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OMVIC Exam Study Guide | 100% Correct
Answers | Verified | Latest 2024 Version
Ch.1 - What is the primary legislation governing Ontario's retail automotive sector? - ✔✔The Motor Vehicle Dealers Act, 2002 see 1. Ch.1 - Which body or agency enforces the MVDA? a. Ministry of Government and Consumer Services b. TADA c. OMVIC d. Automotive Business School of Canada - ✔✔c. OMVIC see 1. Ch.1 - List three functions carried out by OMVIC. - ✔✔Any three of the following:
- Administers and enforces the MVDA
- Inspects dealers
- Maintains a complaint line for consumers
- Conducts investigations
- Conducts disciplinary hearings
- Conducts prosecutions
- Administers the Compensation Fund see 1.
Ch.1 - How many people compose OMVIC's Board of Directors? Of these, how many represent the industry and how many represent the consumers? - ✔✔Twelve total, nine dealers and three consumer reps see 1. Ch.1 - Briefly explain the "Transaction Fee Program." - ✔✔Under the transaction fee program, dealers are required to remit $10 for each vehicle sold or leased (including fleet and "as is" transactions) to OMVIC. These funds are remitted annually with the dealer's registration renewal fee. see 1. Ch.1 - True of False: Under the Transaction Fee Program, dealers are required to remit $10 (to OMVIC) for each retail vehicle sold or leased. - ✔✔True see 1. Ch.1 - True or False: The transaction fee can be passed along to the customer. - ✔✔True see 1. Ch.1 - What information is OMVIC required to make available to the public? a. A dealer's business name, address and phone number b. A Salesperson's name c. Any proposal to refuse to renew, suspend or revoke the registration of a dealer or a salesperson d. All of the above - ✔✔d. All of the above see 1.
see 2. Ch.2 - True or False: All dealer and salesperson applicants undergo a Canada-wise criminal record search as part of the application screening process. - ✔✔True see 2. Ch.2 - Which of the following must be registered with OMVIC (select all that apply): a. Dealers b. Salespersons c. Business managers d. Finance managers e. Service managers - ✔✔a. Dealers b. Salespersons c. Business managers d. Finance managers see 2. Ch.2 - List two reasons why OMVIC might refuse the registration of a dealer or salesperson. - ✔✔Any two of:
- Past conduct
- False statement on application
- Failed to comply with terms
- Cannot be expected to be financially responsible
- The Compensation Fund has paid out a claim and has not been reimbursed see 2.05 and.
Ch.2 - If a person has been refused registration, what is one condition that has to be met before the person can reapply? - ✔✔One of the following:
- Two years have passed
- New evidence to demonstrate circumstances have changed see 2. Ch.2 - Should OMVIC issue a proposal to refuse (or revoke) registration, to whom can the applicant appeal? - ✔✔License Appeal Tribunal (LAT) see 2. Ch.2 - List four "classes" of dealers. - ✔✔Any four classes listed in 2.
- General dealer, consisting of the following subclasses ++ New and used motor vehicles ++ Used motor vehicles
- Broker
- Wholesaler
- Exporter
- Outside Ontario dealer
- Lease finance dealer
- Fleet lessor, O. Reg. 333/08, s. 18(1), O. Reg 377/09, s 2. see 2. Ch.2 - List three examples of individuals or business that are exempt from registration. - ✔✔Any three from 2.
In a large dealership, if the dealer principal delegates responsibility for ensuring that salespersons are registered, this should be delegated to: a. The bookkeeper b. Thesalesperson c. The sales manager d. The payroll supervisor - ✔✔c. The sales manager see 2. Ch.2 - OMVIC can refuse, revoke or suspend registration to a dealer, salesperson or corporation if the financial responsibility or past conduct of an "interested person in respect of the applicant/registrant" gives reasonable grounds for it. Who might OMVIC consider an "interested person"? - ✔✔An interested person:
- Has or may have a beneficial interest in the business
- Exercises or may exercise control either directly or indirectly over the dealer/salesperson
- Has provided or may have provided financing either directly or indirectly to the business see 2. Ch.2 - Where is the certificate of the dealer registration kept? - ✔✔Posted so the public is likely to see it see 2. Ch.2 - True of False: A salesperson must produce his or her registration certificate for inspection if a customer asks to see it. - ✔✔True see 2.
