2024-07-04 00:27:36
Strengthening the obligation of used car dealers and repair shops to scrap total loss vehicles
A fine of 1 million won for hiring a person who has been punished for concealing flooding
“Used Car Market Distribution Cases Will Decrease After Covering Up Flood Facts”
Starting from the end of this month, penalties for used car dealers and repair shops who hide the fact that their vehicles are flooded will be significantly increased. Previously, fines of up to 3 million won were imposed depending on the delay in scrapping, but this will increase to up to 10 million won.
On the 3rd, the Ministry of Land, Infrastructure and Transport announced a legislative notice of a partial revision of the Enforcement Decree of the Automobile Management Act containing the same content.
The Automobile Management Act was revised in January to strengthen the punishment for automobile dealers and repairmen who omit or conceal the fact of flooding. The enforcement decree contains specific criteria for imposing fines.
Previously, if you did not request scrapping of a car that was completely destroyed by flooding to an automobile scrapyard, you would be subject to a fine of 1 to 3 million won. If the delay was less than 10 days, you would be fined 1 million won, and if it was 11 to 49 days, you would be fined 50,000 won per day starting from the 11th day. If it was more than 50 days, you would be fined 3 million won.
According to the enforcement ordinance announced this time, a minimum fine of 2 million won will be imposed if there is a delay of less than 10 days, and a penalty of 200,000 won per day will be added thereafter. If 50 days or more have passed, a maximum penalty of 10 million won will be imposed.
A new provision was also added stating that those who fail to display identification or provide training to junkyard workers will be fined a minimum of 1 million won and a maximum of 3 million won, depending on the number of times they are caught. In addition, a new fine of 1 million won will be imposed on auto dealers who hire people who have been punished for omitting or concealing flooding facts.
The revised enforcement ordinance is scheduled to take effect on the 31st. The penalty provisions for delayed scrapping and management of scrapyard employees will take effect on the 14th of next month.
Usually, during the rainy season in July and August, heavy rain, and typhoons, the number of vehicle flooding accidents increases rapidly. In 2022, when the damage from heavy rain in the metropolitan area and central region was severe, there were 2,147 flooding accidents, the highest number, and damage of KRW 2.1732 trillion occurred.
It is known both inside and outside the used car industry that 20-30% of flooded vehicles are not scrapped or otherwise distributed to the used car market each year, even if they have a history of flood damage repairs. This is a chronic problem that lowers the credibility of the used car market as a whole.
According to the Korea Consumer Agency, a total of 330 consumer damage relief applications related to used car purchases were filed from 2021 to last year, of which 62 cases (18.8%) were due to ‘insufficient notification of accident/flood information’.
Since November of last year, a ‘Flood Vehicle Authenticity Verification Service’ has been launched that allows users to check the authenticity of flooded vehicles using their license plate numbers. However, there have been concerns that there is still no compensation history or that secondary and tertiary victims may arise in cases of private transactions.
A Ministry of Land, Infrastructure and Transport official said, “We expect that this will significantly strengthen management and punishment so that automobile dealers and repair shops cannot conceal the fact of flooding, which will reduce the circulation of flooded total-loss vehicles in the used car market,” adding, “Since we have also strengthened the obligations of repair shops to repair and handle flooded vehicles, blind spots will also significantly disappear.”
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2024-07-04 00:27:36