Interpretation ID: nht81-3.26

DATE: 10/13/81

FROM: AUTHOR UNAVAILABLE; Frank Berndt; NHTSA

TO: Paccar Inc.

TITLE: FMVSR INTERPRETATION

TEXT: This responds to your letter of September 16, 1981, in which you requested our views on whether Paccar may use its name on the certification label of vehicles manufactured by its Mexican affiliate.

This agency's regulations provide that each vehicle's certification label must contain "the full corporate or individual name of the actual assembler of the vehicle." See 49 CFR 567.4(g)(1). The only relevant exception to that requirement is set forth in section 567.4(g) (1) (i), which states that if "a vehicle is assembled by a corporation that is controlled by another corporation that assumes responsibility for conformity with the standards, the name of the controlling corporation may be used." Thus, the answer to your question depends upon whether Paccar "controls" Kenworth Mexican, the Mexican affiliate.

Your letter states that Paccar effectively owns a 49 percent interest in Kenworth Mexicana, the maximum permitted under Mexican law. Based on your telephone conversations with Roger Fairchild of this office, we understand that the vehicles to be produced in Mexico are of Paccar design, with Paccar control over all matters relating to compliance with safety standards. In fact, any design changes in the vehicle must apparently be approved by Paccar under your agreement with the Mexican company.

In these circumstances, we conclude that Paccar may use its corporate name on the Mexican vehicles' certification labels notwithstanding the less than majority equity interest in the Mexican company. The "controlling corporation" exception to the general requirement that the vehicle assembler's name must appear on the certification label was enacted in recognition of the fact that "particularly in some foreign countries, assembly of a vehicle may be performed by a subsidiary corporation controlled by a parent that is the generally known 'nameplate company.'" The agency determined that in such a sitaution, "no important purpose is served by requiring the name of a lesser-known subsidiary corporation on the label." See 34 FR 11360, July 9, 1969. Further, the agency has previously stated in one of its interpretations that the "purpose of the manufacturer's designation in the certification regulations is to identify the company that has primary technical responsibility for conformity of the design and quality control of the assembly." Particularly with respect to the design aspects, Paccar meets this test.

If you have further questions in this area, please feel free to contact us.