By far the most important and potentially disruptive policy issue today is the Federal Trade Commission’s (FTC) recently proposed “vehicle transaction” rule that would overwhelm car buyers and small businesses with additional paperwork and needlessly lengthen the sales process. The rule was proposed without credible data-driven analysis or the necessary time for public comment to avoid unintended consequences to consumers and small businesses. Unfair and deceptive practices in vehicle sales or financing are already illegal and they should continue to be policed by federal regulators. However, the FTC’s proposed rule would make the auto buying experience worse, not better, for consumers. As the auto industry works to streamline the purchase process in the aftermath of the pandemic, the FTC’s proposal will swamp dealers and car buyers with greater inefficiency and complexity.
The FTC’s “ready-fire-aim” rule needs to go back to the drawing board. The agency has allowed only 60 days for the public to review this rule, despite its widespread impact on consumers and small businesses. Moreover, the data the FTC relies upon to support is rule is either unverified, previously rebutted, anecdotal, or non-existent. It is especially concerning that the agency denied a routine request for an extension of the public comment period. Members of Congress are urged to weigh in with the FTC to ensure that this rulemaking process is fair and based on valid research and data rather than assumptions.
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