Issue 20 – April 2024

Changes to Motor Vehicle Dealers (Sales) Regulations 

On 7 June 2024, amendments to the Motor Vehicle Dealers (Sales) Regulations 1974 (the Regulations) will come into effect.

You can start preparing now.  Download a copy of the Regulations to read more on the changes that will start on 7 June 2024 and how to use the new prescribed forms and vehicle sale contract.  Until then, use the current forms.  

The Consumer Protection website will be updated to reflect the various changes. An Industry Bulletin will be sent closer to 7 June 2024 so that dealers know when the new forms are available to download from Consumer Protection’s website.

The amendments are explained in more detail below: 

Repairable write-off disclosure

From 7 June 2024 dealers must disclose whether a vehicle they sell has been listed as a repairable write-off on the written-off vehicle register.

As you know, Form 4 – Vehicle particulars contains important information about a vehicle for prospective purchasers to know before deciding whether to buy a vehicle. You must use the new Form 4 for every second hand vehicle, including motor cycles, and complete the new ‘Yes/No’ tick box on Form 4 to indicate whether the vehicle is: 

• a repairable write-off (referenced above)
• covered by a statutory warranty.

Form 4 will no longer include the explanation about the statutory warranty for a used car or motor cycle. Instead, a dealer must give a purchaser a separate information statement (refer Form 5A below) about the statutory warranty.

It will continue to be a requirement that all details on the Form 4 are completed. Dealers should especially note that the details include the date of sale and odometer reading at time of sale, which as occurs now, must be inserted in the Form 4 when the vehicle is sold.

Statutory warranty information statements

Before a dealer sells a second hand vehicle, the dealer must give the purchaser an information statement regarding the existence and nature of the statutory warranty under the Motor Vehicle Dealers Act 1973, if any, that applies to the vehicle. The information statements will be contained in:

• A new Form 5A – Information statement – statutory warranty for vehicles that are covered by the statutory warranty. The Form 5A must include the applicable illustration ‘The Used Car Warranty’ or ‘The Used Bike Warranty’.
• An amended Form 6 – Information statement – no statutory warranty for vehicles that are not covered by a statutory warranty.

The use of Form 5 – Notice of defects excluded from warranty is largely unchanged. Small changes have been made to delete the reference to a ‘Chassis No’, refer to mileage as “kms/miles”, and an update to the Department’s web address.

Vehicle sale contract

The vehicle sale contract sets out that a dealer may seek damages up to, but not exceeding, 5% of the purchase price of the vehicle as damages for the purchaser’s breach of the contract. This will not change.

Clause 8 of the vehicle sale contract has been amended to insert a new clause which states that any amount sought by the dealer when the purchaser breaches the contract must be a genuine estimate of the dealer’s loss.  From 7 June 2024 all vehicle sale contracts must include the amended clause 8.

Why have these changes been made?

Repairable write-off disclosure – Requiring dealers to disclose to prospective buyers if a vehicle they are selling is listed on the written-off vehicle register as a repairable write-off was a recommendation in the Department’s review of the Motor Vehicle Dealers Act 1973 and the Motor Vehicle Repairers Act 2003.   Consumers will benefit as this additional disclosure will help make an informed purchasing decision.

Changes to prescribed forms – Listing the vehicle particulars that must be disclosed, and amending the prescribed forms, ensures the requirements reflect current industry practice and makes clear the requirements that apply to the sale of all second hand vehicles. 

Vehicle sale contract pre-estimated damages – Consumer Protection has continued to receive complaints from consumers about dealers attempting to automatically charge the maximum 5% pre-estimated damages without regard to the dealer’s actual or anticipated loss.  This small change will protect consumers by making it clear to all dealers of second hand vehicles that any amount claimed by a dealer must be a genuine estimate of loss arising from the breach of the contract.

Frequently Asked Questions (FAQs)

The following FAQs are intended to provide dealers with practical guidance on the use of the new forms.

What is the size of the Form 4?
The Form 4 must be printed, typed, or written in a clear and legible manner. The Regulations no longer specify any minimum dimensions for Form 4.

How do I use the Form 4 if I sell a motor cycle?
The Motor Vehicle Dealers Act 1973 specifies that Form 4 should be attached to a motor cycle in a way and place to ensure the details of the Form 4 are clearly visible. The Form 4 has been streamlined so that it can be printed and attached to a second hand motor cycle.

How and when should I give the information statement to the purchaser?
The information statement must be given to the purchaser before you sell the vehicle.  The vehicle is considered sold once the purchaser and dealer have signed the vehicle sale contract.  This means there is some flexibility for dealers who may wish to combine the forms or provide the forms as a ‘packet’ of documents to the purchaser.

The engine number is difficult to locate. Can I list the engine number based on paperwork I obtained with the vehicle?
The engine number that must be disclosed in Form 4 is the engine number of the engine currently in the vehicle, regardless of what might be recorded on any registration forms or other paperwork obtained by the dealer.  If you choose to rely on the engine number recorded on the vehicle’s paperwork, and that number is incorrect because the engine has been replaced, you will have inserted a false particular in the Form 4.

Where can I read the new Regulations?
The Regulations will be updated on the WA Legislation website on 7 June 2024.

Until then, you can read the copy of the Regulations that compares the current law with the law that will apply from June 7, 2024.  The Motor Vehicle Dealers (Sales) Amendment Regulations 2024 are also available on the WA Legislation website and shows the changes that are being made to the Regulations.

If you have further questions or would like more information about these changes, please contact Consumer Protection on 1300 30 40 54 or by email at automotive@dmirs.wa.gov.au.