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As Enacted

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SEC. 118. (a) Every manufacturer of motor vehicles shall furnish Notification of 8 notification of any defect in any motor vehicle or motor vehicle equip- defect. ment produced by such manufacturer which he determines, in good faith, relates to motor vehicle safety, to the purchaser (where known to the manufacturer) of such motor vehicle or motor vehicle equipment, within a reasonable time after such manufacturer has discovered such defect.

(b) The notification required by subsection (a) shall be accomplished

Notification

by certified

(1) by certified mail to the first purchaser (not including any mail. dealer of such manufacturer) of the motor vehicle or motor vehicle equipment containing such a defect, and to any subsequent purchaser to whom has been transferred any warranty on such motor vehicle or motor vehicle equipment; and

(2) by certified mail or other more expeditious means to the dealer or dealers of such manufacturer to whom such motor vehicle or equipment was delivered.

(c) The notification required by subsection (a) shall contain_a clear description of such defect, an evaluation of the risk to traffic safety reasonably related to such defect, and a statement of the measures to be taken to repair such defect.

(d) Every manufacturer of motor vehicles shall furnish to the Secretary a true or representative copy of all notices, bulletins, and other communications to the dealers of such manufacturer or purchasers of motor vehicles or motor vehicle equipment of such manufacturer regarding any defect in such vehicle or equipment sold or serviced by such dealer. The Secretary shall disclose so much of the information contained in such notice or other information obtained under section 112(a) to the public as he deems will assist in carrying out the purposes of this Act, but he shall not disclose any information which contains or relates to a trade secret or other matter referred to in section 1905 of title 18 of the United States Code unless he determines that 62 Stat. 791. it is necessary to carry out the purposes of this Act.

(e) If through testing, inspection, investigation, or research carried out pursuant to this title, or examination of reports pursuant to subsection (d) of this section, or otherwise, the Secretary determines that any motor vehicle or item of motor vehicle equipment

(1) does not comply with an applicable Federal motor vehicle safety standard prescribed pursuant to section 103; or

(2) contains a defect which relates to motor vehicle safety; then he shall immediately notify the manufacturer of such motor vehicle or item of motor vehicle equipment of such defect or failure to comply. The notice shall contain the findings of the Secretary and shall include all information upon which the findings are based. The Secretary shall afford such manufacturer an opportunity to present his views and evidence in support thereof, to establish that there is no failure of compliance or that the alleged defect does not affect motor vehicle safety. If after such presentation by the manufacturer the Secretary determines that such vehicle or item of equipment does not comply with applicable Federal motor vehicle safety standards, or contains a defect which relates to motor vehicle safety, the Secretary shall direct the manufacturer to furnish the notification specified in subsection (c) of this section to the purchaser of such motor vehicle or item of motor vehicle equipment as provided in subsections (a) and (b) of this section.

Conference Report

Senate Report 1919, Pages 20 and 21

NOTIFICATION

Sections 116 (a), (b), and (c) of the Senate bill require the manufacturer of motor vehicles to furnish notification of any defect in any vehicle or equipment produced by him which he determines relates to motor vehicle safety to the purchaser (where known) within a reasonable time after discovery of such defect by the manufacturer. This notification is required to be accomplished by certified mail to the first purchaser and to the dealer or dealers to whom such vehicle or equipinent was delivered. The notification shall contain a clear description of the defect and evaluation of the risk of traffic safety related thereto and a statement of the measures to be taken to repair the defect.

Sections 113 (a), (b), and (c) of the House amendment are the same as the Senate bill with the exception that notification is required to be accomplished by certified mail not only to the first purchaser but to any subsequent purchaser to whom has been transferred any warranty on such vehicle or equipment.

Sections 113 (a), (b), and (c) of the proposed conference substitute are the same as the House amendment.

Subsection (d) of section 116 of the Senate bill requires the manufacturer of motor vehicles to furnish the Secretary a true or representative copy of all notices, bulletins, and other communications to the dealers or purchasers of such vehicles or equipment regarding any defect therein. The Secretary shall disclose so much of the information contained in such notice or other information obtained under section 114(a) (his authority to conduct independent inspection and investigation) to the public as he deems will assist in carrying out the purposes of this act. He is required not to disclose any information which contains or relates to a trade secret unless he determines that it is necessary to carry out the purposes of this act.

