This information includes terms and definitions under the MVSA, registering as a motor vehicle trader, disclosure obligations, offences and enforcement, and the Motor Vehicle Disputes Tribunal.

Consumer Information Notice

Information on the Consumer Information Notice is available in the Fair Trading Act section. The requirements of the notice are a Consumer Information Standard under this Act. An example Notice is also available in the Fair Trading Act section.

The Commerce Commission has published a resource for traders on the Consumer Information Standard Consumer Information Notice [1662 kB PDF] [external link]. For more information - phone the Commission's Contact Centre on 0800 943 600, or email.

Consumer Guarantees Act

Information on the Consumer Guarantees Act, specifically focused on motor vehicle sales, is also available in this Business Info section.

Business Note Publication

The information on this page is available as a Business Note booklet - Motor Vehicle Sales Act and Related Laws - A Guide for Motor Vehicle Traders, second edition. You can order this publication from the Ministry using our Publications order form.

Business Note - PDF version

Motor Vehicle Sales Act and Related Laws - A Guide for Motor Vehicle Traders, second edition [276 kB PDF] (instructions for obtaining the viewer [link to MED website]).

Legislation

Copies of the Acts and Regulations mentioned in this guide can be accessed online [link to Interim Website of New Zealand Legislation], for free. Printed copies are sold by Bennetts Bookshops and some Whitcoulls stores. Bennetts Bookshop in Wellington carries all legislation and provides a mail service throughout the country. Contact Bennetts Bookshop by phone 04-499 3433 or fax 04-499 3375.

Key Terms and Definitions

This list sets out the key definitions from the Motor Vehicle Sales Act that are referred to throughout the MVSA section of this guide.

Banned person

You can be banned from being a motor vehicle trader if you have had two or more convictions in 10 years for any of the following offences:

trading as, or holding yourself out to be, a motor vehicle trader without being registered under the MVSA
falsifying information on a contract of sale
giving false information to the Registrar when registering.

You can also be banned if you have more than once within a 10-year period done any of the following things:

failed to comply or managed a company that failed to comply with an order of the Motor Vehicle Disputes Tribunal
been concerned in the management of a company that was a registered motor vehicle trader and that went into liquidation because of the company's inability to pay its debts
been concerned in the management of a company that is banned
been concerned in the management of a company that failed to provide compensation for any loss incurred by a finance company as a result of selling a motor vehicle for which that finance company held a security interest.

You may also be banned if, while registered as a motor vehicle trader, you have been:

disqualified under the Companies Act 1993 from managing a company
convicted of a crime involving dishonesty
convicted under the Fair Trading Act of any of the following:
- offering gifts and prizes with the intention of not providing them as offered
- bait advertising
- referral selling
- demanding or accepting payment without intending to supply as ordered
- pyramid selling
- importing goods with a false trade description
more than once in the last 10 years been bankrupt or have failed to provide compensation for loss by a finance company as a result of you selling a vehicle over which the finance company held a security interest.
convicted of odometer tampering.

Car auctioneer

A person who conducts sales of motor vehicles by auction.

Car consultant

A person who, for payment, is contracted by anyone except a motor vehicle trader to act as their agent for anything to do with the sale or purchase of a motor vehicle.

Car market operator

A person whose business is to provide another person with premises or a place of market to sell used motor vehicles, or who operates a facility to sell used motor vehicles. This includes internet websites and webpages.

Customs information

Information about any person who the Comptroller of Customs believes has imported more than three vehicles in 12 months. The information may include the person's full name, residential address, occupation and date of birth or, in the case of a company, the company's name and registered office.

Importer

A person who carries on the business of importing vehicles into New Zealand.

Motorcycle

A vehicle over 60 ccs that runs on two wheels or three with a sidecar, but does not include a moped.

Motor vehicle

A road vehicle that is mechanically propelled and of a type ordinarily acquired by consumers for personal, domestic or household use.

