RE: Clean Car Standard Implementation update for VIA Council, members, and industry

Following on from today’s E-Alert, VIA is now able to provide a little more detail on the proposed implementation of the Clean Car Standard (CCS).

Key dates;

1. 7 November 2022 – This is when Waka Kotahi (NZTA) expects to have to have the Carbon Account system available for dealers / importers to register *
2. 1 December 2022 – This is the proposed date that vehicle will start to be recorded against Carbon Accounts. Consider this the ‘soft launch’ of this step in the process. Vehicles certified on or before 31 December 2022 will not accrue a penalty or credit
3. 1 January 2023 – The CCS takes effect and all vehicles being imported into New Zealand will need to be linked to a Carbon Account *
4. February / March 2023 (estimated) – Anyone wanted to transfer or trade CCS credits will need to complete AML verification (Anti-Money Laundering) with NZTA
5. April 2023 (estimated) – Trading credits becomes available as well as some payment options
6. Late Q2 2023 – Invoicing of accrued charges begins **

* You must have a Carbon Account set-up to import a light vehicle into New Zealand, this applies if it is 1 vehicle or 1,000 and is the critical first step all dealers / importers must complete in November.

** Vehicles certified from 1 January 2023 will be subject to CCS penalties. Dealers will need to be aware of this new cost and allow for it in vehicle trading from 1 January 2023 even though they may not be invoiced until later in the year.

Over the last 8 to 10 weeks VIA has been working closely with NZTA and the Ministry to try and land CCS by the 1-January date, we have experienced first-hand how complex the system and structure are the programme and can understand the difficulties that NZTA have had given the tight time frames.

Significant components of the CCS were legislated earlier in the year, such as the start date and penalty regime, making them difficult rocks to move.

At all times through this process and including on Tuesday the 18^th in a meeting with the Minister VIA has argued that the only way to mitigate all risks associated with the CCS implementation would be to delay the start until NZTA and the industry were ready. However, we were aware that such a significant change to existing legislation would be very difficult, especially given the importance of the Clean Car Programme to the Government’s transport decarbonisation plan.

When NZTA approached VIA and asked that we become involved in planning the delivery of CCS, they were very upfront about being unable to deliver the full end-to-end CCS platform in time for 1 December. VIA’s involvement was to ensure that any alternative proposal would work for industry. An early solution proposed was a semi-automated / manual processing system, working through this concept it became obvious that this would cause delays of days, if not weeks to the onshore importation process. VIA was very vocal about the catastrophic impacts this would have on our industry given the delay estimates were ‘best case scenarios’.

NZTA reacted quickly understanding our opposition going back to the drawing board to find a workable alternative.

The alternative is the staged implementation detailed above, with key milestones set for the first half of next year.

VIA needs all members to understand that this proposal is still draft, and subject to final Cabinet sign-off which is expected next week. It is VIA’s understand that the Minister supports this proposal, and we would like to thank the Minister for his pragmatic approach.

Given the plan is still technically in draft NZTA won’t be in a position to officially deliver anything to industry until it has completed its sign-off process.

VIA would like to apologies to members for their lack of communication regarding CCS over this time. While we would have liked to have been sharing with members sooner, VIA has been working under an obligation of confidence with NZTA, the Ministry and the Minister Office. This was to allow information to be shared freely without the concern it would be shared widely, this helped create the collaborative environment needed to deliver this solution in such a short timeframe.

VIA is aware that the staged solution is not perfect and have raised two key concerns with NZTA and directly with the Minister, these are;

1. The lack of education and awareness given the importance of CCS and the impacts it will have on industry. With the start date so close it was VIA’s opinion that awareness campaigns should have been well underway by now.
2. The impacts of delayed billing could be significant for the many small to medium size businesses that make up our industry. Depending on the mix of cars imported some dealers could be liable for a bill in the tens of thousands.

When we put our concerns to the Minister, he asked that VIA continue to work with NZTA through the staged implementation period to try and reduce the impacts on the industry of these two points.
While not the perfect outcome for industry VIA has worked hard on behalf of its member to find a practical solution to a difficult problem. This is the value of VIA to the industry and a great reason why we continue to need your support.

VIA would like to thank the following for their involvement

• Lead working group members: Frank Willett, Robert Young, Matt Battle, and Chris Stephenson
• Secondary working group members: Ken Quigley, Waqas Khattak, Gordon Shaw, and Hamish Gardyne
• The Waka Kotahi implementation teams and key representatives from the Ministry of Transport

For any questions, please contact VIA on 0800 VIA VIA (842 842) or email info@via.org.nz.”