Mississippi Administrative Code › Title 30 - Professions and Occupations › Part 1301 - Administrative Regulations for Mississippi Motor Vehicle Commission › Chapter 4 - Vehicle Advertising › Rule 30-1301-4.1

Current through June 25, 2024
Regulation four establishes standards of practices setting
				  forth certain basic principles in advertising the sale and lease of new and
				  used motor vehicles. These standards apply to advertisements both in the print
				  (newspapers, mailers, direct offers, etc.) and electronic media (including the
				  internet).
It is the objective of these standards to implement the
				  intent of the legislature by providing for the regulation of the advertising by
				  licensed new motor vehicle dealers, manufacturers, and distributors, in the
				  interest of furthering truthful and accurate advertising practices for the
				  benefit of the citizens of the State of Mississippi.
The foundation for these standards lies in the Better
				  Business Bureau's "Code of Advertising", the basic principles of which are:
a. The primary responsibility for
				truthful and non-deceptive advertising rests with the advertiser. Advertisers
				must be prepared to substantiate any offers made before publication or
				broadcast and, upon request, present such substantiation.
b. Advertisements which are untrue,
				misleading, deceptive, fraudulent, untruthfully disparaging of competitors, or
				insincere offers to sell, shall not be used.
c. Advertisements should advise customers of
				facts and qualities of a product that will allow a more intelligent
				choice.
d. An advertisement as a
				whole may be misleading although every sentence separately considered is
				literally true. Misrepresentation may result not only from direct statements
				but by omitting or obscuring material facts.
Advertisers, advertising agencies, and media should also be
				  sure that they comply with Federal, State, and local laws and regulations as
				  they relate to advertising and selling practices. The FTC regulates credit
				  advertising under the federal Truth-In-Lending Act: Regulation Z. Consumer
				  leasing is regulated under Truth-In-Lending Act: Regulation M. The Attorney
				  General's Office operates under broad powers that simply say, "Unfair Methods
				  of Any Trade or Commerce are Unlawful." Included, following the standards
				  outlined in Chapter 4, are samples of Regulation Z and M and a few examples of
				  both proper and improper ads.
Amended 8/29/2013
Revised 10/19/2013
Revised 11/20/2013
1.
Employee Pricing
:
				A dealer may not advertise they are selling vehicles at employee pricing unless
				it is a manufacturer's program.
2.
Bait Advertising
: "Bait" advertising is an unfair and
				deceptive practice and shall not be used by any Licensee. Bait advertising is
				an alluring but sincere offer to sell a product, the primary purpose of which
				is to obtain leads to persons interested in buying merchandise of the type
				advertised and to switch consumers from buying the advertised product in order
				to sell some other product at a higher price or on a basis more advantageous to
				the advertiser. Advertising a new motor vehicle at a price which does not
				include all equipment listed as standard equipment by the manufacturer or
				distributor without disclosing such fact, or eliminating any such equipment for
				the purpose of advertising a low price and "baiting" the customer into changes
				above the advertised price is prohibited as misleading and deceptive.
3.
Availability of
				Vehicles
: Where a specific vehicle is advertised by a dealer as
				being for sale, that vehicle should be in the possession of the dealer and
				should be willingly shown and sold as advertised, illustrated, or described at
				the advertised price and terms, at the advertised address. A dealer should have
				on hand a reasonable expectable public demand of all vehicles advertised with
				the equipment advertised at the price advertised. If an advertisement pertains
				to one specific vehicle only, this fact should also be disclosed and a stock
				number identifying the vehicle should be disclosed in the advertisement. In the
				event that a dealer does not have a reasonable expectable public demand of
				vehicles advertised, the advertisement should disclose that quantity is
				limited. This provision should not be construed to prohibit general advertising
				of vehicles by a manufacturer or distributor and the inclusion therein of the
				names and address of the dealers selling such vehicles in the particular
				area.
4.
Untrue
				Claims
: The following statements shall not be used in any
				advertising by any dealer:
a. Statements such
				as "write your own deal", "name your own price", "name your own monthly
				payments", or statements with similar meaning.
b. Statements such as "everybody financed",
				"no credit rejected", "we finance anyone", "all applications accepted" and
				other similar statements representing or implying that no prospective credit
				purchaser will be rejected because of his inability to qualify for
				credit.
c. Statements representing
				that no other dealer grants greater allowances for trade-ins, however stated,
				unless such is the case and information is provided to the Commission before
				the ad is run.
d. Statements
				representing that because of its large sales volume a dealer is able to
				purchase vehicles for less than another dealer selling the same make of
				vehicles, unless such is the case and information is provided to the Commission
				before the ad is run.
5.
Inclusion in Price and Add-ons
: When the price of a
				vehicle is advertised in a local media, the vehicles shall be fully identified
				as to year, make, model, and if new, used, or lease. In addition, the stated
				price must include all charges which the customer must pay for the vehicle,
				including but not limited to, "freight" or "destination charges", "dealer
				preparation", "dealer handling", "additional dealer profit", "additional dealer
				margin", and "undercoating or rust proofing" if the vehicle is already so
				equipped. The advertised price need not include state and local taxes, tags,
				registration, title fees, and doc fee.
