21st January 2010

Mr Giacomo Mattino
Deputy Head of Automotive Unit
Enterprise and Industry DG
Rue de la Loi 200
B 1049 Brussels
Belgium

FROM THE AMERICAN IMPORT AGENTS ASSOCIATION

57-63 Coburg Road, Wood Green, London N22 6UB, United Kingdom
Re- Draft Proposal for Harmonised Individual Vehicle Approval

“The Small Business Act for Europe is the commission’s ambitious plan to address the needs of Europe’s
small and medium-sized businesses. It takes into account the diversity of Europe’s entrepreneurial spirit
and includes guidance on how to develop SME policy at EU and national level.”
Françoise Le Bail’s comments before European SME Week in May 2009

Dear Mr. Mattino,

Thank you for your reply, and for recognising our past and continuing efforts to assist the
European legislators and technical experts in the Member States to arrive at a
proportionate solution for micro-sme's and consumers. Our Organisations are also
committed to ensure the good functioning of the European Single Market and a high level of
protection for its citizens. In this regard we are only concerned with vehicles built to North
American standards with which we respectfully ask you to accept our representations that
with the very low volume of these vehicles on European roads, there has never been a
safety or environmental problem, even though they are not built to European Type Approval
standards.

We believe that to a large extent, the European legislators, -European Parliament and the
European Council, and now the Commission has over-reacted to a problem caused in one
Member State by certain manufacturers abusing the concept of a single vehicle approval
scheme (before the enforcement date of 2007/46/EC). As  Mr. Jean has explained in his
letters,  the adverse publicity generated by the FIA's press releases following  the Landwind
and HHR problems, resulted in the Commission having to take action. We fully understand
this, but the Commission has now received sufficient information to react to the problem in
a more targeted way, by preventing the manufacturers from undermining the new IVA
scheme.

It is not the fault of SME's and individual citizens that abuses could still take place under the
scope of Article 24. Real individual vehicle approval is not a loophole-Indeed Article 24 is
cleverly drafted and strikes completely the right balance for very low volume importers of
vehicles built to North American standards.  From our perspective, the only problem that
exists in Article 24 is that it allows Manufacturers to use it and abuse it with high volumes of
vehicles produced in large series.  Article 24 already recognises that there is a line beyond
which exact compliance with Type Approval Standards is disproportionate for individual
vehicles so long as there is an equivalent level of safety and environmental protection.
However, Article 24 does permit Member States to carefully craft the the national
requirements of safety and environmental protection in line with their own historical and
cultural  considerations.

We know that in order to arrive at the correct regulatory balance,  this a complicated issue
for legislators who are normally involved in drafting and negotiating automotive standards
for the benefit of the worlds largest vehicle manufacturers. You will appreciate that as the
AIAA already had to challenge the British Government 3 times between 1997 and 2001,
using the Commission's Single Market services in DG15, we have a clear understanding
and experience of the issues. Indeed during this period, the AIAA's members (6 micro-
businesses) incurred legal costs of nearly 400,000 Euros in order to survive.   We also
undertook a huge lobbying campaign in the UK which culminated in debates in the House
of Lords and in the House of Commons. There cannot be many examples in the history of
the Single Market, where such a small group of micro-businesses have had to fight so hard
to survive. 

With this in mind, we are sure you will appreciate how significant it was for us, when the UK
Department for Transport invited the American Import Agents Association to be an official
Stakeholder in the Industry Working group leading up to the successful implementation of
the Recast Framework Directive. For nearly three years we were involved in every meeting
alongside the SMMT and others, where we tried to make a constructive contribution. Our
engagement with Industry and the officials in DfT was matched 100% by their respect and
attention to detail towards our needs as responsible Stakeholders. The UK technical
officials truly followed the principles of Better Regulation to ensure that  the administrative
provisions and technical requirements applied in the UKʼs National IVA scheme, ensure a
level of road safety and environmental protection which is equivalent to the greatest extent
practicable to the level provided for by the provisions of the Directives. Indeed at the end of
the process the UK Government wrote about the success of the AIAAʼs engagement as an
SME stakeholder in the Governmentʼs Summary of Simplification Plans 2009.

We believe that it is extremely unfair and disproportionate that after 3 years of consultation
and after receiving public recognition of the engagement with the UK Government on the
implementation of 2007/46/EC, the European legislators have sought to change things
again. And all of this is happening before the scope of the new regulations even come into
force for (N1) Light Goods vehicles.

In our view, the key to solving this issue is by applying the principle of proportionality. These
are very low volume imports and  and the benchmark of accepting them as equivalent, 
cannot exceed the requirement  of “greatest extent practicable.” However, as Euro-
enthusiasts we also want to find a solution that assists the efficient workings of the single
market.
If the legislators believe that the enthusiast/consumer does have the basic right to own a
new American vehicle not marketed by the car manufacturers, and that long-standing
micro-sme's have the right to continue to be involved in the importation and sale of such a
new vehicle, then this is a good starting point. The next point to establish is that in order to
undertake this process, there are commercial, financial and technical constraints beyond
which the importation of a vehicle is not feasible.  We urge the legislators to understand
this. By definition, Type Approval is not available to anyone other than a Manufacturer. In
this regard we must re-emphasise the point that it only takes one technical standard to
ban a vehicle.

