The proactive compliance program is education based and designed to help 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 the 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 contact centre team on 1300 30 40 54 or by email.
Preparing yourself
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:
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. For example
- 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 recent advertisements
- consignment documents including current and completed consignment contracts, trust account bank records for the last three (3) months 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.
Proactive visit checklist
Proactive compliance checklist – Motor Vehicle Dealers
Download this checklist to help you prepare for a proactive compliance visit.
| Compliance action | Legislation |
|---|---|
| GENERAL | |
| Is your licensed business name and dealer licence number displayed on a sign, of reasonable dimension, at all your dealership premises? | MVDA 21 |
| Are all of your dealership locations authorised? | MVDA 20E |
| Do you 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? | MVDA 20D |
| LICENCES/ADMINSTRATION | |
| Is your Certificate of Authorised Premises displayed in a clearly visible position inside the authorised premises? | MVDA 20G(3) |
| Do all salespersons or yard managers hold current licences? | MVDA 31 A, B, C |
| For a firm or body corporate: Have any/all changes to the composition of the firm or body corporate been approved by the Commissioner 14 days prior to the change? | MVDA 23 |
| ADVERTISING | |
| Does your dealer business name and licence number appear on all published advertisements? | MVDA 21 |
Do all second-hand vehicle advertisements show the:
| MVD(S)R 11 (1, 2) |
Check any advertisements do not have potential to mislead consumers? You can access more information here Australian Consumer Law and Fair Trading Act 2010? Generally speaking, it is an offence to publish or cause to be published, advertisements that may be false, misleading or deceptive, among other things. | ACL |
| SECOND HAND VEHICLE TRANSACTIONS | |
| Do you have the appropriate licence for the class or description of dealership? | MVDA 30 (3) |
| Are your dealer registers completed using the correct form for all second-hand vehicle transactions at the dealership? | MVDA 25 MVD(S)R 3, 4, 4A |
| Are all your second-hand vehicles, for which you are the ‘trade owner’, kept or parked at the dealership? | MVDA 27(3) |
| Do all your second-hand vehicles display the correct notice? | MVDA 33 (1, 3, 6) MVD(S)R 5 |
Are all vehicle particulars notices:
| MVDA 33(7) MVD(S)R 8 |
| Is warranty information provided to the purchaser in the prescribed form before the vehicle is sold? | MVDA 34 (A, C ,D) MVD(S)R 7 |
| CONSIGNMENT SELLING (ignore if not applicable) | |
| Are your consignment agreements between the dealer and consignor (excluding auctions) provided in writing and signed by all relevant parties; and | MVDA 42A (2) |
| Do the agreements contain the prescribed particulars, terms and conditions? | MVD(S)R 13B |
| PRE-ESTIMATED DAMAGES | |
| When applying pre-estimated damages: Are you able to show/explain your process where an agreement for the sale of a motor vehicle is validly terminated by you (the dealer)? | MVD(S)R Sch 5 |
| Are you able to justify the amount being charged to the consumer? | MVD(S)R Sch 5 |
| NOTE: DEMIRS compliance officers visit Motor Dealer premises and will issue vehicle defect notices, where applicable. | |
More information about fines is available on Infringements, forms and publications - Motor vehicle dealers page.
Legislation
The visits aim to assist dealers to comply with the following legislation: