Fee Consultation

OMVIC’s largest source of revenue is derived from transaction fees. Dealers must remit a fee to OMVIC per vehicle for sales, leases, fleets, or as-is transactions.   Examples of motor vehicles subject to the transaction fee include cars, vans, trucks, SUVs and motorcycles. The transaction fee can be passed on to customers by disclosing the fee on the bill of sale or lease.

Prior to the pandemic, OMVIC reported annual transaction fee revenues averaging $14M/year.

However, in the 5 years from 2019 to 2023, OMVIC averaged revenues of $12.4M/year – an 11% decline, reflective of fewer vehicle transactions (sales and leasing) in Ontario. The following table demonstrates the decline in annual transaction fees received from 2019-2023.  In 2024, transaction fees increased but have not yet returned to pre-pandemic levels.

Simultaneously, OMVIC’s operating expenses, including government oversight fees and administrative costs, have risen steadily each year. Inflation and service improvements drive this trend.

The 2021 Auditor General of Ontario Value-for-Money audit report concluded that “OMVIC did not have processes to consistently administer the Motor Vehicle Dealers Act, 2002 effectively in order to protect the public in their transactions with motor vehicle dealers and salespersons”. The report noted that OMVIC should be increasing resources devoted to enforcement actions and staffing of key areas, including complaints, inspections, and registrations, which had remained largely unchanged over the years.

In 2021, OMVIC conducted a workload assessment and identified the value that 52 additional staff roles would bring to fully carry out the AGO recommendations while accounting for growth in the Ontario motor vehicle sales industry.

Positions were prioritized relative to immediate resources needed to fill shortages, address processing backlogs, and provide required staffing for information technology improvements. 28 positions were prioritized for inclusion in the 2022 budget, and the remaining roles were placed on hold.

In the summer of 2024, OMVIC returned to the previous workload assessment to consider the resources required to support current conditions and anticipated future activities. This resulted in the inclusion of 32 additional staff roles from 2025 through 2027, which causes net new annual costs of approximately $3.5M/year of incremental payroll costs.

In Canada, historical average wages have grown year over year. The average earnings of employees in Canada rose to 4.5% year-on-year in 2024. The largest gains were seen in 2020 at an average growth of 6.9%. The chart below shows Canada’s average wage growth rate from 2016 to 2025.

Increasing fees will ensure OMVIC has the financial resources to deliver on the recommendations set out by the Auditor General of Ontario. This will enable OMVIC to expand services such as enforcement activities, public awareness and other key projects.

Efficiencies: It is important to note that OMVIC is not solely relying on fee increases to achieve these goals. OMVIC has been cost-conscious by historically operating with a lean staff, transitioning services online, renegotiating with vendors, and actively seeking ways to reduce office space, thereby reducing rental expenses.

In June 2024, OMVIC released its 2024-2026 Strategic Plan, a stakeholder-informed and future-focused road map designed to guide the organization as it continues to raise the bar as a modern and best-in-class regulator that is impactful in carrying out its consumer protection mandate. For the 2024-2026 planning horizon, OMVIC’s time, effort and resources are focused on achieving strategic objectives across three priority areas:

• Consumer Protection
• Registrant Professionalism
• Organizational Excellence

The fee adjustments directly support OMVIC’s strategic goals and provide the following key benefits:

• Consumer Protection: Increased enforcement activities, such as more frequent inspections, and an enhanced mystery shop program, will better ensure compliance with regulatory requirements and provide more significant safeguards for Ontario consumers.
• Provincial Curbsider Taskforce: Creation of a new provincial Curbsider Taskforce to strengthen efforts to combat illegal vehicle sales, protect consumers, and ensure fair market competition.
• Registrant Professionalism: The development of OMVIC’s first Continuing Professional Development Program to launch in 2026 will ensure that registrants acquire the necessary knowledge and skills to provide competent and professional services to consumers, thereby enhancing consumer protection and trust in the industry.
• Long-Term Financial Stability: By increasing registration fees by inflation and raising the transaction fee, OMVIC will continue to deliver on its consumer protection mandate, undertake new strategic goals, while achieving its strategic goal of long-term financial viability.
• Enhanced Innovation and Growth through IT: The 2025-2027 Information Technology Strategic Plan, aligned with OMVIC’s broader strategic objectives, will enhance IT’s role in driving innovation and fostering organizational growth.  Critically, IT continues to improve its customer relationship management (“CRM”) system to provide more effective and efficient service to staff and industry users and remains committed to upgrading cybersecurity initiatives to protect the organization.

