Consumer Protection Act Regulations

Link to law: https://www.novascotia.ca/just/regulations/regs/cpregs.htm

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Consumer Protection Act Regulations
made under Section 33 of the

Consumer Protection Act

R.S.N.S. 1989, c. 92

O.I.C. 2000-464 (September 20, 2000), N.S. Reg. 160/2000

as amended to O.I.C. 2015-96 (March 31, 2015, effective June 1, 2015), N.S. Reg. 83/2015

Citation

1     These regulations may be cited as the Consumer Protection Act Regulations.

Agent of lender required to hold permit

2     Every person who

 

                (a)    carries on the business of providing services or goods to a borrower to assistthe borrower in obtaining a loan of money from a lender; or

 

                (b)    holds himself or herself out to be a person as described in clause (a),

 

is deemed to be an agent of a lender for the purposes of the Act and these regulations andis required to hold a valid permit under the Act.

Application

3     (1)    A person may apply for a permit as a lender or an agent under the Act by submittingto the Registrar

 

                (a)    an application in Form D;

 

                (b)    a fee of $133.35;

Clause 3(1)(b) amended: O.I.C. 2015-96, N.S. Reg. 83/2015.

 

                (c)    samples of the forms of any of the following documentation that the lenderproposes to use:

 

                         (i)     credit agreements,

 

                         (ii)    credit application forms,

 

                         (iii)   where variable credit is to be extended, the borrower’s periodicstatement,

 

                         (iv)   where variable rate consumer loans are to be extended, the borrower'sannual statement,

 

                         (v)    the form to be provided to the borrower containing the informationrequired by Section 12;

 

                (d)    such other additional information that the Registrar considers appropriate in thecircumstances.

 

       (2)    The Registrar shall advise an applicant in writing of any defects in the formssubmitted pursuant to clause (1)(c), and the applicant may amend and resubmit theforms.

 

4     The terms and conditions of a permit shall include

 

                (a)    use by the applicant of only those forms approved by the Registrar;

 

                (b)    compliance by the applicant with other relevant legislation, including but notlimited to the Consumer Reporting Act; and

 

                (c)    maintenance of a permanent place of business in Nova Scotia.

Bond

5     (1)    The Registrar may require a lender or agent to deliver a surety bond in an amount of$25 000.00 as a condition of a permit.

 

       (2)    A surety bond required by subsection (1) shall be a penal bond acquired through aregistered surety company approved by the Registrar.

 

       (3)    Where a bond delivered pursuant to this Section is forfeited pursuant to Section 21,the amount due and owing as a debt to Her Majesty by the person bound therebyshall be determined as if Her Majesty suffered such loss or damage as would entitleHer Majesty to the maximum amount of the liability prescribed by the bond.

Suspension or cancellation of permit

6     (1)    Before the Registrar

 

                (a)    refuses to issue a permit to an applicant;

 

                (b)    cancels the permit of a lender or agent; or

 

                (c)    suspends the permit of a lender or agent for a period of more than 12 days,

 

the Registrar shall fix a time and place for a hearing, and not less than 15 daysbefore the date so fixed for the hearing, the Registrar shall give the applicant, lenderor agent written notice of the hearing.

 

       (2)    A notice of hearing under subsection (1) shall set forth the time and place fixed forthe hearing and the particulars of the complaints or the alleged violations of the Actor these regulations in sufficient detail to enable the applicant, lender or agent tomake a full answer, reply or defence.

 

       (3)    An applicant, lender or agent may be represented by counsel at the hearing, callevidence on behalf of the applicant, lender or agent and cross examine under oathany witness giving evidence against the applicant, lender or agent.

 

       (4)    The Registrar shall give a written copy of the decision to the applicant, lender oragent within 30 days of the conclusion of the hearing.

 

       (5)    A notice of hearing under subsection (1) and a written decision of the Registrarunder subsection (4) shall be

 

                (a)     given by registered mail addressed to

 

                         (i)     the applicant, lender or agent at the permanent place of business stated inthe applicant's application form or on the lender's or agent's permit, or

 

                         (ii)    the recognized agent of the applicant, lender or agent within theProvince; or

 

                (b)    delivered by personal service.

 

7     Upon receipt of the notification referred to in subsection 6(4), a lender or agent whosepermit has been suspended or cancelled shall immediately return the lender's or agent'spermit to the Registrar.

