This is a follow up / reminder of an issue we reported on before in Front Line. We have been getting a lot of calls about it so it bears repeating, as it affects garages seeking to charge storage under the Repair and Storage Liens Act as well.

A new regulation came into effect under the Towing and Storage Safety and Enforcement Act (TSSE) on January 1, 2024. The TSSE now requires that tow truck and vehicle storage operators become certified with the Ontario Government and follow a Code of Ethics in order to provide towing or storage services.

Tow truck and vehicle storage operators must also provide customers with additional documentation, information, as well as choice regarding how services are delivered and can only charge customers reasonable rates based on a “maximum fee schedule” which must be filed with the Ontario Ministry of Transportation (MTO).

Be Sure to File a “Maximum Rate Schedule” and Be Ready to Justify Your Prices

Tow truck and vehicle storage operators will be required to submit a schedule setting out the maximum rates that they charge their customers to MTO. This rate schedule should also be made publicly available on the company’s website (if the company has one).

While the TSSE does not establish a set rate which operators can charge, it requires these rates to be a “reasonable amount” and sets out a list of criteria for determining reasonableness which includes an assessment of the rates charged by other operators in the area, previous amounts charged by the operator or other operators in the area, as well as a comparison of the charged rates to those allowable under the Restricted Towing Zones pilot project and other similar programs. Reasonableness will be determined by assessing the time, labour, skill, equipment in light of the importance in keeping the service accessible to members of the public with limited means.

That said, the fee rules under the TSSE will not apply to those acting under an agreement between operators and the Crown. This includes the OPP Tow Program (which already has a pre-authorized fee schedule), MTO’s Provincial Highway Incident Management Limited Financial Program, or the Heavy Tow Program.

Dealers Who Want to Charge Storage Must Register

Dealers will not be considered to be providing vehicle storage services under the TSSE if they do not charge for the service.

The TSSE makes it clear that an organization will not be considered to be a vehicle storage operator to the extent they only store vehicles in order to repair them and do so at no additional cost to the vehicle owner: “vehicle storage yard facility” does not include a lot used by a vehicle repair business, if the storage is ancillary to repairing the motor vehicle and provided at no cost to the vehicle owner or its operator. (“installation d’entreposage de véhicules”)

There are also certain exemptions from the TSSE for vehicle storage services provided in connection with the purchase or lease of a motor vehicle or where this service is provided as part of a membership in an automobile club or association: (3) Sections 20 and 27 of the Act do not apply in respect of the provision of towing services or vehicle storage services where the services are either free of charge or prepaid because the service is provided as part of a membership in an auto- mobile club association or in connection with the purchase or lease of a motor vehicle.

That said, dealers who charge or intend to charge customers for storage will need to be certified in order to do so. Such dealers may apply here: https://tinyurl.com/32c66ern

Members can access the TSSE and its regulations at the following link: https://tinyurl.com/3mec8mmc