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This is a Bill, not an Act. For current law, see the Acts databases.
NATIONAL CONSUMER CREDIT PROTECTION BILL 2009
2008-2009
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
National Consumer Credit Protection
Bill 2009
No. , 2009
(Treasury)
A Bill for an Act relating to credit, and for related
purposes
i National Consumer Credit Protection Bill 2009 No. , 2009
Contents
Chapter 1--Introduction
1
Part 1-1--Introduction
1
1
Short title................................................................................ 1
2
Commencement ..................................................................... 2
3
The National Credit Code ...................................................... 2
Part 1-2--Definitions
3
Division 1--Introduction
3
4
Guide to this Part.................................................................... 3
Division 2--The Dictionary
4
5
The Dictionary ....................................................................... 4
Division 3--Definitions relating to the meaning of credit activity
16
6
Meaning of credit activity .................................................... 16
7
Meaning of credit service .................................................... 17
8
Meaning of credit assistance ............................................... 17
9
Meaning of acts as an intermediary .................................... 18
10
Assignees of credit providers, lessors, mortgagees
and beneficiaries of a guarantee........................................... 18
Division 4--Other definitions
20
11
Meaning of approved external dispute resolution
scheme .................................................................................. 20
12
When a business is carried on in this jurisdiction ............... 20
13
Meaning of misleading......................................................... 20
14
Meaning of person--generally includes a partnership ........ 21
15
Meaning of person--generally includes multiple
trustees ................................................................................. 21
16
Qualified privilege ............................................................... 23
Part 1-3--Application of this Act and the Transitional Act
24
Division 1--Introduction
24
17
Guide to this Part.................................................................. 24
Division 2--Constitutional basis and application of this Act and
the Transitional Act
25
18
Constitutional basis for this Act and the Transitional
Act ........................................................................................ 25
19
Meaning of referring State................................................... 26
National Consumer Credit Protection Bill 2009 No. , 2009 ii
20
Meaning of referred credit matters...................................... 28
21
General application of this Act and the Transitional
Act ........................................................................................ 32
22
Acts bind Crown .................................................................. 33
Division 3--Interaction between the Commonwealth credit
legislation and State and Territory laws
34
23
Concurrent operation intended............................................. 34
24
When Commonwealth credit legislation does not
apply..................................................................................... 34
25
Avoiding direct inconsistency between
Commonwealth and State and Territory laws...................... 35
26
Regulations to deal with interaction between laws .............. 36
Chapter 2--Licensing of persons who engage in credit
activities
39
Part 2-1--Require ment to be licensed to engage in credit
activities
39
Division 1--Introduction
39
27
Guide to this Part.................................................................. 39
Division 2--Engaging in credit activities without a licence
40
28
Application of this Division ................................................. 40
29
Prohibition on engaging in credit activities without a
licence .................................................................................. 40
Division 3--Other prohibitions relating to the requirement to be
licensed and to credit activities
42
30
Prohibitions on holding out and advertising etc................... 42
31
Prohibition on conducting business with unlicensed
persons ................................................................................. 43
32
Prohibition on charging a fee etc. ........................................ 43
33
Prohibition on giving misleading information etc. .............. 44
Part 2-2--Australian credit licences
45
Division 1--Introduction
45
34
Guide to this Part.................................................................. 45
Division 2--Australian credit licences
46
35
Australian credit licences ..................................................... 46
Division 3--How to get an Australian credit licence
47
36
Applying for a licence.......................................................... 47
iii National Consumer Credit Protection Bill 2009 No. , 2009
37
When a licence may be granted--applicants other
than ADIs ............................................................................. 47
38
When a licence may be granted--ADIs............................... 49
39
Regulations may prescribe streamlined process for
other applicants .................................................................... 50
40
Licences must not be granted to certain applicants.............. 50
41
Applicant must be given hearing before refusal of
licence .................................................................................. 50
42
Notice of grant or refusal of licence and date of
