Current through Register Vol. 63, No. 9, September 1, 2024
(2) Violations: It is
unfair or deceptive in trade or commerce for any person to advertise motor
vehicles if:
(a) Trade-in Value - The
advertisement for the sale or lease of a motor vehicle claims that a seller
will value property being offered in exchange for payment toward the motor
vehicle: at a specific amount; within a range of specified amounts; at a
guaranteed minimum amount; or as a multiple of or an increase in trade-in
allowance, unless the advertisement:
(A)
References a value cited in a motor vehicle price guide trade publication that
is: nationally recognized and distributed; not published by the seller; and is
readily accessible by the public;
(B) Clearly and conspicuously discloses the
name of the trade publication being referenced;
(C) Clearly and conspicuously includes the
following disclaimer: "THE VALUE OF USED MOTOR VEHICLES VARIES WITH MILEAGE,
USAGE, INCLUDED ACCESSORIES AND CONDITION. BOOK VALUES SHOULD BE CONSIDERED
ESTIMATES ONLY." and
(D) References
the value cited for the geographic region in which the motor vehicle is being
offered for sale, if the publisher of the trade publication publishes and
distributes separate issues for specific geographic
regions.
(b) Dealer
Rebates - The advertisement represents that purchasers of vehicles will receive
a cash rebate, discount certificate, coupon, cash card for products or services
or other similar promotion unless it is offered by a manufacturer or another
party, independent of the dealer and without dealer participation.
OFFICIAL COMMENTARY: Rebates controlled by the
dealer may be illusory because the dealer may simply increase the offering
price or limit the dealer's negotiated price by the same amount as the
ostensible value of the rebate. The rule eliminates this possibility by
prohibiting such rebates. Therefore, no monetary or similar form of
remuneration to a consumer is allowed in the offering of a motor vehicle,
unless it is a promotion paid for by a party wholly independent of the dealer
and that third party is not paid by the dealer for offering the promotion. This
rule does not prohibit associations comprised of multiple competing dealers
from offering a promotion that customers of any dealership in the association
can receive if any amounts the dealers pay to the association are in no way
correlated to the promotion being offered by the association.
(c) Clarification of sale or lease - The
advertisement includes lease and sale offers in the same advertisement without
making a clear and conspicuous distinction as to which terms apply to the sale
and which apply to the lease;
(d)
Invoice advertising - The advertisement represents that motor vehicles are
offered for sale at a price that is compared in any manner to the dealer's
"cost" or terms of essentially identical import unless the advertisement:
(A) Exclusively uses the term "invoice" or
"invoice price"; and
(B) Complies
with the following:
(i) The invoice price
shall be the final price listed on the manufacturer's invoice after subtracting
any amount identified on the invoice as being held back for the dealer's
account, and after subtracting any advertising fees or manufacturer to dealer
rebates or incentives;
(ii)
Purchasers shall be able to purchase any vehicle described by the advertisement
at the offering price;
(iii) The
invoice shall be readily available for inspection by prospective customers;
(iv) The advertisement clearly and
conspicuously states that the invoice price for the sale of the vehicle is the
dealer's actual cost after subtracting all holdbacks, incentives, manufacturer
to dealer rebates, advertising incentives, promotional fees or any other
consideration which will be paid by the manufacturer to the dealer;
(v) A manufacturer to consumer rebate is not
included in the formula to arrive at the "invoice price." Consumers are
entitled to any such rebate in addition to any savings advertised with the
"invoice price" offer; and
(vi) The
vehicles being so advertised have not had aftermarket items, including, but not
limited to, additional goods, accessories, services, products or insurance
added to them at a price higher than the dealer's actual cost.
OFFICIAL COMMENTARY: This rule mandates the use of
the word "invoice" or "invoice price" when any advertisement is compared to a
dealer's cost. The rule makes it clear that all holdbacks and other funds the
dealer will get from the manufacturer must be subtracted from the offering
price. The rule does not require the vehicle be sold for the invoice price, but
only that the invoice price be the reference price used as a starting point.
For example, it is lawful to state a certain model of car is for sale at $500
over invoice price, as long as the referenced adjusted invoice price is after
all of the appropriate subtractions. Also, manufacturer to consumer rebates
belong to the consumer and the consumer is entitled to those rebates in
addition to the advertised "invoice price." This rule does not require the
dealer to subtract promotional and sales incentives that are not known to the
dealer at the time of the advertisement or listed on the invoice, such as
volume sales incentives or special promotional manufacturer to dealer
incentives and incentives that are calculated based upon special criteria. A
dealer or broker may not, however, offer a vehicle for sale referenced to the
invoice price and simply pack the price of the vehicle by adding aftermarket
items not sold at true invoice price. This practice would simply add back
profit on the vehicle and the consumer's cost would not be the invoice price. A
vehicle advertised at invoice must be sold at invoice.
