Submission Number: 563688-00158
Received: 3/13/2013 6:21:01 PM
Commenter: Faisal Hasan
Organization: CARFAX, Inc.
Agency: Federal Trade Commission
Initiative: 16 CFR Part 455 Used Motor Vehicle Trade Regulation Rule; Project No. P087604
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March 13, 2013
Federal Trade Commission
Office of the Secretary
Room H-113 (Annex T)
600 Pennsylvania Avenue, NW
Washington, DC 20580
Office of Information and Regulatory Affairs
Office of Management and Budget
Attention: Desk Officer for the Federal Trade Commission
725 17th Street NW, Room 10102
Washington, DC 20503
Re: Used Car Rule Regulatory Review, Project No. P087604
Dear Mr. Hallerud and FTC Desk Officer:
The Federal Trade Commission (FTC) is considering revisions to the Buyers Guide based on comments received in response to the Regulatory Review Notice. The FTC has determined to retain the Rule and is seeking comments on the following potential revisions to the Rule: (1) Revising the Buyers Guide to provide additional boxes where dealers would have the option to indicate manufacturers’ and third-party warranties; (2) adding a statement to the Buyers Guide encouraging consumers to seek vehicle history information and directing consumers to an FTC Web site for more information about vehicle histories and sources for that information; (3) retaining the List of Systems and adding catalytic converters and airbags to it; and (4) adding a statement in Spanish to the English Buyers Guide directing consumers who cannot read the Buyers Guide in English to ask for a copy of it in Spanish.
CARFAX, Inc., a Polk company, which offers vehicle history reports to North American used car buyers and sellers, insurers, auto mobile manufacturers and local/state/federal governments among others, is providing comments on the FTC’s notice of proposed rulemaking referenced above. Specifically, CARFAX is commenting on the FTC’s proposal to add a statement to the Buyers Guide encouraging consumers to seek vehicle history information and directing consumers to an FTC Web site for more information about vehicle histories and sources for that information.
In addition, CARFAX is attaching a new, proposed, Buyers Guide in English and Spanish for the FTC’s consideration. CARFAX believes it’s essential the Buyers Guide be available in Spanish upon request and supports this effort. The Buyers Guide primary need is for specific disclosures to protect used car buyers and sellers. A revision to the Buyers Guide, as proposed by CARFAX, simplifies the basic concepts the FTC discusses in the rulemaking. CARFAX’s proposed Buyers Guide provides clear disclosure for the used car buyer and seller by declaring whether the vehicle: 1) has a warranty; 2) has been inspected or being sold “as is”; 3) if a vehicle history report is available on the vehicle, and, if not, providing direction on where to obtain; and 4) if the vehicle has an open recall.
The Buyers Guide can do more to assist used car buyers. However, the FTC must be careful to not place the entire burden of disclosure on the used car seller. Leaving the seller in control of the complete disclosure leaves the buyer with a false sense of security. Buying a used vehicle must be a shared burden. The seller must disclose basic items about the vehicle as provided in the proposed CARFAX Buyers Guide. The buyer has a responsibility to obtain the missing information, take the vehicle for a test drive and have an independent mechanic’s inspection. The FTC’s role, through the Buyers Guide, should not only be one of disclosure but also of education.
CARFAX works with over 31,000 dealers across the United States. They are all small businesses who struggle with increasing regulation. Placing the sole burden of information gathering and disclosure on these dealers isn’t the right approach.
Dealers and used car sellers should never be left as the sole source for disseminating important vehicle information just as the FTC must not rely on a single source for the dissemination of vehicle history information. The key is to educate consumers about their options and allow them to choose.
We appreciate the opportunity to comment.