effect..................................................................................... 51
43
Australian credit licence numbers ........................................ 51
44
Basis on which licence is granted ........................................ 51
Division 4--Conditions on an Australian credit licence
53
45
The conditions on the licence............................................... 53
46
Licence conditions--special procedures for
APRA-regulated bodies ....................................................... 54
Division 5--Obligations of licensees
56
47
General conduct obligations of licensees ............................. 56
48
Requirements for compensation arrangements .................... 57
49
Obligation to provide a statement or obtain an audit
report if directed by ASIC.................................................... 58
50
Obligation to give ASIC information required by the
regulations ............................................................................ 60
51
Obligation to provide ASIC with assistance if
reasonably requested ............................................................ 61
52
Obligation to cite Australian credit licence number ............ 61
53
Obligation to lodge annual compliance certificate .............. 62
Division 6--When a licence can be suspended, cancelled or
varied
64
Subdivision A--Sus pensions and c ancellations
64
54
Suspension or cancellation without hearing......................... 64
55
Suspension or cancellation after offering a hearing............. 64
56
Suspension and cancellation--special procedures for
APRA-regulated bodies ....................................................... 66
Subdivision B--Variations
67
57
Varying licences ................................................................... 67
Subdivision C--Miscellaneous rules about suspensions,
cancellations and variations
67
58
Effect of suspension ............................................................. 67
59
Revocation of suspension..................................................... 67
National Consumer Credit Protection Bill 2009 No. , 2009 iv
60
Date of effect, notice and publication of variation,
cancellation or suspension etc.............................................. 67
61
Statement of reasons ............................................................ 68
62
ASIC may allow licence to continue in force ...................... 68
Part 2-3--Credit representatives and other representatives of
licensees
69
Division 1--Introduction
69
63
Guide to this Part.................................................................. 69
Division 2--Authorisation of credit representatives
70
64
Licensee may authorise credit representatives..................... 70
65
Credit representative that is a body corporate may
sub-authorise natural persons as credit
representatives...................................................................... 71
66
Credit representative of 2 or more licensees ........................ 72
67
A person cannot be a credit representative in relation
to credit activities authorised by a person's licence............. 73
68
Variation and revocation of authorisations and
sub-authorisations ................................................................ 73
69
Obligation not to give authorisation that has no effect ........ 74
70
Obligation to vary or revoke authorisation that ceases
to have effect ........................................................................ 74
71
Obligation to notify ASIC etc. about credit
representatives...................................................................... 75
72
Credit representative numbers ............................................. 77
Division 3--Information about representatives
78
73
ASIC may give licensee information about
representatives...................................................................... 78
Division 4--Liability of licensees for representatives
81
74
Application of this Division ................................................. 81
75
Responsibility if representative of only one licensee........... 81
76
Representatives of multiple licensees .................................. 81
77
Responsibility extends to loss or damage suffered by
client ..................................................................................... 82
78
Effect of this Division .......................................................... 82
Part 2-4--Banning or disqualification of persons from
engaging in credit activities
84
Division 1--Introduction
84
79
Guide to this Part.................................................................. 84
v National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Banning orders
85
80
ASIC's power to make a banning order............................... 85
81
What is a banning order?..................................................... 86
82
Effect of banning orders ....................................................... 87
83
Variation or cancellation of banning orders ......................... 88
84
Date of effect, notice and publication of banning
order, variation or cancellation ............................................ 88
85
Statement of reasons ............................................................ 89
Division 3--Disqualification by the court
90
86
Disqualification by the court................................................ 90
Part 2-5--Financial records, trust accounts and audit reports
91
Division 1--Introduction
91
87
Guide to this Part.................................................................. 91
Division 2--Financial records of licensees
92
88
Obligation to keep financial records .................................... 92
89
