(WASHINGTON, DC) The District of Columbia is home to over 40 used car dealership lots. These licensed businesses are important to providing consumer choice when shopping for a used motor vehicle. These small businesses provide residents and visitors of the District with convenient local access to review automobiles they are seeking to purchase. The Department of Licensing and Consumer Protection (DLCP) values these businesses and their contributions to the economic vibrancy of the city.
Transparency in Pricing: The Consumer Protection Procedures Act (CPPA), among other things, seeks to ensure against improper trade practices. As such, the law requires businesses to notify consumers of the prices of their goods and services. This is achieved by:
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Conspicuously posting the price of goods and services;
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Displaying the prices clearly and concisely; and
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Notifying customers of the price of goods and services before the transaction is made.
In addition to notifying consumers of the price of goods and services, failure to post one’s prices qualify as “unfair and deceptive trade practices” under the CPPA, which may result in the imposition of civil infraction by DLCP and/or enforcement by the D.C. Office of the Attorney General. DLCP wants used car dealerships to succeed in the District, but we want them to do so lawfully so as to protect consumers. The information below is the law and must be adhered to by all used car dealerships.
APPLICABLE REGULATIONS
1. Federal regulations
The Federal Trade Commission ("FTC")’s Used Car Rule, 16 C.F.R. § 455.2 addresses disclosures that must be made when selling used vehicles. This rule requires that a "Buyer's Guide" be posted on a window of a used vehicle offered for sale by a dealer. The Buyer's Guide provides prospective purchasers with critical information about a vehicle, including:
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its year, make, model and Vehicle Identification Number;
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whether there is a warranty on the car and whether it is a full or limited warranty;
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a description of the specific systems covered under a full or limited warranty and for how long;
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whether a service contract is available for the vehicle; and
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a list of major defects that can occur in motor vehicles.
In addition, the Buyer's Guide provides sound vehicle purchasing advice, such as:
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asking if a mechanic can inspect the vehicle on or off the lot,
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advising buyers to purchase a vehicle history report and
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checking for open safety recalls.
The Buyer's Guide provides the websites consumers can use to get a vehicle history report and to check for open safety recalls. Both sides of the Buyer's Guide must be visible.
2. District of Columbia regulations
Consumers and dealerships should also be aware of the District’s Automobile Consumer Protection Act ("ACPA"), D.C. Code § 50-501 et seq., and implementing regulations, found at 16 DCMR §1400 et seq.
In summary, these regulations require:
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Disclosure of Certain Vehicle Damage or Defects
When a dealer knows of certain defects or damage to a motor vehicle, a DC used car dealer shall provide a written notice disclosing any material mechanical defect in the vehicle and any damage sustained by the vehicle because of fire, water, collision, or other cause for which the cost of repairs exceeded $1,000.00. See 16 DCMR § 1421.1
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Disclosure Must be Made on the Car Order and Bill of Sale
The notice required by the preceding subsection must be included in writing on a car order and the bill of sale in a type size equal to the largest type size that appears on the car order and bill of sale. See 16 DCMR § 1421.2
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Disclosure of Whether the Vehicle Has Been Inspected for Defects
Dealers are required to post on the windshield of each used vehicle offered for sale a sign with all upper-case letters no less than three inches high that states as follows:
This motor vehicle has ______
OR
has not ____
been inspected to determine if defect exists.
This regulation requires that dealers check the correct blank. See 16 DCMR § 1421.3
To submit a CPPA or other complaint of violation, visit DLCP’s website here