This does not include:

an invalid carriage
a moped
a motorcycle with less than 60cc total cylinder capacity
tractors/farm machinery
trailers.

Motor Vehicle Dealers Act 1975

The Act replaced by the MVSA on 15 December 2003. It is sometimes referred to in this guide as the "former Act".

Motor vehicle trader

Any person whose business is motor vehicle trading and includes:

a car market operator
an importer
a wholesaler
a car auctioneer
a car consultant.

A person is treated as a motor vehicle trader if they hold themselves out to be carrying on the business of motor vehicle trading. They will also be treated as a motor vehicle trader if they sell more than six vehicles in a 12-month period or import more than three vehicles in 12 months, unless they can prove they are not doing so for gain.

Motor vehicle trading

The sale of motor vehicles by someone (whether they are the principal or the agent).

Register

An electronic register of all the motor vehicle traders in New Zealand. It operates 24 hours a day, seven days a week. It gives the public information about a trader's contact details and their registration status.

Registrar

The Registrar of Motor Vehicle Traders is appointed under the Motor Vehicle Sales Act.

Sale

The sale, lease, exchange or any other disposition of a motor vehicle, or any interest in a motor vehicle. This includes display for sale or offer for sale/lease/exchange but does not include a lease or offer of lease for a term of four months or less.

Tamper

In relation to odometers means to alter or cause to be altered the motor vehicle's odometer so that it appears to have travelled other than the true distance; or to remove the odometer altogether.

Used motor vehicle

A vehicle that has, at any time before being offered or displayed for sale been registered under the Transport Act, Transport (Vehicle and Driver Registration and Licensing) Act, or any corresponding enactment in another country or been used for a purpose not connected with its manufacture or sale.

Also includes a vehicle that has been used as a demonstration in connection with the sale of another vehicle.

Vehicle registration information

Information about any person who the Secretary of Transport believes has sold more than six vehicles in 12 months. The information may include the person's full name, residential address, occupation and date of birth or, in the case of a company, the company's name and registered office.

Wholesaler

A person selling new or used motor vehicles to other motor vehicle traders.

Working Day

Any day other than:

Saturday and Sunday; and
Waitangi Day
Good Friday
Easter Monday
Anzac Day
Queen's Birthday
Labour Day
anniversary days of the local provinces
the period between 25 December and 15 January.

Registration

Registration Requirements

Who is required to be registered?

Any person meeting the definition of "motor vehicle trader" set out in the MVSA must be registered to legally carry on the business of trading in motor vehicles. See Key Terms and Definitions.

Either an individual or a company can register as long as they have not been disqualified from registration.

Grounds for disqualification as a motor vehicle trader

An individual is disqualified from registration if he or she is a person who:

is under 18 years of age
is a banned person
is an undischarged bankrupt
has had their motor vehicle dealer's licence suspended within the previous 12 months (or cancelled within the last five years) under the former Act
has had their salesperson's registration suspended within the last 12 months (or cancelled within the last five years) under the former Act
held a motor vehicle dealer's licence under the former Act, and may be pursued by the Motor Vehicle Dealers Institute for a claim made against the Fidelity Fund within the previous five years
has had their registration cancelled by the Registrar within the previous five years
is prohibited or disqualified from managing a company under the Companies Acts 1955 or 1993
has been convicted of a crime involving dishonesty within the last five years
has been convicted of specific offences under the Fair Trading Act
is subject to a compulsory treatment order under the Mental Health (Compulsory Assessment and Treatment) Act 1992
is subject to a property order made under the Protection of Personal and Property Rights Act 1988.

A company is disqualified from registration if:

the company is a banned person
the company's motor vehicle licence, under the former Act, has been cancelled within the last five years
the company held a motor vehicle dealer's licence under the former Act and may be pursued by the Motor Vehicle Dealers Institute for an amount arising out of a claim made against the Fidelity Fund within the previous five years
the company is in liquidation
the company's name has been removed from the register of companies
a manager of the company is disqualified from registration in their own right
the company's registration as a motor vehicle trader has been cancelled within the previous five years.

