Michael Sukkar MP

Competition and Consumer Amendment (Motor Vehicle Service and Repair Information Sharing Scheme) Bill 2021 – Second Reading

Mr SUKKAR (Deakin—Assistant Treasurer, Minister for Housing and Minister for Homelessness, Social and Community Housing) (09:46): I move:

That this bill be now read a second time.

This bill establishes a mandatory scheme to promote competition in the Australian automotive sector by requiring all motor vehicle service and repair information be made available for purchase by independent repairers at a fair market price.

Motor vehicle servicing and repair is a $23 billion industry in Australia with nearly 35,000 businesses employing over 106,000 Australians.

Currently, around one in 10 motor vehicles taken to repair workshops are affected by a lack of access to service and repair information.

When this is the case, it results in higher service costs for consumers. This is because there is little choice as to where a vehicle, particularly newer models, can be repaired safely and efficiently.

The 2017 Australian Competition and Consumer Commission (ACCC) market study into the sector found that a lack of access to service and repair information was causing delays and detriment to consumers.

The ACCC’s market study also found that independent repairers were not often given fair access to the information they need to do their job safely and effectively.

The scheme will mandate that all service and repair information that car manufacturers share with their dealership networks must also be made available to all independent repairers and registered trading organisations to purchase.

The objectives of the scheme, as set out in the bill, are to:

promote competition between Australian repairers of passenger and light goods motor vehicles and establish a fair playing field by mandating access to diagnostic, repair and servicing information on fair and reasonable commercial terms;

enable consumers to have those vehicles diagnosed, repaired, serviced, modified or dismantled safely and efficiently by a repairer of their choice;

encourage the provision of accessible and affordable information to repairers and registered training organisations;

protect safety and security information about those vehicles to ensure the safety and security of consumers, information users and the general public; and

provide for the low-cost resolution of disputes that could occur under the scheme.

To promote competition and ensure the provision of accessible and affordable information, scheme information must be offered at a price that does not exceed fair market value. Fair market value allows for cost recovery and a reasonable profit margin.

‘Fair market value’ is a recognised concept in both Australian law and an international context. When undertaking regulatory action, it is established practice to ascertain fair market value by using an objective test.

The factors to be taken into account in setting fair market value include the price charged to other repairers, reasonable recovery of costs, and the prices for information in overseas markets.

To support consumer choice of repairer, the majority of vehicles on Australian roads will be captured by this scheme, including passenger and light-goods vehicles manufactured from 2002. Again, this approach is consistent with similar arrangements in overseas jurisdictions.

As you would expect, widespread access to safety and security information would create unacceptable risks to vehicle safety and security. Therefore, information related to safety and security will be available only to individuals who have the appropriate qualifications. This will of course protect consumers, repairers, and, again, the general public.

Further information on the requirements for individuals accessing this information will be set out in scheme rules, which will be consulted on shortly.

The government has been working closely with industry to develop technical aspects of the scheme’s design, and we’ve consulted extensively throughout the duration of the development of the scheme to ensure that it is effective, fair and safe.

Ongoing industry cooperation will be crucial to the scheme’s success. Therefore, a statutory adviser will be established and will have a key role in the day-to-day operation of the scheme. Importantly, the adviser will play a key role in assisting with the mediation of disputes and reporting to the government on the operation of the scheme.

The government intends for the adviser position to be conferred on a joint-industry led organisation that will have the technical expertise, experience and relationships within the automotive industry to support the scheme.

Based on successful arrangements in the United States, industry representatives have advised me that this joint-industry led organisation will run an online portal to facilitate easy access to and supply of information for those that wish to participate. The government will provide a $250,000 grant to facilitate online access to service and repair information.

This bill also provides a strong incentive to comply with these new obligations, with a maximum penalty of $10 million to apply in circumstances where data providers fail to comply with the scheme. The ACCC will be responsible for monitoring compliance and taking any action where necessary.

This bill includes significant reforms to the service and repair industry that has been made possible only through a strong partnership with industry, and I want to take this opportunity to thank the five signatories to the existing voluntary agreement for the work and engagement they have undertaken to date and thank them in advance for the work that will be done to ensure this scheme’s success.

Full details of the measure are contained in the explanatory memorandum.

Debate adjourned.

Click here to access a PDF transcript of the Hansard extract of this speech.