National Consumer Credit Protection Amendment Regulations 2010 (No. 4)1
Select Legislative Instrument 2010 No. 333
I, QUENTIN BRYCE, Governor-General of the Commonwealth of Australia, acting with the advice of the Federal Executive Council, make the following Regulations under the National Consumer Credit Protection Act 2009.
Dated 8 December 2010
QUENTIN BRYCE
Governor-General
By Her Excellency’s Command
BILL SHORTEN
Assistant Treasurer
1 Name of Regulations
These Regulations are the National Consumer Credit Protection Amendment Regulations 2010 (No. 4).
2 Commencement
These Regulations commence on 1 January 2011.
3 Amendment of National Consumer Credit Protection Regulations 2010
Schedule 1 amends the National Consumer Credit Protection Regulations 2010.
Schedule 1 Amendments
(regulation 3)
[1] Chapter 3
substitute
Chapter 3 Responsible lending conduct
Part 3.1 Preliminary
26 Definitions
In this Chapter:
disclosure document means any of the following:
(a) a credit guide mentioned in section 113, 126, 127, 136, 149, 150, 158 or 160 of the Act;
(b) a credit proposal disclosure document mentioned in section 121 of the Act;
(c) a lease proposal disclosure document mentioned in section 144 of the Act;
(d) a quote mentioned in section 114 or 137 of the Act.
(e) a precontractual statement or an information statement mentioned in section 16 of the National Credit Code.
licensee — see section 4.1 of Schedule 4.
relevant provision of the Act is a section of the Act which requires a disclosure document to be provided to a consumer.
Part 3.2 Requirements about credit guides
28 Credit guide of credit representatives — contact details for an approved external dispute resolution scheme
For paragraph 158 (3) (a) of the Act, if:
(a) a credit representative is not required to be a member of an approved external dispute resolution scheme; and
(b) the credit representative is not a member of an approved external dispute resolution scheme;
the credit representative is not required to include in the credit representative’s credit guide the contact details for a consumer to access an approved external dispute resolution scheme under paragraph 158 (2) (h) of the Act.
28A Circumstances where credit guide not required
Franchisees
(1) For paragraph 164 (a) of the Act, a person who is a credit representative is exempted from subsection 158 (1) of the Act if:
(a) the person is authorised by:
(i) a licensee; or
(ii) a body corporate that is a credit representative of a licensee;
to engage in specified credit activities on behalf of the licensee; and
(b) the person is:
(i) a franchisee of the licensee under a franchise agreement with the licensee; or
(ii) an employee or director of a franchisee of the licensee who has a franchise agreement with the licensee; and
(c) the franchise agreement:
(i) subjects the person to the policies of the licensee; and
(ii) requires compliance by the person with the policies of the licensee that were made to give effect to the licensee’s obligations under the licensee’s Australian credit licence; and
(d) the credit guide of the licensee explains that the licensee takes responsibility for the credit activities engaged in by the person (or class of persons of which the person is a member).
Previous dealings with consumer
(2) For paragraph 164 (a) of the Act, a person who is a licensee or a credit representative is exempted from subsections 113 (1), 126 (1), 136 (1), 149 (1), 158 (1) or 160 (1) or (2) of the Act if:
(a) the person has, in the previous 12 months, given the consumer the person’s credit guide in accordance with the requirements in the Act; and
(b) if the person would have been required to give contact details for a consumer to access an approved external dispute resolution scheme — the person’s contact details for access to the scheme of which the person is a member have not changed.
Note Regulation 28 sets out circumstances where a credit representative is not required to give contact details for a consumer to access an approved external dispute resolution scheme.
Debt collectors
(3) For paragraph 164 (a) of the Act, a person who is a licensee or a credit representative is exempted from subsection 160 (1) or (2) of the Act if:
(a) the person has given the consumer the person’s credit guide in accordance with the requirements of section 113, 136 or 158 of the Act; and
(b) the credit guide relates to:
(i) the same credit contract as that under which the person is authorised by the credit provider to collect, on behalf of the credit provider, repayments made by the consumer under the credit contract; or
(ii) the same consumer lease as that under which the person is authorised by the lessor to collect, on behalf of the lessor, payments made by the consumer under the consumer lease.
