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Parallel imports get the green light

Grey matter: Cars such as Toyota's Sentia could end up on Australian roads following changes to new-car import laws proposed by the federal government.

Federal government proposes changes to laws allowing parallel new-car imports

10 Feb 2016

AUSTRALIAN consumers will be able to privately import new vehicles come 2018, under changes to laws proposed by the federal government this morning.

The laws will come into effect from 2018 – after Ford, GM Holden and Toyota have closed their Australian manufacturing operations – and allow consumers to buy a car or motorcycle from another country as long as it has “comparable standards” to Australia's.

Buyers will be restricted to making purchases up to once every two years, per person, as long as specific requirements are met, according to a government statement.

The countries that consumers can import vehicles from are strictly limited to right-hand-drive markets, with the government specifying Japan and the United Kingdom, while adding that other countries could also be included as long as they meet comparable standards.

The vehicles being imported must be no more than 12 months old and have no more than 500km on the odometer.

Federal minister for major projects, territories and local government Paul Fletcher announced the changes, and said that the new laws would offer consumers more choice once the three car-makers wind up manufacturing operations by the end of 2017.

“Over one million new vehicles are sold in Australia today over 90 per cent are imported and within two years all cars will be imported once Ford, General Motors and Toyota cease local manufacture,” he said.

“With around 30,000 vehicles a year expected to be personally imported, most Australians will continue to purchase vehicles directly imported by manufacturers and sold through their existing dealer networks.

“These new arrangements however will offer consumers greater choice. If a manufacturer chooses not to sell a particular model in Australia, a consumer may now have an option to source this model overseas.”

80 center imageLeft: Federal minister for major projects, territories and local government Paul Fletcher.The changes are aimed at not only offering consumers more choice but also to reduce prices of new cars.

Questions have been raised in the past two years about the price of new vehicles in Australia and whether it is cheaper to buy in other countries. This has been refuted by the Federal Chamber of Automotive Industries (FCAI) and car-makers including Mercedes-Benz.

The federal government under then prime minister Tony Abbott reviewed the Motor Vehicle Standards Act 1989 in 2014 with a view to relaxing the laws around the importation of parallel or so called 'grey' imports as well as used car imports.

Former assistant minister for infrastructure and regional development Jamie Briggs proposed the deregulation of new car imports again in April last year, suggesting changes that now appear in the proposed legislation.

The plan to change used-car import laws was squashed by the Coalition late last year, a decision praised by industry bodies including the Motor Trades Association of Australia (MTAA).

Following recommendations in the Harper competition policy review, the government initially leaned towards relaxing new-car import laws.

Other proposed changes to the Act include allowing people to import rare, exotic or classic cars that are at least 25 years old under a Register of Specialist and Enthusiast Vehicles.

The $12,000 special duty for vehicles that fall under this register will also be removed.

“Although this duty is not often applied, it is on the statute books, costing more to administer than it raises – and is seen by consumers as a hurdle to importing second hand cars even in the specific circumstances where such imports are permitted,” Mr Fletcher said. “By removing this duty, we will provide more options for Australian consumers.”

Under the proposed new laws, there will no longer be a requirement to affix an identification plate to vehicles. Details of the vehicles will instead be kept on a Register of Approved Vehicles online database, which is accessible by the public. The government estimates that this will save car-makers about $18 million per year.

In the statement from Mr Fletcher, the government says the new laws save the automotive industry a total of more than $70 million a year “in lower regulatory compliance costs”.

Minister Fletcher said legislation to implement the changes to the Act will be introduced later in the year.

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