24 September 2003

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Car importers lament ‘dumping’ of used vehicles in Malta

By Matthew Vella
Malta’s automobile importers yesterday made an environmental case against the ‘dumping’ of second-hand cars from the Far East, which they claim are enjoying fiscal incentives and being sold at cheaper prices than first-hand cars, despite being more environmentally harmful.
Speaking for the owners of first-hand car importing agencies, lawyer Georg Sapiano said second-hand cars were being imported to Malta from the Far East with importers paying up to Lm900 less in tax than first-hand car importers.
"Having cars which have reached the end-of-life threshold in their countries of origin and then imported in Malta through fiscal incentives is certainly detrimental to our environment." Dr Sapiano said cars in Japan become costlier to maintain as they get older, the result of which is that they end up being exported to Malta as used vehicles. The practice is similarly adopted by the Singaporean government, which buys used vehicles and then sells them to third-world countries.
"This is the same practice which is happening now, except that the third-world country this time is Malta. Used vehicle importers have no costs such as after-sales support, and instead have fiscal incentives which allow them to pay less tax on the cars they import. First-hand car importers have showrooms which they pay permits for, whilst used vehicle sellers just plant their cars on pavements, which is also detrimental to the environment," Dr Sapiano said.
The association for car importers said Government should be offering incentives to make first-hand cars cheaper. Discussion between the Used Vehicles Importers Association (UVIA) and the Transport Authority officials were just recently in progress on the conditions regarding the importation of second-hand vehicles from Japan.
Used vehicles are today under new regulations demanding a European certification of standards for the vehicles, in order to improve road safety and also ensure cleaner emissions. New obligations will have to be fulfilled by second-hand car importers to produce a single vehicle type approval certificate.
However, second-hand cars will not incur higher tariffs for importation. Dr Georg Sapiano said these cars are usually scrapped when they have exceeded their end-of-life threshold. These are then re-sold outside the country.
Around 16 importers of second-hand Japanese vehicles operate on the island, with around 3,500 vehicles imported every year. The cheaper prices make the second-hand car business a lucrative one, as well as one with the lowest costs within the automobile sector.
Second-hand vehicles from Japan have to undergo a new type of certification before being shipped from Japan to Malta. VCA, the Vehicle Certification Agency, is the UK government authority for the approval of motor vehicles and components. Also based in Japan, Korea and Taiwan, the VCA offers certification for vehicle and component manufacturers. The VCA was recommended to the UVIA after the agency conducted inspections on Malta’s newly-imported buses. Reportedly, VCA standards are higher Malta’s own VRT, and are supposed to ensure that all second-hand cars being imported into Malta are of a high and adequate standard. The move is set to ensure an off-limits certification test that should bypass any form of wrangling inherent within the island’s VRT tests.

Copyright © Newsworks Ltd. Malta.
Editor: Saviour Balzan
The Malta Financial & Business Times, Newsworks Ltd, Vjal ir-Rihan, San Gwann
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