| Title: | Exemptions for non-for-profit organizations |
| Guideline Topic: | |
| Legislation: | MVDA |
| Section/Subsection(s): | Various |
| Date Created: | 2023-05-29 |
| Date Revised: |
As the regulator of motor vehicle sales in Ontario, OMVIC registers both individuals and corporations engaged in trade, defined as buying, selling, leasing, advertising or exchanging an interest in a motor vehicle or negotiating or inducing or attempting to induce the buying, selling, leasing or exchanging of an interest in a motor vehicle. There are certain exemptions to the requirements for registration, as outlined below. This guideline is intended to provide consumers and the industry with a framework for understanding and implementing these rules and regulations.
Exemptions along these lines have been industry practice since before the Act came into force in 2002. As such, they were codified and included in the regulations to ensure transparency. Section 2, sub-section 1 of the regulation sets out the 22 separate classes of persons who are exempt from the MVDA registration requirements. In addition to not-for-profits and registered charities, other examples of exemptions – subject to certain conditions – include:
See the Appendix for the full list and all applicable details.
Part of the way not-for-profit corporations can maintain their exemption is by offering education and consumer support. There is a different set of rules that apply to brokers. Those rules are out of scope for this guideline.
Not-for-profit corporations that provide information to help people make a decision regarding trade in a motor vehicle have been designated as a class of person(s) exempted under the Act.
Section 2, sub-section 16 of the Regulation provides an exemption from registration with OMVIC for not-for-profit corporations that:
To remain entitled to the exemption under the MVDA Regulations 333/08, section 2(1)(16), not-for-profit corporations must file annually with the Registrar:
Not-for-profit corporations are required to file the material described in the Regulation as defined in subparagraph 16 vi of subsection (1) with the Registrar no later than 180 days after the day the Regulation comes into force and no later than each anniversary of the day that this Regulation came into force to be exempt under paragraph 16.
If they fail to provide this information, they might be subject to administrative action up to and including revocation of their exemptions.
A brief survey of other Canadian provinces yields no information about similar types of exemptions elsewhere in the country. Exemptions for specific types of vehicles were not included in the survey.
The Ontario Motor Vehicle Industry Council (OMVIC) administers and enforces the Motor Vehicle Dealers Act, 2002 (MVDA), its regulations and code of ethics, as well as relevant sections of the Consumer Protection Act (CPA), on behalf of Ontario’s Ministry of Public and Business Service Delivery. OMVIC’s mandate is to maintain a fair and informed marketplace by protecting the rights of consumers, enhancing industry professionalism, and ensuring fair, honest, and open competition for registered motor vehicle dealers.
The list of available guidelines can be found here.
2. (1) The classes of persons described in each of the following paragraphs are exempt from the Act and the regulations in connection with carrying on the activities described in the paragraph:
1. A person who arranges for and conducts an auction of motor vehicles and the person’s employees and agents acting for the purpose of the auction if the conditions set out in subsection (3) are satisfied.
2. A person who buys one or more motor vehicles for the purpose of wrecking or dismantling them if, after buying them, the person wrecks or dismantles the vehicles in accordance with the Highway Traffic Act and the regulations made under it and does not trade in the vehicles.
3. A person who trades in a motor vehicle in the course of performing the person’s duties under an order of a court.
4. An assignee, a custodian, a liquidator, a receiver, a trustee or another person, if the assignee, custodian, liquidator, receiver, trustee or other person trades in a motor vehicle in the course of performing the person’s duties under the Bankruptcy and Insolvency Act (Canada), the Business Corporations Act, the Companies’ Creditors Arrangement Act (Canada), the Courts of Justice Act or the Winding-up and Restructuring Act (Canada).
5. An executor or estate trustee who trades in a motor vehicle in the course of performing the person’s duties or a person who arranges for and conducts an auction to make such a trade on behalf of an executor or estate trustee.
6. A barrister and solicitor who trades in a motor vehicle in the course of acting in his or her professional capacity.
7. A person that trades in a motor vehicle that is used or to be used by the person as sole proprietor for the purpose of carrying on the person’s business or for the personal use of the person or a member of the person’s family, but not if the person is in the business of trading in motor vehicles or repairing them.
8. A person that trades in a motor vehicle that is used or to be used by an individual who is a director, officer or employee of the person for the purpose of carrying on the person’s business or for the personal use of the individual or a member of the individual’s family, but not if the person is in the business of trading in motor vehicles or repairing them.
9. A person who trades in one or more power-assisted bicycles equipped with both a pedalling device and an auxiliary motor.
10. A person who leases a motor vehicle as lessor if,
i. the person does not own the vehicle,
ii. the lessee does not buy the vehicle at the end of the term of the lease,
iii. the lease is for a term of no more than 120 consecutive days,
iv. the lessor has filed with the registrar, upon request, a declaration stating that the lessor will not trade in the vehicle after the vehicle is no longer going to be leased, except to lease it as described in this paragraph, and
v. the lessor does not trade in the vehicle after the vehicle is no longer leased, except to lease it as described in this paragraph.
