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UNITED STATES OF AMERICA

FEDERAL TRADE COMMISSION

COMMISSIONERS: Lina M. Khan, Chair

Rebecca Kelly Slaughter

Alvaro M. Bedoya

Matter No. P204800

ORDER POSTPONING EFFECTIVE DATE OF 

FINAL RULE PENDING JUDICIAL REVIEW

On January 4, 2024, the Commission published in the Federal Register a Final Rule to 

curtail certain unfair or deceptive acts or practices by covered motor vehicle dealers.0F

1 Final Rule, 

Combating Auto Retail Scams Trade Regulation Rule (“Rule”), 89 Fed. Reg. 590-91 (Jan. 4, 

2024) (to be codified at 16 C.F.R. pt. 463). The Commission designated the Final Rule to 

become effective on July 30, 2024. Id. at 590.

On or about January 5, 2024, the National Automobile Dealers Association and the Texas 

Automobile Dealers Association (“Petitioners”) filed a Petition for Review (“PFR”) in the 

United States Court of Appeals for the Fifth Circuit. Nat’l Auto. Dealers Ass’n v. FTC, No. 24-

60013. The PFR challenged the Rule on the asserted grounds that it is “arbitrary, capricious, an 

abuse of discretion, without observance of procedure required by law, or otherwise not in 

accordance with law[.]” PFR 1-2. The Court has ordered that the administrative record be filed 

by February 14, 2024. 

On January 8, 2024, Petitioners filed a motion with the Fifth Circuit seeking a stay of the 

Rule and expedited consideration of their PFR. Mot. for Stay of Final Rule and for Expedited

Consideration. Although Petitioners did not seek a stay from the Commission in the first instance 

as required by Rule 18(a)(1) of the Federal Rules of Appellate Procedure, the Commission has 

nonetheless reviewed Petitioners’ motion, construing it as though it were a stay request 

submitted under Commission Rule 4.2(d), 16 C.F.R. § 4.2(d).

1 12 U.S.C. § 5519(f)(1) and (f)(2) contain the pertinent definitions of “motor vehicle” and “motor vehicle 

dealer,” and the rule applies only to a “covered” subset. See 89 Fed. Reg. at 693-94 (to be codified at 16 

C.F.R. § 462.3(e)-(f)).

In the Matter of:

Combating Auto Retail Scams

Trade Regulation Rule
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The Administrative Procedure Act provides, in relevant part, that “[w]hen an agency 

finds that justice so requires, it may postpone the effective date of action taken by it, pending 

judicial review.” 5 U.S.C. § 705. The Commission believes that the Rule will provide consumers 

with critical protections from auto retail scams, that Petitioners’ challenges to the Rule lack 

merit, and that undue delay in the Rule’s effective date will harm consumers and honest 

businesses. Petitioners’ arguments for a stay rest on mischaracterizations of what the Rule 

requires of covered motor vehicle dealers, including inaccurate claims that it will require dealers 

to overhaul their practices and substantially increase compliance costs. In fact, the Rule does not 

impose substantial costs, if any, on dealers that presently comply with the law, and to the extent 

there are costs, those are outweighed by the benefits to consumers, to law-abiding dealers, and to 

fair competition—as honest dealers will not be at a competitive disadvantage relative to 

dishonest dealers. Nonetheless, Petitioners’ assertions and suggestions that legally compliant 

dealers have to make unnecessary changes to satisfy Petitioners’ misunderstandings of the Rule 

have created uncertainty. Additionally, Petitioners are seeking expedited consideration of the 

PFR, and if that request is granted, a stay of the effective date pending expedited review should 

not postpone implementation of the Rule by more than a few months, if at all. Balancing the 

equities here, the Commission has determined that it is in the interests of justice to stay the 

effective date of the Rule to allow for judicial review. A Federal Register notice to reflect this 

action is forthcoming. Once the PFR’s merits are resolved, the Commission will publish a new 

document in the Federal Register establishing a new effective date.

Accordingly, 

IT IS ORDERED THAT the effective date of the Final Rule, Combating Auto Retail 

Scams Trade Regulation Rule, 89 Fed. Reg. 590 (Jan. 4, 2024), be, and hereby is stayed.

By the Commission.

April J. Tabor

Secretary

SEAL:

ISSUED: January 18, 2024