/ Pro-consumer reform in the automotive industry: new duties and pending challenges

Francisca Barrientos
Of Counsel
Alessandri Abogados

Automobiles are one of the most sought-after mass consumer goods by Chileans. Even in times of pandemic, in which the same companies have declared a shortage of new cars, and prices have gone up, sales records continue to be broken. The pro-consumer reform, Law No. 21,398 of 2021, recently enacted, incorporates new legal rules for this market.

It should be noted that no other similar rule is known in the Latin American regional systems, or in the European consumer law guidelines, which governs in such a specific way how the quality and durability of these goods shall operate. For this reason, although warned by the authorities and the associations involved during its processing, there is no clarity regarding the impact that the entry into force of these inalienable rules could have on consumers.

The main novelty of article 12 C consists in the introduction of a rule that attempts to ensure the freedom of choice of “authorized” technical services to perform maintenance. On this point, the challenge for companies that enter into sale and purchase agreements or leases with purchase options is that they must display lists of authorized services. In fact, the rule was constructed in the opposite way, prohibiting the limitation of the information to be provided. Therefore, it is not stated how many declared services meet this new legal standard. Therefore, professionalism, reasonableness and a market view should be taken into account to see the exact or approximate number of authorized services that the provider exhibits or has at its disposal. The recommendations made by the company to its customers, which are always welcome, are another matter. What we are trying to protect is the consumer’s freedom of choice. The only “exception”, i.e., that only a certain type of authorized technical service (and not others) may be accessed, will be when it is highly specialized or exclusive; in legal terms, “when it concerns maintenance that, due to its justified specific technical characteristics, must be carried out by expressly authorized workshops or technical service establishments”.

But questions immediately arise, for example, who should be asked for such authorization? What would happen if a clause is included in the contract that is interpreted as arbitrary or abusive, or ambiguous? At least we know that there is some time to clarify these questions, due to the vacancy period of four months from the date of publication in the Official Gazette (December 24, 2021).

There are many challenges for the automotive industry and its entire chain of operators, beyond those related to the freedom to choose the technical service, because the pro-consumer reform includes novelties and new regulations related to price information, delivery, retraction, financing systems and responsible lending, among others. With a pro-consumer approach, it would be expected that companies in the industry comply with these new regulations, adjust their processes when necessary and, above all, adopt preventive measures through the implementation of compliance models that serve to anticipate or mitigate complaints, claims, lawsuits or penalties in these matters.