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The Motor Traders' Association of NSW (MTA NSW) is one of the

largest state-based industry associations in Australia.

Founded in 1910, the MTA NSW represents the interests of over 3,000 owners and business principals and 36,000 employees in the automotive industry throughout NSW and ACT. The Association provides extensive industry information to its membership base and addresses issues through lobbying at local, State and Federal Government levels.

MTA NSW is held in high regard by industry stakeholders due to the longevity of its establishment, where it has been representing the automotive industry in NSW for more than 110 years. MTA NSW offers Members great value for their membership subscription with a range of services and products supplementing its traditional core services.

MTA’s advertising and promotional activities over many years has developed a public recognition of the MTA NSW logo and catch phrase ‘Deal with someone you can trust.’ Both in NSW and the ACT, MTA NSW is strongly placed to represent the interests of Members. The MTA NSW is a registered Organisation under the Fair Work (Registered Organisations) Act 2009. In addition, MTA NSW is a Registered Training Organisation (RTO) and delivers on-site training at business premises, to apprentices in the motor trade industry.

MTA NSW is in continual contact with politicians and Government officials and regularly provides advice to them on matters affecting the motor industry. The Association is the principal consultative party and a leader in employment relations issues impacting the Retail Motor Industry in the State.

MTA NSW is a founding member of the Motor Trades Association of Australia (MTAA), which is the National Body that draws together the MTA related organisations from other States and Territories to represent the industry at a Federal level.

Member and industry suppliers’ support also adds greatly to the success of the Association and the activities it undertakes.

As a peak body, the MTA NSW represents the interests of the following automotive industry participants:

Auto Dismantlers; Auto Electrical Specialists; Auto and Marine Trimmers; Auto Mechanical Repairers; Auto Transmission and Rebuilders; Automobile Dealers – New and Used; Australian Heavy Vehicle Repairers; Body Repairers; Brake Repair Specialists; Caravan Industry; Commercial Vehicle Industry; Engine Reconditioners; Exhaust System; Farm Machinery Dealers; General Trades; Hire Car and Chauffeur Driven Limousines; Motor Bus; Motor Cycle Industry; Motor Vehicle Assessor and Inspector; Parts and Accessories; Radiator Specialists; Rental Vehicles; Rustproofing Specialists; Service Stations; Steering and Suspension Specialists; Tow Truck Operators; Tyre Dealers and Retreaders.

It is to be recognised and acknowledged that a strong and mutual working relationship has been developed with NSW Fair Trading and the MTA NSW, with several issues jointly addressed for the betterment of the industry.

The Motor Traders’ Association of NSW appreciates the opportunity to provide a submission to the Department of Customer Service regarding the Statutory Review of the Motor Dealers and Repairers Act 2013

To provide an appropriate balance between Regulation and our Members’ requirements, MTA NSW makes the following recommendations and comments in relation to the proposed review.

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Chapter 2 – Scope of the Act

Objects

The Act aims to balance necessary safety and protective measures with flexible and modern regulatory practices, as well as appropriate penalties and deterrents to ensure compliance and to minimise unlawful conduct and behaviour within the NSW automotive industry.

The objects of the Act provided in section 3 of the Act are:

a) to provide consumer protections and remedies for consumers who purchase motor vehiclesfrom motor dealers or obtain motor vehicle repair services,

b) to establish appropriate standards of conduct and transparency for motor dealers, motorvehicle repairers and motor vehicle recyclers,

c) to provide enforcement mechanisms to prevent misleading or dishonest conduct and illegaldealings with motor vehicles and parts,

d) to provide protection for motor dealers against unfair contract dealings by motor vehiclemanufacturers.

Question 1

Are the current objects of the Act still valid? Do the terms of the Act remain appropriate for securing those objects?

MTA NSW believes that the current objects of the Act are valid but the terms to secure those objectives need legislative change. For example, record keeping is a part of day to day business operations, keeping receipts and invoices for tax purposes and so on.

There are strict requirements for automotive recyclers which have been in place for many years. With the introduction of the current Act came the introduction of a Form 2 (Prescribed Second-hand Parts Register). This must be used by automotive dealers and repairers to record prescribed parts. This is not only a duplication of record keeping, but also has a huge impact financially on automotive dealers and repairers. One member of MTA NSW was required to put on two (2) full time staff to manage the physical paperwork at a cost of upwards of $100,000 to keep the register up to date. This additional work does not further the objects of the Act.

RESPONSE

With current ATO requirements and the requirements of second-hand parts suppliers, there is sufficient information in relation to those prescribed parts for the objects of the ACT. These receipts and invoices are generally kept electronically which would negate the need for the Form 2. There is no evidence to suggest that the Form 2 has any real use, except for recording consumer supplied parts.

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Question 2

Does the Act appropriately balance the interests of consumers and licence holders with the broader objects?

RESPONSE

MTA NSW believes that the Act does not appropriately balance the interests of consumers and licence holders within the broader objects of the Act. There is little to no avenue for the licence holder to exercise their rights in disputes, especially as there is no apparent regulator. Further, the NSW Civil and Administrative Tribunal (NCAT) procedure is predominately consumer focused. By way of example, NCAT members having little to no automotive specific knowledge.

Question 3

Are there other objects that should be included? If so, please identify what these should be and explain why. What are the complimentary measures that need to be included in the Act to give effect to these options?

RECOMMENDATION

MTA NSW considers that a further object of the Act, should be for the fair, balanced and efficient management of the industry and in this regard, MTA NSW recommends that there be:

• The re-establishment of the Automotive Unit of NSW Fair Trading as the overridingregulator of the automotive industry; and

• That a separate body with industry experience be appointed to oversee the licencing ofoperators in the Automotive Industry

• Ability of Motor Dealers, under Part 6, to refer issues surrounding unfair contracts toFederal Enforcement agencies such as the Australian Competition and ConsumerCommission (ACCC)

There has been a growing trend for more and more consumers taking automotive businesses to NCAT on their interpretation of the Act and the Australian Consumer Law (ACL). The consumer is also contacting NSW Fair Trading to make a complaint and the member feedback which MTA NSW has received is that consumers are being told that they are correct in their interpretation and that the dealer or repairer has to make good. In several cases, it appears to simply be an opportunity for the consumer to get a financial advantage and the lack of Industry knowledge within the Department prevents these claims from being dealt with appropriately at the onset. MTA NSW does recognise that some dealers and repairers unfortunately may do the wrong thing.

This example is provided to support the recommendation for the need to re-establish the Automotive Unit of NSW Fair Trading. This Unit previously had the ability to not only mediate but issue rectification orders on the dealer, repairer, and the consumer. The appointment of industry specialists to operate within this unit will assist in the proper determination of disputes between consumers and the automotive industry. In addition, the Unit was also the regulator and could issue on the spot fines for a multitude of reasons. Today, if someone is caught trading unlicensed it usually equates to a warning and a request to obtain a license. This position lessens the ability of the Act to meet its object of providing consumer protection.

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Further, the appointment of an independent body to be able to work hand in hand with the Automotive Unit will ensure that all legislative requirements surrounding licencing and operations are met by the automotive industry.

In relation to Part 6, the MTA NSW recommends that additional legislation protection be provided for Motor Dealers and Repairers against unfair Contract dealings, in particular for franchised businesses. New car motor dealer franchises need to have stronger protections and or regulatory process to help protect these businesses from unfair contract terms from manufacturers and or suppliers.

