Crapo, Risch, Colleagues Introduce Bill to Prevent Car-Buying Red Tape

Washington, D.C.--U.S. Senators Mike Crapo (R-Idaho) and Jim Risch (R-Idaho) co-sponsored the bipartisan Federal Trade Commission (FTC) Review of Expensive and Detrimental Overregulation (REDO) Act.  The legislation would prevent the FTC from finalizing and implementing a rushed regulation change specific to automotive retailing without first conducting adequate consumer testing and cost-benefit analyses and allowing for public feedback.  The FTC’s rule would create more paperwork when buying a car at the dealership and lead to more bureaucracy and red tape for small businesses.

“Purchasing a new vehicle is a serious decision for most Americans.  There is no need to complicate the process with added costs, more paperwork and a longer sales process,” said Crapo.  “The public and local industry stakeholders deserve the opportunity to weigh-in on changes that affect them and their business.”

“Idahoans want buying a car to be simple, not bogged down by burdensome paperwork and costly red tape,” said Risch.  “The FTC REDO Act gives consumers and auto dealers a seat at the table on decisions impacting the car buying process.”

“Our Idaho franchised new vehicle dealers, primarily family-owned small businesses, appreciate Senator Crapo’s co-signing the FTC REDO Act,” said Jim Addis, Executive Vice-President Idaho Automobile Dealers Association.  “The FTC REDO Act will reverse recent, onerous FTC overregulation that would add time, cost, and complexity for new car buyers.  Not only is this FTC overregulation duplicative, but it is also in conflict with extensive Idaho and federal laws that protect consumers.  Passing the FTC REDO Act will ensure that we protect Idaho car buyers from needless federal overreach, saving them both money and time.”                                                                                   

Last summer, the FTC noticed a 126-page proposed rule, known as the “Motor Vehicle Dealers Trade Regulation Rule,” or the “Vehicle Shopping Rule,” which, if approved, would significantly change the process for consumers to purchase, trade-in and finance new and used cars and trucks.  The proposed rule would re-regulate all aspects of automotive retailing and was noticed without an Advanced Notice of Proposed Rulemaking (ANPRM)--the process for the public to provide comment.

The FTC REDO Act would require the FTC to:

• Issue an ANPRM for public comment;
• Conduct a quantitative study on auto retailing;
• Conduct consumer product testing; and
• Publish a cost-benefit analysis based on real data.