Compliance with Auditor General Recommendations: Incremental revenue will continue to support OMVIC’s commitment to implementing and sustaining operational improvements to follow the Auditor General’s Value for Money audit recommendations and enhance transparency and efficiency.

The following tables demonstrate the growth in compliance activities since 2022. Investment is required in order to increase compliance activities beyond current levels.

Renewal Enhancements

• OMVIC is planning on launching enhanced dealer and salesperson certificates with updated branding and built-in security features to prevent forgery and build trust with auctions, lenders, and consumers.
• Other key future renewal improvements include:
  • Downloadable certificates: Easily accessible through the portal.
  • Enhanced identity verification: Salespersons will upload a valid photo ID during renewal to reduce impersonation and ensure current photos appear on certificates.
  • Clear terms and conditions: New certificates outline obligations, helping prevent unintentional violations.
  • Updated renewal process: Will include new eligibility questions to better understand business operations and provide tailored support.
  • Financial stability checks: Identify risks early – like tax debt or trust account issues – to support long-term compliance.
• Enhanced dealership profiles: Profiles will display all active salespersons with photos and licenses, improving internal oversight and helping to ensure readiness for inspections.
• These proposed updates increase transparency, reduce the risk of fraudulent certificates being used by unregistered individuals, especially in high-risk areas like auctions, and support a more professional, accountable marketplace.

Enhancements to Industry Standards

• As part of OMVIC’s commitment to upholding industry standards, OMVIC has increased investigations and enforcement efforts against auctions that fail to meet obligations.
• In response to complaints about wholesale trades, OMVIC is assessing both sellers and auctions thoroughly and proactively engaging auctions to clarify OMVIC’s expectations.
• These steps allow OMVIC to resolve issues faster and take action when violations occur. OMVIC also responds quickly to emerging trends, such as wholesale trade concerns and exporter obligations, often guided by industry feedback from groups like the UCDA (Used Car Dealers Association of Ontario).
• When dealers report unfair practices—like misleading advertising—OMVIC will take action, including issuing cease and desist orders in serious cases to ensure compliance.
• OMVIC continues to support dealers by providing timely guidance and answering questions.

Webinars

• OMVIC’s 2025 webinar program offers sessions to help dealers and salespersons stay informed and compliant. Topics will include advertising rules, disclosure requirements, upcoming Continuing Professional Development (CPD) obligations and transaction fee reporting.
• These interactive webinars will provide a chance for registrants to ask questions about the Motor Vehicle Dealers Act and the Consumer Protection Act. Participant feedback will help improve future sessions and ensure they meet the needs of participants.
• Consumer complaints and mediation
• Improvements to OMVIC’s complaint process have increased transparency, resulting in registrant satisfaction reaching nearly 97% in 2024.
• This success is partly due to OMVIC’s increased focus on mediation over the past year, helping both consumers and registrants reach fair solutions instead of moving straight to discipline.

Remote Inspections

• Field inspections currently occur approximately every three years. To increase the frequency to a two-year cycle, additional investment in human resources is necessary. In the interim, remote inspections are leveraged strategically to extend coverage where it is operationally and economically viable.
• As of early 2025, OMVIC has enhanced its remote inspection process to improve efficiency, consistency, and adaptability.
• A key improvement includes a new internal alert system that helps inspectors identify whether a dealer uses electronic or paper records, allowing for a more tailored approach.
• A new questionnaire now accompanies record requests, guiding dealers on secure document uploads and collecting business-specific details to support a more focused inspection.
• OMVIC has also identified key triggers for remote inspections, including:
  • Use of electronic records.
  • Low sales volume.
  • Low-risk matrix scores.
  • Inclement weather.
• While these factors help guide inspections, OMVIC may conduct remote reviews outside of the listed criteria when necessary.
• These changes reflect OMVIC’s commitment to high inspection standards while embracing modern business practices and technologies.