Section 113(d) of the House amendment requires every manufacturer of motor vehicles to furnish the Secretary promptly a true and representative copy of any notice, bulletin, or like written communica- 21 tion to the dealers of such manufacturer or purchasers and users of such manufacturer's products regarding the existence or correction of any defect in vehicles or equipment as delivered by that manufacturer. If the Secretary determines the defect is a safety defect he is required to review with the manufacturer the action taken and proposed to be taken to accomplish effective notification to purchasers and users. If the manufacturer's action is inadequate to accomplish effective notification the Secretary shall order him to take further measures that are reasonable and necessary to accomplish such notice. If the manufacturer fails to promptly comply, an injunction to compel compliance may be sought. The Secretary, if he determines after review that publication by him will result in effecting a substantial additional number of corrections, shall disclose to the public so much of the information contained in the notice or other information obtained under section 112(a) (his authority to conduct independent inspection)

as he deems necessary for this purpose. The Secretary is precluded from disclosing information which contains or relates to a trade secret unless he determines that this disclosure is necessary to carry out this

act.

Subsection (d) of section 113 of the proposed conference substitute is the same as subsection (d) of section 116 of the Senate bill, with the exception of a minor conforming change.

Subsection (e) of section 116 of the Senate bill provides that if the Secretary determines that any vehicle or item of equipment does not comply with the Federal safety standards or contains a defect relating to motor vehicle safety as a result either of testing, inspections, investigations, or research carried out by him pursuant to this title or through an examination of the reports which manufacturers are required to file with him under subsection (d) of this section (relating to notification of defects to dealers) he is required to notify the manufacturer of such defect or failure to comply. The notice is required to contain the Secretary's findings and all information on which such findings are based. He then is required to afford the manufacturer an opportunity to be heard and to establish that there is no failure to comply or that the alleged defect does not affect motor vehicle safety. Thereafter, if the Secretary determines there is not compliance or there is a defect relating to motor vehicle safety he is required to direct the manufacturer to furnish the notification specified in subsection (c) of this section to the purchaser as provided in subsections (a) and (b) of this section.

The House amendment contains no corresponding provision. Subsection (e) of section 113 of the proposed conference substitute is the same as section 116(e) of the Senate bill with the exception of a minor conforming change.

House Passed Act

Congressional Record-House
August 17, 1966, 19672

"SEC. 113. (a) Every manufacturer of motor vehicles shall furnish notification of any defect in any motor vehicle or motor vehicle equipment produced by such manufacturer which he determines, in good faith, relates to motor vehicle safety, to the purchaser (where known to the manufacturer) of such motor vehicle or motor vehicle equipment, within a reasonable time after such manufacturer has discovered such defect.

"(b) The notification required by subsection (a) shall be accomplished

"(1) by certifed mail to the first purchaser (not including any dealer of such manufacturer) of the motor vehicle or motor vehicle equipment containing such a defect, and to any subsequent purchaser to whom has been transferred any warranty on such motor vehicle of motor vehicle equipment; and

"(2) by certified mail or other more expeditious means to the dealer or dealers of such manufacturer to whom such motor vehicle or equipment was delivered.

"(c) The notification_required by subsection (a) shall contain a clear description of such defect, an evaluation of the risk to trame safety reasonably related to such defect, and a statement of the measures to be taken to repair such defect,

"(d) Every manufacturer of motor vehicles shall furnish to the Secretary promptly a true and representative copy of any notice, bulletin, or like written commúnications to the dealers of such manufacturer or purchasers and users of such manufacturer's products regarding the existence or correction of any defect in motor vehicles or items of motor vehicle equipment as de

livered by such manufacturer. If the Secretary determines that such defect is a safety defect he shall review with the manufacturer the action taken and proposed to be taken to accomplish effective notification of purchasers and users. If the action taken and proposed to be taken by the manufacturer with respect to a safety defect is inadequate to accomplish effective notification of purchasers and users, the Secretary shall order the manufacturer to take such further measures as are reasonable and necessary to accomplish such notice and, if the manufacturer does not comply promptly with such order, an injunction to compel compliance may be sought in accordance with the provisions of

section 110(a). The Secretary may determine after such review whether publication by him of the information contained in such notices, bulletins, communications relating to a safety defect will result in effecting a substantial additional number of corrections, and if the Secretary so determines, he shall disclose to the public so much of the information contained in such notices or other information obtained under section 112(a) as he considers necessary for such purpose. The Secretary shall not disclose any information which contains or relates to a trade secret or other matter referred to in section 1905 of title 18 of the United States Code unless he determines that such disclosure is necessary for such purposes.