The current sections of the Motor Dealers and Repairers Act Part 6 require stronger options for business to access than the current sections related to Section 144 Complaints to Small Business Commissioner. These options should include the ability for complaints to be referred to Federal Enforcement Authorities such as the ACCC who are able to provide the necessary resources to fully investigate and if necessary prosecute breaches of the Competition and Consumer Act, 2020 (Cth)

This section of the Act around Part 6 is not sufficient and is often a time-consuming process with no action or result and motor dealers in fear of losing their franchise agreements. Please refer to the survey findings from the NSW Motor Dealer Industry to questions in relation to Chapter 2 – Scope of the Act contained in the review referencing part d) protection of motor dealers against unfair contract dealings

Appendix B MD&R Review survey questions and results.

There is a genuine lack of confidence from the motor dealer industry in the way in which the protections are regulated and or applied within the State against manufacturers. The preferred options as the data shows is an independent Federal regulator, such as the ACCC, this is required for new car dealers as the concerns are national.

For example, recent closures of manufacturers such as GM Holden impacts across the country. Manufacturers have a significant imbalance in favour of themselves. NSW, with so many motor dealer businesses, would be severely impacted if more manufacturers withdraw or changed the retail selling model in Australia.

Plus, in many cases, dealers must foot the cost for poorly made products that are allowed to enter the country. Some manufacturers and distributors are putting pressure on the motor dealers to rectify and if not, they are challenged or being threatened adversely with a potential loss of their Franchise or will have monetary penalties applied based on unfair terms that are set out in the Franchise agreements.

This also allows for poor business behaviours to be introduced to achieve objectives and targets with manufacturers in order to survive, in what is a very low margin and competitive industry.

Motor dealers are also being forced to take unwanted stock and or models that are faulty. In recent times, Ford Australia made its Franchise Dealers sell faulty vehicles with transmission issues and the ACCC eventually was involved. This had an impact on motor dealers as well.  

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Similarly, Volkswagen with their diesel emission issues took a class action against the manufacturer to rectify the problem. Again, franchise dealers were penalised for no wrongdoing of their own accord. 

Dealers should be able to lodge claims direct to NCAT for mediation, which could then lead to NCAT referring it to a Federal regulator like the ACCC, when dealing with specific franchise tasks.  This is not only a NSW issue but a national issue for all motor dealers across Australia with unfair dealings with some overseas manufacturers.

What and who should be regulated?

What and who should be regulated is a key consideration for this review. The definition of a ‘motor vehicle’ is central to the application of the Act, as it impacts on who must be licensed and what obligations are needed to safeguard consumers. The current scope of the Act may need to be modified to meet the needs of an ever-changing regulatory landscape and be flexible enough to accommodate new and emerging technologies.

Question 4

Are the definitions in the Act appropriate? If not, how could the definitions be changed?

MTA NSW believes that the definitions in the Act are appropriate, but that they should include alternate powered vehicles such as Electric, Hybrid and Hydrogen powered vehicles.

Question 5

Who should be regulated or hold a licence under the Act?

MTA NSW believes that any person that works within the automotive industry and has the ability to affect the integrity and the safety of the motor vehicle should be licensed and that same person has the correct qualifications and licence to do the work that they carry out. This requirement is fundamental to the object of the Act to protect consumers in their dealings with business in the automotive industry.

RECOMMENDATION

In addition to the current regulations, we recommend that motor vehicle assessors should be licensed. Motor vehicle assessors that work for insurance companies are assessing quotes and advising repairers how to repair vehicles, however these persons do not have the correct qualifications or trade licences. If anything goes wrong with the recommendations of these persons, then the onus falls back onto the repairer.

Also, businesses that offer advice on how to change brake pads or scan a customer’s vehicle for electronic faults due to an issue, should also be licensed. These individuals or businesses need to hold the appropriate qualifications and trade licences as they have potentially compromised consumer safety by offering unqualified advice.

Unfortunately, these businesses or individuals are currently not covered under the current regulatory process and in the submission of MTA NSW this is not consistent with the object of the Act. MTA NSW believes that this is another reason why the Automotive Unit of NSW

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Fair Trading needs to be re-established and for Government to work together with an independent appointed body to oversee licensing of businesses in the automotive industry.

Further, under the current Act, there is no licensing requirements to work on Electric, Hybrid, Autonomous or Hydrogen powered vehicles. This is a serious oversight as these vehicles, if worked on incorrectly can seriously injure or kill the tradespeople that are working on them. There is also the possibility that if worked on incorrectly, the consumer could be seriously injured or killed and endangers the lives of other motorists. The legislation needs to adapt to the technologies that are now being utilised in the automotive industry and marketplace.

Licensing criteria

The Act sets out eligibility requirements and assessment criteria for those entities who can be

granted a licence. It also sets out the fees for those licences and requirements for payments

to the Compensation Fund.

The types of licences under the Act are:

• motor dealers’ licence

• motor vehicle recyclers licence

• motor vehicle repairers’ licence

• tradesperson’s certificate

Question 6

Is the licensing criteria, including licence fees and duration, appropriate? Why or why

not? If you think there should be changes, please provide details.

RECOMMENDATION

MTA NSW believes that the current licencing criteria is appropriate for persons selling from fixed premises, however in giving motor dealers the ability to now be able to sell at trade shows, this needs to be further applied to the whole dealer network i.e. cars, motorbikes, caravans and trailers. MTA NSW also submits that it should be a requirement that any interstate dealer attending trade shows within NSW should hold a current NSW dealers’ licence.

Chapter 3 – Motor dealers and motor vehicle recyclers

Background

More than 980 individuals and 2,500 organisations are licensed as motor dealers and or recyclers under the Act, the majority being motor dealers. Licence holders can hold more than one licence under the Act with some holding both a motor vehicle recycler and motor dealers’ licence. The Act sets out a licensing framework, provides regulatory tools for compliance and enforcement and protections for consumers. Technological changes have paved the way for new ways of doing business for the sale of motor vehicles, which need to be captured by the licensing framework.

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Question 7

What activities should be captured in a motor dealer’s licence?

RECOMMENDATION

In addition to the current activities which are required to be licensed, MTA NSW recommends that the following activities should be licensed:

(a) The Distributors or Agents importing cars into Australia should be licenced the same as motor dealers. This would allow for better regulation around the supply of goods (being cars) to dealers and enforces the acceptable quality and fit for purpose requirements under the ACL.

(b) Brokers and car buying agents should be licenced to retail New and Used vehicles. They are effectively negotiating the purchase with no responsibility and not regulated and could hurt the consumer by coercing the purchase of inferior products or old stock with greater margins. They profiteer from the consumer and at the motor dealers’ expense and have no responsibility in the transactions to purchase cars. By being licenced they would then need to adhere to the rules set under the motor dealer licence to trade and the ACL.

MTA NSW also suggests that the Act should have definitions altered to suit new car demonstrator models and allow for new car company vehicles and loan cars. These are often confused as demonstrator models based on the definition or how it is reported on the current franchise sales models by manufacturers. These vehicles should be treated as “new” and not as “used” as is presently the case.

MTA NSW believes that currently the definition of a new car demonstrator restricts and hinders the sales process with unnecessary regulatory burdens for motor dealers retailing new car demonstrator models. Currently under the Act they are treated as a used car and sold on a dealer notice such as a Form 5. This creates confusion for both motor dealers and consumers.

