Purchasing a new or used vehicle? It’s important to understand how all-in-price advertising works – it’s the law in Ontario.
Feb
23
Thursday, February 23, 2023
However, there are a few “exceptions” to when dealers can add fees…
Primarily, it’s imperative to understand that all consumers have rights under the Motor Vehicle Dealers Act (MVDA) and Consumer Protection Act (CPA) in Ontario when purchasing a new or used vehicle from an OMVIC-registered dealer. That Facebook Marketplace or Kijiji ad might catch your eye as a better deal from a private seller, but unfortunately, there is no consumer law that covers private transactions, and it could put you at risk.
Always remember that if you’re looking for an OMVIC-registered dealer, keep an eye out for the blue and yellow decal on dealership doors and windows, ask to see their registration, or use the find a dealer/salesperson search on OMVIC.ca.
So, what do we mean by all-in-price advertising?
All-in-price advertising means that when OMVIC-registered dealers advertise a vehicle for sale, the price must include all fees and charges they intend to collect from consumers. The only fees that can be included outside of the advertised price are HST and the total licensing cost. This practice is called all-in-price advertising, and it’s been the law in Ontario since 2010.
All-in-price advertising helps protect consumers against paying additional hidden fees that, by law, cannot be collected if they’re not clearly stated in the advertised price. If dealers or salespeople try to charge additional fees, consumers can report them to OMVIC. Furthermore, dealers who break the law can be subject to further investigation by OMVIC.
OMVIC inspectors also conduct routine checks on registered dealers to ensure ongoing compliance with the legislation. However, all-in-price advertising, as with other consumer protection laws in Ontario, only applies to vehicles purchased from OMVIC-registered dealers, not private sales.
Visit omvic.ca for more examples of fees or charges that must be included in an advertised price.
Understand your rights on market adjustment fees
In today’s automotive climate, dealers may be charging amounts over the manufacturer's suggested retail price (MSRP), often referred to as “market adjustment fees”. While this term is not necessarily universal, we are aware that some dealers are adding a charge onto their bills of sale, with this or a similar description to identify charges over the MSRP, on a variety of makes and models. Some of these charges are built into some dealerships’ advertised price, while other dealers don’t advertise a price but itemize the charge on the bill of sale.
Market adjustment fees are being charged by some dealers to reflect an increase in a vehicle price over MSRP and/or because of limited motor vehicle supply which is affecting the entire marketplace.
Ultimately, there is no prohibition against dealers charging current market prices for vehicles that are over and above the MSRP. Similarly, there is nothing wrong with signaling to consumers that prices have increased because of market conditions. Market adjustment fees are only unacceptable if they result in a violation of the MVDA, CPA, or the regulations prescribed under these statutes.
For example, a market adjustment fee that causes a dealer to violate all-in-price advertising laws or breach a binding agreement with a consumer is unacceptable.
A market adjustment may be stated in the bill of sale to itemize the charge over the MSRP. As long as the fees they intend to collect are included in the advertised price, then they have complied with the law.
However, it’s also important to note that advertisements posted by vehicle manufacturers often don’t include all fees – including those build your ideal model/features typically found on a car-maker website and because OMVIC does not regulate vehicle manufacturers (unless they are also registered as dealers in Ontario - like Tesla), their advertisements do not have to comply with the MVDA and all-in pricing.
We often encourage buyers to take a picture of the advertisement, wherever they have seen it – in a newspaper ad, online, on the dealer’s lot - and bring it with them to show to the salesperson when they go to buy. If they are being charged more, then we encourage buyers to walk away and contact our consumer support team.
Help is on the way!
Buying a new or used vehicle? Visit omvic.ca to access free car-buying resources to get you started, and sign up for the quarterly newsletter, Consumer Line.
You can also contact OMVIC’s consumer support team at consumers@omvic.on.ca or 1-800-943-6002 for expert advice and answers to all your car-buying questions, or if you have a complaint about a dealer or salesperson in Ontario.
Follow OMVIC on social media to stay up to date on the latest news.
IG: @omvic_official
Twitter: @omvic_official
Facebook: Ontario Motor Vehicle Industry Council (OMVIC)
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