Curbsider Taskforce

• The Curbsider Taskforce, scheduled to launch in late 2025, will aim to develop a comprehensive strategy to identify, manage and reduce curbsider activity in Ontario’s vehicle sales marketplace.
• This approach combines education, awareness, and enforcement to better protect consumers. Key actions include:
  • Educating the public about the risks of buying from curbsiders.
• Strengthening collaboration with industry stakeholders and law enforcement.
• Conducting investigations and laying Provincial Offences Act charges when warranted.

The taskforce will use an intelligence-led, proactive approach focused on reducing repeat offences. Resources will be strategically allocated based on the scale, location, and complexity of each case, with targeted efforts on large-scale, organized unregistered selling activity.

Legal Services

• The overall growth of the organization’s operations has led to a sharp increase in the amount of legal advice and support requested from the Legal Services department in its role as legal counsel to the corporation.

As other departments update their procedures, engage third party service providers or stakeholders to fulfil their mandates and encounter higher numbers of complaints, registration applications and requests for guidance from the industry, they increasingly turn to Legal Services for guidance. As a result, additional investment in Legal Services personnel is now required.

OMVIC, as an Administrative Authority, is responsible for ensuring that it has adequate resources, including financial resources, to comply with the Administrative Agreement, the Motor Vehicle Dealers Act, and other relevant laws, and in accordance with its business plan that it has provided to the Minister of Public and Business Service Delivery and Procurement (the “Minister”) under clause 6(1)(a) of the Administrative Agreement.

OMVIC’s reserve position presently remains considerably below target levels. December 31, 2024, operating reserves stand at 1.6 months.

Current financial projections indicate that under the existing fee structure, achieving the six-month operating reserve target would take until 2041 – significantly longer than is viable for the organization’s long-term financial health.

The proposed September 1, 2025, fee increases support the 2024-2026 Strategic Plan initiatives and the addition of new resources. A $5.1M deficit is anticipated in 2025, followed by a return to break-even operations in 2026. If realized, any future annual surplus will help to restore the inadequate reserve level by 2028 and achieve a six-month operating reserve target by 2029.

While dependent on personal and financial situations, trends indicate that the transaction fee increase would be included in a consumer’s motor vehicle price on average every 4 to 8 years, given the timespan during which the average Ontarian keeps their motor vehicle. (Source: Varied industry reports from organizations such as J.D. Power, Canadian Black Book, and DesRosiers Automotive Consultants, who track ownership habits across Canada).

When considering the $9.50 incremental increase from $12.50 to $22.00, relative to the timeframe of typical motor vehicle ownership/leasing periods, the average dollar impact is $2.38/year if over a 4-year timeframe or $1.19/year if over an 8-year timeframe.

Based on data from a Canadian Vehicle Survey conducted by Statistics Canada between 2021 and 2023, it can be estimated that drivers will, on average, purchase or lease 7 vehicles in their lifetime.  At the proposed rate of $22.00, this translates to 7 x $22.00 = $154.00 in total transaction fees paid over a lifetime, which is nominal relative to the total cost of purchasing or leasing those 7 vehicles.

OMVIC recognizes that in today’s economy, every dollar counts for Ontario consumers. OMVIC froze the transaction fee for 8 years at $10.00 until the 2024 inflationary increase to $12.50 became effective. Going forward, the $22.00 transaction fee will be considered for annual inflationary adjustment, as/if fiscally necessary.

The benefits to consumers and the industry are substantial and include improved consumer protection, enhanced fraud prevention, and greater consumer trust in motor vehicle sales. These improvements can lead to increased sales and a stronger reputation for businesses within the automotive sector.

*Late fees: Introduced on February 1, 2025, and therefore not subject to a 2025 inflationary adjustment. The administrative agreement permits a reasonable fee to be charged for late applications as part of standard business practice and the creation of a late fee was exempt from the Fee Setting Process criteria.