 

8     Despite the cancellation or suspension of a lender's or agent's permit, the lender or agentmay collect the lender's or agent's accounts receivable and for that purpose may extend thetime of payment, take and give up security and otherwise deal with borrowers and credittransactions, the contracts for which were entered into before the cancellation orsuspension of the lender's or agent's permit, provided no new credit is extended to aborrower.

Duties of agent

9     (1)    No agent shall require or accept any payment or any security for a payment, directlyor indirectly, for whatever reason, from or on behalf of a borrower in respect of aloan of money until the borrower has actually received the loan.

 

       (2)    Every arrangement by which an agent takes payment, consideration or a security incontravention of subsection (1) is void.

 

10   Before providing services or goods to a borrower to assist the borrower in obtaining a loanof money from a lender, an agent shall provide the borrower with a clear statement inwriting showing

 

                (a)    the name, address, and telephone number of the agent;

 

                (b)    the name and address of the borrower;

 

                (c)    the names and addresses of the lenders from whom the agent will attempt toobtain the loan on behalf of the borrower;

 

                (d)    the amount of the loan;

 

                (e)    the date by which the loan will be made to the borrower; and

 

                (f)    the amount that the agent will charge the borrower for consulting, negotiating,or arranging the loan expressed as a sum in dollars and cents and as apercentage of the amount of the loan.

Cost of borrowing

11   For the purposes of clause 17(1)(h) and subclause 17(3)(a)(i) of the Act, a lender shalldisclose the percentage rate for each period during the term of credit that, when multipliedby the principal amount of the credit outstanding at the end of the period, produces anamount the total of which is equal to the cost of borrowing in relation to the cost expressedas a rate per annum.

 

12   The annual percentage rate of interest calculated and disclosed by a lender to a borrowershall be accurate to within one-eighth of one percent.

 

13   The cost of borrowing in respect of a period shall be calculated by multiplying the portionof the annual percentage rate that the period is of 1 year by the principal amount that isoutstanding at the end of the period.

 

14   (1)    Subject to subsection (2), where a prepayment is made, the cost of borrowing of theamount of principal prepaid shall be calculated by multiplying the amount prepaid bythe number of days that have elapsed since the date of the last payment or the date ofthe extension of credit, as the case may be, and the annual percentage rate anddividing the figure obtained by 365.

 

       (2)    Any payment in respect of credit shall be applied first to pay the accumulated cost ofborrowing of the principal amount of the loan and thereafter to reduce the principalamount of the loan.

 

       (3)    Where a prepayment is made, the prepayment shall be applied first to pay theaccumulated cost of borrowing of the principal amount of the credit extended andthereafter to reduce the principal amount of the loan.

Variable rate credit disclosure

15   For the purposes of subsection 17(1) of the Act, where a lender and borrower agree that anextension of credit is subject to variations in the annual percentage rate, the lender shalldisclose to the borrower,

 

                (a)    pursuant to clause 17(1)(h) of the Act, the percentage that the cost ofborrowing bears to the principal amount of the credit, based on the rateprevailing on the transaction date;

 

                (b)    pursuant to clause 17(1)(g) of the Act, the cost of borrowing based on the rateprevailing on the transaction date;

 

                (c)    that the rate is subject to variation, the basis on which it shall vary and that thisvariation will affect the cost of borrowing disclosed in the statement; and

 

                (d)    on a separate statement, the information specified in Form A.

Variable credit initial disclosure

16   In addition to the requirements of subsection 17(3) of the Act, where a lender extendsvariable credit to a borrower, the lender shall disclose to the borrower, before extending thecredit, a clear statement in writing setting forth

 

                (a)    the term of each period for which a statement of account is furnished;

 

                (b)    the amount in dollars and cents, of any service, transaction, or activity chargeand the manner in which it is calculated;

 

                (c)    the manner, if any, in which the borrower may discharge his or her obligationswithout incurring any cost of borrowing;

 

                (d)    where a credit card is issued, the maximum liability of the borrower in theevent the card is lost or stolen; and

 

                (e)    the manner in which the cost of borrowing is calculated.

Demand note disclosure

17   (1)    Where a lender extends credit to a person in the circumstances to which subsection17(6) of the Act applies and the lender and borrower agree that the extension ofcredit is subject to variations in the annual percentage rate, the lender shall discloseto the borrower in a separate statement the information specified in Form B.