(e) Buy-Down Rates - The
advertisement represents that financing is available for the purchase of motor
vehicles at a buy-down rate unless the advertisement includes a clear and
conspicuous disclosure that the interest rate is not sponsored by the
manufacturer, if such is the case, the amount of the buy-down is reflected in
the Federal Truth in Lending Statement, and the advertisement clearly and
conspicuously states that "the cost of the buy-down may increase the price of
the vehicle." If the buy-down will increase the cost of the vehicle, the dealer
shall offer the consumer the option of purchasing the vehicle without the
buy-down rate at the offering price less the cost of the buy-down. If any
specific terms must be met in order to qualify for the advertised buy-down
rate, they shall be clearly and conspicuously disclosed. Examples are large
down payments, only available to the highest credit ratings, hidden finance
charges, unusual terms of the loan or higher selling prices;
(f) Clear and Conspicuous/Complete Offer -
The advertisement:
(A) Fails to incorporate a
material statement or fails to use any disclosure or disclaimer which is
required by law or by these rules, or without which the advertisement would be
false, incomplete, inaccurate, deceptive or misleading;
(B) Fails to incorporate a material statement
or uses any disclosure or disclaimer which is not presented in a clear and
conspicuous manner;
(C) Uses one or
more footnotes or asterisks which, alone or in combination, confuse,
contradict, materially modify or unreasonably limit the material terms or
availability of any advertised statement; or
(D) Uses images, words, phrases, initials,
abbreviations or any other items which are not clear and conspicuous.
OFFICIAL COMMENTARY: In order for material
information to be "clear and conspicuous," it must be in direct proximity to
the information it defines or clarifies and not in an obscure location of the
advertisement. See the definition of "clear and conspicuous" in OAR
137-020-0020. Each advertisement will be evaluated for its overall impression.
The public should not have to weigh each word, hunt for the hidden meaning of
each statement, or search for inconspicuous disclaimers. Advertisers shall not
advertise by placing important disclosures in small print, inconspicuously
buried at the bottom of the advertisement, or speaking so fast or softly that
an average person cannot understand what is being said. Use of multiple
reference symbols which combine all information together in one paragraph at
the bottom of an advertisement in small print is not clear and conspicuous.
Asterisks or other reference symbols may not be used as a means of
contradicting, disclaiming or substantially changing the meaning of any
advertised statements.
(g) Bait and Switch Rules - An advertisement
offers vehicles for sale or lease, vehicles at a specific or discounted price,
or specific interest rates or credit or finance terms when such assertions are
deceptive, false, misleading or not sincere good faith offers, including, but
not limited to, the following:
(A) Statements
or illustrations used in any advertisement which create a false impression of
the grade, quality, year of model, size, usability, origin, price, interest
rate, down payment, monthly payment, make, value or model of the product
offered, or which misrepresent the product, interest rate or terms of sale or
lease in such a manner that later, on disclosure of the true facts, the
purchaser may be switched from the advertised vehicle to another vehicle or to
a higher interest rate or different credit or finance offer (See 16 CFR
¦ 238, FTC Guides Against Bait Advertising);
(B) Except as otherwise allowed by subsection
(2)(j) of this rule, advertising a motor vehicle for sale or lease when it is
not in the possession of the dealer, willingly shown to the consumer or sold at
the advertised price and terms. If already sold or leased, the advertiser
shall, upon request of a consumer, show proof of the sale or lease of the motor
vehicle which was advertised;
(C)
Using a headline or major theme in an advertisement to make an offer of a low
or special interest rate, down payment or monthly payment which makes it appear
that the special offer applies to all or a majority of vehicles offered in the
advertisement when it only applies to a limited number of vehicles;
(D) Using discount or loss leader price
advertising, unless the advertisement lists, in direct proximity in print type
no less than half as large as the offering price, the number of vehicles
available at the offering price. The listed number of vehicles must be
available on the day the offer is advertised at the offered price;
(E) Using a deceptive, false or misleading
offer to secure the first contact or interview, even if the true facts are
subsequently made known to the consumer;
(F) Using any act or practice to discourage
the purchase of the advertised vehicle as part of a scheme to sell another
vehicle;
(G) Using any act or
practice as part of a scheme to raise the interest rate, the down payment or
the monthly payment to one higher than advertised;
(H) Advertising limited availability of
vehicles, such as "only 1 at this price," in order to induce consumers into a
dealership when the dealership has other similar vehicles available for sale at
the same price or for the same terms;
(I) Offering credit or finance terms,
including, but not limited to, low down payments, low monthly payments or low
interest rates or credit or finance terms, which the advertiser cannot provide,
does not intend to provide, does not want to provide, or which the advertiser
knows or should know are not available or cannot be provided as advertised. The
purpose of the offer is to switch borrowers from the advertised credit or
finance offer to other credit or finance terms, usually at a higher interest
rate or on a basis more advantageous to the person making the offer;
(J) Offering a low monthly lease payment
based upon a capitalized cost reduction that is so large the advertiser knows
or should have known:
(i) It is not a bona
fide offer; or
(ii) It is so much
more than an average capitalized cost reduction that most consumers would not
be expected to make such a large payment for the advertised vehicle.
