OMVIC MVDA and Legislation 2 — Questions and Answers
Question 1: Which organization is responsible for administering the Motor Vehicle Dealers Act, 2002 in Ontario?
- Ministry of Transportation
- Ontario Motor Vehicle Industry Council (OMVIC) (Correct answer)
- Financial Services Regulatory Authority of Ontario
- Automobile Protection Association of Canada
Correct answer: Ontario Motor Vehicle Industry Council (OMVIC)
OMVIC is the delegated administrative authority responsible for registering dealers and salespeople and enforcing the MVDA in Ontario.
Question 2: For which type of vehicle transaction is a Condition Disclosure Statement (CDS) required under the MVDA?
- New vehicles only
- All vehicle sales regardless of age
- Used vehicles only (Correct answer)
- Vehicles more than five years old or with over 100,000 km
Correct answer: Used vehicles only
The CDS is required for used motor vehicles and must be completed by the seller prior to completing the transaction.
Question 3: Under OMVIC advertising standards, which costs must be included in a dealer's advertised vehicle price?
- Only the base price before additional charges
- All dealer-controlled fees and charges, excluding government taxes and licensing (Correct answer)
- Every charge including applicable taxes and licensing fees
- Only mandatory government-imposed fees
Correct answer: All dealer-controlled fees and charges, excluding government taxes and licensing
Advertised prices must include all fees and charges within the dealer's control; government taxes and licensing fees are the only permitted exclusions.
Question 4: Does the MVDA provide consumers in Ontario with a mandatory cooling-off period to cancel a motor vehicle purchase contract?
- Yes, 10 business days from the date of signing
- Yes, 2 business days for used vehicle purchases
- Yes, 7 days for any purchase exceeding $25,000
- No, there is no mandatory cooling-off period for motor vehicle purchases (Correct answer)
Correct answer: No, there is no mandatory cooling-off period for motor vehicle purchases
Unlike some consumer contracts, the MVDA does not provide a statutory cooling-off period for motor vehicle purchases in Ontario.
Question 5: When a dealer sells a used vehicle on an 'as-is' basis under the MVDA, what obligation remains?
- All warranty and disclosure obligations are eliminated by the as-is designation
- The dealer must still disclose all known material defects to the buyer (Correct answer)
- As-is sales are only permitted for vehicles more than ten years old
- As-is sales are prohibited for OMVIC-registered dealers
Correct answer: The dealer must still disclose all known material defects to the buyer
An as-is designation does not remove the obligation to disclose known material defects; dealers must still be honest about issues they are aware of.
Question 6: Under the MVDA, how is a 'broker' class registration best described?
- A dealer licensed exclusively to sell new vehicles from a manufacturer
- A wholesaler who sells motor vehicles only to other registered dealers
- A registrant who, for compensation, facilitates vehicle transactions without taking title to the vehicle (Correct answer)
- A salesperson authorized to operate independently without a registered dealer
Correct answer: A registrant who, for compensation, facilitates vehicle transactions without taking title to the vehicle
A broker connects buyers and sellers and earns compensation for facilitating the transaction but does not take ownership of the vehicle.
Question 7: What is the purpose of a dealer's trust account under the MVDA?
- To accumulate funds for annual OMVIC registration renewal fees
- To hold customer deposits separately from the dealer's general operating funds (Correct answer)
- To manage warranty reserve funds required by manufacturers
- To hold funds earmarked for future vehicle inventory purchases
Correct answer: To hold customer deposits separately from the dealer's general operating funds
Customer deposits must be held in trust in an account separate from operating funds to protect the consumer's money until the transaction is completed or funds are returned.
OMVIC MVDA and Legislation 2
Which organization is responsible for administering the Motor Vehicle Dealers Act, 2002 in Ontario?