We summarize this to be "full disclosure" and the following
				  must be included in a note ad:
* Year./make/model
* Stock number
* Down payment
* Monthly note
* APR
* Number of payments
* With approved credit
* Plus tax, title, and doc fee
6.
Minimum Trade-in
				Allowances
: Since the amount of trade-in allowance will vary
				depending on the condition, model, and age of a buyer's vehicle, no specific
				trade-in amount or range of amounts shall be used in advertising.
7.
Disclosure of Material
				Facts
: Any disclosures about material facts which are contained in
				advertisements and which involve types of vehicles and transactions must be
				made in a clear and conspicuous manner to minimize the possibility of
				misunderstanding by the audience. Factors to be taken into consideration
				include, but are not limited to, ad layout, headlines, illustrations, type
				size, contrast, crawl speed, and editing. Commonly known abbreviations may be
				used in advertising; however, those not generally known shall be
				avoided.
8.
An Asterisk
				(or other characters):
An asterisk (or other characters) may be
				used to give additional information about a word or term; however, use of one
				or more footnotes or asterisks which, alone or in combination, contradict,
				confuse, materially modify or unreasonably limit a principal message of the ad
				should not be used.
a. Used Vehicles -
				vehicles of the current and any preceding model year which are "used" shall be
				clearly identified as such.
b.
				Whenever any advertisement relates to a lease, the advertisement must make
				readily apparent (in the body of the ad and not the disclaimer) to the audience
				that the transaction advertised is a lease.
c. Credit Terms when credit terms are
				advertised, they must comply with the specific disclosure requirements of the
				credit advertising provisions of the "Truth-in-Lending" Act and Regulation
				Z.
d. Lease Terms - when lease
				terms are advertised, they must comply with the specific disclosure
				requirements of the lease advertising provisions of the "Truth-in-Lending" Act
				and Regulation M.
e. Television
				Disclosures - any disclosure appearing in television advertisements must
				clearly feature all necessary information in a manner that can be read and
				understood.
Internet Disclosures any disclosure appearing on the
				  internet must be on the same page of the vehicle advertised.
9.
Disclosure in
				Invoice Ads
: The terms "invoice", "factory invoice", "pay what we
				pay", "dealer invoice" or "dealer cost" shall not be used as a reference price
				(such as, but not limited to, $100 over invoice or dealer cost).
10.
Discounts
: When
				an automotive advertisement contains an offer of a discount on a new vehicle,
				the amount of such discount must be stated who is giving the discount by
				reference to the actual dollar figure to the manufacturer's suggested retail
				price of the vehicle. Discount must not imply the selling price to be below the
				dealer cost.
11.
Rebate, Cash Rebate, Cash Incentives, or Similar Terms
				Offers
: The terms "rebate", "cash rebate", "cash incentives" or
				similar terms may be used only when it is clearly stated who is making the
				payment. Such advertisements must also state that "may affect final negotiated
				price" and customer has the option to determine how it is applied in the sale
				process. Rebates, cash rebates, cash incentives or similar terms must not imply
				the selling price to be below dealer cost.
12.
Free Offer
:
a. The word "Free" may be used in advertising
				whenever the advertiser is offering an unconditional gift.
b. The "Free" offer must be temporary;
				otherwise, it would become a continuous combination offer, no part of which is
				free.
13.
Buy-Down Interest Rates
: No buy-down interest rate may
				be advertised if any of the costs of securing the buy-down are passed on to the
				customer in any way, unless the dealer discloses that contribution by the
				dealership may increase the negotiated price of the vehicle to the
				consumer.
14.
List or
				Sticker Price
: Where the words "list" or "sticker" or words of
				similar import are used in a new automotive advertisement, they should only
				refer to the actual dollar figure of the Manufacturer's Suggested Retail
				Price.
15.
Special
				Status of Dealership
: An automotive advertisement should not
				falsely imply that the dealer has a special sponsorship, approval status,
				affiliation, or connection with the manufacturer that is greater or more direct
				than any other like dealer.
16.
Claims of Under Selling
: Any automotive advertisements
				which makes under selling claims should be capable of being
				substantiated.
17.
Price Equaling
: An advertisement which expresses a
				policy of matching or bettering competitors' prices should fully disclose any
				conditions which apply and specify what evidence a consumer must present to
				take advantage of the offer. Such evidence should not place an unreasonable
				burden on the consumer such as producing a signed contract from another dealer
				or requiring the consumer to find a vehicle with such identical features that
				the possibility of doing so is highly unlikely. Any advertisement stating this
				policy or "guarantee" must show the terms in the actual ad.
18.
Addendum
				Stickers
: Dealers may use addendum stickers when adding equipment
				to vehicles. However, when advertising a discount on a vehicle, the dealer must
				clearly disclose that the discount is based on the dealer addendum price and
				not the factory MSRP.
Example:
Dealership Price
$45,000
Dealer Discount
$ 5,000
Manufacturer MSRP
$40,000
Discount
$ 2,000
Rebate
$ 1,500
19.