(h) Limited Offers of
Vehicles, Discounts, Credit or Financing - The offering price or an offer to
lease, a rebate, a discount offer or a special credit or finance offer applies
to a specific vehicle, or to a specific or limited number of vehicles of a
specific model or type, unless:
(A) For new
vehicles, the exact number of vehicles available for which the offer is being
made and the specific models to which the offer applies are clearly and
conspicuously disclosed in type no less than half the size of the type used for
the offer;
(B) Each vehicle is
clearly and conspicuously identified in the advertisement by its vehicle
identification number if there are less than six such vehicles advertised; and
(C) Any advertised vehicle is
available for sale on the day it is advertised.
(i) Offer Limited to Only Eligible Consumers
- An offer, including, but not limited to, one for special finance, credit or
payment terms, rebates or any other special offer made in an advertisement,
applies to a specific or limited number of consumers, unless the following
information is clearly and conspicuously disclosed:
(A) The exact model vehicles for which the
offer is being made; and
(B) All
limitations and conditions of eligibility for the offer, including, but not
limited to, the minimum credit score or tier upon which the offer is based.
OFFICIAL COMMENTARY: This rule is triggered when
there are a "limited" number of consumers to whom an offer applies. If there
are a limited number of consumers to whom the offer applies, the advertisement
must clearly disclose any limitations. If the offer is only available to
consumers with a particular credit score, then the advertisement must clearly
and conspicuously disclose the required minimum credit score. If an offer to
extend credit or financing is limited based on factors other than credit
history, such as past employment, current wages, or a minimum down payment
amount, those factors must be disclosed. It is important to remember that to be
clear and conspicuous the disclosure must be in direct proximity to the offer.
(j) Vehicles Not
Immediately Available - The advertisement uses terms which state or imply that
motor vehicles are in stock or otherwise available for immediate delivery when
they are not. If a motor vehicle is not available for immediate delivery, the
advertisement must clearly and conspicuously state the vehicle's availability
such as it is in transit, on order, or obtainable only by special order or
dealer trade, and that it is not in stock;
(k) Used Vehicle Offers - The advertisement
is for a used vehicle, which was manufactured less than four years prior to the
date of the advertisement, without designating the vehicle as "used." Other
descriptive terms may be substituted for the term used, but not so as to create
ambiguity as to whether the vehicle is new or used. Used vehicles, such as
"dealer demos" or late model vehicles, cannot be displayed in an advertisement
with new vehicles in such a manner that it is difficult to determine if they
are used or new;
OFFICIAL COMMENTARY: Examples of alternative terms
include "lease return," "pre-owned," "dealer demonstrator" or "rental return."
(l) Program and Certified
Vehicles - The advertisement uses the word "program," "certified" or terms of
essentially similar import, unless the advertisement clearly and conspicuously
discloses the nature and benefits of the "program" or "certification" that is
offered with the motor vehicle and the origin and prior use of the vehicle. If
there is an additional cost to the consumer to obtain the program or
certification, that cost must be clearly and conspicuously disclosed in the
advertisement and it must be listed on any purchase or lease agreement;
OFFICIAL COMMENTARY: This rule prohibits use of
terms such as "program" or "certified" unless there is a verifiable benefit
which attaches with the program or certification. The only time these words may
be used are if the manufacturer, dealer or other third party actually has a
special program that attaches to the sale of the used vehicle, such as a
complete inspection for defects, repair of the defects that are discovered,
and/or an additional warranty that is more extensive than the vehicle would
otherwise have without the program. If any program or certification is used in
an advertisement, the advertisement must clearly and conspicuously disclose the
terms and cost, if any, of the program or certification, if that amount is not
already included in the advertised offering price.
