Law and Order

LEGISLATIVE AND TECHNICAL AFFAIRS

FEDERAL UPDATE

  CCAD
SEMA and its Automotive Restoration Market Organization and Hot Rod Industry Alliance councils announced that the next Collector Car Appreciation Day (CCAD) will be celebrated on July 12, 2019.
   

Collector Car Appreciation Day—July 12, 2019: SEMA and its Automotive Restoration Market Organization and Hot Rod Industry Alliance councils announced that the next Collector Car Appreciation Day (CCAD) will be celebrated on July 12, 2019. The date marks the 10th consecutive commemoration in what has become an annual event to raise awareness of the vital role automotive restoration and collection plays in American society. SEMA and its councils will once again seek a Congressional resolution to recognize the day’s significance. The industry endeavors to preserve the nation’s automotive heritage while providing well-paying, high-skilled jobs nationwide. Intended to celebrate the classics of the past and the future, CCAD is a singular tribute to the collector car industry and the millions of hobbyists it supports. SEMA will maintain and publicize a list of scheduled events to commemorate America’s time-tested love affair with the automobile at www.semasan.com/ccad.

Adaptive Headlights: The National Highway Traffic Safety Administration (NHTSA) has issued a proposed rule to permit the certification of adaptive driving beam (ADB) headlighting systems under the federal lighting standard, Federal Motor Vehicle Safety Standard (FMVSS) No. 108, if a manufacturer chooses to equip vehicles with those systems. The rule will establish performance requirements for the equipment. The technology is not currently permitted in the United States, since FMVSS No. 108 requires discrete high- and low-beam settings. Europe and Japan have begun to allow ADB systems as optional equipment. ADB technology seeks to provide more illumination without causing glare. It uses advanced equipment, including sensors (camera and image processing units), data processing software, and headlamp hardware (such as shutters or LED arrays) to detect oncoming vehicles. The headlamp beams are automatically adjusted to provide less light to the occupied roadway and more light when the roadway is unoccupied. FMVSS No. 108 applies to aftermarket replacement equipment as well. The equipment must meet any applicable requirements and include all functions of the lamp it is designed to replace. Replacement lamps intended for vehicles with ADB systems cannot take the vehicle out of compliance when the replacement lamp is installed. NHTSA has requested comment on the possibility that only the original equipment and/or vehicle manufacturer would be able to make a good-faith certification that the replacement equipment meets FMVSS No. 108, since the performance requirements are vehicle level, not equipment level.

Driverless Vehicles: The U.S. Department of Transportation (DOT) released a plan to further accommodate automated vehicle (AV) technologies. Since some federal safety standards effectively assume the presence of drivers, the DOT will ease the process for exempting cars, trucks and other vehicles from existing standards requiring a driver if the vehicles achieve an equivalent level of safety. Transportation officials will also work with their state and local counterparts to eliminate any unnecessary impediments that preclude driverless vehicles. The plan continues to rely on companies to voluntarily assess that their vehicles are safe enough to be on the public roads. NHTSA will also continue to work with the states and industry to consider possible new regulations.

Automotive-Grade Nitrous: U.S. Representative Norma Torres (D-CA) has introduced a bill to request an Environmental Protection Agency (EPA) study on how states regulate nitrous oxide for use in automotive applications. Automotive-grade nitrous oxide is the industry standard for racing nitrous oxide. It contains at least 100 parts per million of sulfur dioxide to make the nitrous pungent to help deter illegal use as an inhalant. The additive does not affect performance or significantly increase the manufacturing cost of nitrous-oxide products. Florida and Georgia have specific laws which require that only automotive-grade nitrous be used for motorsports. Some states have age restrictions (18 or 21 years old) on sales and may require presentation of valid identification at time of purchase. Other states have “intent” provisions that make it illegal to sell nitrous if the seller suspects it will be used to cause intoxication, euphoria or other dulling of the senses or nervous system. A couple of states require shops that sell nitrous oxide to keep receipts or obtain a signed disclosure form of any person who has bought the gas. The bill instructs the EPA to consult with the DOT and Food and Drug Administration to make study recommendations on whether a national standard would be beneficial.

