• Costa Rica Real Estate

Pact to Review Vehicle Inspections Blasted

May 14, 2004

AN agreement to review Riteve SyC’s monopoly over mandatory annual vehicle inspections, included in a pact between the Social Christian Unity Party deputy recently elected president of the Legislative Assembly and deputies of the Libertarian Movement, has come under fire.Presidency Minister Ricardo Toledo and Public Works and Transport Minister Javier Chaves both expressed disagreement with the idea of modifying the country’s contract with the Spanish-Costa Rican company.Representatives of Riteve said they are not concerned about the agreement, and are confident the Costa Rican government will continue to honor the contract giving the firm a monopoly over mandatory vehicle technical inspections.“REGARDING the contract, we have great certainty and a guarantee derived from signing a contract with the Costa Rican government,” Vilma Ibarra, manager of corporate relations for Riteve, told The Tico Times.“Riteve won an international bidding process. The contract was approved by the Comptroller General’s Office and its constitutionality was upheld several times by the Constitutional Chamber of the Supreme Court (Sala IV),” she added.In the May 1 agreement, new Assembly president Gerardo González committed himself to “presenting initiatives that, without violating the contract, would make it possible for private garages and national companies to conduct vehicular technical inspections.”The agreement, meant to secure the vote of the five Libertarian deputies in González’s successful bid for assembly president (TT, May 7), was signed by 16 of 19 Social Christian Unity Party’s deputies.“WE are interested in an agenda that would make it possible to eliminate all monopolies, public or private,” said Carlos Herrera, Libertarian deputy and First Secretary of the assembly.“The most detestable of the private monopolies is Riteve’s,” he added. The Libertarians have proposed the creation of a legislative commission to look into the monopoly.Deputies of the National Liberation Party, including José Miguel Corrales, who has long questioned Riteve’s monopoly over the mandatory technical inspections, and Luis Ramírez, also said they are in favor of evaluating the matter.EDDY González, president of the Association of Costa Rican Integral Automotive Garages (ATICOS), which on several occasions has taken to the streets to protest the Riteve monopoly (TT, Oct. 10, 2003), applauded the proposal.“The country is entering an era of liberalization of monopolies,” he said. “It’s impossible to think the Costa Rican Electricity and Telecom Institute (ICE) and the National Insurance Institute (INS) monopolies will be broken (as negotiated in the yet-to-be-approved Central American Free-Trade Agreement with the United States), but Riteve’s will remain.”González accused Riteve of threatening the livelihoods of thousands of independent mechanics.“Our idea is not for Riteve to leave the country,” he said. “… All we want is for it to be open to competition.”IN related news, the daily Al Día this week reported that according to the contract Riteve signed with the government, the company is allowed to reduce by half the number of days allotted to motorists with vehicles that fail the first inspection to return for a second inspection without being charged.Now, vehicles that fail the annual technical inspection have 30 days to be repaired and taken back for a second inspection free of charge.After the company has been operating in the country for two years, free second inspections will only be provided within 15 days after a vehicle fails its original inspection.During the two weeks after that, vehicles would be charged 50% of the cost of the first inspection.The cost of a technical inspection for an automobile is ¢8,800 ($20.50).RITEVE has said the “re-inspection” charge is “clearly” stated in the contract. However, before it can go into effect, the government must approve changes in the fees Riteve charges motorists for their first inspection every year.The company alleges it is conducting too many inspections and is losing money by not charging for the second round.According to Riteve, 76% of vehicles fail the technical inspection – meant to ensure safety features such as brakes and turn signals function properly – during the first attempt.

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