Can anyone seek an exemption from registering as a motor vehicle trader?

Yes, anyone can seek an exemption from registration by applying to the Minister of Consumer Affairs. There is a format for applying for exemption which is set out in the MVSA regulations.

How do I register?

If you want to register as a motor vehicle trader you must:

complete and sign an application form
complete a statutory declaration declaring that you are not disqualified from registration
pay a registration fee.

In the case of a company, a person involved in the management of the company (eg, a director or manager) carries out these steps. Each person involved in the management of the company must complete a statutory declaration.

Registrations can be made online at the Motor Vehicle Traders Register – operated by the Ministry of Economic Development, or on paper. Paper registration forms can be requested by phoning 0508 MOTOR TRADERS (0508 668 678) or can be downloaded from the MVTR website. More information on the registration process is available online at the MVTR website or by phoning 0508 MOTORTRADERS (0508 668 678) for assistance.

A company that registers as a motor vehicle trader will have obligations and responsibilities under the Companies Act that are separate from the requirements of the MVSA.

For more information visit the New Zealand Companies Office website.

Information required for applying

When making your application, you must give:

your full name, residential address, date of birth and occupation
the proposed trading name of your business
any other information required.

If a company is applying, the manager must give:

the name of the company, the date and place of incorporation, the registered address and principal type of business
the company's incorporation number
the full name, residential address, date of birth and occupation of each individual concerned with the company's management
the proposed trading name of the motor vehicle trading business
address for service
any other information required.

Application accepted

If your application is accepted, the Registrar will enter your name on the Register and give you written notice of the date your registration takes effect. You will also be sent a Certificate of Registration.

Certificate of Registration

All registered motor vehicle traders will be supplied with a Certificate of Registration that includes a registration number and the expiry date. The Certificate of Registration should be displayed at your place of business. You must also show your Certificate of Registration, or a copy of it, to anyone who asks to see it.

The Ministry of Economic Development's Motor Vehicle Traders Registry have developed an
example Certificate of Registration [90 kB PDF] (instructions for obtaining the viewer [link to MED website]).

Application refused

If the Registrar refuses your application, you will be notified in writing of the decision and the reasons for it, within 10 working days after the decision is made. You can appeal this decision to the District Court (see MVSA, section 64 – Right of appeal for more information).

How long is the registration effective?

Your registration is effective for 12 months unless it is cancelled or surrendered earlier. Registration cannot be transferred.

Renewal of Registration

You must renew your motor vehicle registration every 12 months and must include a new statutory declaration(s). Your application for renewal must be made to the Registrar before your original registration expires. Renewal notices will be automatically sent to registered traders prior to expiry – as long as their current address details are correct. Traders can select the "maintain application" option from the Traders Services section of the Motor Vehicle Traders Register.

What if an application for renewal is not decided before the expiry date?

Your current registration stays valid until the application is decided, as long as it was received before the expiry date.

What about renewal after the expiry date?

Renewals after the expiry date will be treated as new applications, not renewals.

What happens if there is a change in circumstances?

You must notify the Registrar within 10 working days if any of your registration details change. You can maintain your address and details or your company information online at the Motor Vehicle Traders Register by using your MVT Number and Key (a personal identification code) sent to you when you applied for registration. Otherwise you must notify the Registrar in writing.

Removing a motor vehicle trader from the Register

The Registrar must remove you from the Register if:

your registration is cancelled
you surrender your registration
your registration expires.

Cancellation of Registration

Registration can be cancelled if the Registrar is satisfied that:

your application fee has been dishonoured
any representations or declarations you made are false
you ceased trading
you are disqualified from registration.

The cancellation process

The Registrar must notify you in writing that your registration will be cancelled. The notice must give reasons for the cancellation and the date it will take effect. You then have 10 working days to give written reasons why your registration should not be cancelled.

