The Ontario Ministry of Public and Business Service Delivery has rejected a controversial proposal to add a two-day cooling-off period for consumers to walk away from a deal for a vehicle they have purchased.
The proposal, one of several harvested from recommendations by the Motor Vehicle Retailers of Ontario (MVRO) and an Auditor General’s report, was put forward earlier this month by the province.
The changes are designed to update the Motor Vehicle Dealers Act and improve regulatory efficiency and enhance consumer protection. The government issued a deadline of May 21 for anyone to submit feedback.
The two-day cooling-off period met with stiff opposition from the Motor Vehicle Retailers of Ontario (MVRO) and its members.
“Over the last two months, my ministry consulted on ways that we can enhance consumer protection and cut red tape in the motor vehicle sector,” said Todd McCarthy, Minister of Public & Business Service Delivery in a statement.
“The feedback we received has made clear that the proposed cooling-off period would create unnecessary red tape that would have negative consequences for consumers. As such, we will not be going forward or giving further consideration to this proposal.”
McCarthy said his Ministry will carefully review and consider all the feedback on other items contemplated through the consultation to determine next steps. Frank Notte, MVRO’s Director of Government Relations, told Canadian auto dealer the decision to reject the proposal eliminates delays and barriers in the vehicle-purchasing process.
“MVRO members have unequivocally expressed their opposition to a cooling-off period,” said Notte. “Implementing such a policy would have created red tape and administrative complexities. Moreover, Ontario already boasts some of the most robust car-buying protection in North America. Minister McCarthy has just eliminated the largest piece of red tape ever proposed for vehicle sales in Ontario — and the industry is incredibly thankful for his support.”
Shahin Alizadeh, President and CEO of Downtown Auto Group, said the proposal became a hot-button topic for dealers.
“This was just a dumb policy,” said Alizadeh. “Changing it would have taken us back 40-50 years of how the government and industry were interacting. That takes us to the days where you pretty well had to police every dealer at every junction. It’s not where we are today. We are self-regulated in a much different sphere. We just simply don’t need it.”
Alizadeh said he couldn’t think of a dealership that would not allow a customer to return a purchased car if given reasonable notice and a legitimate reason. “That’s become almost an industry standard,” said Alizadeh. “We’re not going to be unreasonable about it.”
Rob Stein, President and CEO of Plaza Auto Group, said the proposal was “obscene” because of the implications of making a sale and then having it rejected two days later. It just wasn’t the right thing, it was just wrong all the way around. There were just so many variables there that could have made a ton of work for us,” he said.
In an email statement to Canadian auto dealer, the Ontario Motor Vehicle Industry Council said it supports the Ontario government’s effort to modernize the Motor Vehicle Dealers Act and its regulations through a public consultation process and shares its commitment to enhancing consumer protection, improving efficiencies and reducing burden for compliant dealers. Moreover, it added OMVIC looks forward to the consultation feedback, including any updates to the MVDA and its regulations, and is committed to ensuring that any changes are effectively implemented to protect car buyers and enhance registrant professionalism.
