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Legislative Council - Fifty-Second Parliament, First Session (52-1)
2010-11-24 Daily Xml
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SECOND-HAND VEHICLES

The Hon. CARMEL ZOLLO (14:58): I seek leave to make a brief explanation before asking the Minister for Consumer Affairs a question about consumer protection.

Leave granted.

The Hon. CARMEL ZOLLO: Second-hand vehicle purchasers will soon have greater protection when purchasing a second-hand vehicle. Will the minister inform the chamber of some of the new protections that South Australian consumers will have when buying a vehicle from a second-hand vehicle dealer?

The Hon. G.E. GAGO (Minister for State/Local Government Relations, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister for the City of Adelaide) (14:58): I thank the honourable member for her most important question. As members would be aware, the Second-hand Vehicle Dealers (Cooling-off Rights) Amendment Act 2009, which amends the Second-hand Vehicle Dealers Act 1995, commences on 29 November of this year. One of the key features of that new law is a cooling-off period of two clear business days during which consumers are able to consider their purchase a little more carefully without being caught up in the excitement of the moment and possibly having to live to regret a decision that might be a poor decision that they might not be able to afford, upon reflection.

The cooling-off provision applies to second-hand vehicles, including demonstration vehicles, and allows the purchaser to rescind the sales contract by giving the dealer written notice before the expiry of the two-day cooling-off period. It will be an offence for the dealer to demand or require that a purchaser make a payment other than a deposit before the expiry of the cooling-off period. The legislation does, however, allow buyers to waive their cooling-off rights if they need, for instance, a vehicle right away. That particularly accommodates purchasers such as those in country South Australia who may make a trip to Adelaide expressly for the purpose of buying a vehicle the same day.

The new legislation provides that a dealer is entitled to seek a deposit of up to a maximum of 10 per cent of the contract price. If the purchaser decides to rescind the contract, the dealer will be required to refund the money by the end of the next clear business day after receiving the cooling-off notice. The dealer may keep an amount of up to 2 per cent of the contract price or $100, whichever is the lesser.

Another feature of the legislation is the introduction of a negative licensing scheme for salespersons. The scheme requires that dealers check that there are no disqualifying factors, such as criminal convictions, for the salespeople they employ. A person must not act or be employed by a dealer as a salesperson if he or she has been convicted of an indictable offence of dishonesty; or has been convicted of a summary offence of dishonesty during the last 10 years; or is suspended or disqualified from practising or carrying on an occupation, trade or business under a law of a state or territory or commonwealth. The legislation will make it an offence for both the dealer and the salesperson.

Another great feature of the reforms is that from 29 November a person will be presumed to be a dealer if he or she buys or offers to buy, or sells or offers for sale, at least four second-hand vehicles during a period of 12 months, unless they can demonstrate that the vehicles were bought or sold for private purposes. A person and a close associate will be presumed to be dealers if, between them, they buy or offer to sell six or more second-hand vehicles during a 12-month period, unless they can demonstrate that the vehicles were bought or sold for private purposes.

OCBA has written and provided information and brochures detailing the changes directly to dealers. Consumers and traders can obtain further information about the reforms from the Office for Consumer and Business Affairs website. I am confident that dealers are ready for these reforms, which have been made in consultation with the Motor Trade Association, the Royal Automobile Association of South Australia and the Australian Finance Conference. I look forward to the introduction of the new laws on 29 November.

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