28B Credit guide — circumstances where not required to update information
(1) This regulation is made for subsections 126 (3), 149 (3) and 160 (4) and paragraphs 113 (3) (a), 136 (3) (a) and 158 (3) (a) of the Act.
(2) If information contained in a credit guide changes and requires updating, the updated information, other than the information mentioned in subregulation (3), need not be included in the credit guide given to a consumer if:
(a) the updated information is less than 93 days old; and
(b) the consumer is given a credit guide that contains information that was correct and in accordance with the requirements in the Act at the time it was published.
(3) For subregulation (2), the information is contact details for a consumer to access an approved external dispute resolution scheme, if the person is required to give those contact details.
Note Regulation 28 sets out circumstances where a credit representative is not required to give contact details for a consumer to access an approved external dispute resolution scheme.
Part 3.3 Requirements about quotes
28C Circumstances where no quote required
For subsection 114 (2A) or 137 (2A) of the Act, the circumstances are that:
(a) the licensee’s credit guide includes a statement that the licensee does not impose fees or charges on consumers for providing credit assistance and other services; or
(b) both the following apply:
(i) before the licensee provides credit assistance to a consumer, the licensee does not intend to impose a fee or charge on the consumer for providing the credit assistance or other services;
(ii) the licensee’s proposal disclosure document includes a statement that no fee or charge has been imposed on the consumer for credit assistance and other services provided by the licensee to the consumer.
Part 3.4 Requirements about proposal disclosure documents
[Note: This Part is reserved for future use]
Part 3.5 Other obligations
28J Obligations of credit providers before entering credit contracts or increasing credit limits
For section 128 of the Act, if:
(a) the credit to be provided under the credit contract will be used for the purchase of a residential property; and
(b) the credit will be secured by a mortgage over the property;
the period is 120 days.
Note Section 128 of the Act provides that a licensee must not enter into a credit contract with a consumer, or increase the credit limit of a credit contract with a consumer, on a day unless the licensee has, within 90 days (or other period prescribed by the regulations) before the day, made an unsuitability assessment and made particular inquiries and verification.
28K Exemption — credit assistance provider with shared responsibility for credit contract
(1) For paragraph 164 (a) of the Act, this regulation applies to a person in the following circumstances:
(a) the person is:
(i) a credit assistance provider that:
(A) is an ADI; and
(B) holds an Australian credit licence, or has applied for an Australian credit licence in an application on which ASIC has not made a decision; and
(C) engages in conduct under an agreement with the credit provider; or
(ii) a credit representative of a credit assistance provider mentioned in subparagraph (i);
(b) the credit provider:
(i) is an ADI; and
(ii) holds an Australian credit licence or has applied for an Australian credit licence;
(c) the agreement between the credit provider and the credit assistance provider allows the credit provider to use the credit assistance provider’s name or any other words, phrases, initials or logo associated with the credit assistance provider on the credit contract and any letter or other material;
(d) the credit assistance provider:
(i) provides credit assistance in relation to a credit contract connected with the agreement mentioned in paragraph (c) between the credit provider and the provider of credit assistance; and
(ii) gives to the credit provider the consumer’s details and any other information requested by the credit provider (if it is a reasonable request) in order to enable the credit provider to make an assessment about the credit contract under section 130 of the Act.
(2) The credit assistance provider is exempted from Division 4 and Division 6 of Part 3-1 of the Act in relation to:
(a) a credit contract connected with the agreement mentioned in paragraph (1) (c) between the credit provider and the provider of credit assistance; and
(b) an increase in the credit limit of the credit contract.
(3) Despite subregulation (2):
(a) the credit assistance provider is jointly and severally liable with the credit provider to pay any compensation which the credit provider is ordered to pay to the consumer under section 178 of the Act as a consequence of a breach by the credit provider of Division 4 of Part 3-2 of the Act in relation to a credit contract (including an increase in the credit limit of a contract) connected with the agreement mentioned in paragraph (1) (c) between the credit provider and the provider of credit assistance; and
(b) without prejudice to any other rights or remedies to which a credit provider may be entitled, the credit assistance provider is entitled to be indemnified by the credit provider against any loss or damage suffered by the credit assistance provider through the operation of paragraph (a).