Ch.2 - In your own words describe: a. Both classes of General Dealers b. Three other classes - ✔✔a. General dealer, consisting of the following subclasses ++ New and used motor vehicles ++ Used motor vehicles
- Broker
- Wholesaler
- Exporter
- Outside Ontario dealer
- Lease finance dealer
- Fleet lessor, O. Reg. 333/08, s. 18(1), O. Reg 377/09, s 2. see 2. Ch.3 - True or False: Dealers may sell vehicles from any location, so long as they have registered a head office with OMVIC. - ✔✔False see 3. Ch.3 - List two requirements for a dealer's premises. - ✔✔Any two of:
- Have a business office (large enough to store records securely)
- Have a clearly visible sign identifying registered name
- Be approved for use as a dealership by municipality see 3. Ch.3 - The MVDA specifies the records a dealer must maintain.
see 3. Ch.3 - In order for a remote storage location to be approved by OMVIC, which condition must be met? a. The location has a security system b. The location is always accessible to OMVIC staff during normal business hours c. The location is in the same municipality as the dealer's registered address d. All of the above - ✔✔b. The location is always accessible to OMVIC staff during normal business hours see 3. Ch.3 - True of False: Under the MVDA, all dealers are required to maintain a trust account. - ✔✔False see 3. Ch.3 - Deposits over what amount must be kept in a trust account? a. $1, b. $5, c. $10, d. No amount of deposit needs to be placed in a trust account - ✔✔c. $10, see 3. Ch.3 - True or False: Before issuing a freeze order (freezing the dealer's assets or trust funds), OMVIC must first notify the dealer. - ✔✔False see 3.
Ch.4 - On a purchase contract, what must be printed in 14 pt. bold font next to the buyer's signature? - ✔✔The mandatory "Sales Final" statement see 4.04 19. or 4.05 17. Ch.4 - List four items that must be in a contract for the sale of a new vehicle. - ✔✔Any four from 4.04. Ch.4 - If a dealer does not have a specific new vehicle in stock, but will locate the vehicle and bring it in, what must be disclosed to the purchaser regarding the mileage? - ✔✔A maximum distance that will be shown on the odometer at the time of delivery or a statement (initialled by the buyer) that there is no maximum. see 4.04 9. Ch.4 - List four items that must be included in contracts for the sale of a used vehicle. - ✔✔Any four from 4.05. Ch.4 - If a Safety Standards Certificate is issued for a vehicle, it means: a. The vehicle is safe and guaranteed free of mechanical defects b. The vehicle met certain basic standards of safety on the date of inspection c. The vehicle is safe and has a 36-day warranty - ✔✔b. The vehicle met certain basic standards of safety on the date of inspection see 4.05 22. Ch.4 - What does the term "as is" mean? - ✔✔"As Is": The vehicle is not represented as being in road worthy condition, mechanically sound or maintained at any guaranteed level of quality. The vehicle may not be fit for use as a means of transportation and may require substantial repairs at the buyer's expense. It may not be possible to register the vehicle to be driven in its current condition. see 4.05 23.
see 4. Ch.5 - List three "previous uses of a vehicle" dealers must disclose. - ✔✔Any three of:
- Taxi
- Limo
- Police vehicle
- Emergency services vehicle
- Daily rental (unless subsequently owned by someone other than a dealer) see 5. Ch.5 - List three types of incident damage that must be disclosed. - ✔✔Any three of:
- Collision (greater than $3,000 damage)
- Fire
- Flood
- Structural damage or alterations see 5.06 5., 10. - 12. Ch.5 - True or False: Dealer A buys from a daily rental company, a car previously used in the rental fleet. Dealer A then sells the car (giving full disclosure of the car's history as a daily rental) to a consumer who buys it for personal use. A year later, the consumer trades that car in to Dealer B. Dealer B does a history search and sees the car was once a daily rental. Under Regulation 42 of the MVDA, when Dealer B sells this car to another customer they are not required to inform the customer of the car's previous use as a daily rental. - ✔✔True see 5.06 4.
Ch.5 - True or False: If a vehicle was declared a total loss in a collision, but has since been repaired and received a structural safety certificate and a Safety Standards Certificate (SSC) from an authorized repair centre, the dealer does not need to notify a purchaser of the previous damage. - ✔✔False see 5.06 8. Ch.5 - Which of the following must be disclosed? a. The replacement of any single body panel (excluding bumper covers) b. The replacement of two or more adjacent body panels (excluding bumper covers) c. The repainting of two or more adjacent body panels (excluding bumper covers) - ✔✔b. The replacement of two or more adjacent body panels (excluding bumper covers) see 5.06 8. Ch.5 - Dealers must disclose known damage repairs in excess of: a. $2, b. $3, c. $5, d. $10,000 - ✔✔b. $3, see 5. Ch.5 - True or False: A dealer does not have to inform a purchaser that a vehicle's manufacturer's warranty has been cancelled, so long as the dealer offers or sells the purchaser an extended warranty. - ✔✔False see 5.06 9.
