Le Lézard
Classified in: Transportation, Business
Subjects: LEG, CPG

CFLA Applauds Ontario Government for its Efforts to Ensure that Auto Financing Companies Can Stay Open for Business


TORONTO, May 17, 2019 /CNW/ - The Canadian Finance & Leasing Association (CFLA) is pleased to announce that a long-awaited resolution to the issue of unlimited vicarious liability for auto lessors has been proposed by the Ontario Government in Bill 107 ("Getting Ontario Moving Act"), introduced on 2 May 2019 by The Hon. J. Yurek, Minister of Transportation.

This policy shift aligns Ontario with all but one Canadian province as well as the entirety of the United States by removing the threat of multi-million-dollar lawsuits arising out of motor vehicle accidents that financing companies have absolutely no connection to, other than merely providing the financing to the individuals to purchase their vehicle. These new measures not only reduce uncertainty for business operations but also help protect the more than 5,000 jobs of Ontarians who work in the auto financing and leasing market.

"The Getting Ontario Moving Act is a much-needed step forward in attaining legal clarity around the issue of unlimited vicarious liability," says Howard Cobham, Senior Vice President, Dealer Services, Canada at GM Financial. "Removing the uncertainty and significant potential negative impact related to this issue will allow the auto industry to continue serving as one of the province's most robust drivers of employment, economic value and community engagement and giving."

The issue of unlimited vicarious liability stems from a provision in the Ontario Insurance Act predating the arrival of ride-hailing companies such as Uber and Lyft. It contains an exception where the $1M liability cap is voided if the leased vehicle is used as a 'taxi' or 'limousine'. This leaves auto lessors, the legal owners of the vehicle, exposed to unlimited vicarious liability for personal injury and all other damage, despite having prohibited commercial use in their leases and having absolutely no control over how the leased vehicle is used.

Unlimited vicarious liability has been an issue of great significance for CFLA and its members ? one that the Association has been working on for years. Thanks to the diligent and patient work of the Association and the active support of CFLA member companies, progress was achieved through an open dialogue on this issue with Ontario senior officials both on the policy and political side.

"CFLA appreciates the Government of Ontario taking the issues of the asset-based finance sector seriously", confirms Michael Rothe, CEO & President of CFLA. "This is a significant step forward for the car industry in this province and the thousands of Ontarians it employs. B.C. now stands alone as the last jurisdiction in all North America where auto lessors face unlimited vicarious liability. The Ontario government has shown great leadership in solving this longstanding problem", Mr. Rothe added.

About the CFLA: The Canadian Finance & Leasing Association (CFLA) represents the asset-based financing, equipment and vehicle leasing industry in Canada. With over $400 billion of assets financed in 2018, this industry is the largest provider of debt financing in the country after the traditional lenders (banks and credit unions). CFLA's 230+ corporate members range from large multinationals to national and smaller regional domestic companies, crossing the financial services spectrum from manufacturers' finance companies and independent leasing companies, to banks, insurance companies, and suppliers to the industry. CFLA members are key partners for Canadian small, medium and large businesses as well as consumers. By facilitating business investment in new machinery, equipment and vehicles, the asset finance industry enhances national productivity with a $50Bn impact on Canada's GDP per year that lifts the living standards of all Canadians.

 

SOURCE Canadian Finance & Leasing Association


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News published on 17 may 2019 at 11:39 and distributed by: