Recommended Amendments to the Motor Vehicle Sales Act 2003: Discussion Paper

March 2007

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Foreword from the Minister

Motor vehicles are amongst the biggest financial commitments consumers make, often using finance arrangements. These transactions can be technically complex, making it difficult for the average consumer to judge the merits, or otherwise, of purchasing a vehicle. It is vital that consumers receive useful and accurate information to allow them to make informed decisions.

Many New Zealanders rely on advice from motor vehicle traders. While there are many good motor vehicle traders, the motor vehicle sales industry has also attracted some less scrupulous business practitioners.

The Motor Vehicle Sales Act 2003 was developed to regulate the industry. Its purpose is to promote and protect the interests of consumers in relation to motor vehicle sales. This creates an environment where consumers have the information and confidence to make informed purchases.

The Act says that consumers who buy motor vehicles through registered motor vehicle traders are entitled to certain additional protections compared with those who buy privately. The Act requires consumers to be provided with adequate information to make informed purchases and provides a dispute resolution procedure for consumers and the industry (the Motor Vehicle Disputes Tribunal) should something go wrong with the transaction.

The Motor Vehicle Sales Act is just over three years old, and followed a major review of the then motor vehicle sales legislation. At the time the new legislation was passed, the government made a commitment to undertake a review after two years of operation to ensure the Act was meeting its objectives. This review, undertaken by the Ministry of Consumer Affairs, was tabled in Parliament in March 2006.

The Review of the Operation of the Motor Vehicle Sales Act 2003 suggested some possible amendments to the Act. This discussion paper provides an opportunity for stakeholders and interested parties to comment on specific proposals to amend the Act.

I welcome your submissions on the recommendations to improve the operation of the Motor Vehicle Sales Act 2003.

Hon Judith Tizard
Minister of Consumer Affairs

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