11. A receiver and manager appointed under section 21 of the Act that acts under that section.
12. A person who sells a stock of motor vehicles on behalf of their owner by means of an auction open to the public if,
i. the vehicles were owned in connection with a business of the owner of the vehicles and the sale of the vehicles is part of the sale of the assets of that business for the purposes of the business ceasing operations,
ii. the auction is held at the owner’s place of business or at another location that the person arranges and that is suitable for the auction, and
iii. the person who sells the stock of the vehicles has been retained on a temporary basis solely for the purpose of the ceasing operations mentioned in subparagraph i and does not acquire a property interest in any of the vehicles.
13. A registered charity within the meaning of subsection 248 (1) of the Income Tax Act (Canada) that acts as such.
14. A creditor, other than a registrant, who,
i. lawfully takes possession of a debtor’s motor vehicle or has a lawful lien against the vehicle, and
ii. sells the vehicle to or through a registered motor vehicle dealer or through a person who is exempt under paragraph 15.
15. A person who,
i. after a creditor, other than a registrant, has lawfully taken possession of a debtor’s motor vehicle, takes possession of the vehicle from the creditor and sells it to or through a registered motor vehicle dealer, and
ii. is not otherwise in the business of trading in or repairing motor vehicles.
16. A not-for-profit corporation that assists a person in making a decision regarding a trade in a motor vehicle if,
i. before providing the assistance, the corporation discloses to the person the amounts that the corporation charges or receives from any person in connection with providing the assistance,
ii. the corporation does not have a property interest in the vehicle,
iii. the corporation does not handle the person’s payment for the trade in the vehicle,
iv. the corporation makes reasonable efforts to ensure that no member of the corporation is a registrant,
v. no director, officer or employee of the corporation is a registrant, an insurer under an insurance policy that covers theft of the vehicle or damage to the vehicle or a person in the business of repairing motor vehicles, and
vi. the corporation files with the registrar in accordance with subsection (5),
A. a statement outlining the consideration, if any, that it has received from registrants and listing the corporation’s members, directors, officers and employees, and
B. an affidavit attesting to the information contained in the statement mentioned in sub-subparagraph A.
17.The board of trustees for the Fund, the Trustee of the Fund appointed under section 70 or a person that acts on behalf of the board of trustees for the Fund.
18. A person who trades in a motor vehicle that has a gross vehicle weight rating as defined in subsection (6) of more than 21 tonnes.
i. receives a used motor vehicle after making payment under an insurance policy as a result of the vehicle having been stolen or wrecked, if,
A. the Registrar of Motor Vehicles has classified the vehicle as irreparable or salvage under section 199.1 of the Highway Traffic Act, or
B. the vehicle is registered in the name of the insurer, and
ii. sells the vehicle to or through a registered motor vehicle dealer.
21. Subject to subsection (7), a person who trades in motor vehicles that the person or a person associated with the person, as described in subsection 1 (2) of the Act, manufactures or that the person distributes as the authorized distributor of motor vehicles manufactured by another person according to a declaration that the person files with the registrar under subsection (9) stating that the person is an authorized distributor of that manufacturer.
22. A person who receives a motor vehicle from a purchaser or lessee as all or part of the consideration for supplying a motor vehicle under a trade described in paragraph 21. O. Reg. 333/08, s. 2 (1); O. Reg. 221/09, s. 2 (1)
Q1: What’s the purpose of this guideline?
A1: As the regulator of motor vehicle sales in Ontario, OMVIC registers both individuals and corporations engaged in trade, defined as buying, selling, leasing, advertising or exchanging an interest in a motor vehicle or negotiating or inducing or attempting to induce the buying, selling, leasing or exchanging of an interest in a motor vehicle, as outlined below. This guideline is intended to provide consumers and the industry with a framework for understanding and implementing these rules and regulations.
Q2: What’s important to understand about exemptions?
A2: Any individual or corporation that wants to trade in motor vehicles in Ontario must register with OMVIC. There are certain exceptions, or exemptions, to these rules. They don’t apply to:
Q3: What’s included in the guideline?
A3: The guideline covers:
Q4: How do you decide who’s exempt?
A4: Section 2, sub-section 16 of Regulation 333/08 GENERAL provides an exemption from registration with OMVIC for not-for-profit corporations that:
Q5: How do not-for-profits maintain their exempt status?
A5: Part of the way not-for-profit corporations can maintain their exemption is by offering education and consumer support. To remain entitled to the exemption under the MVDA Regulations 333/08, section 2(1)(16), not-for-profit corporations must file annually with the Registrar:
Not-for-profit corporations are required to file the material described in the Regulation as defined in subparagraph 16 vi of subsection (1) with the Registrar no later than 180 days after the day the Regulation comes into force and no later than each anniversary of the day that this Regulation came into force to be exempt under paragraph 16.
Q6: What happens if they fail to provide the necessary information?
A6: If an exempt entity fails to provide this information, they might be subject to administrative action up to and including revocation of their exemptions.
Q7: Where can I find all of the guidelines that OMVIC has published?
A8: The list of available guidelines can be found here.
The Dealer Support team is available to assist dealers in achieving and maintaining compliance with the MVDA and Code of Ethics. Registrants who wish to contact Dealer Support can reach the team at the phone number below and leave a message.
Messages are returned in priority sequence.
