I believe the recent spike in certificate of entitlement (COE) prices was partly a result of aggressive bidding by authorised dealers and the need for them to stockpile COEs in the lead-up to the enhanced Vehicular Emissions Scheme, with increased surcharges, that will start on July 1.

Everyone is familiar with the need for COEs to regulate the number of vehicles on the roads.

While the system itself is sound, it could do with some tweaks.

The Land Transport Authority says a "successful COE bid gives you the right to own a vehicle that can be used on the road for 10 years".

I have some observations:

First, if the COE is the right to own a vehicle that can be used on the road for 10 years, why do motor dealers need to participate in the bidding on this right?

The right to own a vehicle is an independent individual activity, and all owners or would-be owners should obtain their COEs independently.

Second, if the COE is the right to own a vehicle, why is that right tied to a particular vehicle?

The "right to own" and "the vehicle" should be treated as two different entities.

One buys the "right to own", and therefore can buy a vehicle.

He should then be able to change or replace the vehicle at will, as long as there is a valid "right to own". COEs should not be tagged to a vehicle but, instead, should be tagged to the individual who owns that right.

Third, the purchase of a right to own a vehicle should not be financed by a loan.

At present, the COE can be financed as part of the overall payment for the car. However, the "right to own" is not a physical asset and should therefore not be allowed to be part of a loan. A car loan should be for only the cost of the car.

The COE system does play an important role in regulating traffic on our land-scarce island.

But we should also be aware of changing landscapes and look at fine-tuning existing systems.

Roy Ong Ban Guan