Dealer Registration Frequently Asked Questions

The following are the most common questions related to registration under the Motor Vehicle Dealers Act (MVDA). If your questions are not addressed on this page, please contact us.

Before Registration

1. Is it possible to operate a dealership from a residence address in Ontario?

The Motor Vehicle Dealers Act does not allow the operation of a dealership out of an individual's home. OMVIC might consider such an application if, within the residence's perimeter, there is a separate business area with its own entrance. When this is the case, an applicant could be issued a wholesale-restricted registration provided the local municipality, through a zoning letter, considers that particular location appropriate for commercial purposes. Retail activities – dealing directly with the public – are not allowed at all.

2. How many vehicles can an individual or company sell without being registered as a dealer?

None. Ontario's legislation does not provide for a number of vehicles that an individual or company can sell without the benefit of registration. Unless an individual is selling his/her personal vehicle privately, anybody buying or selling vehicles in order to gain a profit – or as part of their regular business operations (e.g. car rental companies, municipalities, or others that need to periodically renew their fleets) – must be registered as a dealer.

3. What kind of registration is required for selling used vehicles? For motorcycles?

There are no distinctions – in terms of registration requirements or in terms of the registration (licence) itself – between selling new vehicles and selling used vehicles, or between selling automobiles and selling motorcycles, trucks, motor homes, etc. Anybody selling vehicles that are intended for use on the road – as opposed to farming, construction and mining equipment, or recreational vehicles such as snowmobiles and the like – must be registered under the Motor Vehicle Dealers Act.

4. How big of a lot and a sign does a retail dealer need to have in order to qualify for registration?

There are no minimum requirements as to the dimensions of the lot and the sign of a dealership. The MVDA stipulates that dealers must operate out of separate premises, clearly identifiable by a visible sign. Those selling directly to the public (retail dealers) must be able to display the vehicles in a lot that is in compliance with municipal zoning by-laws.

5. Is it possible for a salesperson to work for two or more dealerships at the same time?

No, it is not. Only under special circumstances would OMVIC allow a salesperson to work for different dealerships. When a salesperson opens his/her own dealership, this salesperson's licence must be transferred from the former dealership to the new one as soon as the business application is approved. This restriction does not apply to salespersons of a dealership and its branches. Since they all fall under the umbrella of a single head-office, salespersons are able to work for any of the branches and/or the head office itself.

After Registration

What is required when there are changes in the ownership of a corporation?

A change in the ownership of a corporation does not affect the corporation as a legal entity and is not considered a new application. You need to submit the following:

Business Registration Change Notice listing all new officers and directors;
Copies of the Articles of Amendment;
Letter signed by a director outlining the particulars of this change of ownership;
Individual Registration Applications and copies of ID for new individuals. All checks will be completed on the new owners, and the corporation will retain the same registration number.

Note: Purchasing some of the corporation's assets is not the same as purchasing the corporation as a whole. For instance, if a company acquires a dealership from a corporation, the dealership now belongs to a different legal entity, and a new dealer registration is required.

2. What is required when an amalgamation between corporations take place?

Corporations that amalgamate form a new legal entity and a new application is required. You need to summit the following:

Business Registration Application and Individual Registration Applications as applicable, as well as all processing fees (Compensation Fund excluded) and documentation required for a new dealer registration;
Copies of Articles of Amalgamation;
Letter signed by a director outlining the particulars of this amalgamation and requesting to keep the original registrations valid until the new application is approved;
Individual Registration Change Notice for salespersons of the amalgamated corporations, as employees must be transferred from the original corporations to the new amalgamated one.

Note: The new corporation assumes all assets and liabilities of the amalgamated corporations.

3. What is required when a sole proprietor or a partnership becomes a corporation?

Since a corporation is a legal entity different from a sole proprietorship – even if the corporation is a one-person operation – or a partnership, a new application is required. You need to submit the following:

Business Registration Application and Individual Registration Applications as applicable, as well as all processing fees (including Compensation Fund ) and documentation required for a new dealer registration;
Letter requesting the transfer of the registration of the former sole proprietor as a salesperson for the new corporation;
Proof of dissolution of limited partnership if applicable.

Note: All submitted documentation (e.g. municipal permit, business name registration, etc.) must show the legal name of the new corporation.

4. What is required when a sole proprietor brings in a partner(s) into the operation?

The sole proprietorship ends as a legal entity and a new one, a partnership, is created instead. This requires submission of a new application. See question #3 for requirements.

5. What is required when a partnership is dissolved, and one of the former partners wants to become a sole proprietor?

This, too, constitutes a new legal entity and a new application is required. You need to submit the following:

Business Registration Application and Individual Registration Applications as applicable, as well as all processing fees (including Compensation Fund ) and documentation required for a new dealer registration;
Proof of dissolution of limited partnership if applicable.

The partnership registration number will be terminated. If former partner was not registered as a salesperson, a new registration number is issued.

Note: When a partnership is dissolved due to one of the partners death, the remaining individual(s) must re-register as a new business entity. No new payment to the Compensation Fund is required.

6. What is required when a partnership adds or changes partners?

A change in the ownership of a partnership affects the partnership as a legal entity and requires a new dealer registration. See question #5 for requirements.

Note: The former partnership registration number will be terminated, and a new one will be issued.

7. What is required when opening a branch for an existing dealership?

A branch is registered as an extension of the head office and requires a new application. You need to submit the following

Business Registration Application and processing fees (Compensation Fund excluded);
Copy of municipal permit or zoning letter – depending on your jurisdiction – for the new location.

Note: A designated Branch Manager must be specified in the application. Once it is approved, a new registration number for the branch will be issued.

8. What is required when a business (trade) name is changed?

A change in the business name does not change the nature of the legal entity and is not considered a new application. You need to submit the following:

Business Registration Change Notice;
Copy of registration of new business name.

9. What is required when a corporation's legal name is changed by Articles of Amendment?

A change in name does not change the legal nature of the corporation and is not considered a new application. You need to submit the following:

Business Registration Change Notice;
Copy of Articles of Amendment.

10. What is required to change a wholesale operation into a retail one?

Provided that a lot, with a visible sign, is available for the new retail operation, you need to submit the following:

Letter requesting that the Wholesale Leasing Affidavit signed earlier be disregarded;
Copy of municipal permit or zoning letter – depending on your jurisdiction – for the new location.

Note: If only purchasing some assets of a corporation – a dealership, for example – a new dealer registration is required.

11. What is required when a dealer's registration is not renewed in time?

A lapsed registration (individual or business) requires a new dealer registration. All fees are due,including payment to the Motor Vehicle Dealers Compensation Fund, and all pertinent documentation has to be submitted once again.

12. What is required when a dealership changes its legal status?

When there is a change in the legal status of a dealership, such as in those cases described in questions #2 to #6 inclusive, then a new dealer registration is required. In addition, the dealer must notify the Ministry of Finance (MoF) - Retail Sales Tax Branch, of such a change. Depending on each particular case, MoF may or may not issue a new vendor permit (RST number). However, it is important that MoF be aware that a new application has been submitted to OMVIC and that they keep the current vendor permit number active until the new application is approved. Failure to do so will result in the dealer's inability to transfer vehicles.