Newfoundland and Labrador Regulation 36/23, officially titled “Dealer Regulations under the Highway Traffic Act (O.C. 2023-104),” provides the framework governing the licensing, operation, and regulatory compliance of vehicle dealers within the province. This regulation aims to promote transparency, accountability, and effective management within the vehicle sales industry.

In order to obtain a dealer license, applicants must fulfill several criteria. Requirements include proof of HST registration, adequate commercial and garage insurance coverage, compliance with zoning regulations for the business location, and approval from relevant municipal authorities.

Dealers are also required to provide a security deposit based on their projected monthly issuance of temporary registrations. The deposit amounts range from $5,000 to $75,000, depending on the total value of these registrations. This security must be maintained for 120 days after the license expires and can be forfeited under specific conditions, such as failure to report lost or damaged plates.

Identification and dealer plates are issued by the registrar, who determines the quantity based on the dealer’s needs. Dealers must ensure these plates are securely stored and used appropriately. They are responsible for reporting and reimbursing the registrar for any costs associated with damaged or lost plates and must adhere to annual renewal and record-keeping obligations.

Dealers are authorized to issue temporary vehicle registrations and related identification plates or markers, valid for 120 days. They must submit the corresponding applications and fees to the registrar within 10 days of issuance.

When selling a second-hand vehicle, dealers are mandated to provide purchasers with a vehicle inspection certificate and a vehicle history record from an approved source. At the time of a vehicle sale, dealers must complete a detailed sales agreement, which includes the vehicle’s make, model, VIN, and any additional warranties or trade-in details. This agreement must be signed by all parties involved, with the purchaser receiving a copy immediately.

In terms of leasing, dealers must prepare a lease agreement that outlines payment terms, early termination conditions, and lessee responsibilities. Each lease agreement must be distinct, signed by all parties, and provide clarity on legal and financial aspects of the lease. Dealers are also required to maintain comprehensive records of vehicle sales and leases for a minimum of one year. This includes sales agreements, insurance proofs, inspection certificates, and vehicle history records. These documents must be securely stored and properly destroyed after the retention period.

Source: Newfoundland and Labrador (36/23) May 5, 2023