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What does the parallel import revolution in the automotive field mean? - Walla! vehicle

2020-10-20T13:49:36.544Z


The Supreme Court has confirmed that direct car importers will exercise responsibility for all vehicles made of their own, even if imported in parallel. What does the decision mean and will it affect other areas of consumption as well?


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What does the parallel import revolution in the automotive field mean?

The Supreme Court has confirmed that direct car importers will exercise responsibility for all vehicles made of their own, even if imported in parallel.

What does the decision mean and will it affect other areas of consumption as well?

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  • vehicle

  • Parallel imports

Adv. Avraham Morel

Tuesday, 20 October 2020, 16:42

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Buying a car is, as is well known, a second consumer product in its prestige, but for many years the car market in Israel stood at a high price, due to the lack of competition in the field, and in view of the close affiliation between car manufacturers and their direct importers.

This phenomenon has not gone unnoticed by the state authorities, but despite various attempts, the Ministry of Transport has not been able to bring about a real change in the field of parallel import of vehicles.



On June 11, 2013, the Bill Licensing Services and Professions in the Automotive Industry was published, 2016, which aims, among other things, to regulate in primary legislation all occupations and services regulated so far in supervision orders and to establish new and updated provisions in light of changes in the automotive industry. The bill was submitted as part of the prevailing trend in the country in recent years, according to which competition in the market should be increased, by introducing additional competitors, so that the general public can enjoy cheaper professional services and services.The bill incorporated the recommendations of the Committee to Increase Competition The legislature saw this law as a consumer law of extraordinary importance, a position that was expressed, among other things, in the deliberations of the Economic Affairs Committee before the law was approved. The



law, which entered into force on 18.10.16, stipulates, among other things, that an importer Directly applicable is the obligation to exercise the warranty given by the vehicle manufacturer to each vehicle from a product he imports, whether it is an vehicle imported by the importer himself or imported in parallel.The model proposed and approved under the law is in fact a model similar to the European Directive. Of a vehicle made by him, mb

Contact me at the place where the vehicle was purchased.

The warranty clauses were enacted first and foremost to inform the consumer who buys a vehicle in a parallel import that he is not harmed in relation to the quality of the warranty granted to his vehicle compared to a purchase from a direct importer, as the warranty will be exercised in any case by the direct importer.

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On 5.1.18, a number of direct car importers filed an administrative petition in the Jerusalem District Court against the decision of the Ministry of Transportation, according to which direct car importers must exercise the vehicle manufacturer's liability, in accordance with the law, for each vehicle imported into Israel. When the liability in the country of origin was a territorial liability, that is, a liability whose applicability was limited to a specific territory, so that on the face of it it is not valid in the State of Israel.

According to the direct importers, to the extent that the manufacturer limited the possibility of exercising the warranty given to the vehicle only to a specific territory, the direct importers are not obliged to exercise the warranty to the extent that the same vehicle is imported into Israel, while the manufacturers do not have to indemnify direct importers. That such vehicle be imported into the State of Israel.

The petition of the direct importers, who did not accept the "evil of the decree" that fell on them with the entry into force of the law and their responsibility for exercising liability also in relation to vehicles not sold by them, was apparently intended to dislodge the exercise of liability imposed on them. Which are sold by car manufacturers around the world.



On October 2, 19 the District Court ruled in the administrative petition and ruled in its ruling that the decision of the Ministry of Transportation, conforms to the language of the law, is appropriate to its purpose and is consistent with its legislative history.

Accordingly, the court ordered that the direct car importers would be forced to exercise the warranty given by the manufacturer to the car, even for vehicles that would be imported into Israel in parallel imports, even if it was restricted to a certain territory.

The direct importers did not comply with the district court's ruling and appealed to the Supreme Court.

Following a hearing before Motav headed by the president of the court, Judge Hayut, and Justices Vogelman and read, the court dismissed the appeal and upheld the district court's ruling.



The Supreme Court held that the interpretation that the obligation to exercise the warranty also applies to the manufacturer's warranty as given in the country of origin, is the one that best fulfills the purpose of the clause to promote competition in the car import market by removing the barrier to the direct importers' built-in benefits.

The adoption of the aforesaid interpretation prevents the granting of a competitive advantage to the direct importers while maintaining the limits of the institution of liability.

Removed the barrier that touched on the inherent benefits of direct importers.

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Adv. Avraham Morel (Photo: Eyal Toag)

The Supreme Court's ruling is significant and has the potential to advance the legislature's intention to increase competition in the car market and lower car prices for consumers in Israel, while ensuring the quality of vehicles imported into the country.

Consumers will now know that they can purchase new vehicles from parallel importers at a discounted price, and at the same time enjoy the warranty given to the vehicles by the manufacturer, by treating the service garages of the direct importers, in the same way as the service provided to vehicles from those who purchased them from the direct importers.



The obligation to exercise the warranty is a concrete obligation that has been regulated in the car market, and is not found in other industries.

Days will tell whether the legislature will consider it appropriate to adopt the model of exercising responsibility in other industries as well.



Advocate Avraham Morel of Eitan, Meholet and Sdot represented one of the parallel car importers in the administrative petition and appeal proceedings in the Supreme Court.

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Source: walla

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