In 2010 the Ontario government introduced sweeping new protections for Ontario’s car buyers. One of the most significant changes was the mandatory requirement for registered dealers to advertise all-in prices. This means if a dealer advertises a price for a vehicle, that price MUST include all fees or charges the dealer intends to collect.
The following must be included in advertised price:
• PDI – PDE (pre-delivery inspection/expense)
• Administration (admin) fees
• Government levies (air tax, etc.)
• OMVIC fee ($5)
And, if a dealer intends to charge for products or services they have preinstalled on a vehicle, these costs MUST be included in the advertised price of the vehicle. Examples include:
• Nitrogen/tire warranty
• Security products/services
Note: these are not exhaustive lists and are meant as examples only.
By LAW, the only additional fees an Ontario dealer can charge are HST and licensing (the cost of vehicle registration and plates), unless the fee is for optional services or products the consumer has requested or agreed to purchase. Further, dealer advertisements must clearly indicate that HST and licensing are extra. These regulations apply equally to both new and used car dealers.
The law has teeth.
OMVIC, Ontario’s regulator of vehicle sales, enforces the Motor Vehicle Dealers Act (MVDA) which sets out the all-in pricing requirement. “This law is meant to provide transparency to consumers and to create a level-playing field for dealers,” explained Terry O’Keefe, OMVIC Director of Communications. According to the regulator, dealers who try to charge fees that exceed the advertised price are in violation of OMVIC’s Code of Ethics and the MVDA. According to O’Keefe, “The penalties can be significant; dealers found in breach of the Code face fines up to $25,000, and consumers can find records of all such breaches on OMVIC’s website. Dealers convicted of breaching the MVDA can face fines of up to $250,000 or possible revocation of their licences; an individual convicted of breaching the Act can face a maximum penalty of a $50,000 fine and/or two years less a day in jail.” To find out if a dealer or salesperson has been charged or convicted, consumers can conduct a “Dealer Search” on OMVIC’s site.
What is an advertisement?
Any inducement to buy or lease is an advertisement. This would include, but is not limited to ads:
• in print (newspapers, magazines, etc.)
• on the internet (dealer site, online marketplace, etc.)
• on social media
• on radio or TV
• on signs (including those in or on a vehicle itself)
What should a consumer do if a dealer tries to add charges in excess of the advertised price?
“Don’t buy from that dealer. Walk away!” exclaimed O’Keefe. “If a dealer tries to charge in excess of the advertised price, that dealer doesn’t deserve your business so you should simply shop elsewhere and report that dealer to OMVIC.”
OMVIC takes its job of enforcing the MVDA very seriously as is evidenced by the discipline decisions viewable on its site. But they don’t want consumers to mistrust all dealers: “The vast majority of dealers are compliant and offer excellent service to their customers,” said O’Keefe. “This is a case of the few, tarnishing the reputation of the many.”
So while OMVIC is there to protect consumers and enforce the legislation, it’s just as important consumers learn their rights. In those infrequent instances that a dealer doesn’t live up to the standards demanded of them, an educated consumer is the best line of defence. To learn more about your vehicle buying rights visit omvic.on.ca
Important note: OMVIC does not regulate vehicle manufacturers; therefore advertisements placed by manufacturers do not have to comply with the MVDA and all-in pricing is not required for their ads. That said, some manufacturers voluntarily comply with the all-in pricing provision and commendably provide transparency to consumers.