Proactive compliance – Motor vehicle dealers

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Motor industry

The proactive compliance program assists motor vehicle dealers meet the requirements set out by the legislation plus identify and rectify areas of risk.

Proactive compliance visits

Consumer Protection staff randomly visit licensed motor vehicle dealers to check compliance with their relevant law.

The visits aim to provide education and advice on what the law means on a practical level, and any information about changes.   If the visits pick up obvious disregard for the law, this may result in cancellation of a licence/registration.

The proactive compliance checklist below will assist you to prepare for a visit.

If you would like more information please contact the Consumer Protection Advice Line team on 1300 304 054 or by email.

Preparing yourself

The proactive compliance program is education based and designed to provide advice and guidance to motor vehicle dealers.

How the visit is conducted

A proactive compliance visit includes a:

  • meeting with the person in charge of the dealership
  • reconciliation of your current employees (yard managers, salespersons ) to ensure the accuracy of the Department’s database in relation to your staffing profile and licensed  persons
  • review of completed sales documentation
  • Inspection of used vehicles offered
  • examination of the business trust account and trust accounting procedures
  • discussion about complaints (if any) lodged against the business

What you will need:

The site visits are impromptu, however you can ensure the visit is conducted with the minimum of disruption to your business by regularly reviewing the checklist and knowing where key documents are stored e.g.

  • the dealer’s licence and certificate of authorised premises is on display
  • your trust account bank statements and reconciliations for the previous three (3) months where applicable
  • your trust account receipt book
  • a sample of  advertisements recently placed
  • consignment documents including current and completed consignment contracts, trust account bank records for the last three (3) month period and trust account reconciliation documentation.
  • current list of consignment vehicles in stock
  • all used vehicles offered for sale at the time of the inspection have relevant forms displayed

A sample of settled sales documentation and consignment files (if applicable) will be reviewed during the visit.

Legislation

The visits aim to assist dealers to comply with the following legislation:

Proactive visit checklist

The following checklist will help you prepare for a proactive compliance visit:

Proactive compliance checklist – Motor vehicle dealers

Description

Legislation

GENERAL

Does the Dealer have the business name stated in his application for a licence displayed on a sign of reasonable dimension affixed or erected at every premises at which he conducts the business of a dealer?

MVDA 21

Does the Dealer have the number of the licence issued to him on a sign of reasonable dimension affixed or erected at every premises at which he conducts the business of a dealer?

MVDA 21

Does the Dealer carry on the business of a dealer at any premises other than the premises authorised under section 20E (‘the authorised premises)?

20E, 20H and 30(2) MVDA

LICENCES / ADMINISTRATION

Does the Dealer have his Certificate Of Authorised Premises displayed in a conspicuous position on the premises to which the certificate applies?

20G(3) MVDA

If the Dealer is a firm or body corporate, have there been any changes to the membership of the firm or persons concerned in the management and conduct of the body, and if so, was the Commissioner notified 14 days prior to the change?

23 MVDA

Do all of the persons employed or engaged by the Dealer as Salespersons or Yard Managers hold current licences?

31 A/B/C MVDA

Does the Dealer employ a disqualified person in any capacity on the authorised premises, or allow a disqualified person to frequent the authorised premises, without the prior consent of the Commissioner?

20D MVDA

ADVERTISING

Do all advertisements published on behalf of the Dealer include the Dealer’s licence number?

21 MVDA

Do all advertisements published on behalf of the Dealer include the business name stated in his application for a licence?

21 MVDA

Do all advertisements published on behalf of the Dealer in which one or more second-hand vehicles are specified, clearly and accurately specify

  • The registration number of the second-hand vehicle/s (a stock number may identify unlicensed vehicles)
  • The year of manufacture       
  • The cash price, and 
  • The address of the registered premises of the dealer at which the vehicle is offered for sale

11(1) MVD(S)R

11(2) MVD(S)R

Do any of the Dealer’s advertisements have potential to contravene the Australian Consumer Law?

Note: Generally speaking, it is an offence to publish or cause to be published, advertisements that may be false, misleading or deceptive, among other things.  The law relating to advertising may be considered complex and every case is assessed on its merits.

To gain a greater understanding of those laws, Dealers may wish to consult the Australian Consumer Law (WA) text, as annexed to the Fair Trading Act 2010 and available from the Western Australian State Law Publisher website at www.slp.wa.gov.au, or publications such as the Australian Competition & Consumer Commission’s Pricing manual for the motor vehicle industry, which is available from the ACCC website.

This is general information only, it is not legal advice.

ACL

TRANSACTIONS IN SECOND HAND VEHICLES

Are the Dealer’s transactions consistent with the class or description of business of the licence held by the Dealer?

30(3) MVDA

Does the Dealer keep a register of transactions in the prescribed form?

25(1) MVDA

3, 4 & 4A MVD(S)R

Does the Dealer record in the register the prescribed particulars of every transaction entered into in the course of dealing at those premises?

25 MVDA

Are all second hand vehicles of which the Dealer is the trade owner, kept or parked at the authorised premises of the Dealer?

27(3) MVDA

Do all second hand vehicles offered or displayed for sale by the Dealer have notices in the prescribed form containing the prescribed particulars attached?

33(1), 33(3) and 33(6) MVDA

Are the notices of prescribed particulars attached to the vehicles consistent with the warranty obligations of the Dealer with respect to those vehicles?

34A, 34C and 34D MVDA

Are the Dealer’s contracts or agreements for the sale of vehicles (other than by auction) to people who are not dealers;

  • In writing and signed by all relevant parties, and
  • Contain the prescribed particulars, terms & conditions

42A(2) MVDA,

13B MVD(S)R

Does the Dealer correctly complete the notices of prescribed particulars and retain them for not less than two years?

33(7) MVDA

 

More information about fines is available on Infringements, forms and publications - Motor vehicle dealers page. 

 

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