Stuart Charity said in a statement.

Mr Charity said the Minister had indicated that an effective code “must have the input and support of all key industry stakeholders”.