So, we have now seen the draft legislation which will be put to Parliament today and, if agreed, come into force tomorrow.
This legislation contradicts the position which was set out in the initial government guidance rapidly issued after Boris’s announcement on Saturday.
As legalisation will always trump guidance, this is what car dealers are now working with:
- It is no longer only showrooms which must close, the legislation says “showrooms and other premises, including outdoor areas”. Therefore, forecourts must also close.
- Any Click & Collect must be for a “pre-ordered” vehicle with no business taking place at the premises and so the option to take a holding deposit and concluding the deal at the premises is now not an option. This means all sales will become distance sales as the customer is merely collecting the vehicle and so the 14 day “change your mind” paperwork will need to be issued. Make sure you use our templates which are bespoke to the motor trade and will require the customer to return the vehicle in the event of wanting a refund. Our templates will also allow you to make a deduction for usage, any damage and allow you to pass on any fines or charges the consumer may have picked up while they were driving the vehicle.
The legislation also specifically prohibits consumers from entering the premises to collect. A rather silly rule for a November lockdown given the likelihood of inclement weather, and one, we feel could be broken on the basis that it is absurd. However, to keep on the safe side, the legislation does allow pick up from any of the other places listed in Part 3 of the Schedule which includes petrol stations, car repair and MOT centres, and car parks.
So for those with a service centre on site, pick up could be undertaken there, and for those who use a friendly local garage for their PDIs, pick up could be from there.
The legalisation also sets out the level of fine for breaching the business restriction rules which starts at £1000 for the first offence, £2000 for the second offence, £4000 for the third and £10,000 for the fourth or any subsequent penalty.
This is the position based on the draft legislation. We do not expect it to substantially change but do watch this space!
Octane Finance is the broker of choice for new and used car dealers nationwide. With our uncompromising service levels and our genuine and professional approach, you and your customers can trust us to deliver.