(m) Non-negotiable Offers - The advertisement
offers or the dealer posts on any vehicle or uses any words which imply that
the offering price of the vehicle is non-negotiable or that no negotiations are
necessary unless in fact the dealer:
(A) Does
not negotiate the offering price of the advertised vehicles;
(B) Maintains the same price for all
consumers for equivalent vehicles;
(C) Maintains such price unless a general
price adjustment is made which is applicable to all consumers;
(D) Posts the non-negotiable price on all
such vehicles; and
(E) Does not
falsely inflate the value of any trade-in vehicle by such an amount that the
claim that it is a non-negotiable transaction is a sham.
OFFICIAL COMMENTARY: Dealers who engage in any
advertisement that claims that the offering price is not negotiable, that the
advertised price is so low that it is unnecessary to negotiate, or terms of
similar import may not negotiate the offering price of the vehicle once the car
has been offered at a price with such a claim. The non-negotiable price must be
clearly posted on all such vehicles. The dealer may not alter the vehicle price
offered in a particular transaction. Altering a vehicle price includes
"reappraising" a trade-in vehicle, changing the terms of sale, or changing
vehicle features or options where the effect is to alter the net offered
price.
(n) Limited
Offers - The advertisement offers any vehicle without disclosing material
limitations of the terms listed in the offer, including, but not limited to,
the length of time that the offering price is in effect. Advertisements which
do not list any effective dates will be presumed to offer advertised vehicles
at the "advertised price" until such time as the vehicles are subsequently
advertised at different terms or for a period of 30 days, whichever comes
sooner;
(o) Identification as a
Dealer - The advertisement, including, but not limited to, those on the
internet, offers any vehicle for sale and does not prominently identify the
dealer or broker by the complete business name that the dealer or broker uses
in the normal course of its business. When the advertisement is a classified
line advertisement, the dealer or broker may use the word "dealer" or
abbreviation "DLR." The dealer or broker must also display its business name
prominently at any off-site sale location. In the case of an internet
advertisement, the advertisement must state the full name of the dealer, the
dealer's address, telephone number and Oregon dealer license number. If the
internet advertisement is an online auction or small classified line
advertisement with limited space, a hyperlink or web address which leads to all
dealer information may be used. This rule does not apply to dealers providing
vehicles for display purposes only under ORS 822.040(4), but only if the dealer
complies with ORS 822.040(4) and all rules promulgated pursuant to that
statute;
OFFICIAL COMMENTARY: This rule applies even in the
case of special event or off-site sales, such as mall sales or sales conducted
using the name of another prominent business at that business' location. The
dealer or broker must always display its commonly used business name
prominently in any advertisement or at any off-site sale. Creation and use of
an assumed business name that is not used in the normal course of business is
misleading as to what entity is actually offering the vehicles. Purchasers have
an absolute right to know the dealership with which they are doing business and
who is actually conducting the sale. If more than one dealership is involved,
all dealerships participating in the event must be named. If an advertisement
is by a new vehicle regional dealer group, only the name of the regional group
need be identified, not the individual names of all the dealers in the group.
(p) Reference Pricing - The
advertisement claims, implies or could cause a reasonable consumer to believe
that:
(A) A vehicle is reduced in price from
the dealer's former price, or that the price is a percentage or dollar amount
of savings from the dealer's former price, or words to that effect, unless the
dealer actually advertised or has records to substantiate that the vehicle has
been offered for sale at the former price, for no less than 10 days in the
prior 30 days; and
(i) For new vehicles, the
advertisement lists the MSRP; or
(ii) For used vehicles, the advertisement
lists a value cited in a motor vehicle price guide trade publication that is
nationally recognized and distributed, not published by the seller, and is
readily accessible by the public and the value is based upon the year, mileage,
condition and accessories of the vehicle advertised. The advertisement must
specify if it is referencing a retail or wholesale guide; or
(B) A dealer is conducting a sales
promotion or marketing event at which prices have been reduced, when in fact
prices have not been reduced.
(q) Used Car Reference to New MSRP - A used
vehicle advertisement references the original MSRP of the vehicle when it was
new in comparison to its present sales price;
(r) Comparison Price Advertising - The
advertisement explicitly or implicitly claims that the dealer's offering price
is lower than another dealer or dealers', unless the dealer can clearly show,
through verifiable statistical analysis of other prices in the target market
and records of the dealership, that such is the case;
(s) Adjustable Interest - The advertisement
offers an interest rate that is adjustable without clearly and conspicuously
disclosing that the interest rate is adjustable;
(t) Disclosure of MSRP - The advertisement
states an offering price for a new vehicle and does not also state the MSRP of
the vehicle. If the advertisement states the offering price of a new vehicle as
discounted or in any way reduced by a specified amount below the MSRP or the
dealer's sale price, the MSRP, the amount of any discount, rebate, or other
price reduction and the final offering price shall be clearly and conspicuously
displayed in figures. Each figure shall be labeled with a clear and conspicuous
description;
OFFICIAL COMMENTARY: The clearest way to comply
with this rule is to post this information in the form of a mathematical type
equation.