 

       (2)    Where a lender extends credit to a person in the circumstances to which subsection17(6) of the Act applies and the lender and borrower agree that the extension ofcredit is subject to a fixed annual percentage rate, the lender shall disclose to theborrower in a separate statement the information specified in Form C.

Change in rate statement requirements

18   The statement referred to in subsection 17(2) of the Act shall contain the followinginformation:

 

                (a)    the revised rate;

 

                (b)    the effective date of the revision; and

 

                (c)    any modifications to the term or monthly payment resulting from the change inrate.

 

19   The notification referred to in subsection 17(4) of the Act shall contain the followinginformation:

 

                (a)    the revised rate; and

 

                (b)    the effective date of the revision.

Annual statement for variable rate loans

20   Where an extension of credit referred to in subsection 17(1) of the Act is subject tovariations in the annual percentage rate, the lender shall annually issue to the borrower awritten statement showing

 

                (a)    the number of payments made during the year;

 

                (b)    the total dollar amount of the payments made during the year;

 

                (c)    the amount of principal repaid;

 

                (d)    the amount applied to the cost of borrowing; and

 

                (e)    the amount of principal outstanding.

Bond forfeiture provisions

21   A bond delivered pursuant to these regulations shall be forfeited upon the demand of theRegistrar where

 

                (a)    the person in respect of whose conduct the bond is conditioned or anyrepresentative, agent, officer, servant or employee of that person has beenconvicted of

 

                         (i)     an offence under the Act or these regulations, or

 

                         (ii)    an offence under the Criminal Code (Canada) involving fraud or theft orconspiracy to commit an offence involving fraud or theft;

 

                (b)    a judgment arising from a court proceeding in respect of a claim arising out ofa credit transaction has been given against the person in respect of whoseconduct the bond is conditioned or against any representative, agent, officer,servant or employee of that person;

 

                (c)    the person in respect of whose conduct the bond is conditioned commits an actof bankruptcy, whether or not proceedings have been taken under theBankruptcy Act (Canada); or

 

                (d)    a decision has been rendered by the Registrar stating in effect that afterconsideration and investigation of a complaint, the Registrar is satisfied that theperson in respect of whose conduct the bond is conditioned or anyrepresentative, agent, officer, servant or employee of that person

 

                         (i)     has violated the Act or these regulations, or has failed to comply withany of the terms, conditions or restrictions to which the person's permit issubject, or is in breach of any contract to which the Act and theseregulations apply, or

 

                         (ii)    has departed from Nova Scotia, or been out of Nova Scotia and remainsout of Nova Scotia, or in the case of a body corporate, that its name hasbeen stricken from the record of bodies corporate maintained by theRegistrar of Joint Stock Companies,

 

and the conviction, judgment, order or decision has become final by reason oflapse of time or having been confirmed by the highest court to which anyappeal may be taken.

 

22   The Registrar may assign any bond forfeited under the Act or these regulations, or may payover any money recovered under it or recovered from the sale of any collateral security, to

 

                (a)    any person, or to the Public Trustee in trust for the person, who may becomeentitled to it in respect of a credit transaction with the person named in thebond;

 

                (b)    any representative, agent, officer, servant or employee of the person entitledpursuant to clause (a),

 

                (c)    judgment creditors of the person bonded; or

 

                (d)    any trustee, custodian, interim receiver or liquidator of the judgment creditorsreferred to in clause (c),

 

and any assignment or payment made pursuant to this Section shall be in accordance withand upon conditions set forth by Order of the Governor in Council.

 

23   A bond may be terminated by any person bound by it by giving to the Registrar and theprincipal named in the bond at least 2 months notice in writing of intention to terminate,and the bond shall be deemed to be terminated on the date stated in the notice or 2 monthsafter receipt by the Registrar of the notice, whichever is the latest date.

 

24   For the purpose of every act or omission occurring

 

                (a)    during the period in which a permit is in force; or

 

                (b)    during the period prior to the termination of the bond pursuant to theseregulations,

 

every bond shall continue in force and any collateral security shall remain on deposit for aperiod of 3 years following the cancellation of the permit or the termination of the bond, asthe case may be.

