Awareness Campaign. Season s Greetings. OMVIC Wraps Up Another. OMVIC s Website Gets a Facelift. In this issue: .on.ca. Fall 2013

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1 .on.ca In this issue: OMVIC Wraps Up Another Successful Consumer Awareness Campaign OMVIC s Website Gets a Facelift Problematic Trends Advertising Warranties on CPO Vehicles Serious Fines in Recent Discipline Decision Windsor Dealer Receives Jail Sentence Say It Ain t So Season s Greetings Season s Greetings OMVIC staff would like to wish all dealers and salespersons a joyful holiday season and a happy New Year. OMVIC remains committed to providing excellence in service to all stakeholders as we continually strive to ensure a fair and informed marketplace for Ontario consumers and dealers alike. OMVIC Wraps Up Another Successful Consumer Awareness Campaign OMVIC s Website Gets a Facelift Fall 2013 OMVIC s annual Fall Consumer Awareness Campaign is wrapping up and early results prove it to be another success. The theme of this year s campaign was You re Protected. Launched in mid-september, the campaign promoted awareness of the protections consumers receive from Ontario s consumer protection laws when they buy from an OMVICregistered dealer (specifically all-in pricing, full disclosure of vehicle history, rescission rights (for specified non-disclosures), and access to the Motor Vehicle Dealers Compensation Fund), while making it clear that private purchasers receive none of these protections. Secondary messages of the campaign warned consumers of the dangers posed by curbsiders and increased awareness of OMVIC s role as regulator. Read more inside The Dealer Standard is published by the Ontario Motor Vehicle Industry Council 789 Don Mills Road, Ste. 800 Toronto, ON M3C 1T5 T: F: Toll Free: Executive Director: Carl Compton Writers: Terry O Keefe Sarah Choudhury Dealers and salespeople may have noticed major improvements to OMVIC s websites (omvic.on.ca and buywithconfidence.ca). Designed with a fresh new look and user-friendly navigation, the website offers quick and easy access to important information for registrants and consumers alike.

2 Problematic Trends OMVIC inspectors continue to see a growing number of dealers selling vehicles to so-called exporters, without conducting any due diligence to ensure the buyers are actually OMVIC-registered exporters. The Used Car Dealers Association (UCDA) also reports that it continues to hear about this issue from its members despite bulletins being issued. Put a stop to this problematic trend by doing the following: Ensure Exporter is OMVIC-Registered The Motor Vehicles Dealers Act, 2002 (MVDA) requires exporters (i.e., dealers in the business of purchasing vehicles for the purpose of exporting outside of Ontario) to be registered with OMVIC. Individuals in the business of exporting vehicles without OMVIC registration are considered curbsiders. Selling to curbsiders is a serious breach of the MVDA and OMVIC expects dealers to take reasonable steps to ensure they do not supply curbsiders with inventory. If dealers are unsure of the registration status of a buyer who claims to be an exporter they can check the purchaser s registration on OMVIC s website ( omvic.on.ca/registrantsearch/index.aspx); dealers can also ask to see the person s registration certificate. The MVDA requires all dealers and salespersons to carry their certificate while conducting business and to present it to anyone who asks to see it. Dealers can also contact OMVIC directly to confirm the status of an exporter by calling ext Request Proper Bill of Lading The only acceptable proof of export is in the form of a bill of lading. A bill of lading can only be issued once the vehicle has been delivered to a shipping company also known as a common carrier. It is the common carrier that provides the bill of lading which must clearly identify the overseas destination. The UCDA advises that pre-made or in-house bills of lading are not sufficient documentation and cannot be used for tax exemptions. Importance of Charging HST Dealers are cautioned to ensure adherence to the Canada Revenue Agency (CRA) requirements surrounding HST. Vehicles are only exempt from HST if the dealer ensures they are delivered to a buyer outside of Canada. Otherwise, HST must be collected. Advertising Warranties on CPO Vehicles It has recently come to OMVIC s attention that some dealers are advertising certified pre-owned (CPO) vehicles that include a manufacturer s warranty stated in term/mileage (e.g., 6 years or 120K). While this in and of itself is fine, if the manufacturer s warranty is actually based on the vehicle s original in-service date then the advertisement must clearly and prominently state the actual warranty available is the balance or remainder of a manufacturer s warranty (e.g., comes with balance of 6 year/120k warranty). The Code of Ethics requires dealer advertising to be clear and truthful; an ad suggesting the full warranty applies, when it does not, is neither clear nor truthful.

3 More than 120 MILLION Impressions to be Generated from OMVIC s Consumer Awareness Campaign OMVIC conducted the 2013 campaign using diversified forms of media including online (Kijiji.ca and autotrader.ca specifically targeting consumers shopping for vehicles), TV, print, billboards and through engagement with mainstream media. OMVIC also sponsored the Lemon-Aid Car Show on Rogers Community Channel 10 in Toronto; the show airs weekly on Tuesday nights at 9 p.m. with five weekly repeats until May This year, a new tool was introduced as part of the awareness campaign: an interactive online quiz. The Car-Buying Quiz, permanently available from OMVIC s website, is a fun and engaging way to let consumers test their vehicle-buying knowledge while educating them on their car-buying rights in Ontario (see some of the survey results below). Why conduct a campaign? Educating consumers (and registrants) is vitally important and a key part of OMVIC s mandate. Ensuring consumers know what their rights are, when those rights apply (i.e., only when buying from a registered dealer) and when they don t (when buying privately) provides an important service to Ontario consumers and helps build trust in OMVIC-registered dealers. Betterinformed consumers helps prevent problems and ensures that those who value consumer protection seek out the services of a registered dealer. Page 2

