Fianna Fáil Finance Spokesperson Michael McGrath TD has expressed his concern regarding the regulation of the car rental sector following reports of dubious practices and potentially fraudulent activity on the part of some car hire firms.

Deputy McGrath commented, “As we enter the peak summer tourist season thousands of Irish holidaymakers will be hiring cars both at home and abroad. In addition, many tourists visiting Ireland will be renting a vehicle in airports and in cities here as their primary means of travelling around Ireland.

“Consumers are often presented with reams of paper work when they are collecting their vehicle. It is very doubtful if any of these documents would pass a “plain English” test. In truth, they appear designed to bamboozle customers with a range of terms and conditions which can often leave them picking up the tab for huge additional costs and charges including airport surcharges, expensive fuel refills, and exorbitant fees for essential extras such as child seats and satnav equipment.

“There are disturbing reports in recent days regarding practices at one car hire firm in Europe who it seems may have systematically ripped off customers by massively inflating the cost of carrying out repairs even in the event of only minor damage to a car.

“While the headline price of car hire has fallen in recent years, driven by the growth of comparison websites, it is clear that the true cost of car rental can be much higher as people feel they have little choice but to take out expensive excess policies to cover themselves in the event of an accident. I have been made aware of cases where consumers have been told that the excess policy they purchased from a 3rd party insurer was not valid and they were coerced in to buying a policy from the car rental company at an inflated price.

“In the UK the Serious Fraud Office is reported to be preparing to begin a criminal inquiry into one car hire firm in the wake of claims of potentially fraudulent charges for windscreens and other repairs, which were inflated by up to 300%. This only further fuels the existing widespread consumer concern regarding the regulation of the sector.

“The car rental industry is international by nature, with the typical customer hiring a car while abroad rather than in their home country. If dubious practices are prevalent in the industry the best approach is for it to be tackled on a Europe wide basis.

“At present there is no industry specific legislation in the car rental sector. Consumers are protected to some extent by EU instruments with more general scope such as:

– Unfair Commercial Practices Directive 2005/29/EC
– Directive 93/13/EEC on Unfair Terms in Consumer Contracts

“Given the increasing number of complains about the industry it is my view that these provisions are not adequate and I am writing to the Competition and Consumer Protection Commission on the need for greater consumer protections in Ireland and I am also raising the issue directly with the European Commission.

“This is an issue of increasing consumer concern and it is my view that it is high time that it is tackled in a comprehensive manner.”