Auto trading companies will no longer need to gain authorization from automobile brand owners to sell vehicles from July, according to new measures unveiled Friday.
The preceding measures implemented since 2005, which require that all car dealers secure authorization from brand owners, will be repealed from July 1, 2017, the Ministry of Commerce (MOC) said in a statement.
The authorization system had helped safeguard market order and contributed to the rapid development of the Chinese auto market, the MOC said in a statement.
However, the system also gave rise to monopolistic practices, dragged on competition and made auto parts expensive.
In the future, both authorized and unauthorized car sales companies will be allowed to operate, according to the new measures.
"Automobile marketplaces, stores and e-commerce outlets will be the new ways to sell cars in China," the MOC said.
The new measures will help improve sales and after-sales service across different auto brands, an approach that will save resources, improve efficiency and improve services, it added.
China had remained the world's largest automobile manufacturer and market for eight consecutive years by 2016, with both auto output and sales exceeding 28 million units last year.