Illustrative photo (Source: VNA) Thedecree, developed by the MoIT and the Ministry of Transport with other agenciesand offices says that “enterprises engaged in automotive manufacturing,assembling and importing must be responsible for recalling and disposing ofdefective vehicles.” However, no specific sanctions for violations arementioned.
Thestatement was made by lawyer Nguyen Van Hau, Chairman of the Vietnam Lawyers’Commercial Arbitration Center (VLCAC) and also Vice Chairman of the HCM CityLawyers’ Association, at a meeting to discuss the draft decree in HCM City onJune 13.
“Thequestion is how exactly will businesses compensate consumers and how do weensure that they will recall defective vehicles?" Hau said, adding thatthe draft decree should include sanctions for violations and serve as a legalbasis for state agencies to manage automotive manufacturing, assembling, andimporting enterprises.
Regardingrecalls of defective vehicles, the Vietnam Chamber of Commerce and Industry(VCCI) suggested the drafting agency reconsider the responsibility of vehiclerecalls.
Thedecree’s article 21 stops importers from demanding accountability frommanufacturers over the recall of defective units, the draft dictates that carimporters are responsible for providing warranty and maintenance services andrecalling the products.
Butaccording to the VCCI, recalls should be executed by manufacturers, bothdomestic and foreign, through authorised agencies. No commercial importersshould be allowed to initiate recalls.
Technicalfailures arise during the design, manufacture and assembly processes, all ofwhich are conducted by manufacturers, not distributors, the VCCI said,therefore, in all cases, only the manufacturer possesses precise knowledge ofsystematic errors in the design and production process.
Diagnosingdefects related to details, parts, and components and how to fix them can onlybe carried out by the manufacturer, with their equipment and technicalknowledge, it added.
Infact, in some cases, the two sides could negotiate with each other so that thedistributors can help manufacturers initiate product recalls. However, suchcompanies often merely acted as an intermediary in recalls, VCCI said.
Concerningimported completely-built units (CBUs), if foreign manufactures fail to fulfiltheir obligation to recall vehicles, Vietnam can issue an import ban onproducts provided by that supplier, the VCCI said.
Atthe meeting, Tran Dinh Thu, a lawyer from the Legal Consulting Center under theHCM City Lawyers’ Association, warned about auto redundancy as the draftloosened restrictions on the import of CBUs.
Article21 of the Draft stipulates that importers file a “written commitment with theMoIT in fulfilling their responsibilities in the warranty, maintenance, recall,and recalls of imported cars,” which was ,not tough enough, Thu said.
Withimporting cars are easy, people will flock to buy cheap cars to run businesses,pressuring the market, Thu said.
Inaddition, there is a risk that defective vehicles with poor quality will floodeasy markets, with manufacturers not required to recall defective vehicles, Thusaid.
Althoughthe decree stipulates that importers must "commit to the Ministry ofIndustry and Trade to recall defective vehicles" this makes recallsimpossible, Thu said, adding that the importers, who just trade the vehicles,are not capable of dealing with technical problems.
Sincethere are no specific sanctions for those who can’t fulfil their warranty andmaintenance commitments, they will likely to ignore problems of consumers andopen another company to continuing importing cars, Thu said.
Accordingto the General Department of Customs, in May, imports of automobiles of alltypes hit 9,900 units valued at 216 million USD, up 42.7 percent in volume and27.3 percent in value compared with the previous month.
Inthe first five months of the year, Vietnam imported 43,300 automobiles of alltypes, up 5.3 percent in volume and down 10.1 percent in value over the sameperiod last year.
Thailandsupplied the most CBUs to Vietnam up to June with 15,900 units worth 288million USD, up 27.2 percent in volume and 27.4 percent in value. Vehicles fromIndonesia reached 8,700 units, up sharply against 2016.
Regardingcars under nine seats, Indonesia became the largest supplier for Vietnam with7,200 units in the first five months, soaring from last year’s figure of 100units in the same period, surpassing Thailand, India and the Republic ofKorea.-VNA
VNA