(u) Range of
Prices Advertising - The advertisement states that any vehicles are available
for sale at a range of prices, a range of percentage or fractional discounts, a
specific down payment or a specific monthly payment using the words "as low as"
or "starting at" or words to that effect, unless:
(A) The advertisement clearly and
conspicuously states the number of vehicles available at the lowest offered
term in type no less than half the size of the type used for the offer;
(B) Each vehicle, to which the
offer is applicable, is clearly and conspicuously identified in the
advertisement by make, model, year of manufacture and its vehicle
identification number, if less than 25% of the vehicles advertised are eligible
for the lowest offer. This subsection is not applicable to advertisements
published by a motor vehicle manufacturer;
(C) The highest price or lowest discount in
the range is clearly and conspicuously disclosed in the advertisement in the
same type size;
(D) The offer is
not a major theme or headline in the advertisement, except for when a majority
of the vehicles advertised are eligible for the offer; and
(E) The financing or credit criteria are
clearly and conspicuously disclosed, if a consumer must meet certain minimum
criteria to qualify for the offer.
(v) Limited Rebate Offers - An advertised
offering price includes any rebates or reductions, unless such rebates and
reductions are available to every purchaser or member of the general public
without exception. Rebates or reductions which are not available to every
purchaser or member of the general public, such as "commercial rebate,"
"college graduate rebate," "loyalty rebate," "financing company rebate," or
"first time buyer's rebate," may be listed in the advertisement, but may not be
subtracted from the price so as to reduce the offering price. The offering
price, which is available to every purchaser or member of the general public,
must be prominently displayed in type which is visibly greater than any other
price listed in the advertisement that is not available to the general public.
Any alternate price listed in the advertisement in addition to the offering
price must be one that is reasonably possible for some members of the general
public to obtain;
(w) Factory Sales
- The advertisement uses the terms "factory or manufacturer authorized sale,"
"factory discount outlet," or similar terms indicating that the dealer has been
granted special pricing or distribution privileges by a motor vehicle
manufacturer, unless the dealer is specifically authorized to do so by the
motor vehicle manufacturer. The dealer using such an offer must have written
substantiation before publishing such an advertisement;
(x) Misleading Reasons for Sale - An
advertised sale is one being conducted in a dealer or broker's normal course of
business and a person uses terms or illustrations in the advertisement which
are false or have the capacity or tendency to deceive or mislead consumers as
to the nature of or reason for the sale, including, but not limited to, using:
(A) The terms "liquidator," "auction sale,"
"liquidation sale," "urgent," "disposal sale," "total inventory reduction
sale," "close out," "final clearance," "bank asset sale," "repossession sale,"
"disposal sale," "reprocessed vehicle sale," "authorized distribution center,"
"factory authorized sale" or any similar terms;
(B) The term "public notice" or similar terms
when used in such a manner that it appears to be a publication of any type of
legal notice, court notice or government notice; or
(C) Any terms which imply the sale is an
event of urgent status or the vehicles have unique qualities or benefits or
were specially obtained inventory.
OFFICIAL COMMENTARY: Emergency or distress sales,
including, but not limited to, bankruptcy, inventory reduction, liquidation and
going out of business sales, or any other specific reason for a sale shall not
be advertised unless the stated or implied reason is true. "Selling out,"
"closing out sale," and similar terms shall not be used unless the business
publishing the advertisement is actually going out of business. The term
"liquidation sale" means that the advertiser's business or inventory is in the
process of being liquidated prior to actual closing. Using a business name or
advertising agent that incorporates the term "liquidator," or term of similar
import, in its business name in conjunction with the sale of motor vehicles has
the tendency to mislead consumers as to the nature of the sale and is
deceptive, unless the dealer is actually going out of business. When a dealer
purchases a vehicle for its inventory, the source of its purchase does not
superimpose any special benefit or pricing status upon the vehicle. The fact
that the vehicle was previously a lease or rental return, sold at auction or
repossessed by a lender does not allow the dealer to falsely imply that the
consumer will get a better price on the vehicle because of its prior stature.
