Glossary & Legal Reference
Key terms from the manual, plus a plain-English summary of every Act that governs the trade.
- Advertising orderCh 1
- An order from the Registrar to stop a false or misleading ad and to retract or correct it. Must be complied with immediately, even if appealed to the LAT. Repeat offenders can be required to pre-approve ads for up to two years.
- All-in price advertisingCh 8
- The rule that an advertised price must include every mandatory charge (freight, PDI, admin, levies, pre-installed options) — everything except HST and licensing, and only if those exclusions are clearly stated.
- Appeals PanelCh 17
- A three-member OMVIC panel that hears appeals of Discipline Panel decisions. It can affirm, overturn or change the decision — and its decision is final.
- APR — Annual Percentage RateCh 13
- The true annual cost of credit including interest and cost-of-borrowing charges. Must be disclosed accurately and, in credit ads that show a rate or payment, shown with equal prominence.
- As-isCh 4
- A vehicle sold with no representation of fitness or condition — the buyer takes all the risk. Requires a bold, initialled statutory statement. You cannot sell a vehicle both 'as-is' and with an SSC. Material facts must still be disclosed.
- BrandingCh 18
- A vehicle's registration status assigned in Ontario: None, Salvage (repairable), Rebuilt (repaired salvage that passed a structural inspection), or Irreparable (parts/scrap only, never on the road again). Must disclose the most recent brand.
- BrokerCh 2
- A dealer class that arranges deals but never takes possession of the vehicle or handles the customer's funds. Broker contracts must carry a bold statement saying so.
- CAMVAPCh 18
- Canadian Motor Vehicle Arbitration Plan — free, binding arbitration for disputes between consumers and manufacturers over defects or warranty administration. "Fair, fast, friendly, free, final." A statement about it must appear on every sale and lease contract. Ontario has no lemon law.
- CCPCh 4
- "Clear, comprehensible and prominent" — the standard every required contract term and disclosure must meet. It must be easy to find, easy to read and easy to understand.
- Code of EthicsCh 17
- Ontario Regulation 332/08 under the MVDA. It is law, not a guideline. It sets seven core requirements (integrity, disclosure & marketing, wholesale disclosure, accountability, compliance, respect, professionalism) that every registrant must follow.
- Compensation FundCh 12
- The Motor Vehicle Dealers Compensation Fund. Consumers (not businesses) who lose money in a dealership transaction can claim up to $45,000. General Dealers and Brokers pay a one-time $324 per location at registration; salespeople pay nothing.
- ConsignmentCh 18
- Selling a vehicle on behalf of its owner. Requires a written, signed contract; the vehicle must be clearly marked as consignment; registration can't transfer until sold; personal/family consignor money goes into the trust account.
- Cooling-off periodCh 16
- A myth for vehicle sales. There is NO statutory cooling-off period for a signed vehicle purchase in Ontario. A signed deal is binding (subject to conditions and rescission rights).
- CPACh 13
- Consumer Protection Act, 2002. Protects individuals buying for personal, family or household use (not businesses). Bans unfair practices, governs credit disclosure, repairs and consumer leases. Rights under it cannot be waived.
- CurbsiderCh 11
- An unregistered person who sells vehicles for profit while pretending to be a private seller. Illegal. Minimum fine $5,000. Curbsiders often disguise damaged write-offs and falsify histories.
- Dealer AdministratorCh 2
- A person a dealer names to handle certain OMVIC admin tasks (file dealer renewals, pay fees, review salesperson renewals and notifications). They need not be registered but cannot submit salesperson renewals or file business change/class/branch applications.
- Dealer platesCh 18
- MTO-issued portable plates for a dealer's own inventory vehicles. Private use is allowed. Cannot be lent out or used on customer/loaner vehicles.
- Demonstrator (demo)Ch 4
- A new-model vehicle used by the dealership. Sold as a USED vehicle — new-vehicle charges must be removed or offset by an equal, separately shown discount, and it must be advertised separately from new vehicles.
- Discipline PanelCh 17
- A three-member OMVIC panel (industry peer plus non-industry member) that hears alleged Code of Ethics breaches. Can order education, fines up to $25,000, and hearing costs. Its decisions can be appealed to the Appeals Panel.
