Consumer Information Notice - motor vehicle traders

The Fair Trading Act requires motor vehicle traders to comply with the provisions of the Consumer Information Standard "Consumer information notice" regulation.

All registered motor vehicle traders must prominently display a Consumer Information Notice (CIN) on used motor vehicles they are selling as required by the Consumer Information Standard regulation unless they are selling to another registered motor vehicle trader of licensed car wrecker.

You are not required to display a Consumer Information Notice with any vehicle that does not meet the definition of “used motor vehicle” as set out in the Motor Vehicle Sales Act (MVSA)

Car market operators

Under the MVSA, car market operators must take reasonable steps to ensure motor vehicle traders attach the Consumer Information Notice to a motor vehicle they are selling. Car market operators who do not take reasonable steps to make sure motor vehicle traders display the notice can be fined up to $2,000 under the MVSA.

At the very least, reasonable steps would involve car market operators informing sellers of the requirement to display the notice, and making copies of the notice available to sellers for their use. It would be prudent for car market operators to have systems in place for checking whether sellers have the Consumer Information Notice displayed. 

Enforcement

The Consumer Information Standard is a regulation under the Fair Trading Act and is enforced by the Commerce Commission.

Motor vehicle traders will breach the Fair Trading Act if they either fail to display the Consumer Information Notice, or display a Consumer Information Notice containing inaccurate or incomplete information with vehicles for sale. This does not apply to car market operators unless they are also the vehicle seller. The Consumer Information Notice must comply with the format specified in Section 7 and Schedule 1 of Regulations.

The Commerce Commission has published a resource for traders on their enforcement of the Consumer Information Standard Consumer Information Notice. Contact the Commission's Contact Centre on 0800 943 600.

Or visit the Commerce Commission's website.

Civil claims under the Fair Trading Act may be made by purchasers if false or misleading information is entered onto the Consumer Information Notice.

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Consumer Information Notice example

The Ministry has developed a sample Consumer Information Notice for motor vehicle traders to use.

View this example here.

For motor vehicle traders or trade associations wishing to use this sample to design and brand their own Notices, the Ministry has a Word version for designers available on request (email your request). Please note that there are restrictions on modifying this example - see FAQs below.

Consumer Information Notice - FAQs

Please note, the following Frequently Asked Questions are in addition to Commerce Commission's Consumer Information Notice information.

If an auctioneer auctions a motor vehicle on behalf of a motor vehicle dealer, whose name should be listed as the motor vehicle trader on the CIN?

The auctioneer should be listed as the motor vehicle trader on the CIN. Remember, however, that the motor vehicle dealer may have obligations under the Sale of Goods Act and the Fair Trading Act.

If a motor vehicle trader sells a vehicle on behalf of a vehicle’s owner, whose name should appear on the CIN?

The motor vehicle trader should be listed as the Consumer on the CIN.

What if the motor vehicle trader doesn’t know the year of manufacture of the vehicle?

The "vehicle year", as it appears on the LTNZ Motor Vehicle Register, must be written on the CIN. Vehicle year can be either the calendar year in which the vehicle was manufactured or the model year as designated by the manufacturer. This data is available from the Motor Vehicle Register.

Visit Motochek for further information.

How do you fill in the plate number if the vehicle has personalised plates?

A personalised plate is still the "plate number or distinguishing mark" at time of sale that must be written on the CIN. Upon sale of the vehicle, if the personalised plate is changed, this is done through the LTNZ and the new plate number is recorded on the LTNZ's Motor Vehicle Register.

Visit Motochek for further information. 

"Imported as damaged" - availability of information from LTNZ

An imported damaged flag is recorded on the Motor Vehicle Register only in the case of "obvious structural damage or deterioration" of a vehicle. The key word is "structural", as this determines whether the flag remains on the vehicle record or not. Vehicles with visible damage that is not necessarily structural - such as a minor dent to a door panel - may be flagged initially but the flag will be removed following subsequent inspection by an approved LTNZ certifier. No information on the damage will be retained on the record and, therefore, will not be disclosed on the CIN.

When a vehicle is imported and damage is recorded at the Bordercheck inspection, an "imported damaged flag is set to "Yes". This information will be held against the vehicle record once the vehicle is registered on the Motor Vehicle Register.

The imported as damaged information is available on Motochek. It will display this information within the vehicle details section:

• Result record shows "imported damaged flag" = Yes, then this information must be entered into the CIN.

When Motochek does NOT display this detail, then No should be entered on the CIN against Imported as damaged.

To ensure you comply with the CIN requirements, enter either Yes or No based on what is reported on Motochek. 

If a vehicle is not initially imported as damaged but at certification time by the LTNZ, the vehicle is assessed as damaged – does the CIN have to include "imported as damaged"?

