China revises regulations on repair, replacement, return of vehicles, clarifying sellers’ responsibilities, covering EV parts

China’s State Administration for Market Regulation on July 22 issued the Regulations on the Responsibilities for the Repair, Replacement and Return of Private Vehicles (家用汽车产品修理更换退货责任规定; the “Regulations”) to clarify the responsibilities for the repair, replacement and return of private vehicles (the “Three Guarantees”) in order to protect legal interests of consumers under the relevant laws, including the Product Quality Law (产品质量法) and Consumer Rights and Interests Protection Law (消费者权益保护法). The Regulations take effect on January 1, 2022, replacing an existing set of regulations with an almost identical name (家用汽车产品修理、更换、退货责任规定) issued by the General Administration of Quality Supervision, Inspection and Quarantine on December 29, 2012.

The Regulations states that sellers are responsible for the Three Guarantees. After a seller performs its Three Guarantees responsibility (i.e. a repair, replacement or return of a vehicle), if the manufacture or another entity is responsible for the vehicle’s issue, the seller may claim compensation from the responsible party. In cases of private vehicles imported from abroad, the entities that sell the vehicles in China are considered the manufacturers.

Here are the important provisions of the Regulations:

• If the engine, transmission, traction battery or drive motor of a private vehicle or any of their main components needs to be replaced due to a quality issue within seven days from the beginning of the Three Guarantees period, the consumer may have the faulty part replaced or return it free of charge.
• When there is steering system failure, brake system failure, cracks in the vehicle body, a fuel leak or a traction battery fire in a private vehicle, the consumer may have the vehicle repaired or return it free of charge if it is within 60 days from the beginning of the Three Guarantees period and the vehicle’s mileage doesn’t exceed 3,000 km.
• If a consumer has a valid receipt and Three Guarantee certificate for his private vehicle and chooses to replace or return the vehicle within the Three Guarantee period, the seller must accept the replacement or return, in the following cases:
  • After a private vehicle has been repaired twice in total due to safety feature failure, the failure still has not been fixed or another serious safety feature failure has happened.
  • After the engine, transmission, traction battery or drive motor of a private vehicle has been replaced twice in total due to quality issues, the vehicle still doesn’t work properly.
  • After part replacement has been done twice in total due to quality issues of the engine, transmission, traction battery, drive motor, steering system, brake system, suspension system, drivetrain or pollution control equipment of a private vehicle or it has been done twice for quality issues of any single major component of a vehicle, the vehicle still doesn’t work properly.
  • A private vehicle has been under repair for more than 30 days in total for quality issues or more than four repairs have been done in total due to the same quality issue.
• If the entire engine, transmission, traction battery or drive motor and one of their main components are replaced separately, these replacements are counted as one replacement.
• If a consumer requests replacement or return of his private vehicle within the Three Guarantee period, the seller must reply to the consumer within 10 business days.

The full text of the Regulations (in Chinese) is available at
http://gkml.samr.gov.cn/nsjg/fgs/202107/t20210726_333062.html