How financial records are to be kept ................................... 93
90
Language of financial records .............................................. 93
91
Location of financial records ............................................... 93
92
Information to be shown in financial records ...................... 94
93
Regulations may impose additional requirements ............... 94
94
Financial records taken to be made with licensee's
authority ............................................................................... 95
95
Obligation to retain financial records for 7 years ................ 95
96
Financial records are prima facie evidence of matters......... 96
Division 3--Trust accounts of credit service licensees
97
97
Application of this Division ................................................. 97
98
Obligation for credit service licensees to maintain
trust account ......................................................................... 97
99
Obligations in relation to trust account money .................... 98
100
Obligation to lodge trust account statement and trust
account audit report.............................................................. 99
101
Time of lodgment of trust account statement and
trust account audit report.................................................... 100
Division 4--Matters relating to audit reports
102
102
Auditor's right of access to records, information etc. ........ 102
103
Auditor's fees and expenses............................................... 103
104
Auditor to report on certain matters ................................... 103
105
Qualified privilege for auditor etc...................................... 104
106
Regulations in relation to audit reports etc. ....................... 105
National Consumer Credit Protection Bill 2009 No. , 2009 vi
Part 2-6--Exe mptions and modifications relating to this
Chapter
106
Division 1--Introduction
106
107
Guide to this Part................................................................ 106
Division 2--Exemptions and modifications relating to this
Chapter
107
108
Provisions to which this Part applies ................................. 107
109
Exemptions and modifications by ASIC............................ 107
110
Exemptions and modifications by the regulations ............. 108
Chapter 3--Responsible lending conduct
110
Part 3-1--Licensees that provide credit assistance in relation to
credit contracts
110
Division 1--Introduction
110
111
Guide to this Part................................................................ 110
112
Application of this Part ...................................................... 111
Division 2--Credit guide of credit assistance providers
112
113
Credit guide of credit assistance providers ........................ 112
Division 3--Quote for providing credit assistance etc. in relation
to credit contracts
115
114
Quote for providing credit assistance etc. .......................... 115
Division 4--Obligations of credit assistance providers before
providing credit assistance for credit contracts
117
115
Obligations of credit assistance providers before
providing credit assistance for credit contracts.................. 117
116
Preliminary assessment of unsuitability of the credit
contract............................................................................... 118
117
Reasonable inquiries etc. about the consumer ................... 118
118
When the credit contract must be assessed as
unsuitable--entering contract or increasing the credit
limit .................................................................................... 119
119
When the credit contract must be assessed as
unsuitable--remaining in credit contract ........................... 120
120
Providing the consumer with the preliminary
assessment .......................................................................... 121
Division 5--Fees, commissions etc. relating to credit contracts
123
121
Fees, commissions etc. relating to credit contracts ............ 123
122
No profiting from fees etc. paid to third parties................. 124
vii National Consumer Credit Protection Bill 2009 No. , 2009
Division 6--Prohibition on suggesting, or assisting with,
unsuitable credit contracts
125
123
Prohibition on suggesting or assisting consumers to
enter, or increase the credit limit under, unsuitable
credit contracts ................................................................... 125
124
Prohibition on suggesting to consumers to remain in
unsuitable credit contracts.................................................. 127
Part 3-2--Licensees that are credit providers under credit
contracts
129
Division 1--Introduction
129
125
Guide to this Part................................................................ 129
Division 2--Credit guide of credit providers
130
126
Credit guide of credit providers ......................................... 130
127
Credit guide of credit providers who are assignees ........... 131
Division 3--Obligations of credit providers before entering
credit contracts or increasing credit limits
133
128
Obligations of credit providers before entering credit
contracts or increasing credit limits ................................... 133
129
Assessment of unsuitability of the credit contract ............. 133
130
Reasonable inquiries etc. about the consumer ................... 133
131
When credit contract must be assessed as unsuitable ........ 135
132
Giving the consumer the assessment ................................. 136
Division 4--Prohibition on entering, or increasing the credit
limit of, unsuitable credit contracts
138
133
Prohibition on entering, or increasing the credit limit
of, unsuitable credit contracts ............................................ 138
