Ministry targets rogue dealers

The government has detailed how it is using sales data as part of its proactive, education led approach to identify potential unregistered motor vehicle traders.

The Ministry of Business Innovation and Employment (MBIE) says the initiative aims to ensure people are complying with the Motor Vehicle Sales Act 2003.

A key part of its approach is a data matching process developed with the NZTA, which provides monthly vehicle sales statistics for about the past year as part of a memorandum of understanding. 

“This data helps the investigations team to identify sales activity that may indicate a person is required to be registered as a motor vehicle trader,” explains MBIE.

“Each month, investigators review the data and identify a number of individuals whose sales activity may exceed what the act allows. These cases are allocated to investigators and assessed using a consistent process.”

MBIE says it takes an education-first response with the data-match scheme and investigators contact individuals to provide them with information about their obligations under the act. This includes the requirement to be registered if they sell more than six vehicles in any 12 months.

Individuals also have an opportunity to explain their circumstances or clarify their activity.

“In many cases, this early engagement resolves the issue,” adds MBIE. “Most individuals choose to register once they understand the requirements, while others provide information that explains why registration may not be required. 

“Where appropriate, investigators issue education letters to reinforce obligations and support future compliance.

“Where individuals do not respond, provide no explanation, or continue selling vehicles without registering, matters may be escalated. 

“Since the data matching initiative began, several cases have progressed to early enforcement action, with a few now moving towards formal prosecution pathways.”

MBIE says its proactive approach supports early engagement, helps prevent consumer harm and promotes a fair marketplace for compliant traders.

The investigations team is continuing to refine this approach in partnership with NZTA and internal teams, “with a focus on early education, proportionate responses, and effective compliance outcomes”.

Trader obligations

The ministry is also reminding registered motor vehicle traders about their legal obligations and advises that keeping up to date with the law helps businesses avoid non-compliance, complaints and enforcement action.

The Motor Vehicle Sales Act 2003 sets out the main requirements for dealers, including registration, disclosure, record keeping and compliance with consumer protections. 

“Taking a proactive approach to these obligations helps you run your business confidently and lawfully,” says MBIE.

“Successful traders treat legal compliance as an ongoing responsibility, not a one-off task. You should regularly check trusted sources to stay up to date with your obligations and any changes that may affect your business.” 

It suggests such sources include the New Zealand Legislation website and the news and notices page of the Motor Vehicle Traders Register (MVTR).

The ministry highlights post-sale responsibilities as one area where familiarity with the law is particularly important for dealers. 

“Where consumer guarantees apply, traders are expected to address vehicle issues appropriately. This includes carrying out repairs within a reasonable time when required,” it explains.

“Traders who understand these expectations are more likely to act promptly when a customer raises a concern. This means assessing the issue without delay, clearly communicating expected repair timeframes, and arranging repairs efficiently.”

MBIE notes acting early and transparently can reduce frustration for consumers and lower the risk of disputes being escalated to the Motor Vehicle Disputes Tribunal, which has jurisdiction over some claims relating to vehicle sales and consumer guarantees.

Another key obligation under the act is to remain registered while operating as a trader as failure to renew registration on time can expose dealers to compliance risk.

“You can avoid this by regularly checking your certificate of registration, noting the expiry date and renewing well before it lapses,” states MBIE. 

“You must also be able to display your certificate or produce it on demand. Staying familiar with these requirements helps ensure you can continue trading lawfully without interruption.

“Understanding and meeting your legal obligations is not just about avoiding penalties. It also helps build trust with customers, supports fair trading, and protects your reputation as a professional trader.”