Advertising and Disclosure Rules Flashcards

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?

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.

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?

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.

Which of the following vehicle histories requires mandatory disclosure in an advertisement, according to OMVIC guidelines?

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.

A dealership advertises a vehicle 'as-is'. According to the Motor Vehicle Dealers Act (MVDA), what specific disclosure must be included in the advertisement?

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.

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?

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.

Under what circumstances can a dealer's advertised price lawfully exclude a specific fee?

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').