Part 3-3--Licensees that provide credit assistance in relation to
consume r leases
140
Division 1--Introduction
140
134
Guide to this Part................................................................ 140
135
Application of this Part ...................................................... 141
Division 2--Credit guide of credit assistance providers
142
136
Credit guide of credit assistance providers ........................ 142
Division 3--Quote for providing credit assistance etc. in relation
to consumer leases
145
137
Quote for providing credit assistance etc. .......................... 145
National Consumer Credit Protection Bill 2009 No. , 2009 viii
Division 4--Obligations of credit assistance providers before
providing credit assistance for consumer leases
147
138
Obligations of credit assistance providers before
providing credit assistance for consumer leases ................ 147
139
Preliminary assessment of unsuitability of the
consumer lease ................................................................... 148
140
Reasonable inquiries etc. about the consumer ................... 148
141
When the consumer lease must be assessed as
unsuitable--entering lease ................................................. 149
142
When the consumer lease must be assessed as
unsuitable--remaining in lease .......................................... 150
143
Providing the consumer with the preliminary
assessment .......................................................................... 151
Division 5--Fees, commissions etc. relating to consumer leases
153
144
Fees, commissions etc. relating to consumer leases .......... 153
145
No profiting from fees etc. paid to third parties................. 154
Division 6--Prohibition on suggesting, or assisting with,
unsuitable consumer leases
155
146
Prohibition on suggesting, or assisting with,
unsuitable consumer leases ................................................ 155
147
Prohibition on suggesting to consumers to remain in
unsuitable consumer leases ................................................ 156
Part 3-4--Licensees that are lessors unde r consumer leases
159
Division 1--Introduction
159
148
Guide to this Part................................................................ 159
Division 2--Credit guide of lessors
160
149
Credit guide of lessors........................................................ 160
150
Credit guide of lessors who are assignees .......................... 161
Division 3--Obligations of lessors before entering consumer
leases
163
151
Obligations of lessors before entering consumer
leases .................................................................................. 163
152
Assessment of unsuitability of the consumer lease............ 163
153
Reasonable inquiries etc. about the consumer ................... 163
154
When consumer lease must be assessed as unsuitable....... 164
155
Giving the consumer the assessment ................................. 166
Division 4--Prohibition on entering unsuitable consumer leases
168
156
Prohibition on entering unsuitable consumer leases .......... 168
ix National Consumer Credit Protection Bill 2009 No. , 2009
Part 3-5--Credit representatives
170
Division 1--Introduction
170
157
Guide to this Part................................................................ 170
Division 2--Credit guide of credit representatives
171
158
Credit guide of credit representatives ................................ 171
Part 3-6--Debt collectors
174
Division 1--Introduction
174
159
Guide to this Part................................................................ 174
Division 2--Credit guide of debt collectors
175
160
Credit guide of debt collectors ........................................... 175
Part 3-7--Exe mptions and modifications relating to this
Chapter
177
Division 1--Introduction
177
161
Guide to this Part................................................................ 177
Division 2--Exemptions and modifications relating to this
Chapter
178
162
Provisions to which this Part applies ................................. 178
163
Exemptions and modifications by ASIC............................ 178
164
Exemptions and modifications by the regulations ............. 179
Chapter 4--Remedies
180
Part 4-1--Civil penalty provisions
180
Division 1--Introduction
180
165
Guide to this Part................................................................ 180
Division 2--Declarations and pecuniary penalty orders for
contraventions of civil penalty provisions
181
166
Declaration of contravention of civil penalty
provision............................................................................. 181
167
Court may order person to pay pecuniary penalty for
contravening civil penalty provision.................................. 181
Division 3--General provisions relating to civil penalty
provisions
183
168
Contravening a civil penalty provision is not an
offence................................................................................ 183
169
Involvement in contravention treated in same way as
actual contravention ........................................................... 183
National Consumer Credit Protection Bill 2009 No. , 2009 x
170
Civil evidence and procedure rules for proceedings
relating to civil penalty provisions..................................... 183
171
Criminal proceedings before civil proceedings ................. 183
172
Criminal proceedings during civil proceedings ................. 183
173
Criminal proceedings after civil proceedings .................... 184
174
Evidence given in proceedings for pecuniary penalty
not admissible in criminal proceedings .............................. 184
175
