Hyundai Auto Corp. and
Kia Canada Inc. recently entered into consent agreements
with the Competition Bureau addressing inaccurate fuel
consumption advertisements they made.
Hyundai and Kia advertized fuel consumption figures based on
tests conducted in Korea. They later discovered that procedural
errors in the testing invalidated the results. On November 2, 2012,
the two car makers issued press releases explaining the error and
announcing a compensation program for consumers. The compensation
program offers consumers pre-paid credit cards for the extra fuel
they use over and above the advertized consumption rating, plus
Hyundai and Kia then self-reported to the Competition Bureau.
This led to a consent agreement with the Bureau in which the Bureau
agreed that further restitution or notice was not required, and
that the 15% bonus offered by Hyundai and Kia made administrative
monetary penalties unnecessary. Hyundai and Kia agreed to implement
a Competition Act compliance program, with a Compliance
Officer, and to keep the Bureau apprised of developments in their
The Bureau then announced that
it has "secure[d]" consent agreements from the two car
makers wherein they "formalize the steps they have taken to
respond to inaccurate fuel consumption ratings found in
advertisements for a number of their automobiles".
Unfortunately, one has to read the consent agreements themselves to
appreciate fully that Hyundai and Kia discovered the problem,
remedied it, and self-reported.
In the United States, Hyunadi and Kia announced a similar
Class actions were launched in both Canada and the US. The US
class actions were settled with Hyundai and Kia agreeing that
affected customers can choose between prepaid cards under the
original compensation program, or lump sum
compensation. Customers who choose a lump sum can choose
between a dealer service credit worth 150 percent of their payment
or 200 percent of their lump sum amount toward a new car. The lump
sum option allows affected customers to avoid having to claim
annual rebates. (See Press Release
by American law firm leading the class action.)
The Commissioner of Competition addressed innovation, enforcement and policy initiatives at the Competition Bureau in his keynote speech, "Strengthening Competition: Innovation, Collaboration and Transparency."
Used car listing website operator CarGurus Inc.'s attempt to force rival Trader Corporation to supply it with vehicle listing data has encountered a dead end as the Competition Tribunal denied it leave to commence a private application under several provisions of the Competition Act.
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