From February 1, car owners will have to present a V5 document in order to obtain a vehicle tax disc, making it vital for the appropriate part of the registration document to be passed on to the buyer when the vehicle is sent for auction or sale.
It means fleets could see their end-of-contract company cars rejected by the used car market if they try to dispose of vehicles with incomplete sets of documents.
Manheim Auctions senior group auctioneer Andrew Shepherd said the new ruling would 'cause a major concern to the used car industry as a whole'.
He said: 'The new Government/Driver and Vehicle Licensing Agency ruling on vehicle taxation by V5 only is certainly causing major concerns among the buyers and many major buyers have already asked me to announce whether a V5 is available at the time of sale.
'While this is not a major factor at the moment, it is going to become one by the turn of the year. Buyers who want to bid and buy vehicles will most certainly either 'down price' cars without log books or not bid on them at all.'
Shepherd added: 'Those companies disposing of vehicles really will need to ensure that they have V5 documentation at time of sale, buyers, either retail or wholesale, will not be prepared to have vehicles sat off road until they can apply for a tax disc.
'I can envisage that many companies, finance companies in particular, having major headaches with this ruling of having a V5 in order to apply for road tax. It seems to me that whoever came up with this idea, really has not thought it through for all sectors of the car industry.'
Commenting on the current state of the used car market generally, Shepherd said: 'Volumes around the centres are still just about right for the demand at present and those vendors with a good mix of quality stock are the one's reaping best rewards.
The quality and the quantity sales are definitely best attended at the moment and service histories and documents with vehicles are certainly coming to the fore, more and more.'