E15 Gasoline: The White House directed the EPA to allow E15 (gasoline that contains 15% ethanol) to be sold year-round. Currently, the EPA prohibits the sale of E15 between June 1 and September 15 due to fuel-volatility concerns that higher blends of ethanol combined with warmer temperatures may lead to increased ground-level ozone formation and smog. The EPA will draft regulations to allow E15 sales to begin as early as 2019, although the decision to lift the restriction could be challenged in court. Ethanol supporters maintain that few gas stations sell E15, given that it is available only part of the year. In 2011, the EPA made it illegal to used E15 fuel in motor vehicles made before 2001 as well as in motorcycles, boats, and gasoline-powered equipment. SEMA opposes the expansion of E15 sales, since ethanol—especially in higher concentrations such as E15—can cause metal corrosion and dissolve certain plastics and rubbers in automobiles that were not constructed with ethanol-resistant materials.

NAFTA/USMCA: The North American Free Trade Agreement (NAFTA) may soon be replaced by the United States-Mexico-Canada Agreement (USMCA). The three countries have agreed to update and rename the 1994 accord that created the trilateral trading bloc. The current timetable calls for the new agreement to be submitted to the U.S. Congress for ratification in 2019. Major provisions include a requirement that vehicles have 75% North American content, compared with 62.5% currently. At least 40% to 45% of the vehicle content must be made by workers earning at least $16 an hour, and the accord’s labor standard provisions could lead to higher wages in Mexico. The USMCA includes an automatic 16-year sunset clause, although reviews every six years can keep extending the pact. The accord outlines how each nation must allow cross-border enforcement of IP rights and includes enforceable rules to curb countries from manipulating their monetary exchange rates. Mexico and Canada would not be subject to national-security tariffs if such were imposed on imported automobiles and auto parts. However, relief from the current national-security tariffs on steel and aluminum are subject to separate negotiations.

Small-Businesses IP 
Protection Training: President Trump signed the Small Business Innovation Protection Act of 2017 (S. 791) into law. Senator Gary Peters’ (D-MI) legislation directs the U.S. Small Business Administration (SBA), the Under Secretary of the U.S. Department of Commerce for Intellectual Property, and the Director of the U.S. Patent and Trademark Office enter into a partnership agreement to develop an intellectual property (IP) protection training program and educational materials. The law also requires the training program to educate small businesses on domestic and international IP protection when developing business plans and growth strategies. Additionally, the bill directs the agencies to use existing materials to develop the training program, which may be provided either online or at physical locations, including at SBA Small Business Development Centers and the U.S. Patent and Trademark Office headquarters and regional offices.

Postal Rate Hikes: The U.S. Postal Service has proposed price increases to take effect on January 27, 2019. Mailing service costs would increase by an average of 2.5% to make up for the U.S. Postal Service’s revenue shortfall, which totaled $2.7 billion in the last fiscal year. A first-class Forever stamp (1-oz. letters) would increase from $.50 to $.55, while mailing service rates, including magazines and catalogs, would increase by 2.5%. Domestic priority mail flat rates would also increase. In a separate action, the U.S. government intends to withdraw from the Universal Postal Union, a 192-country postal agreement that sets the fees that national mail carriers may charge. U.S. frustration with the Universal Postal Union is largely due to a provision dating back to the ’60s that offers discounts to companies based in underdeveloped countries, which has enabled Chinese companies to ship parcels weighing under 4.4 lbs. to U.S. customers at rates up to 70% below what domestic companies are charged. The State Department intends to renegotiate rates to ensure that American manufacturers are not placed at a disadvantage, which will ultimately determine whether the United States completes the one-year process of withdrawing from 
the pact.

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