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Chairman Williams Pens Letter to FTC Regarding New Rule Negatively Impacting Car Dealers

WASHINGTON, D.C. – Today, Congressman Roger Williams (R-TX), Chairman of the House Committee on Small Business, wrote to the Federal Trade Commission (FTC) over concerns with a new rule that would negatively impact small car dealerships.

This letter builds on the House Committee on Small Business’ work to ensure federal agencies adhere to the Regulatory Flexibility Act and Small Business Regulatory Enforcement Fairness Act to protect small businesses from burdensome regulations and rulemaking.


Read the full letter here.

Read excerpts from the letter below:

“The House Committee on Small Business (Committee) writes to inquire about the Federal Trade Commission’s (FTC) recent rule regarding sales practices in motor vehicle sales. This rule would create additional record keeping and disclosure requirements for automobile dealerships, increasing the regulatory costs and number of manhours needed to run a dealership. It appears that the Federal Trade Commission (FTC) may not have properly considered small entities during this rulemaking process.

“This rule ‘prohibits motor vehicle dealers from charging for add-on products or services from which the consumer would not benefit.’ This new standard is vague and interpretation of such a standard will undoubtedly create additional burdens, particularly on small dealerships, to hire compliance officers to determine what is or is not a ‘benefit’ to consumers. Further, fraudulent misrepresentation of products and services to consumers is illegal under current law. After the FTC published its proposed rule, the SBA Office of Advocacy—the independent voice for small business within the federal government—stated that the FTC did not sufficiently calculate the projected cost to small entities, and that it should remedy this before it finalized its rule. It appears the FTC either did not perform this analysis or did not include it in its final rule.”


Signatories include Chairman Roger Williams (R-TX).