Effective date of FTC auto rule delayed amid industry court challenge

The Federal Trade Commission issued an order delaying the effective date of the recently released rule that seeks to provide protections for car buyers against some of the more prevalent deceptive practices in car sales. The Combating Auto Retail Scams (CARS) rule, originally set to become final on July 30, is now pushed back pending the auto dealer industry’s request for a judicial review, and ultimately the industry’s desired reversal, of the regulation.

While the FTC is making way for the industry challenge to move forward, it also defended its final rule. The agency said that the petitioners, specifically the National Automobile Dealers Association and the Texas Automobile Dealers Association, mischaracterized the rule and made inaccurate claims about it increasing car dealer compliance costs.

“The Rule does not impose substantial costs, if any, on dealers that presently comply with the law,” the FTC said. And any costs are “outweighed by the benefits to consumers, to law-abiding dealers, and to fair competition.”

Leave a Reply

Your email address will not be published. Required fields are marked *