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Toronto, Ontario -- January
12, 2010
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The Ontario Motor Vehicle
Industry Council (OMVIC)
announced today the details of
the new Motor Vehicle Dealers
Act (MVDA), designed to build
stronger consumer confidence in
the vehicle-buying experience.
Effective January 1, 2010,
the new MVDA clarifies former
"grey areas" by stipulating
clear requirements for
advertising, pricing, vehicle
disclosure, contracts and
consumer remedies. OMVIC
enforces the new MVDA, which
applies to more than 8,300
registered vehicle dealers and
22,000 salespeople in Ontario.
Building Consumer
Confidence Through Increased
Disclosure
"People should know
what they're buying and dealers
should know what they're
selling. That's why the key
theme of the new MVDA is
disclosure," says Carl Compton,
executive director of OMVIC.
"The legislation hadn't been
updated in some time, and was
sometimes unclear about
advertising, pricing and
disclosure requirements. The new
MVDA is very specific and calls
for all-in pricing and vehicle
history disclosure in all
advertisements and contracts.
The new MVDA also establishes
circumstances in which a
consumer can rescind a contract,
and provides access to increased
financial remedies from a
dealer-supported compensation
fund. These measures will
increase consumer protection and
require more dealer
professionalism."
Improvements in
Advertising Disclosure
"The new MVDA makes it
easier for consumers to shop and
compare," says Compton.
"Specifically, advertising must
be clear, comprehensible and
prominent. All-in pricing is a
great example. All-in pricing
means all advertisements must
include every fee a consumer
could expect to pay, including
freight and administration fees
– there can be no hidden or
extra fees. Advertisements must
also state a vehicle's model and
whether or not it was previously
used as a police or service
vehicle. And, if there are a
limited number of vehicles
available at a certain price,
the advertisement must say how
many vehicles are left."
Improvements in
Contract Disclosures
The MVDA also calls for
increased vehicle history
disclosure in contracts. Dealers
are now required to collect and
disclose more than 20 facts
about a vehicle's history,
including liens, replaced panels
or parts, and prior collisions.
"It's not necessarily bad to
buy a vehicle that's been in a
collision or that requires
work," says Carey Smith,
director of investigations for
OMVIC. "What's at stake here is
that consumers must know what
they are paying for – the
average person can't tell if a
vehicle has had previous issues
just by looking at it. That's
why full disclosure is so
critical."
"The new MVDA increases
dealer professionalism by
requiring dealers to provide
more information so consumers
can make informed decisions,"
says Compton. "The MVDA also
outlines instances in which a
consumer can cancel a contract
if full disclosure is not
provided."
Increased Financial
Compensation Now Available
"The vast majority of
vehicle purchases through
Ontario-registered dealers are
positive," says Compton. "Out of
approximately 1.4 million
transactions annually, OMVIC
historically receives about
30,000 inquiries. Only 1,200
require further action. For
consumer cases that cannot be
resolved, the MVDA provides
consumer remedies through the
Motor Vehicle Dealers
Compensation Fund, financially
supported entirely by
Ontario-registered vehicle
dealers." The new MVDA increases
the maximum Compensation Fund
payout from $15,000 to $45,000
to reflect the true cost of
buying a vehicle today.
"When a major problem occurs,
consumers and dealers are first
encouraged to sort out issues
together, and this is often
possible," says Compton.
"However, if a resolution can't
be achieved, consumers may apply
to the Motor Vehicle Dealers
Compensation Fund to be
financially compensated."
New MVDA Does Not
Cover Private Sales
To receive full
protection of the new MVDA and
the Motor Vehicle Dealers
Compensation Fund, consumers
must purchase vehicles from an
Ontario-registered dealer.
Private sales are not covered
under the legislation.
"The new MVDA applies only to
transactions with
Ontario-registered dealers. It
does not cover private sales,"
says Compton. "People should
also be aware that if they
purchase a vehicle from a
private seller, they risk
becoming a victim of a
curbsider. Curbsiders are
unregistered vehicle sellers in
the business of selling
misrepresented or stolen
vehicles. They often operate
entirely over the Internet, by
mobile phone, and without a
sales lot or signage. If
consumers choose to deal with
curbsiders, there is not much we
can do to protect them."
Consumers can identify
registered dealers by the blue
and yellow "Ontario-registered
dealer" decal posted on
dealership doors or windows, or
by asking dealers for their
OMVIC registration. Consumers
can also find out if a dealer is
Ontario-registered by contacting
OMVIC or by searching for a
registered dealer online at
BuyWithConfidence.ca.
Videos and Launch
Event Webcast Available
Watch videos about the
new MVDA and what it means for
dealers and consumers here:
www.youtube.com/buywithconfidence
A webcast of a launch event
with the Ministry of Consumer
Services will be available in
the afternoon of January 12,
2010 at:
events.digitalmedia.telus.com/omvic/011210/index.php
Visit
BuyWithConfidence.ca for
more information.
About OMVIC
OMVIC licenses and
regulates motor vehicle dealers
in Ontario and enforces the
Motor Vehicle Dealers Act on
behalf of the
Minister of
Consumer Services. OMVIC's
mandate is to maintain a fair,
safe and informed marketplace by
ensuring registration of dealers
and salespersons, inspecting
dealerships, maintaining a
complaint line for consumers,
conducting investigations and
enforcing the Act and its
associated rules and
regulations. OMVIC is also
responsible for administering
the Motor Vehicle Dealers
Compensation Fund on behalf of a
Board of Trustees.
For more information, please
contact:
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