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New Law Prohibits Renting Out Vehicles with Open Recalls

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June 6, 2016—A new law came into effect on June 1 prohibiting rental car companies with an average of 35 or more vehicles in their fleets to rent out those vehicles if they are subject to an open recall. 

The requirement was a part of the Fixing America’s Surface Transportation Act (FAST Act), signed by the president in December. The law does not state, however, whether “loaner” vehicles are included in the limitations. 

The National Independent Automobile Dealers Association (NIADA) successfully lobbied Congress to exclude provisions from the FAST Act that would have prohibited dealers from selling or leasing vehicles with open recalls. 

The NIADA in a release, encourages businesses with rental and loaner cars to regularly check to look up whether vehicles have open recalls, and to fix those cars if possible, before putting them into customer hands. If a fix is not available, the NIADA encourages a full disclosure of the recall to the customer. 

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