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ARTICLE · 04 JULY 2022

US FTC Proposes New Rules Governing The Car-Buying Process

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The FTC has a long history of enforcing its laws against the auto industry, with the proposed rule's explanatory section counting more than 50 such cases in the past decade.

United StatesConsumer Protection
Christopher B. Leach
Christopher B. Leach
Tori K. Shinohara
Tori K. Shinohara
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The upshot, for busy people:

  • As part of its increased emphasis on rulemaking, the Federal Trade Commission ("FTC") released on June 23, 2022, a proposed rule placing extensive restrictions on the sale, financing and leasing of motor vehicles. Dubbed the "Motor Vehicle Dealers Trade Regulation Rule," the proposed rule covers four core areas: prohibitions of specific misrepresentations in auto sales; disclosure requirements related to vehicle cost, add-on products and services, and monthly payments; and recordkeeping.
  • If finalized, the proposed rule would impose a number of new compliance obligations on the auto industry, which the FTC estimates will cost the industry at least $1.4 billion over the next 10 years. And violations of any provision could come with monetary penalties, including civil penalties at more than $46,000 per violation.

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