Civil double jeopardy......................................................... 184
Part 4-2--Powe r of the court to grant remedies
186
Division 1--Introduction
186
176
Guide to this Part................................................................ 186
Division 2--Power of the court to grant remedies
187
177
Injunctions.......................................................................... 187
178
Compensation orders.......................................................... 188
179
Other orders to compensate loss or damage....................... 189
180
Orders in relation to unlawful credit activities................... 191
181
Preference must be given to compensate consumers ......... 192
182
Adverse publicity orders .................................................... 193
183
Relief from liability for contravention of civil
penalty provision................................................................ 193
184
Multiple remedies may be granted..................................... 194
Part 4-3--Jurisdiction and procedure of courts
195
Division 1--Introduction
195
185
Guide to this Part................................................................ 195
Division 2--Civil proceedings
196
Subdivision A--Application of this Division
196
186
Application of this Division ............................................... 196
Subdivision B--Conferral of civil juris diction
196
187
Civil jurisdiction of courts ................................................. 196
188
Jurisdiction--decisions to prosecute and related
criminal justice process decisions made by
Commonwealth officers ..................................................... 197
189
Cross-jurisdictional appeals ............................................... 199
190
Courts to act in aid of each other ....................................... 199
Subdivision C--Transfers between courts
200
191
Transfers--application of Subdivision .............................. 200
192
Transfers--exercise of transfer power ............................... 201
193
Transfers--criteria for transfer .......................................... 201
xi National Consumer Credit Protection Bill 2009 No. , 2009
194
Transfers--how initiated.................................................... 202
195
Transfers--documents and procedure ............................... 202
196
Transfers--conduct of proceedings ................................... 203
197
Transfers--entitlement to practise as a lawyer .................. 203
198
Transfers--limitation on appeals ....................................... 203
Subdivision D--Other matters
204
199
Plaintiffs may choose small claims procedure ................... 204
200
Costs only if proceedings brought vexatiously etc. ........... 208
201
Civil proceedings not to be stayed ..................................... 208
202
Standard of proof in civil proceedings ............................... 208
Division 3--Criminal proceedings
210
Subdivision A--Application of this Division
210
203
Application of this Division ............................................... 210
Subdivision B--Conferral of criminal jurisdiction
210
204
Criminal jurisdiction of courts ........................................... 210
205
Criminal proceedings--laws to be applied ........................ 213
206
Criminal proceedings--how taken..................................... 213
207
Certain persons to assist in prosecutions............................ 214
208
Privilege against self-incrimination not available to
bodies corporate in criminal proceedings .......................... 215
Division 4--Proceedings generally
216
209
ASIC's power to intervene in proceedings ........................ 216
210
Evidence of contravention ................................................. 216
211
Power of court to punish for contempt of court ................. 217
Chapter 5--Administration
218
Part 5-1--Registers relating to cre dit activities
218
Division 1--Introduction
218
212
Guide to this Part................................................................ 218
Division 2--Registers relating to credit activities
219
213
Credit registers ................................................................... 219
214
Inspection and public availability of credit registers ......... 220
Part 5-2--Documents lodged with ASIC or require d by this Act
221
Division 1--Introduction
221
215
Guide to this Part................................................................ 221
Division 2--Lodgment of documents with ASIC
222
216
When documents are lodged with ASIC............................ 222
National Consumer Credit Protection Bill 2009 No. , 2009 xii
217
Approved forms for documents to be lodged with
ASIC................................................................................... 222
218
ASIC may refuse to receive document etc......................... 223
Division 3--ASIC's register of documents
225
219
Register of documents lodged with ASIC.......................... 225
220
ASIC may require person to give information for
document registers ............................................................. 225
221
Written document setting out information from
document registers is prima facie evidence of matters ...... 226
Division 4--Other provisions relating to documents lodged with
ASIC or required under this Act
227
222
Certified copy or extract of document lodged with
ASIC is admissible in evidence ......................................... 227
223
ASIC may destroy or dispose of certain documents .......... 227
224
Court may order lodgment of document etc. ..................... 227
225
Offences relating to documents lodged with ASIC
etc. ...................................................................................... 228