 

25   Where a bond has been forfeited and the Registrar has not received notice in writing of anyclaim against the proceeds of the bond or such part as remains in the Registrar's handswithin 3 years of the forfeiture, the Registrar may pay the proceeds of the bond or thecollateral security, or any part remaining, to any person who made a payment under thebond or who deposited the collateral security, after first deducting the amount of anyexpenses incurred in connection with any investigation or otherwise relating to the lenderor agent in respect of whose conduct the bond was conditioned.

 

26   Where a bond in place pursuant to these regulations is terminated, the permit of the lenderor agent shall automatically be cancelled and shall remain cancelled until the lender oragent delivers to the Registrar a new bond in the amount and form required by theRegistrar.

Advertising

27   A lender may disclose cost of borrowing information in addition to the informationrequired by the Act and regulations if the additional information is not stated, utilized orplaced so as to contradict, obscure or distract attention from the information required to bedisclosed.

 

28   In a representation referred to in subsection 20(1) of the Act, where the lender offers theoption of a reduced interest rate or cash rebate, the cash rebate forms part of the cost ofborrowing and, therefore, shall be reflected in the interest rate and disclosed in accordancewith Section 17 of the Act.

 

29   In a representation made by a lender of the type referred to in subsection 20(1) of the Act,

 

                (a)    where the annual percentage rate contained in a print advertisement will onlybe available to the borrower for part of the anticipated term of the creditagreement, the period of time that the advertised rate will be in effect shall beincluded in the advertisement in print of a size that can be easily read; and

 

                (b)    where the annual percentage rate contained in a radio or televisionadvertisement will only be available to the borrower for part of the anticipatedterm of the credit agreement, the period of time that the advertised rate will bein effect shall be given equal prominence in the script, in the case of radio,with the rate referred to in the advertisement and, in the case of a televisionadvertisement, the information required by this Section shall remain on thescreen for a period long enough to be easily read.

 

30   In a representation made by a lender of the type referred to in subsection 20(2) of the Act,the lender shall also disclose the total amount to be repaid.

 

31   In a representation referred to in subsection 20(2) of the Act and Section 30,

 

                (a)    the relevant terms of the credit transaction disclosed in any televisionadvertising shall remain on the screen for a period of time sufficient to enablethe viewer to read the information in its entirety and in a size of print that caneasily be read; and

 

                (b)    the relevant terms of the credit transaction disclosed in any print advertisementshall be of a size that can be easily read.

Form A - Variable Rate Fixed Term Loan

 

Date                                                                                               

Customer's name                                                                           

Account number                                                                            

 

1.    Present balance or amount borrowed                                                                                 

2.    Additional funds                                                                                                                

3.    Official fees                                                                                                                       

4.    Insurance (optional)                                                                                                          

5.    Principal amount of loan                                                                                                   

(1 + 2 + 3 + 4) or

(1 + 3 + 4)

6.    *Cost of borrowing                                                                                                           

       interest in dollars and cents                                             

       other fees                                                                         

7.    **Prevailing annual rate                                                  

8.    Payment                               $                                           

                                                    x                                          

number of months

9.    Total amount to be repaid                                                                                                 

 

*     The cost of borrowing, as stated here, is the difference between the amount to be repaidand the principal amount and is based upon the assumption that the payments required tobe made by the borrower are made as they become due.

 

**   The annual rate indicated above is the rate prevailing on the transaction date. The rate issubject to change in accordance with the policy of the lender (as stated on the loandocument). Changes in the rate will result in changes in the cost of borrowing and amountto be repaid.

Form B - Variable Rate Demand Loan (No Fixed Term)

 

Date                                                                                                 

Customer's name                                                                            

Account number                                                                             

1.    Present balance                                                                       

2.    Additional funds                                                                     

3.    Principal amount (1 + 2)                                                        

4     *Prevailing annual rate                                                            

5     **Cost of borrowing (see examples below)

Schedule of Costs of Borrowing

       Principal amount                                 Annual interest rate in dollars and cents

       outstanding ($)                                     over a 12-month period at various rates

***

                 15%                    16%                      17%

                1000                                              180.00                 192.00                 204.00

                2000                                              360.00                 384.00                 408.00

                3000                                              540.00                 576.00                 612.00

                4000                                              720.00                 768.00                 816.00

                5000                                              900.00                 960.00               1020.00

 

*     The annual rate indicated above is the rate prevailing on the transaction date. The rate issubject to change in accordance with the policy of the lender (as stated on the loandocument).

