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European Commission opens infringement procedure against Italy over insufficient action on Fiat Chrysler emission control strategies

The European Commission has launched an infringement procedure against Italy for failure to fulfil its obligations under EU vehicle type-approval legislation with regards to Fiat Chrysler (FCA) automobiles. The Commission sent a letter of formal notice asking Italy to respond to concerns about insufficient action taken regarding the emission control strategies employed by Fiat Chrysler Automobiles group (FCA).

Under current EU law, national authorities are responsible for checking that a car type meets all EU standards before individual cars can be sold on the Single Market. When a car manufacturer breaches the legal requirements, national authorities must take corrective action (such as ordering a recall) and apply effective, dissuasive and proportionate penalties laid out in national legislation.

The Commission is closely monitoring the enforcement of these rules by Member States and has already opened infringements against the Member States that issued type approvals for Volkswagen Group in the EU for not applying their national provisions on penalties despite the company’s use of illegal defeat device software.

Car manufacturers have been treating emission tests laxly—some have even broken the law. The emissions scandal has shown that the responsibility to enforce the law and punish those who violate it can no longer be left solely to individual Member States. While the European Parliament and Member States have recently made good progress on our proposal to overhaul the current system, it’s high time that they reach a final agreement. Citizens’ health and trust is at stake and we have no time to lose.

—Commissioner Elżbieta Bieńkowska, responsible for Internal Market, Industry, Entrepreneurship and SMEs

The current case relates to information brought to the Commission’s attention in the context of a request from the German Transport Ministry in September 2016 to mediate between the German and Italian authorities on a dissent on NOx emissions concerning vehicles of a type approved by Italy. In the course of the mediation process, the Commission carefully assessed the NOx emissions test results provided by the German type approval authority (Kraftfahrt-Bundesamt), as well as the extensive technical information provided by Italy on the emission control strategies employed by FCA in the car type in question.

Reuters: US preparing to sue FCA over diesel emissions
Reuters reported that the US Justice Department will file a civil lawsuit against Fiat Chrysler Automobiles NV over excess diesel emissions as early as this week if no agreement is reached with the Italian-American automaker, citing two sources briefed on the matter.
The EPA in January accused FCA of illegally using undisclosed software to allow excess diesel emissions in about 104,000 cars and SUVs. The EPA and California Air Resources Board have been in talks with FCA about the excess emissions and whether the agencies would approve the sale of 2017 FCA diesel models.

EU type approval legislation bans defeat devices such as software, timers or thermal windows which lead to higher NOx emissions outside of the test cycle, unless they can be justified by the need to protect the engine against damage or accident, or for the safe operation of the vehicle. As the Commission has pointed out repeatedly, the exception to the prohibition is precisely that: an exception that must be interpreted strictly.

The Commission is now formally asking Italy to respond to its concerns that the manufacturer has not sufficiently justified the technical necessity—and thus the legality—of the defeat device used, and to clarify whether Italy has failed to meet its obligation to adopt corrective measures regarding the FCA type in question and to impose penalties on the car manufacturer.

A letter of formal notice is a first step in an infringement procedure and forms part of the Commission’s dialogue with Italy to clarify facts and to find a solution to the concerns identified by the Commission. Italy now has two months to respond to the arguments put forward by the Commission; otherwise, the Commission may decide to send a reasoned opinion.

Background. Defeat devices are clearly banned by EU law (subject to a limited number of exemptions). Car manufacturers have an obligation to comply with this law and respect the ban which has been in place since 1998.

Under current rules (Directive 2007/46/EC, which sets the general framework, and Regulation (EC) 715/2007), which establishes the specific type-approval requirements for the emissions from Euro 5 and Euro 6 cars), it is the responsibility of the Member State which approved a vehicle type (commonly referred to as “model”) to address any non-compliance of production and vehicles of that type.

The European Commission is closely following Member States’ efforts to clarify the possible wrongdoing by car manufacturers in the past. In December 2016, the Commission opened infringement procedures against seven Member States for breach of EU type approval legislation.

Following the revelations in September 2015 that Volkswagen Group used defeat device software to circumvent emissions standards for certain air pollutants, the Commission called on Member States to carry out the necessary investigations into the possible presence of such devices in vehicles approved by their approval authorities, and to ensure compliance with EU law. As a response, several Member States have conducted investigations and published reports with regard to NOx emissions from vehicles.

In the context of these investigations, some Member States have concluded that a number of manufacturers use emission strategies that can be justified and legal because they are needed to protect the engine. The ban on defeat devices foresees an exemption (both under EU and US law) for when the need for the device is justified to protect the engine against damage or accident and to ensure the safe operation of the vehicle. It is up to the manufacturer to demonstrate to the national authority that any use of defeat devices is covered by one of the exceptions and is technically necessary.

On 26 January 2017, the European Commission published guidance to help Member States evaluate if car manufacturers use defeat devices or other strategies that lead to higher vehicle emissions outside of the test cycle and analyse whether they are technically justified. A car manufacturer using emissions abatement strategies should be able to provide a technical justification for questions such as: Is the increase of emissions kept at the lowest possible level? Is there no better technology or design on the market that would allow for improved emission control or safer operation of the engine? Can the risk of sudden and irreparable engine damage be appropriately demonstrated and documented?

The Commission has introduced more robust and realistic testing methods for measuring both nitrogen oxides (NOx) and CO2 emissions from cars. Since May 2016 (under “RDE Act 2”, Commission Regulation (EU) 2016/646), car manufacturers need to declare and get approval of their emissions control strategies before the respective vehicle type can be approved. In January 2016, the Commission proposed a Regulation on the approval and market surveillance of motor vehicles. The proposal—which is pending adoption by the European Parliament and Council—aims to ensure more independent vehicle testing and more checks on cars already in circulation. The proposal also foresees greater EU supervisory powers over national authorities, test centers and manufacturers, including the possibility to impose fines on manufacturers. It also includes an obligation on car manufacturers to grant relevant authorities access to their emissions software protocol.



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