If no written representations are received, the Registrar will record the cancellation. If the Registrar decides to cancel a registration despite your representations, you will be notified as soon as possible.

What happens if registration is cancelled because the motor vehicle trader is a "banned person"?

The Registrar will record the name of a "banned person" on the Banned Persons list. The list will be accessible online at the Motor Vehicle Traders Register website.

Registered Trader Stops Trading

If you decide to stop trading, you must notify the Registrar and surrender your registration within 20 working days. You can do this by surrendering your registration online at the Motor Vehicle Traders Register website, or by notifying the Registrar in writing.

Address for Registration Enquiries

National Processing Centre, Private Bag 92061, Auckland Mail Centre, Auckland.

Address for the Registrar: Registrar of Motor Vehicle Traders, Private Bag 92061, Auckland Mail Centre, Auckland.

The Ministry of Economic Development also publishes MVTR Factsheets and online Frequently Asked Questions (FAQs) on registration processes and the Motor Vehicle Traders Register.

Applications to Ban Traders

Any person can apply to a District Court to have a person banned from participating in the business of motor vehicle trading. The Court may ban someone if the person has been convicted of a specified offence and the Court considers (or if there is sufficient evidence before it to indicate) that the person is not a fit and proper person to be in the business of motor vehicle trading. Some bans are automatically imposed by the MVSA, which means registration or renewal as a motor vehicle trader is prohibited because the trader committed offences under the MVSA while they were registered.
See the definition of "banned person" and for more information see Enforcement of the MVSA.

Other Motor Vehicle Sales Act Legal Obligations

Contracts for Sale

When you sell a motor vehicle you must keep a record of every sales contract for at least six years. The record must include certain information required by regulations made under the MVSA.

This information is:

the names of the parties to the contract
the agreed price
a description of the motor vehicle sold including its VIN (or where no VIN is recorded the chassis number), make, model, and calendar year of manufacture or model year, as recorded on the LTSA Motor Vehicle Register.

The records may be kept in an electronic form as long as they can be retrieved easily. The records can be inspected by the Registrar or the Police.

Consumer Information Standard – Consumer Information Notice

A Consumer Information Notice must be prominently displayed with every used motor vehicle for sale by motor vehicle traders and sellers at car markets. Car market operators must take reasonable steps to ensure sellers display the Notice.

Registered motor vehicle traders who display used motor vehicles for sale exclusively to other registered motor vehicle traders are not required to display a Consumer Information Notice with these vehicles.

This information disclosure is required by the Consumer Information Standard regulation under the Fair Trading Act.

The Ministry has supplied a sample Consumer Information Notice [37 kB PDF] (instructions for obtaining the viewer [link to MED website]).

Buyer's Copy of Consumer Information Notice

You must get written confirmation from the vehicle buyer that they were given a copy of the Consumer Information Notice [37 kB PDF] (instructions for obtaining the viewer [link to MED website]). This confirmation must be obtained as soon as is practical after the sale. You must keep a copy of every Consumer Information Notice and buyer's confirmation for at least six years.

Sales "On Behalf"

The MVSA requires that, where you act as an agent for another person (the principal) in the sale by consignment of a used motor vehicle, you must:

pay the principal all money received for the sale immediately on demand by them, or
if no demand is made by the principal, within five working days after the money is received from the purchaser.

This duty is subject to any written authority or instructions given to you by the principal.

You are not allowed to use the funds from the sale for the payment of your debts, or to be attached to or taken to execute a court order initiated by a creditor's claim. The money also cannot pass, as part of a bankruptcy, to either the Official Assignee (in the case of individuals) or to a liquidator (in the case of a company).

If you cannot find the principal after making reasonable enquiries, you are still required to pay the money to the principal as soon as you do become aware of their whereabouts.

Providing a written account of sale

You must provide the principal with a written account setting out:

the particulars of the money you received on the principal's behalf in respect of the sale, and
the manner in which you have applied that money.

You must provide the account on demand or, if no demand is made, within five working days after the sale was completed.

