Interpretation ID: nht74-1.12

DATE: 06/11/74

FROM: AUTHOR UNAVAILABLE; L. R. Schneider; NHTSA

TO: Amerace Corporation

TITLE: FMVSS INTERPRETATION

TEXT: This is in reply to your letter of May 17, 1974, with questions as to the applicability of the National Traffic and Motor Vehicle Safety Act to your operations, and its relationship to a contract provision requested by General Motors (GM) requiring that you certify compliance of the hoses you deliver to it.

Your primary responsibility under the Act is to manufacture brake hoses that conform to 49 CFR @ 571.106, Motor Vehicle Safety Standard No. 106. On and after September 1, 1974, pursuant to S5.2, Labeling, of that standard, each hydraulic brake hose, end fitting, and assembly shall be marked with "The symbol DOT, constituting a certification" by the hose manufacturer, fitting manufacturer, and hose assembler that each item "conforms to all applicable Federal motor vehicle safety standards." Since the symbol is a permanent mark on the product, certification will be furnished to anyone through whose hands it passes, whether or not it is required by @ 114 of the Act. In our view, the symbol DOT is also a "certificate" within the meaning of @ 108(b)(2) since it is the manufacturer's representation of compliance upon which other persons may rely. The contract language suggested by GM is therefore not something required by the Act.

I note however, that the amendment requested by GM is to take effect July 1, 1974, two months before you are legally required to use the DOT mark. With respect to your obligations in the interim: Under @ 114 and the certification notice published November 4, 1967, (32 F.R. 15444) an equipment manufacturer must certify conformity to "dealers" and "distributors" by a label or tag on the item itself or on the container in which it is shipped. Obviously this includes dealers and distributors to whom you sell directly.

We also consider that the manufacturer of a vehicle, such as GM, into which a hose is incorporated is a distributor of brake hoses to whom @ 114 certification must be provided. Any further requirements specified by GM in your contract would be, of course, purely a matter of contract law.

Because you are required to manufacture hoses to conform to Standard No. 106 you are legally responsible for any violation directly attributable to the manufacturing process, irrespective of any certification provided GM. The question whether that certificate relieves GM of liability cannot be answered in the abstract. As of January 1, 1975, Standard No. 106 will also apply to motor vehicles, and we do not interpret @ 108(b)(2) in this context as relieving a vehicle manufacturer of his obligation to exercise due care. Certainly, at a minimum, GM would be liable for violations attributable to installation.

You have also asked for guidance on the recall provisions of @ 111 and (Illegible Word) notification provisions of @ 113. The repurchase provisions of @ 111 come into effect upon a determination by either NHTSA or a manufacturer that there exists either a safety-related defect or a nonconformance. This section is not enforced directly by NHTSA, but affords redress to distributors and dealers in the event a manufacturer refuses to repurchase substandard vehicles or equipment items. Since a @ 108(b)(2) certificate covers only compliance and is not a guarantee of freedom from safety-related defects, it cannot have been intended "to pass the expense of recall from GM" to you when @ 111 is invoked. The @ 108(b)(2) certificate was intended only to provide protection to certificate holders from civil penalty liabilities. Liability for expenses under @ 111 or @ 113 is a contract matter between GM and you.

As for @ 113, your understanding of Mr. Vinson's remarks is essentially correct. There is a direct notification obligation under @ 113(a) only upon manufacturers of vehicles and tires. But a @ 113(e) proceeding can involve any motor vehicle equipment manufacturer as a party, who could be ordered to proceed with a @ 113(a) notification campaign upon a finding that a safety-related defect or a noncompliance exists. A brake hose manufacturer upon such a finding would be required to provide notification to aftermarket purchasers. If the component is used as original vehicle equipment the vehicle manufacturer would normally also be a party to a @ 113(e) proceeding and required to furnish notification to vehicle purchasers.

SINCERELY,

AMERACE CORPORATION,

May 17, 1974

Lawrence R. Schneider Chief Counsel National Highway Traffic Safety Administration

Pursuant to a conversation with Mr. Taylor Vinson of your office, I am requesting a written opinion relating to certain questions I have concerning the applicability of the Motor Vehicle Safety Act to our operations.