This rule does not prohibit a dealer from disclosing that a vehicle is a rental
return; however, the vehicle is simply being sold in the dealer's normal course
of business and cannot be represented to be anything other than that. A new
motor vehicle dealer may use the terms such as "close-out" or "final clearance"
for the sale of inventory that is no longer being manufactured or for year-end
vehicles that are not going to be restocked by the manufacturer. This rule does
not prohibit offers of special sales events held in conjunction with a specific
financial organization, such as a local credit union.
(y) Misrepresenting Down Payment -
Any down payment required for the vehicle transaction is referred to in an
advertisement as a "transfer fee," "reassignment fee," "assumption fee" or any
other words of similar import that do not clearly specify that the amount
referenced is in fact a down payment; or the monthly payment is referred to by
any other term that is not commonly used to describe a monthly payment;
(z) Deceptive Format or Layout -
The advertisement uses any format, layout, headline, assertion, illustration or
type size which has a tendency to mislead or deceive its intended audience
regarding the prices, finance terms, availability or applicability of any offer
made in the advertisement;
OFFICIAL COMMENTARY: Some advertisements
incorporate large amounts of information that, if taken individually, might
communicate valid information regarding the offering of a vehicle. When
combined, however, the combination of inconsistent information makes it
difficult to determine what information is applicable to any other information
or vehicles. Disclaimers may not cure otherwise deceptive messages or
practices. The composition and layout of advertisements should minimize the
possibility of misunderstanding by the reader. Prices, illustrations, or
descriptions should be displayed in an advertisement in such a manner that it
is clear to which vehicles they apply.
(aa) False or Misleading Statements - The
advertiser or advertising agent makes any representation or statement of fact
in an advertisement if the advertiser or advertising agent knows or should know
that the representation or statement is false, confusing or misleading or the
advertiser or advertising agent does not have sufficient information upon which
to base a reasonable belief in the truth of the representation;
OFFICIAL COMMENTARY: Statements made in an
advertisement must be true and specifically applicable to the sale or offer
being made in the advertisement. An example of a violation of this rule is an
advertisement that stated, "National Rental Car Company Files Bankruptcy -
Liquidation Companies Across the County Move to Eliminate Inventory." While
some rental car company may once have filed bankruptcy, the dealerships and
advertising agent which published this advertisement had no vehicles from the
rental car company to sell. Further, no liquidation companies were liquidating
vehicles from a rental car company and none were in any dealers' inventories.
An advertisement may not be false, manipulate the truth or use language that
does not correctly describe the nature of the sale, or the source of ownership
of the vehicles for sale. Superlative advertising claims may be objective
(factual) or subjective (puffery). General superiority claims like "the best"
may only be used in clear puffery, and not on the basis of selective
comparisons. The repeated insistence of superlatives within a script might in
itself amount to a claim of supremacy which would need to be verified.
Qualitative claims of superiority (e.g., "we simply sell for less") which are
open to challenge and/or which are impossible to measure conclusively should be
avoided, except for appropriate mentions in a way which allows that rival
brands may also make the same claim (e.g., "we simply try to sell for less").
(bb) Zero Down
Advertisements - The advertisement uses the phrase "zero down ($0 down)," "no
money down," "a penny down" or words of similar meaning, when a down payment of
any kind is, in fact, required, including, but not limited to:
(A) The consumer must use the vehicle's
rebate as the down payment;
(B) The
consumer must use the equity from the consumer's trade-in as a down payment;
or
(C) The consumer must pay a
security deposit, first month's payment, acquisition fee or any other amount,
other than taxes, license and registration costs or a document processing fee
which are clearly and conspicuously disclosed in the advertisement, at the
inception of the transaction.
OFFICIAL COMMENTARY: If a down payment or fee of
any amount is required at the time of the transaction it is not a "no money
down" offer. This is especially a problem in lease advertising where it is
common to require the first month's payment, a security deposit, and an
acquisition fee at lease inception. If any government fees are required to be
paid at the time of sale or lease, including, but not limited to, title or
registration fees, this information must be clearly and conspicuously disclosed
in the advertisement.