This is where we believe that legislators have the greatest difficulty in accepting the position
of an individual vehicle importer. For very low volume imports,  It means that the technical
experts need to acknowledge different ways of regulating, and in so doing achieve a
fairness that is proportionate. It is conceivable that an American vehicle may in some
respects offer a marginally higher level of safety, and in other respects offer a marginally
lower level of safety. Broadly speaking though, for such low volume imports, the safety and
environmental standards of North American vehicles are functionally equivalent with the
European standards. The 65 year history of more than 250,000 of these vehicles operating
safely on European roads proves this is true. However, some Member Stares may accept
these equivalencies more than others.

For our micro-enterprises to continue, we need to know if the vehicles are either accepted
or not in a proportionate way. There is no middle ground. Consumers and micro-sme's need
transparency and certainty before they import a vehicle. If individuals cannot meet a type
approval standard, with vehicles built to North American standards they will be able to
demonstrate a broadly equivalent standard affording an equivalent level of safety and
environmental protection. Individual vehicle importers/micro-SME's cannot be expected to
redesign or remanufacture a vehicle that has already been produced by a mass-market
manufacturer.

Our concrete proposals are as follows

1)    Amend the 2007/46/EC Directive to disallow a Manufacturer from using National IVA
for a vehicle produced in large series.  Manufacturers may already use National Small
Series, EC Small Series and ECWVTA. This amendment would prevent a future Landwind,
Suzuki or HHR problem from occurring.

2)     Continue to permit Member States,  for genuine low volume imports,  to offer an
approval on a National basis under the current regime of Article 24. This will continue to
allow the differing views held by Member States in their treatment of Individual vehicles to
prevail. As these approvals are National and would not automatically gain acceptance in a
second Member State, Mutual Recognition would need to be relied upon, as explained
clearly in Articles 23 and 24 of the Directive.

3)    To facilitate the Mutual Recognition procedure of re-registering a vehicle in a second

Member State that has only received a National approval, the Member States should
publish the wording in the Directive “on request, the applicant can be provided with a
statement of the technical provisions against which the vehicle was approved” on their
National IVA Certificate.  This will help the applicant that is seeking to re-register the vehicle
in a second Member State by increasing his/her awareness that detailed information is
required for Mutual Recognition to work in practice. We believe that this may help to reduce
the number of cases referred to SOLVIT.

 4)     If the Commission wants to introduce a Harmonised IVA, we believe that this should
be for vehicles produced in Large series, distributed by a Manufacturer or their Official
Importer. Otherwise manufacturers may benefit from the amendment to Article 22 that we
outlined in our presentation. From a single market perspective, a large manufacturer may
derive a benefit from a Certificate of Conformity, as part of their European distribution plans.
For the reasons we have already explained, we believe that for micro-smeʼs in Member
States involved with low volumes of North American vehicles imported for local enthusiasts,
a COC is of no great benefit. And even more importantly,  HIVA has not satisfied the test of
proportionality to warrant the removal of Subsidiarity from Member States.  The problem of
mass individual vehicle approvals was not a widespread problem and only occurred in one
Member State. Furthermore, since 2007/46/EC came into force on 29th April 2009, we are
not aware of any abuse or loophole, a point that Mr.Delneufcourt proudly echoed in our
meeting on Monday.

It is important to re-emphasise that the vehicles we are concerned with do not directly
compete with the OEMʼs as they are generally models sold to enthusiasts that the
manufacturers do not offer. Hence we pose no threat to them (previously in the UK, the
SMMT has acknowledged this fact). Instead, individuals/micro-smeʼs can choose from a
wider selection of vehicles and can sometimes introduce more environmentally friendly
technologies such as Hybrid or Electric vehcles onto European roads quicker than the
OEM's. This can make an impact for consumers in the marketplace and can put pressure
on the manufacturers to react quicker, providing the manufacturer with useful market
intelligence.

We remain committed to work hard in tandem with the Commissionʼs services to resolve
this issue. Even though we represent only the smallest category of business designation in
the European marketplace,  we are fully supportive of the many principles of law that the
European Commission stands for. We are also optimistic that after due consideration of our
representations, the technical experts in the 27 Member States will find it possible to
legislate in a conciliatory and proportionate manner. As business people that care about
environmental protection and consumer safety, and believe in the efficient workings of the
Single Market, we hope that a successful outcome will be forthcoming soon without the
need for additional lobbying.

 Yours truly,

Anthony Cohen

Chairman-American Import Agents Association

Tel: +44 20 8889-4545
aiaa_eu@me.com
cc
-Mr. Philippe Jean-Head of Unit Automotive –Enterprise and Industry
-Mr. Jean-Paul Delneufcourt-Chairman –Technical Committee for Motor Vehicles
-Ms. Neelie Kroes-Commissioner for Competition
-Mme Françoise Le Bail-SME Envoy and Deputy Director-General Enterprise and Industry
-Malcolm Harbour-MEP-
-Sylvia Mohr-Automotive Commercial Attaché-US Mission to the European Union
-Rosalind Travers-Assistant Director-Transatlantic Business Dialogue
-Tina Sommer, President –European Small Business Alliance
-Mark Spelman-Chairman American Chamber of Commerce to the European Union
-Ian Yarnold-Deputy Head of Vehicle Technology and Standards Dft –UK
-Mike Lowe-Senior Policy Advisor, Transport Technology and Standards DfT-UK
-Harry Sanne-President European Association of Independent Vehicle Traders
-Denise Lagercrantz-Consultant to BIRF-Swedish Association of Vehicle Importers
-Brian Osler-President North American Automobile Trade Association