Motor Vehicle Block Exemption Regulation
The CMA will be reviewing the retained Motor Vehicle Block Exemption Regulation to inform its recommendation to government on whether to replace or vary it when it expires on 31 May 2023.
Final Guidance
1 June 2023: The Competition Act 1998 (Motor Vehicle Agreements Block Exemption) (No. 2) Order 2023 (the MVBEO) has came into force. Following consultation with interested parties, the CMA has published Motor Vehicle Agreements guidance to accompany the MVBEO.
Recommendation to the Secretary of State
4 October 2022: The CMA has published its final recommendation to the Secretary of State.
Consultation on proposed recommendation to the Secretary of State
21 July 2022: The CMA has published, for consultation, its proposed recommendations to the Secretary of State. The CMA will consider responses to the consultation before making a final recommendation to the Secretary of State later in 2022.
Summary
The CMA will be reviewing the retained Motor Vehicle Block Exemption Regulation to inform its recommendation to government on whether to replace or vary it when it expires on 31 May 2023.
Timetable of work
| Date | Action |
|---|---|
| 31 May 2023 | Retained Motor Vehicle Block Exemption Regulation expires, is varied, or is replaced |
| October 2022 | CMA’s final recommendation to Secretary of State |
| Summer 2022 | Consultation on CMA’s proposed recommendation to Secretary of State |
Context
The Competition Act 1998 prohibits agreements between businesses that restrict competition in the UK (unless they meet the conditions for exemption in section 9(1) of the Competition Act or are otherwise excluded). This is known as the Chapter I prohibition.
An agreement is exempt from the Chapter I prohibition if it creates sufficient efficiencies and benefits to outweigh any anti-competitive effects. A ‘block exemption’ regulation automatically exempts agreements of a certain category from the Chapter I prohibition if the agreement satisfies the conditions set out in the block exemption regulation. In this way, a ‘block exemption’ regulation provides legal certainty for businesses.
Following the UK’s exit from the EU, the EU ‘block exemption’ regulations that were in force under EU law at the end of the Transition Period on 31 December 2020 were retained in UK law. For details on what the retained block exemptions cover, see Guidance on the functions of the CMA after the end of the Transition Period (paragraphs 4.31 to 4.36).
The retained Motor Vehicle Block Exemption Regulation (MVBER), which expires on 31 May 2023, sets out automatic exemptions for certain categories of agreements related to the purchase, sale, and resale of spare parts for motor vehicles, and the provision of repair and maintenance services for motor vehicles.
The CMA’s review of the retained MVBER
The CMA’s review will assess whether the retained MVBER meets its intended purpose and takes account of specific features of the UK economy serving the interests of UK businesses and consumers, as well as considering the impact of recent developments in technology and industry business models. The CMA’s review will also include assessing the European Commission guidelines that accompany the existing MVBER, namely the supplementary guidelines on vertical restraints in agreements for the sale and repair of motor vehicles and for the distribution of spare parts for motor vehicles (Supplementary Guidelines).
The European Commission launched its review of the MVBER in December 2018. In May 2021, the European Commission finalised its evaluation phase and concluded that the MVBER remained useful and relevant for stakeholders, but that its effectiveness and coherence could be improved. The CMA will draw on evidence from the European Commission’s evaluation, to the extent that it is relevant to the UK.
What the CMA is planning to do and when
The CMA will provide further information on this webpage in due course regarding the review process for the retained MVBER. It is expected that the review process will be similar to that of previously reviewed retained block exemptions.
The CMA plans to consult on its proposed recommendation in late spring / early summer of 2022.
If you have any queries, please contact us at [email protected].
Background
In accordance with the Competition Act 1998 the CMA has a role in advising the Secretary of State for Business, Energy and Industrial Strategy on varying or revoking retained block exemption regulations, or replacing them with UK legislation when they expire.
The CMA has recently completed its review of the retained Vertical Block Exemption Regulation and published its recommendation to the Secretary of State on 3 November 2021. The CMA has launched its review of the Horizontal Block Exemption Regulations (HBERs), with an initial Call for inputs which closed on 11 January 2022. The CMA will be reviewing the other retained block exemption regulations in due course in order to make recommendations to the Secretary of State.
Personal data
When handling personal data (like your contact details), we comply with data protection law, as set out in the UK General Data Protection Regulation and the Data Protection Act 2018 and other laws designed to protect sensitive information.
For more information about the CMA’s statutory functions, how the CMA processes personal data and your rights relating to that personal data (including your right to complain), please visit the CMA’s Personal Information Charter.
Updates to this page
Published 16 March 2022Last updated 5 June 2023 + show all updates
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Final guidance published
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Recommendation to the Secretary of State announced.
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Update on proposed recommendations to the Secretary of State.
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First published.