Changes to the Motor Car Traders Act 1986 - Legislation update

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30 October 2014
Legislation updates

Changes affecting licensed motor car traders

Amendments to the Motor Car Traders Act 1986 (the Act) will come into effect on 3 November 2014.

The changes will streamline the process for cooling-off on vehicle sales, and simplify the forms and notices that licensed motor car traders must use. There are also changes to their record-keeping obligations, and the categories of employees subject to a background check.

Changes to the cooling-off process

Licensed motor car traders will no longer have to provide purchasers with a separate cooling-off notice; instead, they must include information about their cooling-off rights in the contract of sale.

Purchasers who wish to accept delivery of a vehicle during the cooling-off period will no longer be asked to waive their cooling-off rights will be abolished. Instead, a purchaser who takes delivery of a vehicle within the three-day cooling-off period will automatically lose their right to do so.

Changes to forms

Used motor car price and data sheet

The current window display forms (Forms 5, 6 and 7) have been merged into a single, simplified, form, called the ‘Used motor car price and data sheet’ (Form 5).

From 3 November, licensed motor car traders will be able to use this form for all used vehicles they offer for sale. They will no longer have to use a different form depending on whether they are selling a vehicle with or without a statutory warranty.

Download an example Licensed motor car trader form 5 (Used motor car price and data sheet) (Word, 61KB).

Contracts of sale

Licensed motor car traders must include additional information in the contract of sale for new and used motor vehicles, including a prescribed information box setting out a purchaser’s cooling-off rights. This information box will replace the existing cooling-off notice (Form 4).

The contract of sale for a used car must contain extra information about the details of the statutory warranty under section 54 of the Act, to ensure it is consistent with Australian Consumer Law (ACL) requirements for displaying information about warranties against defects.

Display of information

The current requirements for the size, layout and colour of text in prescribed forms and notices, contracts of sale and advertisements will be replaced by a general requirement that all text be clear and legible.

Changes to record-keeping requirements

Licensed motor car traders will no longer have to retain copies of documents, such as notification of changes to their business name or address, which they have provided to the Business Licensing Authority, Consumer Affairs Victoria or the Motor Car Traders Guarantee Fund Claims Committee.

The time that licensed motor car traders must retain other documents, such as the dealings book, contracts of sale and prescribed forms, will be reduced from seven to six years.

‘Customer service capacity’

This definition is being clarified to include only employees involved in the actual buying, selling or exchanging of cars on behalf of a trader.

Licensed motor car traders will no longer have to conduct background checks on employees who deal with customers but are not involved in the above transactions, such as receptionists or ancillary product sellers.