There is also the unnecessary requirement of selling demonstrators with a current inspection report (pink slip) when it’s already been registered and often has less than a few 100km’s and in most cases company and or loan vehicles are sold with less than 5000km's and are delivered within a 6-month period from new.

These vehicles under the current registration renewal rules in NSW do not require inspections for consumers for 5 years but are required when sold as a demonstrator. So why place the burden on these vehicles for dealerships if the car is under 5 years of age and is covered by a manufacturer's warranty, in some cases from 5 – 7 years. Also, the majority of vehicle manufacturers back-date the warranty to start from the sale date so as not to penalise the consumer.

MTA NSW seeks alternative amendments to the Regulation requirements and Section 61 of the Act to allow demonstrators to be sold as new car demonstration models on ‘contract of sale’, due to the consumer being the rightful first owner and not the dealer.

Section 55 (1) and (2) of the Act also needs to be amended allowing for current registration renewal requirement for inspection notices for vehicles under 5 years of age and should be exempt from inspection reports. This does not impact or affect the consumer

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under the ACL and or dealers guarantees to apply to make sure the vehicles sold are of acceptable quality and fit for purpose.

Question 8

Do the current obligations for motor dealers adequately ensure consumer safety and protection? Please provide comments.

RESPONSE

MTA NSW believes the Act provides sufficient protections for consumers in current legislation but lacks the regulatory or mediation supports, when navigating through general or even difficult complaints for both consumers and businesses.

However, MTA NSW believes that these protections are heavily weighted to the consumer. Even with the strict licencing requirements for businesses to operate within, and adhere to, there is a lot of uncertain terms contained within the Act for motor dealers when it comes to licences and or motor vehicle repairer licencing requirements.

RECOMMENDATION

Therefore, the industry requires the Government to re-establish the NSW Fair Trading Automotive Unit. This would also reduce the back log in NCAT representations with unjustified claims. The system needs to allow businesses to mediate centred on the ACL without having to be locked into NCAT for resolution of what is already a requirement on “dealer guarantees” or warranty for goods and services. A requirement of mediation before any claims progress will assist both consumers and businesses to swiftly deal with issues.

The experience of business in the motor industry is that they are susceptible to different opinions of what is fair and reasonable under the ACL and even in NCAT when it comes to warranty. There is currently no consistency in the interpretation of what is acceptable quality or fit for purpose for used vehicles. Legislative guidelines on these concepts as well as the appointment of a specialist unit with persons having industry experience will assist in providing guidance and certainty on how these issues are determined between consumers and businesses.

Question 9

Are there other regulatory tools that could be considered to help enforce compliance with the Act? If so, please provide examples.

RECOMMENDATION

MTA NSW would recommend that the following additional regulatory tools be considered to assist Government with compliance with the Act:

(a) The NSW Fair Trading Automotive Unit is required as a regulatory function within the Department of Customer Services NSW and this Unit is crucial and should be re-established as a vehicle inspection team and have a separate compliance regulatory function to keep both the consumer protected and safe and also keep the business safe from unreasonable consumer claims.

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(b) That an independent body such as MTA NSW be appointed to assist Government with the regulation and compliance with licensing. MTA NSW already assists its members with licencing and compliance and indeed membership to MTA NSW is preconditioned upon compliance with our “Code of Ethics”. This forms the basis of what the Association already does to support the industry and Members. MTA NSW has the industry knowledge and reputation, as well as resources to assist Government in this task.

Examples of how these regulatory tools would operate:

• The NSW Fair Trading Automotive Unit previously would investigate complaints fromconsumers and in turn inspect, if required and communicate with business to eithercheck compliance breach’s in legislation or regulations and if needed would applyenforcement infringements and or cautions for the business.

Or alternatively resolve unfair claims and mediate with consumers aroundmisinformed claims against business to resolve and not havethe unnecessary burden for business to attend NCAT for minor claims.

• MTA NSW alternatively could be considered as a regulatory compliance body, as theAssociation currently supplies industry with supports in compliance adviceincluding signage, regulatory forms, and dealer notices that are required in the MotorDealers and Repairers Act.

MTA NSW as a Registered Training Organisation (RTO) also delivers training qualifications required to industry under the MD&R, so therefore would have the resources and qualifications on hand to assist industry and keep businesses compliant in repairers licencing and individual licencing requirements.

This would also be a potential solution to an alternate regulatory enforcement body if it were supported and funded by the NSW Government. MTA NSW is the leading industry body representing the motor industry in NSW and so would make sense to be the alternative regulator and or mediator for the industry.

Question 10

Should the dealer guarantee under the Act remain the same, or rely on the consumer guarantees under the ACL? Explain why.

RESPONSE

MTA NSW believes that this is not a sustainable system to have both as it creates confusion for both the dealer industry and consumers in general. Not to mention unfair claims and costs to the industry.

The additional costs in dealing with both dealer guarantees and consumer guarantees creates an unfair and uncompetitive environment for motor dealers selling cars as against new entrants who sell online or through other distribution models such as auction houses or private sales. These additional costs are a deterrent to the dealership network expanding and this has the consequent effect of limiting employment prospects in the industry and regional and rural NSW where margins are finer than in the Metropolitan areas.

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By way of example, the additional costs of having both guarantees apply means that vehicles with a consumer guarantee that have a failure could still have the ACL apply outside of the warranty period such as 3 months / 5000 km’s terms when under 10 years of age and or under 160,000 km’s for used cars.

Further, the requirements of dealer guarantees and consumer guarantees vary across new and used cars in that the definitions “fit for purpose” and or “acceptable quality” for goods and services are applied differently. It would be clearer if the dealer guarantee requirements formed part of the ACL and hence only one set of rules applied to remove any confusion.

The consumer law “fit for purpose” does not factor reasonable wear and tear items effectively, also usage and mileage and does not consider that vehicles will have normal wear and tear. This means dealers need to charge considerably more to sell vehicles to cover unexpected costs which also effects the consumer by having to pay more for these cars. Especially, if they need to trade the vehicle, then the value of the trade is also impacted as they will receive less.

RECOMMENDATION

MTA NSW recommends that dealerships should only be accountable for the requirements

under the ACL which is the governing Federal legislation.

New business models and ways of working

New business models for motor dealers have emerged, often as a result of technology. This includes online only dealerships, particularly for second-hand cars, buying vehicles from overseas, integrated businesses, or a one-stop shop for servicing and mobile mechanics. Technological innovations provide consumers with greater choice about the types of vehicles they use and how they travel. They also provide industry the scope to trial and introduce new ways of working. In response, the Act should be agile enough to be able to regulate and accommodate newer business models that fall within its remit.

Question 11

How could the Act capture future innovations and developments such as new business models and emerging technologies?

RESPONSE

New industry business models are being developed such as ride share sales models, rental / buy car ownership models and online trading for future dealerships. For example, car retailers operate in new ways such as retail shopping centres and or CBD locations where cars are stored in warehouses ready for delivery as technology is changing at a rapid rate.

In addition, new emerging technologies such as battery Electric Vehicles (EV), autonomous driving, hydrogen and hybrid models are evolving.

New car dealer franchises are also at risk as there is no manufacturing within Australia. This

means that new car sales will shift from a Dealership model to an Agency

agreement scenario as ‘distributors’ and no manufacturer representation.

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This is prevalent with manufacturers withdrawing from the Australian market such as Holden

and GM global and more recently with Honda and Mercedes-Benz announcing new retailing

platforms. This will possibly affect the franchise business models and in turn will

affect consumers when it comes to consumer guarantees with large corporate entities

operating from outside Australia.

RECOMMENDATION

The Act does not take into account these new types of business models and will need to

have provisions to allow for Exceptions and Exemptions to be allowed to amend trading and

operational requirements whilst still forming protections for consumer and dealer

businesses. This is so industry can adapt to new processes and pre-empted changes in how

businesses will be required to trade in the future. Technology is constantly changing but the

rules and requirements currently are not always adaptable.

Allowance for amendments in legislation will better accommodate for changes whether it be

new innovations or new training, retailing and licensing requirements.

Motor vehicle recyclers

Licensing framework

In NSW, motor vehicle recyclers are required to hold a licence if their business involves:

• buying or obtaining, and demolishing or dismantling motor vehicles or parts oraccessories of motor vehicles

• buying and selling major body and mechanical components of motor vehicles, major caraccessories, and prescribed parts or accessories of motor vehicles

Motor vehicle recyclers are licensed, to limit backyard recycling and to ensure records are kept for vehicles, parts and accessories that are recycled. Similarly, individuals dealing with scrap metal are regulated in NSW.

Question 12

What activities should be captured in a motor vehicle recyclers licence?

RESPONSE

MTA NSW believes the current activities as defined in the Act are sufficient for the purpose of covering activities for this class of licence for vehicle recyclers being:

(a) Buying and obtaining motor vehicles or parts or accessories of motor vehicles and demolishing or dismantling the motor vehicles or parts or accessories

(b) Buying and selling major body and mechanical components of motor vehicles, major car accessories and parts or accessories of motor vehicles prescribed by the regulations for the purpose of this definition

.

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Question 13

Are the current obligations for motor vehicle recyclers fit for purpose? For example,

requirements for record keeping and provision of information to consumers. Please

provide comments.

RECOMMENDATION

MTA NSW recommends the current obligations for record keeping and provision of information

to consumers is sufficient and does not require any alterations to the current requirements.

Question 14

Are there other regulatory tools that could be considered to help enforce compliance

with the Act? If so, please provide examples.

RESPONSE

There are still several operators within the automotive recycling industry that flaunt current regulations and legislative requirements. Unfortunately, the lack of enforcement has resulted in a continual operation of these businesses. Recent media coverage of damaged written off vehicles being exported overseas to various countries highlights some of unscrupulous activity within this sector at present.

RECOMMENDATION

MTA NSW proposes the recommendations set out in answer to Question 9 namely:

(a) The Automotive Unit within NSW Fair Trading; and

(b) An Independent funded regulator for licensing and compliance such as the MTA NSW.

Other issues

You are welcome to raise additional issues in relation to the regulation of motor dealers and motor vehicle recyclers and to make suggestions for improvements to the legislation. Please include the reasons behind your suggestions to assist in our understanding and consideration.

Question 15

Are there other issues in relation to the regulation of motor dealers or motor vehicle

recyclers that should be considered as part of this review? What evidence is there of a

problem? How do you think the issue or problem can be resolved?

1. Regulation 28

MTA NSW believes Regulation 28 relating to Retention of Dealer's Notices (Section b) should be amended to meet the changing needs for motor dealers using electronic programs, to continue to have to retain printed copies of all Forms / Notices – for example: Form 5 needing to be retained in a loose leaf folder.

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Most businesses today have invested in technology and advanced data entry systems that can be easily audited with the ability for documents to be reprinted and report generation of all electronic amendments made. It is not efficient for businesses today to have to retain paper-based invoices in a folder for records. This is a current requirement only for NSW Fair Trading compliance inspectors’ and is an impost on business considering the cost to maintain and the manpower required to keep these documents up to date and filed for a 3-year period.

Motor dealers can sell high volumes of vehicles per month. This requires the constant removal and updating of hardcopy paperwork that is required to be held in a folder for inspections.

RECOMMENDATION

A solution is to have the Form 5 simply reprinted or viewed electronically, upon request. Most systems can have a stock on hand sheet printed for auditing purposes and with a site inspection, the data can be verified. The hardcopy documentation impedes on business and is an unnecessary cost and burden to maintain when an easily generated electronic alternative, which is auditable, is available.

2. Form 2

MTA NSW believes that Form 2 registers should only apply to second-hand supplied parts brought in for fitment by a consumer. Again, most motor dealers have electronic Digital Management Systems (DMS) that can produce an invoice or sublet invoice and order number for second-hand parts purchased for repairs.

Whether the vehicle parts are ordered from workshop service departments and / or spare parts departments, they are all traceable. This is enough proof that the business sourced parts from external providers, whether it be new or used and / or remanufactured parts. This applies equally to dismantling yard purchases and / or supplied parts as they are already captured on a Form 3 or 3A along with their origin and details of purchase are supplied on an invoice.

This is another example of a substantial cost and burden on industry to have to maintain a log for what is an auditable process anyway.

RECOMMENDATION

MTA NSW agrees that parts supplied from vehicle owners or sourced without an invoice needs to be recorded on a Form 2 register and is the only reason to have the register in place. Manufacturer, supplier or remanufactured component(s) caught under replacement warranties should be exempt from the Form 2 register due to manufacturers safety campaigns.

3. Consignment

Consignment sales need to be a part of the existing dealer notices process on Forms 5, 6, 7, 8, 9, 10 and 11 for Auctions. This could be done on the form with a tick box on the existing design and the ability to adda consignment number (same as the prescribed forms) as proof of the agreement. This is a better alternative than having to have copies of consignment notices attached to the existing forms. Again, it is all tracible in the DMS system or on the manual forms.

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RECOMMENDATION

The documentation be amended to provide for consignment sales to be part of the existing forms.

Chapter 4 – Motor vehicle repairers and tradespersons

Background

Under the Act, individuals and organisations are required to hold a licence if their business involves carrying out repair work on motor vehicles in NSW. In addition, repair work can only be carried out by an individual holding a tradesperson’s certificate for a particular class of repair work, for example, panel beater, motor mechanic and vehicle painter.

At present, the Department of Customer Service licences over 5,200 individuals and over 6,100 organisations as repair businesses, and over 45,000 tradespersons for particular classes of repair work under the Act.

Licensing regime

Question 16

Should licensing of motor vehicle repair businesses and tradespersons be retained in

NSW? Why or why not?

RESPONSE

MTA NSW believes that licensing for motor vehicle repair businesses and tradespersons should be retained in NSW. By having licensed repair shops and tradespeople, this balances the objects of the Act to provide consumer protection, consumer’s and the general public can feel safe in the knowledge that the business is compliant with legislation and that the tradesperson working on their vehicle has the appropriate qualification to do the work required.

Question 17

Are there other options for regulating the motor vehicle repair industry that would be appropriate for NSW?

RECOMMENDATION

MTA NSW believes in the re-establishment of the Automotive Unit within NSW Fair Trading and the appointment of an independent organisation to provide oversight of licensing and compliance. These two bodies would then be able to reduce the need for consumers and automotive businesses to resolve issues in NCAT. MTA NSW, as the largest automotive industry Association, has the skills and resources to assist Government in this role.

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Question 18

What would be the potential benefits and costs or risks from changing the requirements for regulating the motor vehicle repair industry?

