OMVIC - Ontario Motor Vehicle Industry Council Advertising and Disclosure Rules Questions and Answers 1 — Questions and Answers
Question 1: A dealership advertises a used car for $15,000. When a customer arrives, they are informed that this price does not include a mandatory $599 administration fee and a $399 fee for nitrogen-filled tires that were pre-installed. According to OMVIC's all-in pricing rules, which of the following is true?
- The only charges that can be added to the advertised price are HST and licensing. (Correct answer)
- The administration fee is acceptable, but the fee for nitrogen tires must be included in the advertised price.
- Both the administration fee and the nitrogen fee are optional and can be added if the customer agrees.
- The dealership is compliant as long as they verbally disclose the extra fees before the contract is signed.
Correct answer: The only charges that can be added to the advertised price are HST and licensing.
OMVIC's all-in price advertising rules state that the price in an advertisement must include all fees and charges the dealer intends to collect, such as freight, PDI, administration fees, and pre-installed products. The only exceptions are HST and licensing costs, provided the ad clearly and prominently states they are extra.
Question 2: A salesperson creates a social media post to advertise a vehicle available at their dealership. Which piece of information is mandatory to include in the ad to comply with OMVIC regulations?
- The vehicle's stock number.
- The total cost of borrowing if financing is offered.
- The dealership's registered name and contact information. (Correct answer)
- The salesperson's personal OMVIC registration number.
Correct answer: The dealership's registered name and contact information.
All advertisements, regardless of the platform, must clearly and prominently include the dealer's registered name and contact information. While including a stock number is a recommended best practice, and financing details are required when credit terms are advertised, the dealer's information is a fundamental requirement for all ads to ensure consumers know they are dealing with a registered dealer.
Question 3: Which of the following vehicle histories requires mandatory disclosure in an advertisement, according to OMVIC guidelines?
- The vehicle was previously owned by a commercial fleet.
- The vehicle had its brake pads replaced last year.
- The vehicle was previously used as a police or emergency services vehicle. (Correct answer)
- The vehicle was used for a daily commute of over 100 km.
Correct answer: The vehicle was previously used as a police or emergency services vehicle.
OMVIC's advertising rules specifically require the disclosure if a vehicle was previously used as a police or emergency services vehicle, a taxi, or a limousine. While other facts might be material to the sale and require disclosure on the bill of sale, the previous use as an emergency vehicle is a specified advertising disclosure requirement.
Question 4: A dealership advertises a vehicle 'as-is'. According to the Motor Vehicle Dealers Act (MVDA), what specific disclosure must be included in the advertisement?
- A statement that the vehicle comes with a limited 30-day powertrain warranty.
- The estimated cost to bring the vehicle to safety-certified condition.
- A list of all known defects with the vehicle.
- A specific statement that the vehicle is unfit, not e-tested, and may require substantial repairs at the purchaser's expense. (Correct answer)
Correct answer: A specific statement that the vehicle is unfit, not e-tested, and may require substantial repairs at the purchaser's expense.
When a vehicle is advertised 'as-is', OMVIC requires a very specific, mandated disclosure statement. This statement must inform potential buyers that the vehicle is being sold 'unfit, not e-tested and is not represented as being in a road worthy condition, mechanically sound or maintained at any guaranteed level of quality.' It must also state that the vehicle may not be fit for transportation and could require costly repairs.
Question 5: A dealer's advertisement includes an image of a premium, top-trim level model of a car with a price listed. However, the advertised price is for the base model, which lacks many of the features shown in the picture. This practice is a violation of which principle under the OMVIC Code of Ethics?
- Financial responsibility.
- Accountability.
- That all representations must be legal, decent, ethical, and truthful. (Correct answer)
- Professionalism in all dealings.
Correct answer: That all representations must be legal, decent, ethical, and truthful.
Using an image of a higher-spec model to advertise a lower-priced base model is misleading and deceptive. The OMVIC Code of Ethics requires that all representations, including advertising, must be 'legal, decent, ethical and truthful'. The ad misrepresents the vehicle being offered for the price shown.
Question 6: Under what circumstances can a dealer's advertised price lawfully exclude a specific fee?
- When the fee is for a government levy like the air conditioning tax.
- When the advertisement is a joint ad from two or more dealers whose administration fees differ. (Correct answer)
- When the fee is for freight, as this is set by the manufacturer.
- When the advertisement is exclusively online and not in print.
Correct answer: When the advertisement is a joint ad from two or more dealers whose administration fees differ.
There is a specific exception to the all-in pricing rule for joint advertisements. If two or more dealers advertise together and their fees (like administration fees) differ, that fee can be left out of the advertised price. However, the ad must separately and clearly disclose the fee and the range (e.g., 'admin fees vary from $X to $Y').
OMVIC - Ontario Motor Vehicle Industry Council Advertising and Disclosure Rules Questions and Answers 1
A dealership advertises a used car for $15,000.
When a customer arrives, they are informed that this price does not include a mandatory $599 administration fee and a $399 fee for nitrogen-filled tires that were pre-installed.
According to OMVIC's all-in pricing rules, which of the following is true?