Interpretation ID: 77-1.22

TYPE: INTERPRETATION-NHTSA

DATE: 02/11/77

FROM: AUTHOR UNAVAILABLE; Frank Berndt; NHTSA

TO: British Standards Institution

TITLE: FMVSR INTERPRETATION

TEXT: This responds to the British Standards Institution's December 2, 1976, request to know what constitutes "first purchase of [a new motor vehicle] in good faith for purposes other than resale" as this phrase is used on @ 108(b)(1) of the National Traffic and Motor Vehicle Safety Act (the Act) (15 U.S.C. @ 1397(b)(1) and @ 567.7 of NHTSA regulations (Part 567 -- Certification). You also ask to know the legal basis for any distinction between "original equipment" and "replacement equipment" as those terms are used in regulation of motor vehicles and equipment in the United States.

I can confirm your understanding of @ 567.7 of our regulations, as set forth in the statements which you designate as "(a)" and "(b)". With regard to statement "(b)", @ 108 (a)(2)(A) of the Act prohibits, except in the process of repair, a manufacturer, distributor, dealer, or repair business from knowingly rendering inoperative in whole or part, any device or element of design installed in a motor vehicle incompliance with an applicable standard. Thus a dealer could not make the sunroof alteration if he knew that installation rendered inoperative the minimum roof crush capabilities specified by Standard No. 216, Roof Crush Resistance.

Your statement designated "(c)" is not necessarily correct. The NHTSA's interpretation of the meaning of "first purchase" relies substantially on the modifier "in good faith."

Thus the agency evaluates the circumstances of the purchase with a view to whether or not there is an attempt to circumvent the requirements of law and applicable regulation. For example, when purchasers asked for disconnection of ignition interlock systems by dealers after contracting for the purchase of a vehicle, the agency required that bona fide physical delivery take place without an immediate return of the vehicle to the dealer for disconnection. As a practical matter, the new provision of the Act discussed above (@ 108(a)(1)(A)) prohibits dealer action of this type in the future.

Since the 1974 amendments to the Act, there has been a distinction between "original equipment" and "replacement equipment". I have enclosed a copy of our proposal to implement this distinction for purposes of Federal regulation. I believe your question actually addresses the practices of the American Association of Motor Vehicle Administrators. You may wish to contact one or more of those organizations for an answer to your questions.