see 5. Ch.6 - True of False: The MVDA remedy of rescission (cancellation of a sales contract) is available only to a customer who is a "consumer." - ✔✔False see 6. Ch.6 - Dealers are required to disclose all the information set out below (a - f); however, rescission is only granted automatically for failing to disclose three of them. Which are they? a. The make, model and model year of the vehicle b. The vehicle is missing things c. The vehicle was previously a taxi or limo d. The vehicle's manufacturer's warranty has been cancelled e. The vehicle has been branded f. The vehicle was involved in a collision - ✔✔a. The make, model and model year of the vehicle c. The vehicle was previously a taxi or limo e. The vehicle has been branded see 6. Ch.6 - There are three other disclosure requirements that, if not met, trigger a customer's rescission rights. What are they? - ✔✔Rescission is triggered if the following is not disclosed:
- Previous use as police/emergency services vehicle
- Previous use as daily rental (unless subsequently owned by someone other than a dealer)
- Mileage/distance travelled see 6. Ch.6 - True of False: The remedy of rescission is available to a customer who is also a dealer. - ✔✔False
see 6. Ch.6 - Under the MVDA, a customer is entitled to rescission has how long to request cancellation? a. 30 days b. 90 days c. 180 days d. One year - ✔✔b. 90 days see 6. Ch.6 - True or False: Consumers may also have up to one year to request rescission under the Consumer Protection Act. - ✔✔True see 6. Ch.6 - What is the margin of error allowed to a dealer who provides the distance driven (odometer reading) or who cannot determine the total distance driven, but can determine the distance driven as of some past date? - ✔✔A margin of error is allowed to a dealer when he or she determines the total distance driven or when he or she cannot determine the total distance driven, but can determine the distance driven as of some past date. The disclosure of distance made by the dealer is deemed to be accurate if it is within the LESSER of five percent or 1,000 km of the correct distance required to be disclosed. Ch.6 - True or False: If the dealer "inflated" the selling amount of a vehicle and the dollar amount of a trade-in, and the contract ends up being rescinded, the dealer would have to return the inflated trade-in dollar amount. - ✔✔True see 6.
see 7. Ch.7 - When selling to another dealer, what must the selling dealer do if he/she cannot determine the distance the vehicle has been driven? - ✔✔If the dealer cannot determine the total distance the vehicle has been driven, but can determine the distance the vehicle has been driven as of some past date, provide a statement of that distance and date, together with a statement that "the total distance the vehicle has been driven is believed to be higher." If the dealer cannot determine the total distance the vehicle has been driven, nor the distance the vehicle has been driven as of some past date, provide a statement that "the total distance the vehicle has been driven is unknown and may be substantially higher than the reading shown on the odometer." see 7.04 2., 3. Ch.7 - Check any statement that is correct: A contract for sale or least of a vehicle between dealers: a. Must disclose specific information to comply with the Code of Ethics Regulations b. Must disclose exactly the same information required in the sale of a vehicle to a purchaser who is a consumer c. Must disclose a statement as to whether CAMVAP is available d. Is subject to the provisions of the Consumer Protection Act - ✔✔a. Must disclose specific information to comply with the Code of Ethics Regulations see 7. Ch.8 - If a dealer's advertisement contains a price for a vehicle, that price must include: a. Administration fees b. Taxes (unless ad states in a clear, comprehensible and prominent manner that taxes are not included)
c. Freight and PDI d. "Other" mandatory fees such as documentation fees, window-etching fees, SSC fees, etc. e. All of the above - ✔✔e. All of the above see 8. Ch.8 - True or False: If an advertisement is for a vehicle that was previously used as a police vehicle, that information must be prominently displayed in the ad. - ✔✔True see 8.05 or 8. Ch.8 - True or False: If an advertisement is for a vehicle of the current model year, but the vehicle is used, the ad must clearly state the vehicle is used. - ✔✔True see 8.05 or 8. Ch.8 - If OMVIC believes a dealer's advertisement to be false, misleading or deceptive, it can: a. Take the dealer to the LAT b. Sue the dealer for misrepresentation c. Order the dealer to issue a retraction or correction - ✔✔c. Order the dealer to issue a retraction or correction see 8.03 or 8. Ch.8 - Dealers found in breach of the advertising regulations may have to have their ads pre-approved by OMVIC for a period of up to: a. Six months b. One year
