With the growing uncertainty currently being faced over the precise terms of any British exit from Europe, a number of members have come to us with concerns that any British exit from Europe, may affect the delivery dates, prices and import duty/tariff on parts and vehicles manufactured and/or sourced within Europe but delivered to dealerships in the UK after any exit. It is understood that some manufacturers intend to pass any import duty/tariff or costs to motor traders in the form of an additional charge per vehicle.
As no deal has yet been reached ahead of the UK’s proposed departure from Europe on 29 March 2019, it is impossible to accurately predict what changes, if any, a British exit from Europe may have on the UK, the motor industry generally, any one manufacturer specifically or the contract between you, your manufacturer and your client.
Whilst we cannot predict the future, there are some basic precautions that can be taken to increase your preparedness and benefit your business generally.
It is our view that the greatest commercial risk will come from any fees that motor traders are liable to pay that have not been included in the original contract and cannot be passed to your customers, or delays in providing vehicles to satisfy dealer commitments. These are both areas that we would expect most terms and conditions to deal with in some way: Indeed, those members who have based their current Standard Terms and Conditions of Sale on our recommended precedents will already have some protection.
Where you are concerned about potential delays, surcharges or tax increases and you wish to be pro-active, we would advise that you review your current Standard Terms and Conditions of Sale to see what charges are included, what charges may be passed to customers and what processes need to be followed to do so.
In addition to providing some protection from potential issues from any British exit from Europe, such an exercise would have the added bonus of ensuring that your Standard Terms and Conditions of Sale continue to be fit for purpose with regards other recent changes to the law including distance selling, ADR, consumer rights and data protection.
As always, this advice is general in nature and will need to be tailored to any one particular situation. As an RMI member you have access to the RMI Legal advice line, as well as a number of industry experts for your assistance. Should you find yourself in the situation above, contact us at any stage for advice and assistance as appropriate.
Motor Industry Legal Services
Motor Industry Legal Services (MILS Solicitors) provides fully comprehensive legal advice and representation to UK motor retailers for one annual fee. It is the only law firm in the UK which specialises in motor law and motor trade law. MILS currently advises over 1,000 individual businesses within the sector as well as the Retail Motor Industry Federation (RMI) and its members.