28L Manner of giving disclosure documents
(1) This regulation is made for the following provisions of the Act:
(a) subsection 113 (4) (credit guide of credit assistance providers in relation to credit contracts);
(b) subsection 114 (3) (quote by credit assistance providers in relation to credit contracts);
(c) subsection 121 (4) (credit proposal disclosure document of credit assistance providers in relation to credit contracts);
(d) subsection 126 (4) (credit guide of credit providers in relation to credit contracts);
(e) subsection 127 (4) (credit guide of assignee credit providers in relation to credit contracts);
(f) subsection 136 (4) (credit guide of credit assistance providers in relation to consumer leases);
(g) subsection 137 (3) (quote by credit assistance providers in relation to consumer leases);
(h) subsection 144 (4) (lease proposal disclosure document of credit assistance providers in relation to consumer leases);
(i) subsection 149 (4) (credit guide of lessors in relation to consumer leases);
(j) subsection 150 (4) (credit guide of assignee lessors in relation to consumer leases);
(k) subsection 158 (4) (credit guide of credit representatives);
(l) subsection 160 (5) (credit guide of debt collectors).
(m) section 18 of Schedule 1 (credit provider’s contract document).
(2) In this regulation:
licensee includes a person who is a credit representative of a licensee.
(3) A licensee may, with the consent of the consumer, give a disclosure document to the consumer by:
(a) making the document available for a reasonable period on the licensee’s information system for retrieval by electronic communication by the consumer; and
(b) promptly notifying the consumer by electronic communication that the document is available for retrieval on that information system and the nature of document; and
(c) providing the consumer with the ability to retrieve the document by electronic communication.
(4) A consumer may consent to the giving of documents by electronic communication only after being told that, if consent is given:
(a) paper documents may no longer be given; and
(b) electronic communications must be regularly checked for documents; and
(c) consent to the giving of documents by electronic communication may be withdrawn at any time.
(5) If a disclosure document is given by sending it to a nominated electronic address or in a manner described in this regulation:
(a) it must be in a format that allows it to be saved to an electronic file and to be printed; and
(b) at the time it was sent or was made available on the licensee’s information system, it would have been reasonable to expect that the intended recipient would be able to save it to an electronic file and print it.
(6) If a disclosure document is not given to a consumer personally, or to a person acting on the consumer’s behalf, the licensee must be reasonably satisfied that the consumer has received the disclosure document before engaging in further credit activities in relation to the consumer’s credit contract or consumer lease.
(7) For subregulation (6), a person is not acting on the consumer’s behalf if the person is engaging in credit activities.
(8) The licensee may be reasonably satisfied that a consumer has received a disclosure document (unless the consumer advises the licensee otherwise):
(a) if the disclosure document is a credit guide and was made available to the consumer for retrieval on the licensee’s information system — when the consumer tells the licensee that he or she has accessed the document on the information system; or
(b) in any other case — if the disclosure document was properly addressed to the consumer and sent to that address (including an electronic address or fax number).
(9) Two or more disclosure documents may be combined in a single document only if all other requirements of the Act and these Regulations are met.
Part 3.6 Modifications and exemptions
28M Modifications
Disclosure requirements
(1) For paragraph 164 (d) of the Act, the provisions to which Part 3-7 of Chapter 3 of the Act applies, apply as if the provisions were modified as set out in Schedule 4.
Extended time period for consumer assessment
(2) Subregulation (3) applies to a licensee to whom the rights of a credit provider under a credit contract have been assigned.
(3) For paragraph 164 (d) of the Act:
(a) paragraph 132 (2) (c) of the Act is modified by omitting ‘7 business days’ and inserting ‘15 business days’; and
(b) paragraph 132 (2) (d) is modified by omitting ’21 business days’ and inserting ‘25 business days’.
(4) Subregulation (5) applies to a licensee to whom the rights of a lessor under a consumer lease have been assigned.
(5) For paragraph 164 (d) of the Act:
(a) paragraph 155 (2) (c) of the Act is modified by omitting ‘7 business days’ and inserting ‘15 business days’; and
(b) paragraph 155 (2) (d) is modified by omitting ’21 business days’ and inserting ‘25 business days’.
