WASHINGTON—House Oversight and Accountability Committee Chairman James Comer (R-Ky.) today begins an investigation into the Federal Trade Commission’s (FTC) proposed auto trade regulation rules. The proposed rules would prohibit or burden auto dealers’ practices in selling, leasing, and financing new vehicles and add-on products. In a letter to FTC Chair Lina M. Khan, Commissioner Comer requests documentation and communications to support oversight of the proposed rule.
“This proposed rule, promulgated in the name of consumer protection, could harm consumers and small businesses by making it more difficult to purchase a car and stifling innovation in the industry. , appears to be based on scant analysis and unreliable data, and suffers from several procedural flaws, including a violation of FTC regulations that require advance notice of proposed rulemaking. ” Chairman Comer wrote:
The Oversight Committee is investigating problems with the FTC’s enforcement of its mandate to prevent unfair and harmful practices in the U.S. market. In a letter to FTC Chairman Kern, Chairman Comer wrote that the proposed rule would impose sweeping regulations on all auto transactions without any evidence to suggest a problem of widespread deception in the industry, and that It warned that the FTC was violating its own procedures by ignoring the proposed regulations. Providing advance notice of proposed rulemaking. The Commission will continue to provide accountability and transparency, ensuring the FTC does not overstep its role in protecting U.S. markets.
” [Small Business Administration’s] The Advocacy Bureau suggests that fraud is a pervasive problem in the industry, especially when less than 1 percent of consumers have complained about the practices the FTC proposes to address in this rule. He pointed out that the FTC lacks evidence to do so. The Advocacy Bureau expresses concern that the FTC may have violated the Regulatory Flexibility Act by failing to properly assess the cost of the proposed rule and consider alternatives that are less harmful to small businesses. did. Finally, the Advocacy Office noted that the proposed rules would make buying a car more cumbersome, stifle innovation in the industry, and overwhelm non-automotive dealers. ” Chairman Comer continued.
Read the letter to FTC Chair Lina Khan here.