Hard to believe, but before 1990, there were no written standards or guidelines for automobile advertising in the province of Ontario. This included messages in all forms of media ? newspapers and magazines, TV, radio, billboards, point-of-sale, direct mail, and so on.

Before 1990, the determination of an inappropriate advertisement was left solely to the Motor Vehicle Registrar who, under Section 19 of the Motor Vehicle Dealers Act, could decide on ?reasonable and probable grounds? if an advertisement was making a false, misleading or deceptive statement.

The problem of course, was that this process was unfair to consumers and dealers alike because the decision was purely subjective. It lacked consistency mainly because no specific benchmark existed to determine if the advertisement had breached ?reasonable and probable grounds.?

In the fall of 1990, the Toronto Automobile Dealers Association (TADA) approached Provincial Government officials and offered to work with them to form a special joint committee to create advertising guidelines that would protect consumers from false and deceptive advertising.

At the same time, the proposed guidelines would assist the dealer community by providing consistency and certainty about the acceptability or unacceptability of an advertisement ? by establishing industry standards and assuring the ads complied to those standards.

The committee reviewed advertising codes from jurisdictions in the U.S., Australia and Europe, as well as Canadian court decisions, to formulate these new advertising guidelines. By 1991 the guidelines for automobile advertising in Ontario were completed, and Ontario?s new car dealers agreed to follow the new standards voluntarily.

In 1997, the Ontario Motor Vehicle Industry Council (OMVIC) codified these advertising standards in their Standards of Business Practice to guarantee that all dealers adhered to them. In Ontario, the Motor Vehicle Dealers Act (which governs registered automotive dealerships) is administered by OMVIC. It has both the mandate and the authority to enforce these standards. Let me share with you a few of these standards, and the rationale used in setting them.

Advertisements should not indicate or imply that vehicles are offered for retail sale or lease without economic advantage or benefit to the dealer. Examples of prohibited terms include ?Dealer cost? and ?Factory price, invoice price, or under/over invoice price.?

Ads cannot encourage someone to break an existing contract. For example, ?we will beat your best deal.? Once a consumer has signed a sales contract, unless it?s conditional, it?s binding and another dealer cannot encourage you to break that agreement.

Advertisements cannot guarantee a minimum trade-in allowance. For example, ?Push, Pull, or Drag Your Trade for $1,000 Guaranteed.? The dealer may have been prepared to discount that vehicle the equivalent amount, with or without a trade.

Advertisements similar to the following are prohibited because they may not represent a true savings ? since the vehicle may normally sell for less in the marketplace:

• MSRP $ 20,000
• Sale Price $ 18,500
• Save $ 1,500

A true savings occurs only when the selling price is compared to the average selling price of that advertised vehicle(s). The dealer?s records must be able to support this.

In all newspaper advertisements, dealers are required to disclose all details surrounding the price or lease payment. Unfortunately, this creates what is commonly referred to as the ?fine print.? OMVIC also regulates the size of this fine print.

When advertising a vehicle price, a dealer must disclose if the price does not include specific taxes, freight, PDI/PDE, or specific administration fees.

When advertising a finance offer, a dealer must disclose the annual interest rate, the total cost of borrowing, and whether a down payment or credit approval is required. In fact, if the customer has a choice between a ?finance offer? or a ?cash rebate? offer, the ?effective? interest rate must be disclosed.

Dealers must disclose if the offer is a lease, the number of payments and the amount of these payments, as well as any amount due at delivery or ?additional costs?. The ad must also disclose the annual interest rate, kilometer restrictions and charges along with any financial obligation at the lease end.

Advertisements cannot indicate that a consumer can purchase a vehicle from an unregistered salesperson. Therefore, ads cannot state ?no salespeople.?

Dealers cannot advertise such terms as ?Going out of Business, Bankrupt, or Lease-Expired Sale, unless it?s a fact.

The term ?bumper to bumper? warranty cannot be used as it may infer ?wear? items are covered.

An advertisement must also disclose if a used vehicle was previously a Police Cruiser, a Taxi or a daily rental vehicle.

In today?s fast-paced society, we experience a barrage of advertising messages every day from many sources ? TV, newspapers, radio, billboards and the Internet. The sheer volume of advertising in our industry makes it absolutely essential that our members adhere to these standards.

While OMVIC does its best to enforce these guidelines and act on consumer complaints, it cannot possibly monitor every single advertising message out there. It?s really up to each and every dealer to ensure they follow these regulations in their advertising and promotions.

These standards are another example of the proactive strategies of new car dealers to protect consumers and enhance the business practices in our industry. Bottom line: everyone wins.

Until next week, remember: YOU are in the driver?s seat!