Does consumer law apply to sales by consignment?

Yes. The Fair Trading Act (FTA) applies to sales by consignment. You must not mislead, deceive or make false representations to either the buyer or seller of a vehicle on sale by consignment. You are also required to display the Consumer Information Notice [37 kB PDF] (instructions for obtaining the viewer [link to MED website]) with vehicles for sale by consignment.

The Consumer Guarantees Act applies to sales of consumer goods where the trader acts as an agent for another trader or for a consumer – this covers sales "on behalf of" or by consignment.

Be aware
Auction sales and sales by competitive tender are not covered by the Consumer Guarantees Act.

Offences under the MVSA

Infringement Offences

Under the MVSA there are a number of infringement offences which carry a fine of up to $2,000. These are:

failure by a car market operator to take reasonable steps to ensure a seller has attached a Consumer Information Notice to the vehicle being sold
entering false information into a record of sale
otherwise failing to comply with requirements to keep records of contracts for sale
being unable to show your Certificate of Registration without a good reason
not giving notice to the Registrar of any changes in your registration details
preventing an inspection by the Registrar, or giving false or misleading information
preventing the carrying out of a search warrant.

If the Registrar considers you have committed an infringement offence, the Registrar may either:

a) issue you with a notice requiring you to pay a fine of $500, or

b) seek a court hearing against you.

If (a) applies, you may pay the $500, but if you wish to contest liability you may request a court hearing. If you request a court hearing and lose the case, you may be required to pay up to $2,000.

Serious Offences

These offences carry a fine of up to $50,000 for an individual and up to $200,000 for a company, and other penalties may also be added. These offences are:

trading without being registered
carrying on trading while being banned
failing to comply with a ban
tampering with an odometer
making a false statutory declaration or supplying false or misleading information to the Registrar.

Enforcement of the MVSA

The National Enforcement Unit (NEU), part of the Ministry of Economic Development, enforces the MVSA. The NEU will identify, and where appropriate, take action against individuals or companies, including importers, who have not registered and are trading illegally, or who are otherwise violating sections 95-119 of the MVSA, including odometer tampering. The NEU can receive written complaints against traders via their Motor Vehicle Sales Act 2003 Complaint Form.

For more information visit NEU. The NEU does not ban traders, only a Court can do that - see Applications to ban traders.

The Consumer Information Notice under the Fair Trading Act is enforced by the Commerce Commission.

Motor Vehicle Disputes Tribunal

The Motor Vehicle Disputes Tribunal (MVDT) can hear claims under the Consumer Guarantees Act, the Fair Trading Act, and the Sale of Goods Act. The MVDT is administered by the Ministry of Justice.

Key Information for Auctioneers

If you are an auctioneer selling motor vehicles:

you are required to be registered as a motor vehicle trader on the Motor Vehicle Traders Register
you are not required to be licensed under the Auctioneers Act if you are properly registered as a motor vehicle trader, although you must comply with the Auctioneers Act requirements
you must comply with the requirement to display a Consumer Information Notice [37 kB PDF] (instructions for obtaining the viewer [link to MED website]) with used motor vehicles for sale at auction
you must disclose whether there is a security interest on any motor vehicle you offer for sale
you must comply with the Fair Trading Act
you may not be required to comply with the Consumer Guarantees Act . However, if you pre-sell a vehicle before auction, you may be required to comply with the Consumer Guarantees Act.

Key Information for Car Market Operators

If you operate a car market, car fair or "display for sale", including on a website or webpage, you are:

required to be registered as a motor vehicle trader if you meet the definition of "car market operator" in the MVSA
required to take reasonable steps to ensure sellers display a Consumer Information Notice [37 kB PDF] (instructions for obtaining the viewer [link to MED website]) with vehicles they offer for sale at your car market
required to comply with the Fair Trading Act in relation to information you provide to sellers and buyers
not required to comply with the Consumer Guarantees Act unless you are the Consumer of the vehicles for sale.

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