Part 5-3--Concealment or falsification of credit books
231
Division 1--Introduction
231
226
Guide to this Part................................................................ 231
Division 2--Prohibitions relating to the concealment or
falsification of credit books
232
227
Concealing etc. of credit books.......................................... 232
228
Falsification of credit books............................................... 233
229
Precautions against falsification of credit books................ 234
Part 5-4--Fees imposed by the National Consume r Credit
Protection (Fees) Act 2009
235
Division 1--Introduction
235
230
Guide to this Part................................................................ 235
Division 2--Fees imposed by the National Consumer Credit
Protection (Fees) Act 2009
236
231
Fees are payable to the Commonwealth ............................ 236
232
Lodgment of document without payment of fee ................ 236
233
Doing act without payment of fee...................................... 236
234
Effect of sections 232 and 233 ........................................... 236
235
Waiver and refund of fees .................................................. 236
236
Debts due to the Commonwealth ....................................... 237
xiii National Consumer Credit Protection Bill 2009 No. , 2009
237
Payment of fee does not give right to inspect or
search ................................................................................. 237
Part 5-5--Other administrative matters
238
Division 1--Introduction
238
238
Guide to this Part................................................................ 238
Division 2--Other administrative matters
239
239
ASIC has general administration of this Act ..................... 239
240
Obstructing or hindering ASIC etc. ................................... 239
241
Approved codes of conduct................................................ 239
242
ASIC may arrange for use of computer programs to
make decisions ................................................................... 240
243
Qualified privilege for information given to ASIC ............ 241
244
ASIC certificate is prima facie evidence of matters .......... 241
245
Operator of approved external dispute resolution
scheme may give information to ASIC.............................. 242
Chapter 6--Compliance and enforcement
243
Part 6-1--Investigations
243
Division 1--Introduction
243
246
Guide to this Part................................................................ 243
Division 2--Investigations
244
247
General powers of investigation ........................................ 244
248
Minister may direct investigations ..................................... 244
249
Interim report on investigation........................................... 245
250
Final report on investigation .............................................. 246
251
Distribution of report ......................................................... 246
Part 6-2--Examination of persons
248
Division 1--Introduction
248
252
Guide to this Part................................................................ 248
Division 2--Examination of persons
249
253
Notice requiring appearance for examination .................... 249
254
Proceedings at examination ............................................... 249
255
Requirements made of examinee ....................................... 249
256
Examination to take place in private.................................. 250
257
Examinee's lawyer may attend .......................................... 250
258
Record of examination ....................................................... 251
259
Giving to other persons copies of record ........................... 251
260
Copies given subject to conditions..................................... 252
National Consumer Credit Protection Bill 2009 No. , 2009 xiv
261
Record to accompany report .............................................. 252
Part 6-3--Inspection of books and audit information-gathering
powe rs
254
Division 1--Introduction
254
262
Guide to this Part................................................................ 254
Division 2--Inspection of books and audit information-gathering
powers
255
263
When certain powers may be exercised ............................. 255
264
ASIC may inspect books without charge ........................... 255
265
Notice to auditors concerning information and books ....... 256
266
Notice to produce books about credit activities ................. 257
267
Notice to produce documents in person's possession ........ 258
268
ASIC may authorise persons to require production of
books, giving of information etc. ....................................... 258
269
Application for warrant to seize books not produced ........ 259
270
Grant of warrant ................................................................. 259
271
Powers if books produced or seized................................... 260
272
Powers if books not produced ............................................ 262
Part 6-4--Proceedings after an investigation
263
Division 1--Introduction
263
273
Guide to this Part................................................................ 263
Division 2--Proceedings after an investigation
264
274
ASIC may prosecute .......................................................... 264
275
ASIC may bring civil proceedings ..................................... 265
Part 6-5--Hearings
266
Division 1--Introduction
266
276
Guide to this Part................................................................ 266
Division 2--Hearings
267
277
Power to hold hearings ....................................................... 267
278
General discretion to hold hearing in public or