Yes – the CIN should state whatever is listed on Motochek. "Imported as damaged" means the LTNZ recorded that the vehicle had obvious structural damage or deterioration at time of import. See above for more information from the LTNZ about Imported Damaged flag.

If a vehicle is imported as damaged, must all subsequent sales by a motor vehicle trader state on the CIN that the vehicle was imported as damaged?

Yes, because the LTNZ has recorded this status on the Motor Vehicle Register. See above for more information from the LTNZ about Imported Damaged flag. 

What should I write on the CIN if the vehicle is unregistered and the information is not on the Motor Vehicle Register?

As certain data required to complete parts of the CIN is unavailable for unregistered vehicles displayed for sale (data is only recorded on the Motor Vehicle Register once the vehicle is registered) then this information should be left blank. To indicate otherwise (eg that data not available) may be a breach of the Fair Trading Act.

To prove a vehicle is unregistered, a query on Motocheck will return the message "Vehicle never registered". This information can be printed out and provided to the customer as supporting evidence from the Motor Vehicle Register.

Once the vehicle is registered before sale, the CIN must be updated to include all information that becomes available from the Motor Vehicle Register.

We recommend that motor vehicles offered or displayed for sale be registered.

An "unregistered" is a vehicle that has never been registered on the Motor Vehicle Register. This term should not be confused with "de-registered". That is, as a result of registration cancellation or automatic de-registration where licence fees remain unpaid after 12 months. In these cases, full information is available on the Motor Vehicle Register. 

What if the motor vehicle trader is unable to explain the extent of the damage (or has no knowledge of the damage)?

If a vehicle is recorded on the Motor Vehicle Register as "imported damaged", a motor vehicle trader should explain that the vehicle had obvious structural damage or deterioration at time of import. Apart from that, a motor vehicle trader is not required to have specific knowledge of the vehicle damage at time of import.

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Why aren't New Zealand damaged vehicles flagged on the CIN like imported damaged used motor vehicles?

Reliable information on damaged imported vehicles is readily available, unlike information on New Zealand damaged vehicles. 

Can I put “unknown” in damaged import section of the CIN if I know it was imported but don’t know if damaged ?

You must write into the CIN whatever is listed in Motochek. If the vehicle is not flagged as damaged, leave this space blank. 

The used vehicles I sell are only offered or displayed to other registered traders. Do I still have to put a CIN on each vehicle?

No. There is an exemption from the requirement to display the CIN where a trader offers or displays vehicles for sale exclusively (that is, only) to other registered traders. The traders must be registered for the exemption to apply. The exemption will not apply if other non-trade customers can view the vehicles. 

I am a motor vehicle trader and the finance company has a security interest registered over all my inventory, including the vehicles I have for sale to consumers (this is sometimes known as an "inventory" or "floor plan" security). Do I have to disclose this type of security on the CIN?

No, you do not need to disclose this type of security because a consumer is not affected by this type of security. The Consumer Information Standards (Used Motor Vehicles) Regulations 2003 is intended to capture security interests affected by section 58 of the Personal Property Securities Act 1999. It is not intended to capture inventory securities. Under section 53 of the Personal Property Securities Act generally any security interest between a financier and Consumer over the supplier's own inventory does not survive an ordinary sale of any item from that inventory to a consumer.

The vehicle has a registered security interest on it but the amount owing will be paid off as soon as the vehicle is sold to another purchaser. Do I have to say there is a security interest ?

Yes. You must write "There is a security interest registered over this vehicle" on the CIN. If it is your practice/intention to clear the interest on the vehicle when it is sold, you should record this as a term of the sale agreement/contract. 

The information on the CIN must be kept up-to-date. Does this mean I have to update the odometer reading disclosed on the CIN as soon as a vehicle is taken for a test drive?

No. The information has to be updated as soon as reasonably practicable after the information has changed. Updating it after every few test drives is reasonable. 

I am a trader who imports vehicles for customers. The vehicle details are not on the LTSA register until the vehicle gets to New Zealand. How should I fill in the CIN ?

You only need to display a CIN where the used vehicle is offered or displayed for sale in New Zealand and you are a trader carrying on business in New Zealand. It may also be relevant whether the sale contract is completed in New Zealand or overseas. For instance, if the customer has the right to examine the vehicle in New Zealand and refuse to complete the sale and purchase, then there is clearly an offer or display for sale in New Zealand and the CIN should be displayed. You should seek legal advice on whether the regulations apply to your situation. 

Why is there no requirement to list the number of previous owners on the CIN ?

It is recognised that consumers generally value this information. However, the number of previous owners is not available for used imported vehicles before they are exported to NZ. For “New Zealand new” vehicles, the information on the Motor Vehicle Register is inaccurate due to inconsistent recording of “trade” owners. However, sellers can still voluntarily provide this information in some other way if they wish.