Toronto Dealer Fined For Breaching All-In Price Law

TORONTO, Sept. 16, 2014 /CNW/ - OMVIC, Ontario's regulator of vehicle sales announced today a $21,500 fine handed down to Platinum Cars Inc.  An OMVIC Discipline Panel found the Toronto dealer breached OMVIC's Code of Ethics by failing to advertise all-in prices as is required by Ontario's Motor Vehicle Dealers Act (MVDA). The dealership's officer/director was also personally fined, $3,000.

The Panel heard evidence the dealer placed 22 advertisements that stated "prices do not include $399 admin[istration] fee". "This was a clear violation of the MVDA which mandates a dealer's advertised price to include all fees and charges the dealer intends to collect, with the exception of HST and licensing" stated OMVIC Director of Communications Terry O'Keefe. According to O'Keefe, Platinum continued to advertise non-all-in prices after the dealer received a warning from an OMVIC Inspector, and continued even after the dealer received a Notice of Complaint – the document issued to a dealer alleging a breach of the Code of Ethics and starting the discipline process.

In rendering its decision the Panel wrote: "the penalty…must protect the public and the public confidence in the industry… [and] an appropriate penalty must act as… a general deterrent to other members of the profession".

Consumer Education = Consumer Protection. OMVIC Launches an Awareness Campaign

As part of its on-going efforts to educate consumers about their rights when buying a car, OMVIC today launched a six-week Consumer Awareness Campaign. The theme: "All-in pricing... IT'S THE LAW".

"As regulator it is impossible to review the millions of daily ads placed by dealers on the web and across the myriad of other mediums available", explained O'Keefe. "That is why we want to educate consumers; an educated consumer is not only able to protect him or herself, he or she can drive compliance. If customers start walking out of dealerships because the dealer tried to tack fees on top of the advertised price, we believe dealers will change their tactics".

OMVIC's campaign includes online, radio, TV and billboard advertising. OMVIC will also launch a new infographic, "The Road to Buying a Car", designed to teach consumers about their rights and how to "Ask the Right Questions", whether buying from a dealer or private seller.

Understanding All-In Price Advertising

All-in pricing is the law.  If an OMVIC-Registered Dealer advertises a price for a vehicle, the MVDA requires that the price include ALL fees and charges the dealer intends to collect.  Examples include:

• Freight
• PDI-PDE (pre-delivery inspection/expense)
• Administration (Admin) fee(s)
• Government levies (air tax, etc.)
• OMVIC fee ($5)
• Safety and e-test (unless the ad contains the mandatory "Unfit Vehicle" statement)

Note: HST and licensing do not have to be included in the price if the advertisement clearly and prominently indicates they are not included 

Further, if a dealer intends to charge for products or services they have pre-installed on a vehicle, those costs MUST also be included in the advertised price. Examples include:

• Nitrogen/tire protection package
• Warranties
• Security or theft deterrent products/services (etching, etc.)
• Fuel

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)

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 in manufacturer ads. That said, some manufacturers voluntarily comply with the all-in pricing provision and commendably provide transparency to consumers.

About OMVIC

The Ontario Motor Vehicle Industry Council (OMVIC) administers and enforces the Motor Vehicle Dealers Act (MVDA) on behalf of the Ministry of Government and Consumer Services. OMVIC maintains a fair and informed vehicle sales marketplace by regulating dealers and salespersons, regularly inspecting Ontario's 8,000 dealerships and 25,000 salespeople, maintaining a complaint line for consumers and conducting investigations and prosecutions. OMVIC is also responsible for administering the Motor Vehicle Dealers Compensation Fund on behalf of its Board of Trustees.

Image with caption: "Ontario Motor Vehicle Industry Council (OMVIC) (CNW Group/Ontario Motor Vehicle Industry Council (OMVIC))". Image available at: http://photos.newswire.ca/images/download/20140916_C1362_PHOTO_EN_5625.jpg

SOURCE: Ontario Motor Vehicle Industry Council (OMVIC)

For further information: Terry O'Keefe, Director of Communications, 416-226-4500x3525, [email protected], www.omvic.on.ca; Sarah Choudhury, Communications Officer, 416-226-4500x3172, [email protected] www.omvic.on.ca; Amy Paterson, Communications Assistant, 416-226-4500x3335, [email protected], www.omvic.on.ca