Right To Repair |

Despite the amended Guidelines being visually quite different to those published in July 2021, there are few amendments of substance.

The most important amendments to take note of can be summarised as follows:

Accessories

Accessories are now expressly included in the Guidelines and are treated in the same way as Spare-Parts. This means that you can now fit any matching quality accessories to your vehicle without compromising your warranty.

Extended Warranties

Extended warranties are now expressly included in the Guidelines and are treated in the same way as factory warranties, whether you purchase the Extended Warranty from an OEM or an insurance company. This means you can make use of an ISP for your servicing and repairs during the Extended Warranty period in the same way that you are permitted to do so during the factory warranty period.

Appointment of Motor Body Repairers by Insurers and OEMs

Sections 6 and 7 have been amended to allow insurers and OEMs to choose motor body repairers on a case-by-case basis, however they are still required to cater for entry of HDIs to participate and not limit their decision whether to approve a Motor-body Repairer to prevailing market conditions or low volumes of work in the Designated Geographic Area concerned. Previously they were required to accept all motor-body repairers who fulfilled their requirements.

Bundled Sale of Value-Added Products: Demo and Second-Hand Vehicles

Section 11 has been extended to include demo and second-hand vehicles. OEMs/dealerships are now obliged to separate the sale of all vehicles from the value-added products on offer, including demo and/or second-hand vehicles. Previously this was limited to new vehicles.

Part Numbers

Part numbers on quotations and invoices has been added as an item on the list of technical information that OEMs must make available to ISPs under Section 12.

The following is a full list of all amendments made:

Definitions:

Page 3

New definition added:

2.2 “Accessories” means parts or fittings attached to or carried by a motor vehicle for purposes of enhancing or altering its comfort, appearance, function or performance, as defined in the OEM terms and conditions. Accessories may include (but not limited to) spoilers, fenders, grills, carpets, and alloy wheels.

Page 4

Section 2.4 has been substituted with a new definition as follows:

Old:
2.4. “Commercially Sensitive Information” means trade, business, industrial information and data stored electronically or in the cloud that has economic value to a firm and its business strategy and that is generally not available to or known by others.

New
2.5. “Competitively Sensitive Information_” _means information that is important to rivalry between competing Firms and likely to have an appreciable impact on one or more of the parameters of competition (for example price, output, product quality, product variety or innovation). Competitively sensitive information could include prices, customer lists, production costs, quantities, turnovers, sales, capacities, qualities, marketing plans, risks, investments, technologies, research and development programmes and their results.

Section 2.9 has been substituted with a new definition as follows:

Old:
2.9 “Extended Warranty” is an optional and additional Warranty that a consumer can purchase to extend the application of a Warranty.

New:
2.10. “Extended Warranty” is an optional and additional Warranty that a consumer can purchase, from either an OEM, or an Insurer or any other service provider offering the product, to extend the application of a Warranty within the provisions of the original warranty contract or as a new product contract.

Section 2.12 has been substituted with a new definition as follows:

Old:
2.12. “Information Barriers” means measures within an organization that are created to prevent exchanges of Commercially Sensitive Information or communication that could lead to conflicts of interest and/or constitute a prohibited practice in terms of the Act.

New:
2.13. “Information Barriers” means measures within an organization that are created to prevent exchanges of Competitively Sensitive Information or communication that could lead to conflicts of interest and/or constitute a prohibited practice in terms of the Act.

Page 6

Section 2.25 has been substituted with a new definition as follows:

Old
2.25. “Spare Parts” means replacement products for worn, defective or damaged components or parts of a Motor Vehicle.

New
2.26. “Spare Parts_” means replacement products for worn, defective or damaged components, parts or Accessories of a Motor Vehicle.

Section 2.29.1 has been substituted with a new definition as follows:

Old
2.29.1. “In-Warranty” means the period in which an OEM has an obligation to repair or replace any component or part of the Motor Vehicle which proves defective in materials or workmanship.

