European Union regulators proposed on Monday to continue letting carmakers set up exclusive repair networks and bypass antitrust rules for three more years due to limited competition in the sector.
But the European Commission, the EU's executive, said it planned to scrap antitrust exemptions for restricted car sales dealerships as there was already fierce competition in models and prices.
The motor vehicle sector enjoys exemptions from EU competition rules, allowing carmakers to set up selective and exclusive dealerships for sales and repairs.
In July, the Commission unveiled proposals to replace the so-called general block exemption set to expire next May, and invited comments from stakeholders by September 25.
"Our analysis has shown that competition is fierce as regards car sales, so we have no reason to treat this sector differently from any other," Competition Commissioner Neelie Kroes said in a statement.
"In contrast, we found the repair and maintenance market more prone to competition problems. This is why we propose to keep specific rules in this area."
The proposed block exemption for repairs networks will only be granted to companies with a market share below 30 percent, the Commission said.
The European Council for Motor Trades and Repairs (CECRA), which represents 27 national associations for car repair businesses and 14 European dealer councils, criticized the proposals, saying it may favor large companies.
"This approach will play into the hands of the larger, stronger players, the manufacturers, who by nature are more able to hire expensive lawyers than the distributors to explore the new framework in order to limit the competition in its own interest," CECRA president Juergen Creutzig said.
The Commission said interested parties have until February 10 to comment on its latest proposals, which the EU executive aims to apply until the end of May, 2013. It then plans to scrap the antitrust exemptions for the sector.
The car industry has had to cope with the credit crisis, fragile demand, chronic overcapacity and stricter environmental regulations. Government intervention in Europe and the United States has kept some weaker players from collapse.