RESPONSE

MTA NSW believes that the risks would outweigh the benefits. By changing the requirements for regulation, the NSW Government would be allowing an influx of unqualified workers to open shops and there would also be a rise in backyard work. In saying that, the chances of a consumer being able to take an unlicensed trader to NSW Fair Trading would be virtually impossible. This would then add to the detriment of the consumer and their protection from unsafe work.

Question 19

Should a supervisor certificate be introduced for motor vehicle repairers to supervise different classes of repair work?

RESPONSE

MTA NSW does not believe that a supervisor’s certificate is necessary. Our licencing regulations ensure that the supervisor of an apprentice or trainee must hold the relevant Motor Vehicle Tradespersons Certificate (MVTC) for that class of repair work that is being carried out, and this negates the need for a supervisor’s certificate.

Classes of repair work

The scope of the regulatory framework for motor vehicle repairers and tradespersons is dependent on what is ‘repair work’. Under the Act, ‘repair work’ means work of a class or classes prescribed by the regulations. There are 12 classes of repair work prescribed in the Regulation; a list of the classes is provided in Appendix A.

Certain work is not considered repair work under the Regulation. This is commonly referred to as “low scope work”. To carry out “low scope work”, a licence or tradesperson’s certificate is not required under the Act. A list of “low scope work” is also provided in Appendix A.

Question 20

Do you support the existing classes of repair work in the Regulation? Why or why not?

RESPONSE

MTA NSW supports the existing classes of repair work as it shows what qualifications are needed and that the appropriate qualification has been achieved to be able to perform that particular type of repair work. In addition, MTA NSW also strongly recommends that more classes of repair work are needed.

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Question 21

Do you think there should be more or less classes of repair work? If so, which classes should be added, and which should be removed?

RECOMMENDATION

MTA NSW believes that there should be more classes of repair work. These classes of repair would be ’specialist classes’ and they should include the following:

• Electric Vehicle Repair

• Hybrid Vehicle Repair

• Hydrogen Vehicle Repair

• Heavy Vehicle Mechanical Repair

• Autonomous Vehicle Repair

The above classes of repair would have to carry a Certificate III qualification. At this point in time there is no apparent training package, so one would need to be formulated. Once a package is formulated there needs to be a transition period of at least 12 months, for people to be able to obtain the correct qualification.

• Transmission Specialist

• Brake Specialist

• Service (lubrication) Technician

• Underbody Specialist

• Tyre Fitting (light vehicle)

• Tyre Fitting (heavy vehicle)

While there is already a repair class for both Transmission Specialist and Underbody Specialist work, there is a need for these to also be available as a Certificate II as some workshops don’t have the scope of work to carry out full Certificate III training.

There is also the need for a Heavy Vehicle Mechanical Repair class of repair. While this is captured in the motor mechanic class, there must be a clear definition i.e. motor mechanic light vehicle and motor mechanic heavy vehicle and should also be displayed on their MVTC.

In addition, there is also the need for licensed vehicle assessors. These assessors are advising on how a vehicle should be repaired and what processes are to be used - in affect they are diagnosing the repair method and under the current legislation a licence is required for diagnosis. The need for licensing is to provide safety for consumers and the peace of mind that suitably qualified personnel are undertaking this work.

MTA NSW also believes that the Liquefied Natural Gas (LNG) mechanic should be removed as a class of repair as there are low numbers of LNG powered vehicles in NSW and there has been no take up for the qualification through the TAFE system.

Finally, MTA NSW notes that, trailer and caravan mechanic are a class of repair. However, there is presently no qualifications required to undertake this class of repair which runs contrary to the purpose and objects of the Act.

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Question 22

Should any of the existing classes of repair work be amalgamated? Why or why not?

RESPONSE

MTA NSW believes that none of the existing classes of repair work should be amalgamated as not all workshops would have the scope of work to cover the training requirements.

Question 23

Do you support the required qualifications continuing to be prescribed in the Regulations? If not, what alternative method do you think should be adopted? Explain why.

RESPONSE

MTA NSW agree with the required qualifications being prescribed in the regulation.

Question 24

What changes to the current classes of repair work and required qualifications are needed to address upskilling in response to changing technology?

RESPONSE

Changes in technology as outlined earlier in these submissions bring both benefits to the community but also carry safety risks. The position of MTA NSW is that it is most important that suitably qualified and trained personnel undertake this work, not only so that the objects of the Act are met, but also for the integrity of the automotive industry.

RECOMMENDATION

MTA NSW believes that there should be more Certificate II qualified tradespeople allowed to hold a MVTC to enable them to be active in the industry. This would then give the tradesperson the ability to upskill in their chosen profession and would make it easier for them to adapt to new technologies as they would be learning as the new technologies are released. This would also allow manufacturers and Registered Training Organisations (RTO’s) to carry out this training to more people.

MTA NSW believes that there is a need for licencing for hybrid electric vehicles, battery electric vehicles as well as hydrogen powered vehicles. However, full qualifications have not been created or released to date. With the emergence of this technology, the creation of these full qualifications should be prioritised. MTA NSW believes that full qualifications are the best way to address the new technology aspect. Once the qualifications are available, then the classes of repair work will need to change to reflect these new technologies.

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Question 25

Are there other reforms that could be considered to address skill shortages in the motor vehicle repair industry? The safety implications of electrical and LP gas installation or repair work being carried out by people who may not be licensed electricians or gas fitters, should be considered.

RECOMMENDATION

MTA NSW believes that there should be more lower level qualifications with licencing outcomes, for example, a Certificate II in Automotive Servicing should have a MVTC licencing outcome of Service Technician. This would allow more people to enter the industry that would not have been able to previously, either because their aptitude level or the scope of work that they were able to do does not align with the requirements of a Certificate III level qualification.

Question 26

Should there be new categories of licenses for electrical and LP gas installation or repair work on caravans and recreational vehicles or should work be completed by fully qualified licence holders? If so, why, or why not?

RECOMMENDATION

MTA NSW believes that there should be new categories of licenses for those that do electrical and LP gas work on caravans and recreational vehicles. At this point there is no qualification needed at all to work on any part of a caravan. This not only includes the under carriage but also the electrical and gas systems of the caravan. This change is necessary to ensure consumer safety.

Obligations of motor vehicle repairers

A motor vehicle repairer is required to comply with several obligations under the Act designed to protect consumers and provide accountability. These obligations include displaying licence details onsite through adequate signage, reporting stolen or unlawfully obtained goods, and complying with the ACL.

Some of the same requirements that apply to motor dealer recyclers, applies to motor vehicle repairers. This includes keeping a register of prescribed parts and accessories and contributing to the Compensation Fund. Fair Trading can use the same powers and regulatory tools, such as rectification orders and dispute resolution.

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Question 27

Are the current obligations for motor vehicle repairers fit for purpose? For example, record keeping and provision of information to consumers. Please provide comments.

RESPONSE

The obligations under the Act were implemented in 2013. Since this time, the operating environment for motor dealers and repairers has significantly changed. In this modern environment and in particular, the digitisation of operations in the era of the “Internet of things” means most documentation is held online either in cloud storage or purpose-built servers.

MTA NSW believes that the current obligations for motor vehicle repairers are not fit for purpose. This is especially concerning the record keeping for second-hand parts. At present, the automotive industry must use a Form 2. The Form 2 is a prescribed second-hand parts register.