 

**   Whereas no specific payment amount or time for repayment is specified at the time thisloan is extended, the cost of borrowing shown above has been disclosed in dollars andcents for 1 year (for purpose of example only) at various rates.

 

*** The rate of interest in the centre column represents the rate prevailing on the transactiondate.

 

 

Form C - Fixed Rate Demand Loan (No Fixed Term)

 

Date  

Customer's name                                                                                                               

Account number                                                                                                                 

1.    Present balance                                                                                                           

2.    Additional funds                                                                                                         

3.    Principal amount (1 + 2)                                                                                            

4.    Annual rate                                                                                                                 

5.    *Cost of borrowing (see examples below)                                                                 

 

Schedule of Costs of Borrowing

 

       Principal amount                                                Cost of borrowing in dollars and

       outstanding ($)                                                    cents over a 12-month period

 

1000

2000

3000

4000

5000

 

*     Whereas no specific time for repayment and/or repayment amount is specified at the timethis loan is extended, the cost of borrowing shown has been disclosed in dollars and centsfor 1 year on various loan amounts, based on the annual rate of this credit transaction.

 

 

Form D - Business Permit Application

 

Business name:

 

(operating name)

 

Revenue Canada BN #:                 N.S. Registry of Joint Stock Companies #:                  

 

Civic address (not P.O. box):

 

 

Street #                  Street name                                                                          Unit/Suite/Apt #

 

 

City/Town/County                                    Province                                           Country

 

Postal code

 

Business mailing address (if different):

 

Street, P.O. Box, RR #, Site #, etc.

 

City/Town/County                                    Province                                           Country

 

Postal code

 

Contact information:

 

Primary phone #                                                                                                 Fax #

 

Please check the appropriate item(s)

Type of Permit

Governing Legislation

□   Lender Permit

□   Agent of Lender Permit

Consumer Protection Act

 

For the following 7 questions, please respond for either the individual applicant or each partner (in the case of apartnership applicant), or each officer/director (in the case of a Corporation applicant). Please use theaddendum if additional space is required.

 

1.    Name and address of institution housing the applicant's trust account (if applicable)

 

 

2.    Has the applicant been involved in a personal or corporate bankruptcy?

       No Yes                       

       If yes, give full particulars:                                                                                                   

 

 

3.    Does the applicant have any unpaid judgments outstanding?

       No Yes

 

       If yes, give full particulars:                                                                                                   

 

 

4.    Has the applicant previously held a permit?              No       Yes

       If yes, give full particulars:                                                                                                  

 

 

5.    Has the applicant ever had any permit refused, suspended or revoked?

       No Yes

       If yes, give full particulars:                                                                                                  

 

 

6.    Has the applicant ever been convicted of an offence under the law and not been pardonedor been disciplined by a professional/occupational organization?

       No Yes

       If yes, give full particulars:                                                                                                  

 

 

7.    Will the applicant be employed in any other business or profession?

       No Yes

       If yes, give full particulars:                                                                                                  

 

8.    List all corporation officers, partners of a partnership, or applicants. Include principalcontact for permit correspondence.

 

Last name

First name

Initials

Birth date

D M Y

Address of residence

Position held

Telephone

Active?

      Y N

Last name

First name

Initials

Birth date

D M Y

Address of residence

Position held

Telephone

Active?

      Y N

Last name

First name

Initials

Birth date

D M Y

Address of residence

Position held

Telephone

Active?

      Y N

Last name

First name

Initials

Birth date

D M Y

Address of residence

Position held

Telephone

Active?

      Y N

 

9.    Employment history of the applicant, branch manager, each partner (in the case of apartnership), and each officer/director (in the case of a corporation):

 

Name of Individual

Applicant, Partner orOfficer

Name & Address ofEmployer

Type of Businessof Employer

Nature ofEmployment

Period ofEmployment

(give dates)

From: To:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The undersigned hereby confirms the information presented to be correct to the best ofhis/her knowledge, agrees to abide by the Acts and Regulations governing the permitbeing applied for, and authorizes Service Nova Scotia to verify the information given orsupplied as part of this application with the appropriate sources.

 

 

Authorized signature:

 

Signature of applicant/authorized officer                                                                         Date of application

 

 

Name of applicant/authorized officer (please print)                                                         Title

 

 

Addendum: Please include additional information as required

 

____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________