- EPA — Environmental Protection ActCh 16
- Prohibits tampering with emissions devices and governs the disposal of automotive fluids/parts. Applies even to as-is sales.
- ExporterCh 2
- A dealer class that buys vehicles in Ontario to sell outside the province/country.
- Extended warrantyCh 9
- A repair-coverage product that MUST be either insured under the Insurance Act or backed by an irrevocable letter of credit to the Compensation Fund ($100,000 if the seller is the selling/leasing dealer, $500,000 otherwise). Otherwise the dealer is liable if the provider fails.
- Fleet LessorCh 2
- A dealer class that leases fleets — Commercial Fleet Lessors and Short-term Fleet Lessors (consumer leases under 4 months). Exempt from the certification course.
- Freeze orderCh 1
- An order that stops money or property from moving — issued with NO advance notice, against a dealer or a curbsider, to protect consumers.
- Garage registerCh 3
- The record required under the HTA listing vehicles a dealer buys and sells, available to OMVIC, police and the MTO.
- General RegulationCh 1
- Ontario Regulation 333/08 under the MVDA. Contains the detailed operating rules: registration, records, trust accounts, contract contents, disclosure requirements and more.
- HTA — Highway Traffic ActCh 3
- Requires dealers to keep a garage register and to notify the MTO of vehicle purchases and sales (new permit proof within 6 days).
- IDS — Initial Disclosure StatementCh 13
- Under the CPA, the document a dealer arranging financing must give showing the cost of borrowing: amounts, term, APR, payment schedule, prepayment terms and more.
- IrreparableCh 18
- A brand meaning the vehicle can only be used for parts or scrap and can never be driven or registered for road use again.
- LAT — Licence Appeal TribunalCh 2
- The independent tribunal that hears appeals of the Registrar's proposals to refuse, suspend or revoke registration, and advertising orders. It can uphold, change or set aside the Registrar's decision.
- LDS — Lease Disclosure StatementCh 13
- Under the CPA, the disclosure a consumer lease requires: lease value, term, payment amount and count, residual, implicit finance charge, APR and total lease cost.
- Lease Finance DealerCh 2
- A dealer class dealing in the financing of leases. Exempt from taking the certification course.
- Material factCh 5
- Any fact that could reasonably influence a buyer's decision. Must be disclosed even if no specific rule names it — the catch-all disclosure obligation.
- Merchantable qualityCh 16
- An implied SGA condition that goods are of acceptable quality — they provide transportation, have no hidden defects that affect value, and can be driven a reasonable distance for a reasonable time.
- MVDACh 1
- Motor Vehicle Dealers Act, 2002 — the Ontario law that governs the retail sale and lease of vehicles. In force in its current form since January 1, 2010. It requires dealers and salespeople to register and sets the rules for contracts, disclosure and conduct.
- Negative equityCh 4
- When a customer owes more on their trade-in than it's worth. The shortfall must be shown truthfully on the contract — inflating the vehicle price, fees or products to hide it is illegal even if the customer agrees.
- OMVICCh 1
- Ontario Motor Vehicle Industry Council — the administrative authority delegated by the Ministry of Public and Business Service Delivery to enforce the MVDA. OMVIC registers dealers and salespeople, inspects businesses, investigates complaints and disciplines the trade.
- Option (closed-end) leaseCh 13
- A consumer lease where the lessee can buy the vehicle at the residual value at the end, but isn't obligated to. Liability at end is capped.
- Outside Ontario DealerCh 2
- A dealer registered in Ontario but operating from outside the province, allowing them to buy at Ontario auctions. Exempt from some Ontario record requirements (SSC/inspection/repair records).
- PIPEDACh 3
- The federal Personal Information Protection and Electronic Documents Act — governs how businesses collect, use and disclose personal information. Customer personal information belongs to the dealership, not the salesperson.
- PPSA — Personal Property Security ActCh 15
- The Ontario law under which liens (security interests) on vehicles are registered and enforced. A lien search reveals registered claims.
- Quiet possessionCh 16
- An implied SGA condition that the buyer will enjoy the vehicle free of third-party claims (liens, theft). If breached, the buyer gets a refund even if the dealer didn't know.
- Realizable valueCh 13
- In an open-end lease, the value used to calculate end-of-lease liability: the HIGHEST of the actual sale price, 80% of the residual, or the residual minus three monthly payments.
- RebuiltCh 18
- A brand meaning a salvage vehicle was repaired and passed a Structural Inspection Certificate from a licensed inspection station, allowing registration.
- Receiver / ManagerCh 1
- A person the Registrar can appoint to take over a dealership that is going out of business, facing revocation, or about to freeze operations.
- RegistrarCh 1
- The OMVIC official with statutory power to grant, refuse, suspend or revoke registration, issue orders (advertising, freeze) and appoint receivers/managers.
- RescissionCh 6
- The consumer's right to unwind a purchase and get their money back when a dealer failed to disclose specific required facts (e.g. previous daily-rental/police/taxi use, make/model/year, branding, or the distance driven). Available to any non-dealer buyer within 90 days of delivery under the MVDA.
- Residual-obligation (open-end) leaseCh 13
- A consumer lease where the lessee is responsible for any shortfall between the vehicle's realizable value and the residual at the end.
- RSLA — Repair and Storage Liens ActCh 15
- Gives repairers and storers a lien for unpaid work/storage. An RSLA lienholder is paid BEFORE a PPSA secured party.
- SalvageCh 18
- A brand meaning the vehicle is repairable. To return to the road it must be repaired and pass a structural inspection, after which it becomes Rebuilt.
- Service planCh 9
- A plan covering repairs that is NOT insured (unlike an extended warranty). The contract must state it isn't insurance and list covered goods/services and service locations.
- Service platesCh 18
- Plates for BUSINESS use only — unlike dealer plates, no private use is permitted.
- SGA — Sale of Goods ActCh 16
- Implies conditions into sales: merchantable quality, fitness for purpose and quiet possession. Excludes leases and repairs — but the CPA extends similar protection to consumer leases.
- SSC — Safety Standards CertificateCh 18
- A document issued by a licensed Motor Vehicle Inspection Station saying the vehicle met minimum safety standards at inspection. Valid 36 days for transfer. Needed to plate a fit vehicle. It is NOT a warranty or guarantee of condition — a mandatory statement must say so.
- Structural Inspection CertificateCh 18
- The certificate a rebuilt vehicle needs, issued by a licensed Motor Vehicle Inspection Station, confirming structural repairs meet standards.
- TKU / TMUCh 15
- "True kilometres unknown" / "True mileage unknown." A signature alone is not enough — a prescribed statement is required when the true distance can't be certified. A rolled-back odometer makes the dealer liable even if honestly unaware.
- Transaction feeCh 1
- A per-vehicle fee dealers pay OMVIC (annually at renewal) for each vehicle sold or leased. Dealers may pass it to customers; salespeople never pay it. Dealer-to-dealer sales and sales to a lessee are exempt.
- Trust accountCh 3
- A dedicated bank account a General Dealer must use to hold certain money — deposits over $10,000 and money from personal/family consignments. The account name must include "Motor Vehicle Dealers Act, 2002, Trust Account." It can never be used as collateral and must be reconciled monthly within 30 days.
- Two-thirds ruleCh 13
- Under the CPA, once a consumer has paid two-thirds or more of a secured debt, the creditor needs court permission to repossess.
- Unconscionable representationCh 13
- An unfair practice where a dealer takes advantage of a consumer — e.g. they can't understand the deal, the price is grossly excessive, there's undue pressure, or the consumer clearly can't afford it.
- Unfair practiceCh 13
- Under the CPA, either a false/misleading/deceptive representation (including failing to disclose a material fact) or an unconscionable act (taking advantage of someone who can't protect their interests, grossly excessive pricing, undue pressure). Makes the agreement voidable and exposes the dealer to penalties.
- UVIP — Used Vehicle Information PackageCh 18
- An Ontario package showing a used vehicle's registration history, odometer information, liens and Red Book value. Private sellers MUST provide it; dealers are NOT required to.
- WholesalerCh 2
- A dealer class that buys and sells only to other registered dealers — never to the retail public.