This prescribed form has had a huge impact on businesses across the industry. The Form 2 is seen as a duplication of what is already accepted and enforced. All second-hand parts that are purchased from automotive recyclers are already recorded in a Form 3a (whole vehicle) and a Form 3 (for individual parts) and must be kept for a period of 6 years as per the current legislation. Those details are then included on the tax invoice which must be kept for a period of 5 years under the current Australian Taxation Office (ATO) requirements.

There are also extra costs associated with keeping the Form 2 and there are many examples of automotive dealerships having to employ extra staff to keep the Form 2 up to date. Currently, most automotive businesses keep records electronically and this requirement could be easily added to their operating systems. It would also negate the need for a paper-based register.

MTA NSW believes the only need to record second-hand parts via the Form 2, would be when the parts are supplied by the consumer.

RECOMMENDATION

That Dealers and Repairers be entitled to manage and store their required forms online, with inspection and auditing of same by Government as required.

Question 28

Have relationships between insurance companies and smash repairers been improved through mandating the Motor Vehicle Insurance and Repair Industry Code of Conduct? Why or why not?

RESPONSE

The relationships between insurance companies and smash repairers has not been benefited by the mandating of the Motor Vehicle Insurance and Repair Industry Code of Conduct. MTA NSW would submit that relationships have deteriorated since the inception of the mandatory code.

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By way of example, Insurance companies have in recent times adopted policies and processes to facilitate, promote and support the vertical integration model of managing repair work for the insurers, which model has been at the expense of the remainder of the smash repair industry.

Insurer have incorporated policy conditions on their consumers in what could be said as unethical circumstances. These policy conditions have either removed or restricted the ability of a consumer to choose their repairer. Choice of repairer is now, in most cases, only afforded by way of payment of an additional premium by the consumer. Even then, the insurers have wording built into the policy which gives them the option of not agreeing with the repairer’s quotation and seeking alternative quotations from a “network” repairer, which is owned and operated by the Insurer. In most cases the “network” repairer is less expensive than that quoted by the consumers chosen repairer.

In these circumstances if the insured proceeds with the repairer of their choice, then the consumer is then offered a “cash settlement” in full and final settlement of their claim. This practice then does not offer the consumer guarantee of warranty by the repairer through the insurance policy which is contrary to the often-used sales technique used by the insurer to consumers, “We Offer a Lifetime Warranty on Repairs”. The freedom of choice of repairer issue has been highlighted in a recent survey undertaken by the MTA NSW as being a major concern affecting most respondents to the survey.

Repairers have also advised that insurers will use various techniques in attempting to “steer” customers to their preferred or network repairers. These include allegedly making misleading statements to consumers in relation to:

• Quality of work by the consumers chosen repairer vs the insurers network or preferredrepairer

• Capacity to do the work in a timely manner (insurers do not have access to thisinformation)

• Advising no lifetime warranty will apply if the consumer uses their choice of repairer

• Increased time frame for assessment and authorisation of repairs at their choice ofrepairer

• If the vehicle is repaired at their choice of repairer, the consumer will have to managethe claim

• Their vehicle will not be washed at the completion of repairs

• The chosen repairer does not do work for the insurer

• Making statements to the consumer which cast doubt into the consumers mind. i.e. keepan eye on them to make sure they do the work properly

As can be seen from the above statements, responses to a recent MTA NSW survey conducted with Member’s businesses, the attempted steering of consumers is rife by the insurers utilising what could only be described as extremely questionable tactics.

Complaints have been made by insured persons against this practice. handled by the Australian Financial Complaints Authority (AFCA). The response by Insurers has been to provide assurances that internal training will be undertaken to rectify any inappropriate behaviour and apologies. AFCA are limited in their available powers to investigate what is a systemic issue in the industry and consequently the behaviour of the insurers has little change.

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Other problematic issues between repairers and insurers are:

(a) The amount of poor-quality work emanating from preferred/network repairers or “large” businesses that require rectification work to be undertaken. The work required can be a “total re-work” of the original repairs and in worst case scenarios, the repairs undertaken in question have led to the writing off of the vehicle and the insured (consumer) being paid out the sum insured. This in some instances has been as a result due to restrictions or directions from the insurer.

(b) The insistence of the insurers in utilising ‘times guides’ based upon the method of ‘Funny Time/Funny Money’. Most insurers are utilising a times manual supposedly including “manufacturer” agreed times which according to most repairers are questionable as they do not include working on “damaged” vehicles. Accompanied with this is the insurers to pay what they consider to be the applicable rate per hour as deemed by them. Insurers consistently ignore the repairer’s application of a calculated hourly rate utilising a recommended rate calculator, supplied by industry which has been reviewed by the Australian Taxation Office. Best case scenario would be payment of approximately 70% to 80% of the calculated rate by “some” not “all” insurers. This, in most cases, is “best case scenario” with differing insurers paying differing hourly rates.

When MTA NSW approached their Member’s businesses for input into this review, some responses received are as follows:

“Repairer / Insurer relationships are a constant battle”

We see assessing staff under enormous pressure from upper management to keep reducing costs, constantly looking for more discounts. This creates ill feeling and disharmony not only with assessors and repairers but with shop owners and staff, placing extra pressure to reduce costs at the expense of quality.

• Steering Customers into programmes and specific shops under fixed or average repaircost contracts has a huge impact on Repair Shop sustainability. The inherent problemsin getting Insurers to review hourly rates and material allowances can lead to short cutsbeing taken and or cheaper inferior products sourced. One insurer will only allow $5.00for waste disposal per job to supposedly cover the costs of steel bins, cardboard bins,general waste bins, coolant disposal, oil disposal etc and that allowance has notchanged for 10 years.

• ROI on Equipment and Training is non-existent. Some Insurers set labour rates acrossthe board and expect that labour rate applied to cover all facets of a Repair Businessincluding location, labour, office staff, overtime, fuel and power, business insurance,repairs and maintenance, new equipment, staff training and leaving little or no room forprofit.

• There is little consistency among Insurers regarding hourly rates and times. SomeInsurers still expect Repairers to quote at $32.00 per hour and base their times onmanuals that were discontinued 20 years ago.

• Some Insurers have introduced overseas times guides. Their assessors are producingestimates that Repairers are forced to accept. These assessors only receive basictraining to understand these systems and deny any variations requested by Repairers.Some Repairers are forced to buy these overseas systems which are expensive to useand are not able to charge back as a cost of repair. Some of these Insurers simply windback the hourly rate to reduce costs to between $55 & $65 per hour. Where thesesystems originated in Europe, rates in excess of $100 euro are commonplace. These

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systems ignore the fact that different shops require different rates based on location, size, and ability.

• Some Insurers tell repairers to forget about making profit on each job, but to concentrateon volume. This only suits the Insurers to achieve average or fixed costs but putspressure on Repairers to increase hours of operation, take short cuts and pressure theirstaff and families, while committing to unrealistic DRP Programmes.”

As can be seen from the above, it is in line with our stated responses to this question (and others) and even gives a repairer’s perspective on the current state of the industry and the relationship between insurers, repairers and consumers.

MTA NSW would welcome the opportunity of discussing this pertinent issue with the NSW Government, and feel that this sector of the industry does indeed need an independent review of the operating environment in which it is forced to operate within, which is being influenced by the insurance companies, and causing detriment to consumer safety.