New
2.30.1. “In-Warranty_” _includes Extended Warranty offered by an OEM and under the same provisions as the original warranty contract and means the period in which an OEM has an obligation to repair or replace any component or part of the Motor Vehicle which proves defective in materials or workmanship

Section 5:

Page 11

Section 5.4.3 had the following words added, highlighted in bold:

Old:
5.4.3. The Motor-body repairs of consumers who have insurance cover shall be undertaken by an Approved Motor-body Repairer during the In-Warranty period, as allocated by an Insurer to the consumer.

New:
5.4.3. The Motor-body repairs of consumers who have insurance cover shall be undertaken by an Approved Motor-body Repairer during the In-Warranty period, as allocated by an Insurer to the consumer. This section only applies to repairs performed in terms of an insurance claim and does not apply to repairs that fall outside of the insurance policy or to the service and/or maintenance of the vehicle.

Section 6: The Appointment of Motor-Body Repairers by OEMs

Page 15

Section 6.4 had the words “that it” deleted as follows:

Old:
6.4 It is also common that OEMs can place limits on the number of Motor-body Repairers that it approves in a particular Designated Geographic Area. The rationale advanced by OEMs for limiting the number of repairers is typically related to cost/investment justification viz-a-viz market saturation or insufficient volume of work available in the area concerned.

New:
6.4. It is also common that OEMs can place limits on the number of Motor body repairers approved in a particular Designated Geographic Area. The rationale advanced by OEMs for limiting the number of repairers is typically related to a cost/investment justification vis-à-vis market saturation or insufficient volume of work available in the area concerned.

Section 6.9.2 had the following words added, highlighted in bold:

Old
6.9.2. OEMs shall approve any Motor-body Repairer applicant that meets their standards and specifications.

New
6.9.2. OEMs should approve any Motor-body Repairer applicant that meets their standards and specifications. However, when deciding on the number of Motor-body Repairers in a particular Designed Geographic Area, OEMs must make their assessment on a case-by-case basis, must cater for entry of HDIs to participate and not limit their decision whether or not to approve a Motor-body Repairer to prevailing market conditions or low volumes of work in the Designated Geographic Area concerned.

Section 7: Appointment of Service Providers and Allocation of Work by Insurers

Pages 16/17

Section 7.8.2 had the following words added, highlighted in bold:

Old
7.8.2. Insurers must approve any Repairer that meet their standards and specifications, to undertake repairs on out-of-warranty Motor Vehicles.

New
7.8.2 Insurers should approve any Repairer that meets their standards and specifications, to undertake repairs on out-of-warranty Motor Vehicles. However, when deciding on the number of Motor-body Repairers in a particular Designated Geographic Area, Insurers must make their assessment on a case-by-case basis,but must cater for entry of HDIs to participate and not limit their decision whether or not to approve a Motor-body Repairer to market demand and the volume of claims and work available in a Designated Geographic Area.

Section 9: Preventing Anti-Competitive Information Sharing by Multi-Brand Dealerships

Pages 19/20

Wherever the word “commercially” is present in this section it has been replaced with the word “competitively”.

Section 11: The Bundled Sale of Motor Vehicles with Value Added Products

Page 23

Section 11.1 had the following words added, highlighted in bold:

Old
11.1. In South Africa, when consumers buy a new Motor Vehicle, they are typically sold Maintenance Plan and/or Service Plan, included in the purchase price of the Motor Vehicle. Most consumers are unaware that the purchase price of the Motor Vehicle is bundled with these value-added products.

New
11.1. In South Africa, when consumers buy a new, demo and/or second-hand Motor Vehicle, they are typically sold a Maintenance Plan and/or Service Plan, included in the purchase price of the Motor Vehicle. Most consumers are unaware that the purchase price of the Motor Vehicle is bundled with these value-added products.

The word “new” has been deleted from the following Sections 11.6.1.1 and 11.6.1.2 as indicated by the crossed out word:

11.6.1.1. – purchase Value-Added Products (such as Maintenance Plans, Service Plans and Extended Warranties) concurrently and together with a new Motor Vehicle from Approved Dealers;
11.6.1.2. – purchase Value-Added Products (such as Maintenance Plans, Service Plans and Extended Warranties) separately from a new Motor Vehicle from Approved Dealers;

Page 24

Section 11.6.3 had the following words added, highlighted in bold:

Old
11.6.3. OEMs and independent/ 3rd party providers must transfer a Maintenance Plan and/or a Service Plan to a replacement Motor Vehicle in the instance where the Motor Vehicle is written off by the Insurer. In instances where there is no replacement Motor Vehicle after a write-off or it is not feasible to transfer a Maintenance Plan and/or a Service Plan to a replacement Motor Vehicle, the consumer shall be afforded the right to cancel the Value-Added contract and/or receive a refund of the value of the balance of the product.

New
11.6.3 OEMs and independent/3rd party providers must transfer a Maintenance Plan and/or a Service Plan to a replacement Motor Vehicle in the instancewhere the Motor Vehicle is written off by the Insurer. In instances where there is no replacement Motor Vehicle after a write-off or it is not feasible to transfer a Maintenance Plan and/or a Service Plan to a replacement Motor Vehicle, the consumer shall be afforded and notified of the right to cancel the Value-Added contract and/or receive a refund of the value of the balance of the product by Approved Dealers.

Page 25

The word “Commercially” is substituted with “Competitively” in the following paragraph: 11.6.4.4

Section 12: Access to Technical Information and OEM-Training for ISPs

Page 26

The addition of the following to the list contained in 12.2.3

k) part numbers on quotations and invoices

You have the freedom to choose your service provider

  • You are entitled to chose where you service your vehicle both during the in-warranty (including extended warranties) period and after.
  • You may choose to service your vehicle at the dealer from whom you purchased your vehicle or shop around for a better price.

Your warranty is protected no matter which service provider you choose

  • You are entitled to take your vehicle to an independent service provider (ISP) for your services or other non-warranty related maintenance during the in-warranty period AND still keep your warranty.
  • If the vehicle is insured all insurance based accident repairs must be undertaken by a original equipment manufacturer (OEM) approved repairer while the vehicle is still under warranty.
  • ISPs must record all work performed in the vehicle’s service book and must disclose to consumers the risk that a OEM may decline a portion of the warranty should a fault arise and the ISP or materials used be found to be the cause of the fault. In such instances the OEM is not entitled to void the warranty in its entirety.
  • ISPs must disclose to the consumer whether they have adequate commercial insurance to cover an instance where a OEM declines a warranty claim

You are entitled to use original or matching-quality spare parts and accessories

  • You are entitled to use original or matching-quality spare parts and accessories in your vehicle during your vehicle’s in-warranty period and OEMs are not entitled to void your warranty for doing so.
  • If there is any damage to the vehicle from the fitment of matching- quality parts by an ISP, there is a risk that the provisions in the warranty relating to the fault may be voided by the OEM. In such instances the OEM is not entitled to void the warranty in its entirety.
  • OEMs must make original parts available to ISPs where required to perform service, maintenance or repair work.
  • OEMs are entitled to require ISPs to meet accreditation standards before providing access to security critical components.
  • OEMs may not restrict manufacturers of spare parts from placing their logo on the parts they produce.

OEMs must adopt measures to lower financial barriers to becoming a dealer

OEMs shall not impose onerous obligations to prospective dealers and take measures to make becoming a dealer more accessible, with preference given to historically disadvantaged individuals (HDIs).