House Debate

Congressional Record-House August 17, 1966, 19630 and 19631

Mr. SPRINGER.

And what about those who actually build the new cars-what must they do under this bill? Taking the steps in sequence, the first thing they will do is cooperate and assist the Secretary of Commerce in his deliberations and decisions about sensible, practical safety standards. They will not dominate this activity, but they will contribute. Then, of course, they must adhere to the standards when actually building production models. Having built one, the manufacturer must place a certificate in a permanent fashion which indicates that the vehicle does in fact measure up to the standards in effect when it was built. Records must be kept which can be inspected to determine compliance.

If, after all precaution and surveillance, cars do get by and are delivered which

have defects, the manufacturer must notify the owner and dealer, if they are not still the same. Such notice must also be given to a later owner if he has taken over a warranty still in effect. Then the car builder must remedy the defect. In the case of autos still in the dealer's intentory, they may be returned or fixed by the dealer at the expense of the manufacturer. Those in the hands of owners will be fixed promptly by a dealer. Should the manufacturer fail or refuse to carry out his responsibilities under these sections, it can be assessed penal- 19631 ties of $1,000 per car, and the Secretary may also seek the help of the courts by way of injunction to force compliance and stop the violation.

Congressional Record-House
August 17, 1966, 19654

Mr. COHELAN.

This legislation should be passed, but it also should be improved. The bill now authorizes the Secretary of Commerce to order manufacturers to notify owners of any defects that are discovered, but it

fails to provide penalties if the manufacturers do not comply. Civil penalties are certainly in order if this reasonable requirement is to have any real meaning.

House Committee Report

House Report 1776, Pages 27 and 28

NOTIFICATION OF DEFECTS

Section 113(a) requires every vehicle manufacturer to give notice of any defect in any vehicle or equipment produced by him which he determines relates to safety to the purchaser (where known to him) within a reasonable time after the manufacturer discovers such defect. Section 113(b) provides that the notification will be accomplished by certified mail to the first purchaser (other than a dealer) and to any subsequent purchaser to whom has been transferred any warranty upon such vehicle or equipment and by certified mail or other expeditious means to the dealer to whom such vehicle or equipment was delivered.

Section 113(c) requires the notification to contain a clear descrip- 28 tion of the defect and the evaluation of the risk to traffic safety reasonably related to the defect and a statement of the measures to be taken to repair the defect.

Section 113(d) requires each manufacturer of motor vehicles to furnish the Secretary promptly a copy of any notice, bulletin, or other written notification to his dealers, to purchasers, and to users of his products regarding the existence or correction of any defect. If the Secretary determines the defect is a safety defect, he reviews with the manufacturer the action taken or proposed to be taken with the accompanying notification to purchasers and dealers. If the action taken or proposed to be taken is inadequate to accomplish effective notification, the Secretary is required to order the manufacturer to take such further measures as are reasonable and necessary to give notice and if he fails to promptly comply, an injunction to compel compliance may be sought in accordance with section 109(a). If the Secretary determines after a review by him that publication by him of the information contained in the notice, bulletin, and communication issued by the manufacturer under this section will result in effecting a substantial additional number of corrections, he is required to disclose to the public so much of the information contained in the notice or other information obtained under section 112(a) as he considers necessary to effect a substantial additional number of corrections. The Secretary shall not disclose any information which contains or relates to a trade secret or other matter referred to in 18 U.S.C. 1905 unless such disclosure is necessary to effect a substantial number of corrections. This section was included to afford a means for uniform and prompt notification to vehicle owners of the discovery of any defects related to safety. "Defect" is a defined term which includes any defect in performance, construction, components, or materials in motor vehicles or motor vehicle equipment. The provisions of this section do not alter other courses available to the Secretary, with respect to the deficiencies which necessitate notification, such as the imposition of a civil penalty or the seeking of injunctive relief. It is the committee's intention that the Secretary will exercise his authority

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