(cc) Rebate Offers - The advertisement offers
the availability of a manufacturer's, lender's or other third party's rebate
unless such advertisement clearly and conspicuously discloses:
(A) The amount of any applicable rebate;
(B) Any conditions, restrictions
or limitations placed on the rebate; and
(C) To which model the rebate applies. If
multiple rebates are applicable in the same advertisement, the models that each
respective rebate applies to must be identified;
(dd) Withdrawal of Advertisement - An
advertisement for the sale or lease of a specific motor vehicle is not
withdrawn or the words "sold" superimposed over the advertisement as fast as
technologically and reasonably possible, based upon the media used for the
advertisement and the frequency of publication, after the motor vehicle is sold
or is no longer available for sale or lease to the general public;
OFFICIAL COMMENTARY: Dealers, advertisers and
advertising agents have the responsibility to monitor their advertisements and
ensure that after a vehicle is sold or leased, or otherwise no longer available
to the public, any advertisement for the vehicle is removed from the media in
which it is published, including, but not limited to, television, radio,
newspapers or the internet. If an internet vehicle advertising company, an
advertising agent or any other publisher has received notice from a dealer that
a vehicle is sold or no longer available, it must remove the advertisement or
superimpose the words "sold" over the advertisement as fast as possible based
upon the type of media in which the advertisement is placed and the frequency
of its publication.
(ee)
Sale Offer May Not be Reduced by Down Payment - The advertised offering price
or monthly payment for the sale of a motor vehicle is calculated by reducing
the offering price by the amount of a down payment, minimum trade-in amount,
deposit or other payment to be made by the purchaser, unless a financial
organization is making the offer, payment by the purchaser is required to meet
the terms of this particular offer and the identity of the financial
organization making the offer is clearly and conspicuously disclosed in the
advertisement;
OFFICIAL COMMENTARY: This rule should be read in
conjunction with OAR 137-020-0020(2)(v) and (3)(c) regarding what fees are
allowed to be excluded from any offering price.
(ff) Price Matching Offers - The
advertisement uses terms "we will meet your best offer" or "we won't be
undersold," or terms of similar import which suggest that a dealer will beat or
match a competitor's price unless:
(A) The
advertisement clearly and conspicuously discloses the price matching policy and
any limitations; and
(B) Such
policy does not require the presentation of any evidence which places an
unreasonable burden on the consumer.
OFFICIAL COMMENTARY: Dealers may not encourage
consumers to make and break contracts in an attempt to offer them a price lower
than the price which they already negotiated with another dealer. A dealer may
always offer to beat another advertised price, but requiring a consumer to
present a purchase order, lease agreement, retail installment contract or other
written proof of an offer from another dealer is an unreasonable burden on the
consumer.
(gg)
False Credit Advertisements - The advertisement makes a false or misleading
offer of credit or makes any false or misleading statement in connection with
an offer of credit, including, but not limited to:
(A) Failing to clearly and conspicuously
disclose all material limitations or conditions of the offer of credit;
(B) Stating that "no credit
application is refused," "no credit application rejected," "all credit
applications are accepted," "we finance anyone," or words of similar import,
unless the offeror can substantiate that all credit applications received by
the offeror have been approved for credit;
(C) Stating that a consumer is "approved" or
"pre-approved" for an offer of credit, or words of similar import, if:
(i) The offer of credit is qualified by
conditions other than the specific criteria used in making a firm offer of
credit pursuant to the Fair Credit Reporting Act or otherwise allowed by FCRA;
(ii) The offer is not a "firm
offer of credit" made pursuant to FCRA; or
(iii) The offer made is false; or
(D) Stating that the dealership
will assist in improving or can improve the consumer's credit record, credit
history or credit rating, unless it is in fact true.
OFFICIAL COMMENTARY: A dealer that sells a retail
installment contract to a financial organization is not assisting a consumer in
improving the consumer's credit record. If the financial organization reports
payments to a consumer reporting agency (aka credit bureau), the consumer's
credit record may be improved if the consumer makes all payments on time.
However, the consumer's credit record may be detrimentally affected if the
consumer does not make timely payments. Other examples of violations of this
rule include: an advertisement for financing when financing is not actually
offered or available by the stated financial organization listed in the
advertisement or the dealership or advertising agent never intended to sell
retail installment contracts to the stated financial organization; an offer
that states consumers are qualified for a loan of $30,000 when the offeror knew
the credit scores used to obtain the names of consumers would only qualify for
loans of a lesser amount; and an advertisement claims that consumers are
approved or pre-approved for credit when the offeror has no basis upon which to
claim a consumer will be approved for credit.
(hh) Alternative Offer Limitations - An
advertisement offers the sale or lease of a motor vehicle with either a special
finance or credit rate or a manufacturer's rebate and fails to clearly and
conspicuously disclose that the consumer is only entitled to receive one or the
other and not both;
OFFICIAL COMMENTARY: It is common for a
manufacturer to offer a special low finance or credit rate or a rebate on a
vehicle at the same time; however, the consumer must make a choice of one or
the other. Advertisements must clearly and conspicuously state, when such a
situation exists, that the consumer may only receive one or the other.