The NSW Government conducted a Parliamentary Inquiry into the Motor Vehicle Repair Industry and produced a report dated July 2014 which contained 21 recommendations from the Select Committee undertaking the inquiry. A number of these recommendations from the Committee’s Report have not been implemented to date. This report and the recommendations, could be the starting point of discussions between the industry and Government to address what the MTA NSW and it Member’s businesses within the smash repair industry could only describe as a serious concern into the ongoing safety of both consumers and the industry.

Question 29

How could the Act capture future innovations and developments such as new business models and emerging technologies?

RECOMMENDATION

MTA NSW believes that the Act requires amendment to require training and qualifications in areas of new technology and further to allow a transition period for businesses and tradespeople to “come up to speed” and afford them adequate time to become qualified and adapt to evolving trends. This is evident with the emergence of Battery Electric and Hydrogen Electric vehicles. At present there are no training packages available to business or tradespeople in these areas.

The Act could also proactively promote new innovations by way of exemptions for apprentices, trainees and tradespeople while participating in the required training packages.

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Question 30

Are there other issues in relation to the regulation of motor vehicle repairers that should be considered as part of this review? What evidence is there of a problem? How do you think the issue or problem can be resolved?

1. Heavy Vehicle Body Repair

MTA NSW is aware that at present there is a practice of heavy vehicles (over 4.5 tonne GVM) being directed into repair facilities that:

a) lack the necessary equipmentb) lack the skilled employees/tradespersons to be able to undertake the repairs to specialistheavy vehicles

This practice should be ceased immediately as this has the potential to place at risk not only the motoring public, but the public as a whole. There are vast differences in repair equipment and knowledge for heavy vehicles. There are insurer representatives (assessors) who currently are allowing and or directing these specialist vehicles into repair facilities that are not equipped for this specialised repair work.

We have all witnessed the horrific consequences of heavy vehicle accidents and feel that these risks can be minimised through the assurance that vehicles are repaired in facilities capable of undertaking repair procedures to return these specialist vehicles to pre accident roadworthy conditions.

All Members of the Australian Heavy Vehicles Repairers Association (AHVRA), which can be described as specialists in this field, and are few in numbers due to the specialised work, who have invested extensively into the businesses.

This includes but is not limited to:

• Highly specialised staff who have been trained to repair heavy vehicles utilising repairprocedures and processes including aluminum and steel fabrication

• Specialised heavy duty chassis measurement, repair, and alignment equipment

• Appropriate spray booth and bake oven facilities to accommodate heavy commercialvehicles

• Forklift and overhead cranes capable of lifting heavy equipment to prevent anyunnecessary injury to employees

• Strict adherence to WHS requirements when working in the heavy vehicle repair sector

• Unique waste disposal systems to protect the environment

• MIG, TIG, Aluminum and Spot-welding equipment including knowledge of heattreatment and effects

• The application of acquired knowledge and experience with rollover protection andunder run protection systems

• Engine diagnostic and scanning equipment capable of completing diagnostic and safetycheck scans on commercial vehicles (which can include various configurationsdepending on fitted equipment)

• Specialised knowledge and experience in dismantling steering boxes, critical steeringcomponents, axles and suspension, turntables and the crack testing of suchcomponents

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• Spray painters specifically trained in the complex processes and application of finishesin the heavy vehicle repair sector and specialist Commercial Vehicle Body Buildertechnicians.

MTA NSW and AHVRA would welcome the opportunity of discussing this issue with the NSW Government with a view of implementation of an accreditation (recognition) program to enable the repairs on Heavy Vehicles to be undertaken in the appropriate facilities by appropriately skilled personnel.

RECOMMENDATION

MTA NSW, through the Australian Heavy Vehicle Repairers Association (AHVRA) a division within MTA NSW consisting of heavy vehicle panel shop repairers / owners, recommend that the distinction between light vehicle and heavy vehicle be recognised as an additional licence class for Motor Vehicle Tradespersons Certificate (MVTC).

Question 31

What could be done to ensure that industry is supported when legislative changes are proposed and implemented?

As stated, several times throughout this submission, there is a strong need for the NSW Fair Trading Automotive Unit to be re-established. This unit also needs to work alongside a Government funded independent regulator. MTA NSW believes that as the largest employer Association within the industry in NSW, the Association would suit that role perfectly. MTA NSW already delivers training, employment relations advice and legislative advice to Members and the industry.

There is also the need for Government, especially policy, to work a lot closer with the automotive industry. Other than the occasional submission, there is no real networking between the two bodies. This leads to misunderstandings and misinterpretation of legislation and regulation. Again, having MTA NSW as the independent regulator working closely with the NSW Fair Trading Automotive Unit would ensure that the proposed legislative changes are properly implemented

RECOMMENDATION

MTA NSW recommends that a Policy Working Group be established in order for ‘the voice of industry’ to be party to the process relating to the drafting of rules governing the operation of the automotive industry.

Question 32

Do you have any other general comments on the Motor Dealers and Repairers

regulatory regime? Please provide further detail.

1. LOW SCOPE WORK

MTA NSW believes that the definition and what is classed as “low scope work” needs to be rectified. Currently, the definition is open to misinterpretation by consumers and businesses alike. A definitive list and description should be put in place to make it clear

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what can be done without a qualification. This is becoming more important as vehicles are evolving at extremely fast rates with the development of new technologies.

MTA NSW recommends that “low scope work”, as defined in the Regulation, should consist of:

“replacement or installation of an accessory that does not alter the performance, handling, or safety of the vehicle, if the accessory was replaced or installed for one or more of the following purposes

• cosmetic customisation of the vehicle, • providing enhanced entertainment options, • informing the driver of vehicle functions or performance, • assisting the driver in navigation or communication, • equipping the vehicle for occupational tasks,”

and this already forms part of the definition of “low scope work”.

MTA NSW also believes that the following work that is currently exempted work within the Act and listed as “low scope work” should in fact be licensed:

• emergency breakdown repairs provided by a membership organisation to a member of the organisation, but only if the work is carried out by an employee of, or contractor with, the membership organisation,

• work carried out by an authorised examiner, within the meaning of the Road Transport (Vehicle Registration) Regulation 2017, in the course of exercising the functions of an authorised examiner under that Regulation.

Also captured in the definition of “low scope work” is

“(b) work carried out on a recreational motor vehicle with a living space, living facilities, or both, other than work in the following classes of repair work—

(i) underbody work, (ii) motor mechanic,”

It is also noted that Section 16 of the Act states:

“Repair work must be done by holder of tradesperson’s certificate”

(1) A motor vehicle repairer, a motor dealer or a transport service owner must not permit an employee of the person to do any repair work unless the person doing the work:

a. Holds a tradesperson’s certificate for a class of repair work,

Yet in the Regulation Section 5 Exemption of certain persons it states:

(3) Sections 16 and 26 of the Act do not apply to the trailer and caravan class of repair work, if the person carrying on the repair work or applying for a license, carries out the work, or proposes to carry out the work, at a place for which a motor vehicle repair licence is granted

This contradicts what is stated within the definition of “low scope work”.