Note Paragraph 164 (d) of the Act provides that the regulations may provide that Chapter 3 of the Act applies as if specified provisions were omitted, modified or varied as specified in the regulations.
28N Exemption — requirement to provide disclosure documents
(1) For paragraph 164 (a) of the Act, a person who is a licensee or a credit representative engaging in a credit activity is exempted from a relevant provision of the Act, other than section 114 or 137, if:
(a) the person gives the consumer information, in writing, about the contact details for a consumer to access the approved external dispute resolution scheme of which the person is a member; or
(b) the person has given the information mentioned in paragraph (a) to the consumer within the previous 90 days.
(2) The information mentioned in paragraph (1) (a) may be given to the consumer as follows:
(a) in the manner set out in regulation 28L;
(b) together with some or all of the information mentioned in a relevant provision of the Act.
(3) For paragraph 164 (a) of the Act, a person who is a credit representative to whom regulation 28 applies is exempted from a relevant provision of the Act.
Note Regulation 28 sets out circumstances where a credit representative is not required to give contact details for a consumer to access an approved external dispute resolution scheme.
Quotes
(4) For paragraph 164 (a) of the Act, a licensee providing credit assistance to a consumer is exempted from sections 114 and 137 of the Act if:
(a) before the licensee provides credit assistance to a consumer, the licensee has entered into a written contract with the consumer setting out the maximum amount that will be payable by the consumer to the licensee in relation to the licensee’s credit assistance and other services; or
(b) both the following apply:
(i) before the licensee provides credit assistance to a consumer, the licensee does not intend to impose a fee or charge on the consumer for providing the credit assistance or other services;
(ii) the licensee does not impose a fee or charge on the consumer for the licensee’s credit assistance and other services.
(5) This regulation ceases to have effect on 1 April 2011.
[2] After Schedule 3
insert
Schedule 4 Modifications — responsible lending conduct
(regulation 28M)
4.1 Subsection 5 (1), definition of licensee
substitute
licensee means:
(a) a person who holds a licence; or
(b) a person who has applied for a licence before 1 January 2011 in an application on which ASIC has not made a decision.
4.2 After paragraph 114 (1) (e)
insert
(ea) the licensee is not required to give the consumer a quote in the circumstances prescribed by the regulations; and
4.3 After subsection 114 (2)
insert
(2A) The regulations may prescribe circumstances where a licensee is not required to give the consumer a quote in accordance with subsection (2).
4.4 After subsection 114 (4)
insert
No demanding payment if no quote given
(4A) The licensee must not request or demand payment of an amount for the licensee’s credit assistance if the licensee has not given the consumer a quote in accordance with subsection (2).
Civil penalty: 2,000 penalty units.
4.5 Paragraph 121 (2) (e)
omit
made.
insert
made;
4.6 After paragraph 121 (2) (e)
insert
(f) any other information prescribed by the regulations.
4.7 After subsection 121 (3)
insert
(3A) The regulations may prescribe information that need not be included in the credit proposal disclosure document, despite subsection (2).
4.8 After paragraph 137 (1) (d)
insert
(da) the licensee is not required to give the consumer a quote in the circumstances prescribed by the regulations; and
4.9 After subsection 137 (2)
insert
(2A) The regulations may prescribe circumstances in which a licensee is not required to give the consumer a quote in accordance with subsection (2).
4.10 After subsection 137 (4)
insert
No demanding payment if no quote given
(4A) The licensee must not request or demand payment of an amount for the licensee’s credit assistance if the licensee has not given the consumer a quote in accordance with subsection (2).
Civil penalty: 2,000 penalty units.
4.11 Paragraph 144 (2) (d)
omit
lease.
insert
lease;
4.12 After paragraph 144 (2) (d)
insert
(e) any other information prescribed by the regulations.
4.13 After subsection 144 (3)
insert
(3A) The regulations may prescribe information that need not be included in the lease proposal disclosure document, despite subsection (2).
Note
1. All legislative instruments and compilations are registered on the Federal Register of Legislative Instruments kept under the Legislative Instruments Act 2003. See http://www.frli.gov.au.
