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Lobby to stop bulk discounts for fleets

The retail industry plans to lobby for the next Block Exemption to stop fleet buyers getting bulk discounts on cars that are later remarketed in competition with dealers.

CECRA, the European Council for Motor Trades and Repairs, will raise the issue with Competition Commissioner Neelie Kroes at its conference in Brussels next month.

Direct sales by carmakers to leasing and rental companies is a key issue on the table for CECRA members, who include the RMIF.

They are concerned that leasing and rental firms buy cars with bulk discounts from vehicle manufacturers then sell them on the open market against franchised dealers, which pay manufacturers more for their cars.

CECRA wants the European Commission to include a clause preventing this in a future Block Exemption, possibly from 2010 when the current regulation comes under review.

CECRA wants leasing and rental companies to have an identified customer for any vehicle bought from a carmaker.

VAT is paid in the country where the car is registered, not bought, allowing fleets to exploit this by buying in low VAT countries and selling in high VAT ones.

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