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2. TRANSITION PERIODS

There also has to be “allowances” or “amnesties” put in place when adding new classes of repair. These are not present with the current addition of the five (5) new classes of repair work requiring a Certificate II qualification. This does not allow people the appropriate time frame to become qualified. MTA NSW believes that a 12 month “amnesty” should be put in place

3. CONSULTATION

There also needs to be a mechanism that will allow amendments to be made to the Act easily through industry consultation. One example is with the five (5) new classes of repair where it states that the work required can be carried out on vehicles with the exemption of electric or hybrid vehicles. This is seriously floored, as when doing a wheel alignment there is no difference between a normally aspirated vehicle or an electric / hybrid vehicle. Likewise, with exhaust repair, there is no difference between a normally aspirated vehicle and a hybrid vehicle.

4. HEAVY VEHICLE

While heavy vehicles are captured in various Acts and regulations, there is the need for it to also be within the revised Act. There is no clear definition on tradespersons’ MVTC’s if they are qualified as a “light vehicle mechanic” or a “heavy vehicle mechanic”. This is also applicable with workshop licensing (MVRL).

5. RECOGNITION OF OVERSEAS QUALIFICATIONS

Regarding recognition of overseas qualifications, these were previously recognised in the Motor Repairers Act 1980, enabling overseas qualified tradespeople to obtain the necessary licences to gain employment within NSW. Under the current Motor Dealers and Repairers Act 2013 and the regulations, this is not possible and places NSW at a disadvantage compared with all other States and Territories in Australia who do recognise these qualifications.

NSW requires the tradesperson to obtain an Australian qualification through a registered training organisation and then obtain a licence, when in fact these tradespeople in some cases are more highly qualified in their chosen trades. There is a need to re-establish the recognition of overseas qualifications that are “similar or equivalent to” as defined in the previous 1980 Act.

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Appendix A – Classes of repair work & “low scope work”

Classes of repair work For the purposes of section 6(2) of the Act, the Motor Dealers and Repairers Regulation prescribes the following classes of repair work:

a. automotive electrician—being the work carried out by persons who install or repair

electrical equipment, systems or circuits in motor vehicles,

b. body maker—being the work carried out by persons who make motor vehicle bodies (otherwise than in the course of manufacturing new motor vehicles) or who repair motor vehicle bodies,

c. compressed natural gas mechanic—being the work carried out by persons who install, or repair compressed natural gas equipment in motor vehicles,

d. liquefied natural gas mechanic—being the work carried on by persons who install, or repair liquefied natural gas equipment in motor vehicles,

e. liquefied petroleum gas mechanic—being the work carried out by persons who install or repair liquefied petroleum gas equipment in motor vehicles,

f. motorcycle mechanic—being the work carried out by persons who repair the engines or transmissions or the fuel, induction, exhaust, electrical, steering, suspension, cooling or braking systems, or remove or replace wheels or tyres, of motor cycles only,

g. motor mechanic—being the work carried out by persons who repair the engines or transmissions or the fuel, induction, exhaust, electrical, steering, suspension, cooling or braking systems of motor vehicles,

h. panel beater—being the work carried out by persons who repair the structural components, frames or panels of motor vehicles,

i. trailer and caravan mechanic—being the work carried out by persons who repair the underbody of a trailer or towable recreation vehicle,

j. transmission specialist—being the work carried out by persons who repair the gears, clutches, drive shafts and differentials of motor vehicles,

k. underbody work—being the work carried out by persons who repair underbody systems of motor vehicles, including brake equipment or systems, exhaust systems or steering or suspension systems, but does not include mechanical systems or electrical equipment, systems or circuits,

l. vehicle painter—being the work carried out by persons who paint motor vehicles.

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Appendix B – MDRA Review Survey

(Response summary in red)

Q1 Which of the following best describes your business?

o Motor Dealer Group – Single or Multi Franchise (93%)

o Motorcycle (7%)

o Caravan

Q2 What is the total number of staff employed?

Q3 What is your postcode?

Q4 As a Motor Dealer are you aware of the current specifics around protection against unfair

dealings in the Act Part 6 (Section 142-148)?

o Yes (70%)

o No (30%)

Q5 Have you ever utilised the protections available through Part 6 of the Act?

o Yes (0%)

o No (100%)

Q6 Did the Part 6 provisions provide you with a positive outcome?

o Yes (1)

o No (3)

Q7 Please describe your experience with the protections available through Part 6.

Q8 Are you aware that under the Motor Dealers and Repairers Act 2013 you can apply to NCAT

to set aside an unfair contract?

o Yes

o No (52%)

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Q9 Are you aware that under the Motor Dealers and Repairers Act 2013 you can apply to NCAT

for a finding that a manufacturer engaged in unjust conduct?

o Yes

o No (52%)

Q10 Are you aware that you can apply to the Small Business Commissioner to deal with an

issue of an unjust term of a contract or unjust conduct by a Manufacturer?

o Yes (1)

o No (55%)

Q11 Do you agree that additional changes to Part 6 of the Motor Dealers and Repairers Act

2013 are required to protect the industry?

o Yes (89%)

o No

Q12 What impediments would stop you from making an application to NCAT or the Small

Business Commissioner about an unfair contract or unjust conduct?

(Please select all that apply)

o Legal costs (11%)

o Management time devoted to the Application (11%)

o Adverse reaction by OEM (33.3%)

o Length of time in conducting Application (0%)

o All the above (44.4%)

o Other (please specify) (0%)

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Q13 Which one of the following should the Motor Dealers and Repairers Act be regulated by?

o State

o Federal (93%)

Q14 Which of the following State regulator would you prefer?

o NSW Fair Trading

o Australian Small Business and Family Enterprise Ombudsman

o NSW Small Business Commissioner

o NCAT (NSW Civil & Administrative Tribunal (100%)

o Other (please specify) ________________________________________________

Q15 Which of the following Federal regulators would you prefer?

o ACCC (60%)

o ASIC (4%)

o Small Business Commissioner (30%)

o Other (please specify) (0%)

________________________________________________

Q16 The mediation process for the State legislation is either the Small Business Commissioner

for mediation or NCAT for orders.

Do you think this is sufficient to protect the Motor Dealer against the Manufacturer?

o Yes (50%)

o No (50%)

Q17 Please provide an alternative suggestion/reason why you DO NOT think this is sufficient to

protect the Motor Dealer against the Manufacturer?

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Q18 Should the State legislation mediation process be controlled by an independent Franchise

regulator with Federal jurisdiction to make the decision or mediate between parties?

o Yes (100%)

o No

Q19 Please specify your preferred independent Franchise regulator

Q20 Should the Civil and Administrative Tribunal (NCAT) be the main conciliator and mediator

for Motor Industry concerns with the Suppliers or Manufacturers?

o Yes (82%)

o No

Q21 What other changes in the Motor Dealers and Repairers Act would enable you to deal

with an unfair contract or unjust conduct of a manufacturer?

o Ability to have your identity remain anonymous in any complaint or Application

(23%)

o Stronger sanctions in the legislation for unjust conduct by a Manufacturer (24%)

o Penalty provisions against senior management of a Manufacturer in relation to

unjust conduct (19%)

o Ability of ACCC or other Federal Government agencies to investigate unjust conduct

(31%)

o Other (please specify)

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Appendix C

Recent results of a MD&R survey conducted with MTA NSW Automotive Repair Specialist members

This survey was put to members prior to the start of the statutory review of the Motor Dealers and Repairers Act 2013. This survey went to all members of MTA NSW. The results below reflect the industries feelings towards the Form 2 (prescribed second-hand parts register) the re-introduction of Certificate II qualifications (with a licensing outcome) and the need to re-establish the Automotive Unit of NSW Fair Trading.

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