WASHINGTON Jan 11 Volkswagen AG, as part of a
$4.3 billion settlement with U.S. regulators, on Wednesday
agreed to sweeping reforms, new audits and oversight by an
independent monitor for three years to resolve diesel emissions
Under the settlement of charges it installed secret software
in U.S. vehicles to allow them to emit up to 40 times legally
allowable pollution, the German automaker agreed to change the
way it does business in the United States and around the
VW will separate the jobs of product development and
certification and testing and monitoring into different
U.S. regulators said the reforms, which come after
President-elect Donald Trump criticized the Environmental
Protection Agency (EPA) for over-regulating U.S. industries,
were an example of why vigorous environmental enforcement was
"There are some structural changes that we are requiring so
there is less ability for these types of things to happen," EPA
Administrator Gina McCarthy told reporters on Wednesday.
VW will plead guilty to three felonies and be on probation
for three years.
In addition to oversight by an independent monitor, the
company will also face separate annual environmental management
systems audits over the next three years.
VW said in a statement Wednesday that its emission tests are
now evaluated externally and independently. It said most of the
reforms required by the settlement would apply to VW operations
The company said it looked for any indications "that a
defeat device may be present-before a model receives technical
approval" and those tests were conducted by a different
department than the one that was or is responsible for
developing the vehicle.
VW must test all of its U.S. vehicles over the next three
years using portable emissions measurement system testing - a
method designed to capture real world emissions and deter
cheating. It must also provide new protections for
The company's Porsche unit will face separate audits and
vehicle testing requirements.
McCarthy said the actions were needed to "level the playing
field for all the responsible companies who always do the right
"Markets like this don't manage or police themselves," she
VW must within three months create a group steering
committee for monitoring and complying with U.S. vehicle
emissions laws and add new environmental protection provisions
to its employee code of conduct.
VW faces fines of up to $50,000 a day if it fails to comply
with some requirements - and up to a $1 million penalty if they
make false statements to regulators.
(Reporting by David Shepardson; Editing by Andrew Hay)