China's Cabinet Oks draft rules for auto recall

China’s State Council approved last Wednesday (October 10) the draft rules for the recall of defective automotive products sold in the country, which indicates that the rules formulated byChina’s quality regulators ten years ago might be soon put into effect.

Analysts said under the much more stringent rules, an enterprise could face a huge fine of as much as 10 million yuan if it fails to meet the requirements.

“An enterprise could be fined up to 10% of the total value of auto products that the enterprise should file for recalling but deliberately refuses to do so, according to the draft rules; then the fine could be quite huge if there are 1,000 defective cars at one time, which is only a conservative estimate, then the total fine could be as high as 10 million yuan if the auto prices average 100,000 yuan per unit,” said Qiu Baochang, the head of the lawyers delegation associated with China Consumers’ Association (CCA).

With the rules going into effect,Chinawill see more automobile recall cases in the future, not only homebred ones, but joint venture brands and imported automobile products, asserted Cui Dongshu, deputy secretary general with China Passenger Car Association (CPCA).

Moreover, compared with the previous regulations concerning auto recall, the new rules have significantly raised the fines from RMB1,000-5,000 and RMB10,000-30,000 to RMB50,000-200,000 and RMB500,000-1,000,000 for different types of violation.

(Contributed by Olivia, olivia@tireworld.com.cn)