Our Swan Hose Division manufactures brake hose for, among others, the Chevrolet Motor Division of GM. We have been asked by Chevrolet to certify that the act of making each shipment pursuant to our contract constitutes certification as referred to in Section 108(B)(2) the Act (copy of certification enclosed).

Specifically, I would like to know what is our general responsibility under the Act as a manufacturer of brake hose? Does this request for certification add anything to what we are already obligated to do by the Act? I note that Section 114 apparently requires us to certify to distributors and dealers but not to manufacturers, such as GM. Do we have to certify if we sell to dealers or distributors directly?

Section 109 of the Act provides for civil penalties in situations where there is a violation. Does our certification to Chevrolet, in effect, pass the responsibility for violation on to us directly and insulate Chevrolet? Is is likely that the Administration would proceed against us directly in the case of a defect whether or not we have given the Section 108(P)(2) certification?

There are provisions in Section 111 of the Act for the recall of vehicles prior to the sale by a distributor or dealer. Is the Section 108 certification intended to pass the expense of recall from GM to us? Mr. Vinson advise me that recall is otherwise never mandatory. Can I assume that since recall is not mandatory the liability and expense for recall is a matter of agreement between Chevrolet and us and is unaffected by the Section 108 certification?

Mr. Vinson indicated that in the case of a safety-related defect the (Illegible Word) pursuant to Section 113(A) would be on the vehicle manufacturer to notify with no notification obligation on the hose manufacturer. However, in the event Chevrolet refused to recognize the safety defect, then a Section 113(E), Administrative Proceeding, might be brought against Chevrolet in which we would then be a party to the proceeding. Is there ever a situation where we have to notify dealers of a defect? Does the Section 108 certification pass the expense of notification from GM to us?

I wish to thank you, Mr. Vinson, and the other members of your staff who have been extremely helpful in assisting us in interpreting the Act.

I await your office's reply on the above questions and comments.

J. C. Vecchio Assistant Counsel

Enclosure

cc: N. P. Beveridge

AMERIACE CORPORATION SHAN HOSE DIVISION (Illegible Word) W SQUARE LK RD POB 249 BLOOMFIELD HILLS, MICH. 48013

CONTRACT AMENDMENT NO.: 38550

Amendment Effective Date: 7/1/74

Date: 4/3/74

(Illegible Words) Date: 6/30/75

The (Illegible Word) contract is hereby amended as follows: FOB DUNS-017560988

Contract No. CO-23064

PLEASE ADD THE FOLLOWING CLAUSES TO THE ABOVE MENTIONED CONTRACT:

"BY ACCEPTANCE OF THE CONTRACT OR PURCHASE ORDER, IT IS AGREED THAT THE ACT OF MAKING EACH SHIPMENT PURSUANT THERETO CONSTITUTES CERTIFICATION, AS REFERRED TO IN SECTION 108 (B) (2) OF THE NATIONAL TRAFFIC AND MOTOR VEHICLE SAFETY ACT OF 1966, THAT EACH ITEM IN SUCH SHIPMENT CONFORMS WITH ALL APPLICABLE FEDERAL MOTOR VEHICLE SAFETY STANDARD." ALL SHIPPING CONTAINERS (INDIVIDUAL OR BULK), EXCEPT (Illegible Word) TIRES AND GLAZING MATERIALS (GLASS), PROVIDED THE ARTICLES INDIVIDUALLY HEAR THE CERTIFICATION SYMBOL SPECIFIED IN THE FOLLOWING WORDING: - CONFORMS TO APPLICABLE U. S. FEDERAL MOTOR VEHICLE SAFETY STANDARDS -

THE PARTS IN THIS CONTRACT IDENTIFIED WITH AN ASTERISK (*) MUST BE PRODUCED IN ACCORDANCE WITH THE FEDERAL MOTOR VEHICLE SAFETY STANDARDS ACT OF 1966, AS AMENDED."

BUYER 03

Reason for Change: ADDING CLAUSES TO CONTRACT

Accepted:

AMERCE CORPORATION SWAN HOSE DIVISION

CHEVROLET MOTOR DIVISION General Motors Corporation Central Office