The over-arching principle is to adjust registration fees no more than the inflation that occurred since the fees were last reviewed in 2023. (Source: Bank of Canada’s online inflation calculator). Registration fees are proposed to increase 2.5% which represents inflation from the date of the last fee review (2023).

Example: The Salesperson Renewal fee is presently $200.00 and is due every two years. A 2.5% inflation factor represents a $5.00 increase over the two-year cycle ($2.50/year). The Dealer Renewal fee is presently $385.00. A 2.5% inflation factor represents a $7.00 increase to $392.00.

The only exception to this approach is to increase the transaction fee beyond inflation. The $12.50 transaction fee is proposed to change beyond inflation to $22.00. Various financial models demonstrated that a $22.00 fee would be needed to deliver upon OMVIC’s Strategic Plan goals and ensure long-term financial viability.

When the OMVIC Board of Directors approves a fee change up to the cost of inflation, the Minister must be notified 30 days in advance, followed by 60 days’ notice to registrants. The OMVIC Board of Directors approved the proposed fee changes on December 17, 2024. Any proposal for a new fee or a fee increase beyond inflation must undergo a Fee Review Analysis. OMVIC’s proposal was submitted 45-days in advance, as is required.

On December 31, 2024, the Minister acknowledged receipt of the Fee Review Analysis and expressed his understanding that OMVIC would continue to the follow process steps as outlined in the administrative agreement.

1. Why did OMVIC not choose to stagger the $9.50 transaction fee increase over a period of years?
Financial forecast models show that increasing the transaction fee on September 1, 2025, is essential to achieving a financial break-even position. Second, increasing all fees on an expected date (such as September 1, 2025) is most efficient, logistically, for systems, forms, policies and processes, and stakeholder communications.

2. Can fee increases be avoided by adjusting OMVIC’s human resources?
An adjustment to OMVIC’s human resources is an unlikely option given the Auditor General’s recommendation was to increase resources in OMVIC’s various operational areas. The Auditor General of Ontario’s 2021 Value-for-Money Audit Report noted that OMVIC had not increased resources devoted to enforcement actions, and staffing of key areas, including complaints, inspections and registration, had remained largely unchanged over the years. Several audit recommendations included the request for OMVIC to conduct workload studies and ensure it had the right amount of staffing to best deliver on its mandate. The investments in personnel following the Value-for-Money Audit were necessary to address the recommendations of the Auditor General. However, these investments have contributed to OMVIC’s current and projected operating deficits.

3. What key factors did OMVIC consider in assuming dealerships could bear the additional costs associated with fee increases?
OMVIC considered an inflationary increase was reasonable at 2.5% given that OMVIC, as most organizations, faces rising annual costs due to inflation. Additionally, the proposed $9.50 increase to the transaction fee is often passed on to consumers at the point of sale/lease. If a motor vehicle is kept for four years, this averages $9.50/4 years = $2.38 per year. If a motor vehicle is kept for 8 years, this averages $9.50/8 years= $1.19 per year.

4. Would it be possible for OMVIC to implement fee increases so that all registrants, regardless of when their fiscal year begins and ends, receive notice of one full fiscal year (as opposed to the fees taking effect on the same start date for all registrants regardless of their fiscal year)? If not, why not?
It is possible; however, doing so would present significant logistical and administrative challenges and require additional human resources to re-program and re-configure OMVIC’s registration systems and tracking mechanisms for each individual registrant, given that we have ~8,000 dealers and ~30,000 salespeople, each with their own unique fiscal year start and end dates. Aligning the transaction fee increase from $12.50 to $22.00 with a common date facilitates effective communication with consumers.

5. OMVIC has been reported to have large, accumulated surpluses over the years. Why is an increase necessary?
OMVIC has experienced consecutive deficits for the past several years. A recommendation from the Auditor General of Ontario 2021 Value-for-Money audit was that OMVIC should use its accumulated surpluses for programming. Now, the accumulated surpluses are nearly depleted. Without fee increases, OMVIC’s reserves will be fully depleted.