King
John Myers Jr., Staff Reporter
WIDESPREAD ABUSE by some auto parts dealers forced the Government to implement a new policy governing the importation of damaged vehicles and body parts, according to trade consultant and chairman of the Trade Board, Ambassador Peter King.
"The market was restricted and it resulted in widespread black market activity, unconscionable price mark-ups and a general trend of free-for-all activity without licence," he told The Sunday Gleaner.
He explained that with the previous system, dealerships "just mushroomed" in almost every town in the island and people who bought used cars were often fleeced.
"So as a result of this, we put up a new policy that sought to revise, expand and liberalise the importation of motor vehicles into the island, "
RESTRICTIONS
The new policy measures implemented by the Ministry of Commerce, Science and Technology effected several restrictions governing the importation of damaged or salvaged vehicles by dealers, as well as the transfer of vehicles prior to customs clearance.
Restrictions were also placed on the importation of half-cars and clips which now require approval from the Trade Board to import for repairs to a vehicles registered, or was previously registered to operate in Jamaica.
"The most glaring activity in this was that people (dealers) were bringing sections of cars or damaged cars in bulk. A dealer would bring it in, patch it up together, spray it and you would think you are getting a genuine used car without knowledge of the history that it has gone through a series of accidents, in which case makes some of them structurally deficient," Ambassador King explained.
He said there were instances too, of dealers deliberately damaging vehicles in order to benefit from lower importation duties.
"You would have, for instance, a BMW (where) somebody cuts a hole in the roof...and that car arrives as a damaged car, attracting a totally lower level of duty," he pointed out. "When you examine carefully and open the trunk of the car, there (lies) the piece that was cut out of the car," he added. This, he said, results in the Government losing significant revenue.
Kenneth Shaw, president of the Jamaica Used Car Dealers Association (JUCDA), conceded that this was a common practice among some car dealers.
He said, "A significant portion of the vehicles that are brought in were damaged. A significant amount of damaged vehicles, at different levels, have been imported over the last year or two."
Ambassador King pointed out there were concerns by some dealers about how the Customs Department would now assess vehicles which have been legitimately damaged through transportation, for example.
However, he said "Customs are well-trained and are able to use the adjustment."
Mr. King said a series of seminars will be held with the various stakeholders to facilitate full understanding and transparency.
Despite the inconvenience and added restrictions, Mr. Shaw said JUCDA was in full support: "The Association didn't feel it was the way forward for our industry. We felt that we didn't have a crashed car industry, we have a used car industry and a lot of people who were perpetrators were not members of our Association," he said. "And from a moral point of view, we felt that customers shouldn't be sold a crashed car not knowing prior to purchasing the vehicle and they were being sold at the regular market value."
The JUCDA president noted that in many instances the chassis of these vehicles were twisted and the front ends damaged, resulting in the buyer having to spend money to repair these defects.
LEVEL PLAYING FIELD
Mr. Shaw said the new policy will "make the playing field a lot more level in that you won't have anybody bringing in car that would cost them $500,000 and they sell it for $1.5 million. It makes the playing field more level, it protects the consumer and it protects the industry in the long run."
The new policy measures were introduced following consultations with JUCDA, the Automobile Dealers Associa-tion, the Jamaica Bureau of Standards the Customs Department and other key stakeholders.
Under the new policy, the Island Traffic Authority will no longer issue Certificates of Fitness for vehicles created from imported clips or half cars.
The Inland Revenue Department will no longer licence cars older than three years, light commercial vehicles older than four years, or vehicles not accompanied by the relevant customs documentation.
