Sue McGregor, managing director of Canada, IronPlanet, shares a few important things to keep in mind when making vehicle purchases across the border in the May 9 Issue of Equipment Journal, page A17.
As online auctions of used heavy equipment continue to increase in popularity as a preferred method for purchasing equipment, you want to stay on top of the requirements related to registration documents – especially if you are buying or selling across a border. Each country has different requirements. For example, if you’ve purchased a piece of used, on-road equipment outside of Canada, you understand the importance of a registration document, also known as a certificate of title or vehicle title in the U.S. This is a legal form that establishes a person or business as the owner of an item and accompanies the item as it transfers from the current owner to the new buyer. Here are a few important things to keep in mind when making vehicle purchases across the border.
THE IMPORTANCE OF REGISTRATION DOCUMENTS
Buyers must confirm with Canada’s Registrar of Imported Vehicles (RIV) that a titled vehicle is admissible before it can enter the country. Permission can be withheld depending upon the type of titled vehicle, where it was manufactured, and for which market it was originally made. Additionally, you should always keep registration documents in a place that is accessible to the owner. These registration documents should include: ·· Information about the item, including its vehicle identification number (VIN), license number, make, and year of manufacture. ·· The name and address of the registered owner who will use the machine. ·· Whether money is owed on the vehicle and to whom this money is owed (a lien holder). A bill of sale, which records the transaction between the buyer and seller, is also an important document. Although not always required, this document can provide a more seamless registration process. Since a bill of sale does not prove ownership, buyers need to secure a title or registration document when possible.
IF YOU ARE UNSURE OF THE RULES, SEEK OUTSIDE HELP
Without help from an outside organization— such as Service Alberta or a registry agent in Alberta, Insurance Corporation of British Columbia (ICBC) in British Columbia, or Ontario’s ServiceOntario or your local provincial registry—a buyer might mistakenly purchase a piece of equipment without realizing that it doesn’t have the appropriate registration document. For instance, in the US, all states can issue titles for select types of equipment, including most on-road vehicles and some specialty equipment, but there are some limitations. In some cases, if an item doesn’t have a registration document, the new owner would never be able to acquire one, like in Florida, where a trailer that weighs less than 900 kg (2,000 pounds) can’t receive a title document. In some extreme instances with older equipment, simply having a registration document isn’t enough. Per a rule instated in 1981 by the U.S. National Highway Traffic Safety Administration, all over-theroad-vehicles sold must have a 17-character VIN. Those without the proper 17-character VIN can never be transported into Canada. Also in Quebec all construction equipment is required to be registered while most other provinces do not have this requirement for offroad construction equipment. Buyers must also make sure that all of the proper documents arrive at the Canada-U.S. border 72 hours in advance of the equipment’s arrival. There can be delays and additional fees if the documents are late. Make sure you understand the importance of timing in your purchase decision.
HOW ONLINE MARKETPLACES CAN HELP
To ensure a smooth purchasing process, buyers of used heavy equipment can consult with an online marketplace to help them determine whether it will be worthwhile to bid on a particular item. Ideally, the marketplace will have an internal database that includes information to determine what types of equipment are titled and where, and can also direct prospective buyers to the right resources for Canada’s provinces, since there are different rules for each. The RIV recommends that importers conduct a complete title history search on a vehicle before making a purchase. Ask the marketplace you use to conduct a lien search on the VIN to see if there is a lienholder on the equipment. If there is a lienholder listed but the item’s loan has been paid, the lienholder must release their lien and transfer the title to the new registered owner. Buyers should confirm that the marketplace they are considering buying from discharges all liens on the equipment or vehicles they sell. It’s important that used equipment buyers understand the requirements for registration documents associated with their purchases. With assistance from an online marketplace and local Canadian agencies, buyers can proactively eliminate issues to legally expedite the transport of the equipment or vehicles into Canada. Ensuring you’re doing your due diligence on registration in advance of a purchase will reduce your risk of buying something you cannot use.