4 Findings & Results (at the time of writing) Media Outlet Impressions (possible views) Online (Kijiji.ca, autotrader.ca, Toronto Sun) 28,734,600 Television (CP24 and OMNI) 34,624,200 Out of Home (digital billboards) 32,790,000 Public Relations/Media 4,082,700 It s expected the campaign will generate in excess of 121,000,000 impressions (possible views), each an opportunity to educate Ontarians that You re Protected when you buy from an OMVIC-registered dealer. Quiz Results As was mentioned previously, this year s campaign introduced a Car-Buying Quiz. Kijiji and autotrader ads challenged readers to take the quiz and test their carbuying savvy. The quiz was hugely popular and yielded some interesting results: 65% knew a curbsider was an unlicensed dealer The results from this year s consumer awareness campaign will undoubtedly assist Ontario vehicle-buyers and dealers s theme You re Protected will continue to resonate in OMVIC s future messaging. Take OMVIC s Car-Buying Quiz! Visit omvic.on.ca/portal/quiz 75% 74% 43% 21% understood retail vehicle sales in Ontario were regulated by OMVIC understood that they are only protected by consumer protection laws when they buy from a registered dealer said they would buy privately even knowing they were not protected by consumer protection legislation mistakenly believed they were protected when buying privately Page 3

5 .on.ca Serious Fines in Recent Discipline Decision Ontario Ltd, o/a Kingston Nissan and CarOne, as well as Trevor Cotton, were recently fined a total of $27,000 for breaches of OMVIC s Code of Ethics regulation (CoE). In an agreed statement of facts the discipline panel heard the dealer failed to provide required disclosures including: Failure to disclose out-of-province history on a contract Failure to disclose former daily rental history on a contract The panel also found the dealer s advertising to be non-compliant in the following areas: Advertisements failed to prominently disclose vehicles were being sold as-is Advertisements failed to disclose the former daily rental status of vehicles Advertisements failed to include an all-in price As well, it was found the dealer employed unregistered sales staff and an unregistered business manager. In determining the fines, the discipline panel stated the penalty is appropriate to the circumstances and the panel was satisfied the penalty was sufficient to deter the registrant from similar acts, while sending an appropriate message to other registrants about their obligations with respect to advertising and disclosure of material facts in writing. It should be noted Discipline Panels are made up of three individuals, two of whom are dealers. In finding the parties in breach of the CoE and MVDA the panel ordered the following penalties: Kingston Nissan fined $8,000 CarOne branch fined $8,000 Cotton ordered to pay $9,000 The parties were also ordered to pay the Registrar s costs ($2,000) and Cotton was ordered to successfully complete the OMVIC Certification Course. All Discipline Decisions must be made public as mandated by the MVDA. To access this discipline decision in full and to view previous decisions, visit OMVIC s website at: DealersSalespersons/EnforcementCompliance/ DisciplinaryProcess/DisciplineDecisions.aspx Windsor Dealer Receives Jail Sentence Hussain Al Manhsor was sentenced to 180 days jail time and his dealership Ontario Inc. operating as Sandwich Auto has been fined $90,000 on multiple counts of breaching the MVDA. The Windsor-area man and company were convicted of: Trading off premises Retaining unregistered sales staff (two counts) Falsifying documents Failing to provide a purchaser with required financing information (CPA) Failing to maintain required records (six counts) Failing to provide a copy of the Bill of Sale Manhsor was sentenced to 15 days (to be served consecutively) on each of the 12 charges. Sandwich Auto was fined $7,500 on each count. Page 4

6 Say It Ain t So It is with heartfelt thanks and appreciation that OMVIC bids farewell to Melinda Williams, OMVIC Project Director at Georgian College s Automotive Business School of Canada (ABSC); Melinda retires December 19 after more than 16 years of service. Melinda began her Georgian College career in administration for International Studies in In 1999, she found herself in charge of the fledgling OMVIC Project, a new department responsible for developing and administering the OMVIC Certification Course. Fourteen years later, it s clear Melinda s talented management, ongoing efforts to improve the program and commitment to the partnership between Georgian College and OMVIC has been the foundation of its great success. Melinda s team at ABSC now delivers the Automotive Certification Course to 5,500 students every year! Melinda is well respected by her colleagues for her ability to facilitate and anticipate the needs of the industry without ever compromising the integrity of the partnership OMVIC shares with Georgian College, states Marie-Noëlle Bonicalzi, Dean of ABSC. OMVIC s Manager of Education, Terry O Keefe couldn t agree more. Melinda s genuine interest in providing a superior educational experience to students, her exemplary customer service skills and her unquestionable dedication to excellence will be truly missed. OMVIC would like to thank Melinda for her years of dedicated hard work; not just for OMVIC, but for each and every dealer and salesperson who successfully completed the Certification Course. We wish her much happiness and good fortune. Publication Mail Agreement # The Dealer Standard Return undeliverable Canadian addresses to: 789 Don Mills Road, Ste. 800 Toronto, ON M3C 1T5