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Tweaks to the Certificate of Entitlement (COE) system will be finalised in the coming weeks, said the Land Transport Authority (LTA) as it wrapped up its public consultation exercise on Monday. LTA said it has received diverse views from over 3,700 people who gave feedback. Most of them agreed that the current way the COEs are categorised -- based on engine capacity -- should be reviewed. In recent years, luxury car models have become more common in Category A, which is meant for the mass market or small cars of not more than 1,600cc each. To tackle this, the transport minister in May called for ideas on how the system could be refined. Most felt that categorisation should be based on the Open Market Value (OMV) of the car. More than 60 percent of those who took part in LTA's online survey felt that Category A should be set aside for cars with OMV of not more than S$20,000. Noel Davenash, a participant, said: "The best way to choose mass market would be through the cost of the car, and that's really all that boils down to. "Most people who buy mass market cars want something that is a bit cheaper, versus someone who wants something a bit more prestigious or luxurious." But there are those who feel that the OMV of a model can fluctuate due to variations in exchange rates and car specifications. This means the same model could fall into different COE categories at different times. Some voiced concern that the criteria, such as OMV and engine power, could be circumvented. Others suggested keeping engine capacity as a criterion, but factoring in other criteria such as engine power. They felt this will be good as engine power can be reviewed every few years to keep pace with technological developments. A majority of those surveyed also supported the proposal to levy a surcharge on multiple-car owners. But LTA said there was a lack of consensus on whether the levy should be imposed on an individual or a household -- and whether it should be a one-off or a recurring surcharge. There were also concerns that a surcharge could penalise bigger households, and that this could be easily circumvented. Many also wanted a pay-as-you-bid system for COEs, where every successful bidder pays exactly what he or she has bid. Some believe this will result in more conservative bidding, and therefore lower COE prices. But experts said this would not be as efficient. They argued that the current system, where all successful bidders pay the lowest market-clearing price results in the most efficient way and that bid prices are open to public scrutiny. Professor Ng Yew Kwang, from the Nanyang Technological University's Economics Division, said: "Under the pay-as-you-bid (system), everyone must underbid, and different people have different psychology. "Some underbid by a lot, and some underbid by less. Then the item may go to the wrong person, to the person who may not value it very highly." There was also a strong perception that motor dealers are driving up COE premiums and should be banned from bidding, but some said this would be more inconvenient for buyers. But others felt this would not help, as long as there is a strong demand for the limited supply of COEs. Some felt dealers typically commit to car purchase agreements to absorb the additional cost should COE prices move up higher than expected and thus have every incentive to bid low once a purchase agreement is signed. Some also felt that such a ban could be easily circumvented by buyers who may ask dealers to bid in their name. A good number of buyers also prefer to have the convenience of dealers bidding for them. LTA said whatever its decisions on the COE refinements, the industry and buyers will be given ample time to adjust. Source: http://www.channelnewsasia.com/news/singap...-be/790958.html