Post-Brexit ‘clarity’ for legal status of rental and leasing sectors

The Competition and Markets Authority (CMA) has clarified the legal status of rental and leasing firms in the vehicle supply chain.

Following significant input from the British Vehicle Rental and Leasing Association (BVRLA), the CMA has formally stated that rental and leasing firms can continue to be considered as ‘end users’, a status that was previously unconfirmed following the UK’s exit from the EU.

The clarification was confirmed in the updated Vertical Agreements Block Exemption Order (VABEO) guidance, which is relevant to businesses operating at different levels of the supply chain.

The guidance also confirms the continuation of rental and lease agreements being exempt from block exemption regulations.

Toby Poston, director of corporate affairs at the BVRLA, said: “This is a significant and welcome move from the CMA.

“The unequivocal clarity gives the sector protection at a time when it is under threat from disrupted supply, shifting business models and new technologies.”

He added: “The BVRLA has worked hard to influence this outcome to ensure the sector can benefit from long-established protections that had become uncertain and at risk.

“The next step on this journey is the Motor Vehicle Block Exemption framework, where we are again engaging with the CMA to protect member interests regarding the aftermarket.”

In addition to the clarifications over end user status, the CMA has increased provisions relating to information exchange in certain settings of the supply chain, as well as further clarifications around the role of brokers as online intermediation service providers (OISPs) in the distribution chain, and dual-role agents.

The latest Vertical Agreements Block Exemption Order (VABEO) guidance from the CMA can be viewed online.