(ii) Misleading Use of
Illustrations - An advertisement uses inaccurate photographs, descriptions or
illustrations when describing specific motor vehicles. However, an advertiser
may use stock illustrations or photos which are substantially similar when an
exact match is not available;
OFFICIAL COMMENTARY: Examples of improper
advertisements include advertising a fully-loaded motor vehicle when the
advertisement actually refers to a minimally-equipped motor vehicle in the text
and a photograph of a four door pickup truck when the advertisement refers to
an extended cab truck. Use of a deceptive illustration is not legitimized by
stating in the advertisement "photo for illustration purposes only" or similar
language.
(jj) False
Advertising - The advertisement is a false advertisement;
(kk) Misleading Initial Term Offers - The
advertisement offers adjustable terms of payment with no payments or low
payments in the beginning of a loan or lease, which then increase after a term
of months unless:
(A) The offer is by a
manufacturer or financial organization as part of a specific loan or lease
offer and no rebates, incentives or other funds that the consumer is entitled
to receive are used to fund the reduction; or
(B) The offer is made by any person using
rebates, incentives or other funds that the consumer is entitled to receive to
fund the reduction and the advertisement clearly and conspicuously discloses
that the offer is available only by using rebates, incentives or other funds
that the consumer is entitled to receive and the use of the rebates, incentives
or other funds as a down payment may be more financially beneficial to the
consumer over the term of the loan or lease.
(ll) Broker Fiduciary Obligation - Any person
advertises as, holds itself out as, or engages in the conduct of a broker and
fails to act in a fiduciary capacity for the consumer;
(mm) Use of Abbreviations - An advertisement
uses any abbreviation which is deceptive, misleading or not commonly understood
by the general public or approved by federal law or state law;
OFFICIAL COMMENTARY: Examples of abbreviations
commonly understood: AC, AM/FM, AUTO, AIR, 2DR, CYL, MSRP, DOC, DOC. PROC. FEE,
or DOC. PROCESS. FEE; abbreviations not commonly understood: WAC, OAC, PEG.
(nn) Misleading Business
Names -Any words are used in a company name or advertisement which would
mislead the public either directly or by implication regarding the nature or
affiliation of a dealer or broker's business. Use of the term "wholesale" or
"wholesaler" shall not be used in a company name affiliated with motor vehicle
sales or leases after January 2, 2008 unless the person actually owns and
operates a motor vehicle business that only sells vehicles wholesale. Any
Oregon dealer or broker that used the term "wholesale" or "wholesaler" in its
business name prior to January 2, 2008 may continue to use that word, except it
must clearly and conspicuously state in any advertisement or display of its
name at its business location words that convey to the public that it is a
retail, not wholesale, motor vehicle business. Use of the term "liquidator"
shall not be used in a company name to sell or advertise motor vehicles, unless
the company is solely in the business of liquidating assets of persons going
out of business and in fact the sale is a going out of business sale;
OFFICIAL COMMENTARY: This rule ensures that words
are not incorporated into a business name that would tend to mislead a consumer
as to the affiliation or nature of a business, the source of its goods or the
type of business being conducted. Examples, other than wholesale, include:
"factory" or "manufacturer," which should not be used in a company name, unless
the advertiser actually owns and operates or directly and absolutely controls
the manufacturing facility that produces the advertised products.
(oo) Negative Equity Trade-in
Disclosure - The advertisement offers to "pay off" any motor vehicle taken in
trade, or words of similar import, unless the advertiser will actually pay off
the outstanding debt, without including the cost as negative equity as part of
the new transaction. If the advertisement makes any statements regarding
accepting any vehicle in trade for the purchase or lease of another vehicle,
the following disclaimer must be used: "NOTICE: Trading in a vehicle will not
eliminate your debt. Negative equity will be added to any purchase or lease."
OFFICIAL COMMENTARY: If a consumer owes $2,000 on
his/her car, but its actual cash trade-in value is only $1,500, that person has
$500 of negative equity that will be added to the purchase price or capitalized
cost of a lease agreement. An advertisement that offers to "pay off" the
balance on a trade-in can easily mislead a consumer to believe that the dealer
is going to "pay off" the negative equity as well.
(pp) Consignment Sales - The advertisement
falsely represents that the vehicle is being sold by an individual owner when a
dealer is selling the vehicle on consignment;
OFFICIAL COMMENTARY: Since the dealer is selling
the vehicle as an agent of the consignor, the dealer may not advertise the
vehicle as "for sale by owner."
Stat. Auth.: ORS 646.608(1)(u)
Stats. Implemented: ORS
646.608(1)(u)