Unbundling of service/maintenance plans from the price of a vehicle

  • Vehicle retailers are now obliged to provide you with separate prices for your vehicle and for any value added products that they have on offer such as service and maintenance plans, extended warranties ect.
  • Included in the price breakdown must be the average price of each service included and the average price of the parts covered by a maintenance plan.
  • Car retailers are also obliged to sell you a vehicle without a service or maintenance plan if you do not wish to purchase one and simply pay for your services as they are performed.
  • You are entitled to purchase value added products from any licensed third parties.

Workshops are entitled to technical information

  • ISPs are entitled to be provided with the technical information they require in order to work on the vehicles brought to them by their customers.
  • OEMs must provide access to training to employees of ISPs who request training.
  • OEMs are required to provide the technical information and/or training on reasonable terms and conditions that are no less favourable to the terms offered to its dealers and approved motor body repairers.
  • The information that OEMs are required to provide access to includes, but is not limited to: service books (stored electronically or in the cloud); technical repair and service information; diagnostic codes; operational software and data record information.

OEMS must adopt measures to promote the entry of new repairers

  • OEMS must give preference to HDI owned repairers;
  • OEMS must approve repairers on a case-by-case basis;
  • OEMS may not enter into exclusive agreements relating to a geographic area;
  • OEMS may not enter into contracts exceeding 5 years or continuously renew agreements to the exclusion of new ISPs.

Insurers must adopt measurers to ensure the fair allocation of work

  • Insurers must give preference to HDI owned repairers;
  • Insurers must approve repairers on a case-by-case basis;
  • For transparency insurers must publish the standards used to accredit repairers and a list of all of their repairers on their website;
  • Vehicles under warranty shall only be allocated to OEM approved repairers;
  • Insurers may not enter into contracts exceeding 5 years or continuously renew agreements to the exclusion of new ISPs.

Stand up for your rights!

Encountered what you believe to be non-compliance with the Guidelines?

Contact Right to Repair South Africa at kate@r2r.org.za or lay a complaint directly with the Competition Commission by doing the following:

Download the complaint form here and fill it in.
Prepare a written statement setting out all of the facts relating to your complaint and attach any evidence you may have to the statement (eg. an email, photograph ect.)
Email your complaint form together with the written statement and evidence to ccsa@compcom.co.za
For full details regarding lodging a complaint visit the Competition Commission’s website here.

An OEM has declined your warranty, now what?

When you bring your vehicle to a OEM with a suspected warranty fault the manufacturer must at its own cost conduct an assessment of the vehicle and fault to ascertain the cause of the failure. If the failure is a factory fault the OEM is obliged to honour the warranty.

If the OEM declines your warranty without a valid basis, your options are to contact the Motor Industry Ombudsman here, approach an attorney to take legal action or if the basis on which the OEM is refusing to honour your warranty relates to any of the provisions of the Guidelines such as making use of an ISP for your services then you can contact the Competition Commission by following the instructions above.

If the OEM is able to provide evidence that the failure can be attributed to the work performed by an ISP or the parts/materials used by an ISP then you are entitled to claim against any party in the supply chain (ISP, supplier, manufacturer ect.) If the ISP/supplier/manufacturer disputes your claim you are entitled to approach the Motor Industry Ombudsman or approach an attorney to assist you with your claim.

Enforceability of the Guidelines

The Guidelines are not enforceable as a stand alone document. However the Guidelines were created as a document which must be considered when interpreting the Competition Act in the context of the Automotive Aftermarket. The Competition Act is of course enforceable and accordingly the sections of the Guidelines which are very clear and directive in their nature must be adhered to if one wishes to stay on the right side of the law.

To access FAQs on the Guidelines click here and for a copy of the full Guidelines click here.

This infographic was prepared by Right to Repair South Africa to serve as an explanation of the Competition Commission’s Guidelines and does not constitute legal advice. The final decision on the implementation of the guidelines lies solely with the Competition Commission. To continue to fight for your Right to Repair we require donations from the public, to make a donation or for any other enquiries email kate@r2r.org.za.

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