Discount Ads
: Ads showing a very low priced vehicle
				that has a disclaimer which says the price is after a sizable customer down
				payment (20% cent; or more of MSRP for new vehicles or 20% or more of selling
				price on used vehicles) or trade equity shall be unlawful and deemed
				unacceptable. Factory lease ads are excluded from this regulation.
20.
Manufacturer's Suggested
				Retail Price
: The suggested retail price dollar figure of a new
				motor vehicle when advertised by a manufacturer, distributor or regional ad
				association shall include all costs and charges for the vehicle advertised,
				except that destination, and state and local taxes, title, and license fees may
				be excluded from such price, provided that the advertisement conspicuously
				states that such costs and charges are excluded. However, with respect to
				advertisements placed with local media in Mississippi by a dealer, such price
				must include all costs and charges for the vehicle advertised including
				destination charges, and may exclude only state and local taxes, license, title
				fees, insurance, and doc fees.
21.
Lease, Balloon or Residual Advertisements
: Vehicle
				lease advertisements shall clearly and conspicuously disclose that the
				advertisement is for the lease of a vehicle, the balloon or residual note
				amount that is due at expiration of the lease, and the customer has the option
				to buy the vehicle at the pre-determined price, or turn vehicle in.
22.
Consolidated
				Loans
: Credit terms which purport to consolidate other bills with
				new car financing, shall not be advertised.
23.
Van Conversion
				Advertisements
: In the case of a modified vehicle, such as a
				converted van, the dealer may advertise using the conversion firms name and
				refer to the chassis manufacturer, but in no case should the dealer advertise
				vans solely by a chassis manufacturers name unless enfranchised to sell that
				make of vehicle.
24.
Demonstrators, Executives, Officials, and Program
				Vehicles
: The word "Demonstrator" shall be understood to refer to
				a vehicle which has never been sold or leased to a member of the public. This
				term shall include vehicles used by new motor vehicle dealers or their
				personnel for demonstrating performance ability but not vehicles purchased and
				used as their personal vehicles. "Demonstrators" may be advertised for sale as
				such only by a dealer franchised for the sale of such make of new vehicles.
				"Executives", "Officials" or "Program Vehicles", when so advertised, shall have
				been used exclusively by executives of the dealer's franchising manufacturer or
				distributor, or by any executive of the franchised dealership. These vehicles,
				so advertised, shall not have been sold or leased to a member of the public
				prior to the appearance of the advertisement. "Demonstrators", "Executives",
				and "Officials" vehicles shall be clearly and prominently qualified as such in
				immediate conjunction with year, make, and model offered.
25.
Auction
: Terms
				such as "Auction" or "Auction Special" and other terms of similar import shall
				be used in connection with vehicles offered or sold at a bona fide auction and
				auctioneer license number given.
26.
Layout Type
				Size
: The layout, headlines, illustrations, or type size of a
				printed advertisement, including billboards, and the broadcast words or
				pictures of radio/TV advertisements shall not covey or permit an erroneous or
				misleading impression as to which vehicle or vehicles are offered at featured
				prices. No advertised offer, expression, or display of price, terms, down
				payment, trade-in-allowance, cash difference, savings or other such material
				terms shall be misleading and any necessary qualifications shall be clearly,
				conspicuously, and accurately set forth to prevent misunderstanding. For
				purposes of these rules, qualifying terms and phrases will be considered to be
				clearly, conspicuously, and accurately set forth if they are:
a. In bold print and type of such size that
				is capable of being read without unreasonable extra effort
b. Expressed in terms that are understandable
				to the buying public
c. In close
				proximity (on the same page) to the qualified representation and not separated
				or buried by asterisk in some other part of the advertisement.
27.
Billboard
				Advertising
: Billboards shall not contain pricing information
				other than the Manufacturer's Suggested Retail Price.
28.
Liquidation
				Sale
: Use of terms "Liquidation Sale", "Public Notice", "Public
				Sale" or similar terms used to connote or imply a court ordered or other forced
				liquidation of assets shall not be advertised, unless such is the
				case.
29.
Changes in
				Monthly Payments
: Changes in monthly payments are not allowed.
				Payments may not go up during contract term and all payments must be split-up
				equally for the length of contract. (Exception: National manufacturer and/or
				distributor plan)
30.
Alternate Payment Terms
: If payments are not based on
				traditional monthly method, (i.e. bi-weekly, weekly, etc.) it must be disclosed
				as such in same size font as shown price and not referenced by use of asterisk,
				character, and/or footnote.
31.
Deferred Payments
: No advertisement shall offer to
				defer the first payment on a credit sale or lease beyond the historic and
				accepted 45 day selective maturity date unless such advertised states with
				equal prominence the fact that the purchaser's own money or equity will be used
				in implementing such deferred payment plan (i.e. 90 days until first payment)
(Exception: National manufacturer and/or distributor payment
				  plan)
32.
Rebates, Cash Back, Cash Incentives, etc
.: When
				advertising an amount to be returned to the buyer, the buyer must be made aware
				that they have the option to determine how the dollar figure is to be used in
				the sale or lease.