About 100 used-car dealers held a demonstration in Kuala Lumpur today, to protest an amendment to the Hire Purchase Act 1967.

From June 15, all used cars will have to be put through an additional 14-point inspection before being transferred to the new buyer.

The dealers claimed that this new rule by Domestic Trade, Cooperatives and Consumerism Ministry, will only benefit Puspakom, the private concessionaire that has a monopoly of computerised vehicle inspection services.

NONE The 14-point inspection, dubbed B7, will be effective on top of the current compulsory 4-point inspection called B5.

Khoo Kah Jin, secretary-general of the Federation of Motor and Credit Companies Associations of Malaysia (FMCCAM) said the B5 inspection is sufficient to protect buyers.

“The new rule does not serve any purpose. The consumers (will be paying) for Puspakom to benefit," he claimed.

The B5 inspection determines if the car was stolen, if  the engine has been tampered with, whether there's any 'cut and join' on the body, and on the condition of the windscreen.

Khoo also said extra costs will be incurred by both sellers and dealers as B7 inspection will cost RM90, on top of the RM30 levied for B5 inspection.

'Say no'

NONE During the 30-minute peaceful demonstration, dealers unfurled banners that read 'Say No to mandatory hire purchase inspection B7 and new HP (Hire Purchase) Act 1967 amendment (2010)' and 'We suspect Domestic Trade, Cooperatives and Consumerism Ministry to be operating in secrecy to benefit certain quarters and burden the people'.

They shouted "Protest B7!" and posed for photographers under the watchful eyes of several policemen.

The FMCCAM has more than 3,000 members nationwide.

NONE Khoo (left) said the B7 requirement will open up opportunities for more corruption because 10 out of the 14 points are visual inspections which can be very subjective.

"If you want a good report, just pay more to Puspakom," he said.

He pointed out that the inspection report produced by Puspakom is only valid for one month and does not provide any guarantee, should the buyer find out that the condition of the vehicle is different from what is stated in the report.

"This encourages more corruption because Puspakom doesn't have to be responsible for the report. Why do the buyers need to pay for another report which only gives the vehicle information without a guarantee?"

The dealers are worried that the B7 inspection will prolong the current two- to three-hour B5 inspection to one whole day, thus affecting their business.

NONE They also complained that Puspakom's inspection results are not consistent and reliable, thus creating more confusion.

"Sometimes the vehicle passes the first inspection but fails the second one only after two months. Sometimes it passes the inspection at (one) Puspakom centre but fails at another centre.

"There is no professional body to authorise the Puspakom technicians. No checks and balance. If we fail the inspection, there is nowhere to appeal," said car dealer Azman Salleh (right) .

'Secret agreement'

Khoo revealed that the ministry had allowed Puspakom to ink an agreement with another private company Motordata Research Consortium Sdn Bhd (MRC) which collects vehicle's accident history.

"We learnt that Puspakom will charge the buyers RM25 and pay to MRC to obtain the vehicle's accident history. Why can't the Road Transport Department directly link with MRC? I believe it will be cheaper rather than having a secret agreement between Puspakom and MRC," he said.

NONE The FMCCAM had held a dialogue with Deputy Minister Tan Lian Hoe but the ministry rejected the federation's demand to postpone the enforcement.

"Why was it done in such a slapdash way? There must be something behind. Only Puspakom benefits from this amendment," said Federal Territory Gerakan Youth chief Lau Hoi Keong who lent his support to the dealers today.

Previously Tan had clarified that Puspakom does not have exclusive rights in the field, but it happens that Puspakom is the only company.

NONE Lau (right) dismissed Tan's statement and urged the ministry to postpone enforcement to allow other companies to have more time to provide the service.

"If that is the case, why doesn't the ministry enforce the amendment together with Competition Act next year?" he asked, adding that the Competition Act will prohibit monopoly in all industries.

Earlier Gerakan Youth had submitted a memorandum to Tan demanding a postponement of enforcement, but to no avail.

The movement will now take the issue to the prime minister, said Lau.

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