private................................................................................. 267
279
Request by person appearing at hearing that it take
place in public .................................................................... 267
280
Certain hearings to take place in private ............................ 268
281
ASIC may restrict publication of certain material ............. 268
282
Who may be present when hearing takes place in
private................................................................................. 269
283
Involvement of person entitled to appear at hearing.......... 269
xv National Consumer Credit Protection Bill 2009 No. , 2009
284
Power to summon witnesses and take evidence................. 270
285
Proceedings at hearings ...................................................... 271
286
ASIC to take account of evidence and submissions .......... 272
287
Reference to court of question of law arising at
hearing................................................................................ 272
288
Protection of ASIC members etc. ...................................... 272
Part 6-6--Offences
274
Division 1--Introduction
274
289
Guide to this Part................................................................ 274
Division 2--Offences
275
290
Contraventions of requirements made under this
Chapter ............................................................................... 275
291
False information ............................................................... 276
292
Obstructing person executing a warrant under this
Chapter ............................................................................... 276
293
Disrupting hearings ............................................................ 277
294
Concealing books relevant to investigation ....................... 277
295
Self-incrimination .............................................................. 278
296
Legal professional privilege............................................... 279
297
Powers of court relating to contraventions of this
Chapter ............................................................................... 280
Part 6-7--ASIC's powe rs in relation to contraventions of this
Chapter
281
Division 1--Introduction
281
298
Guide to this Part................................................................ 281
Division 2--ASIC's powers in relation to contraventions of this
Chapter
282
299
Application of this Part ...................................................... 282
300
Orders by ASIC relating to credit contracts,
mortgages, guarantees or consumer leases ........................ 282
301
Orders under this Part ........................................................ 283
Part 6-8--Evidentiary use of certain material
284
Division 1--Introduction
284
302
Guide to this Part................................................................ 284
Division 2--Evidentiary use of certain material
285
303
Statements made at an examination: proceedings
against examinee ................................................................ 285
National Consumer Credit Protection Bill 2009 No. , 2009 xvi
304
Statements made at an examination: other
proceedings ........................................................................ 285
305
Weight of evidence admitted under section 304 ................ 286
306
Objection to admission of statements made at
examination ........................................................................ 287
307
Copies of, or extracts from, certain books ......................... 288
308
Report under Part 6-1 ......................................................... 289
309
Exceptions to admissibility of report ................................. 289
310
Material otherwise admissible ........................................... 290
Part 6-9--Miscellaneous provisions relating to compliance and
enforcement
291
Division 1--Introduction
291
311
Guide to this Part................................................................ 291
Division 2--Miscellaneous provisions relating to compliance and
enforcement
292
312
Requirement made of a body corporate ............................. 292
313
Evidence of authority ......................................................... 292
314
Giving documents to natural persons................................. 292
315
Place and time for production of books ............................. 293
316
Application of Crimes Act and Evidence Act.................... 293
317
Allowances and expenses................................................... 293
318
Expenses of investigation under Part 6-1........................... 294
319
Recovery of expenses of investigation............................... 294
320
Compliance with this Chapter............................................ 295
321
Effect of this Chapter ......................................................... 295
322
Enforcement of undertakings ............................................. 295
Chapter 7--Miscellaneous
297
Part 7-1--Miscellaneous
297
Division 1--Introduction
297
323
Guide to this Part................................................................ 297
Division 2--Liability of persons for conduct of their agents etc.
298
324
Liability for bodies corporate for conduct of their
agents, employees etc......................................................... 298
325
Liability of persons (other than bodies corporate) for
the conduct of their agents, employees etc. ....................... 299
326
Regulations for the purposes of this Division .................... 300
xvii National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Review of ASIC's decisions
301
327
Review by Administrative Appeals Tribunal of
decisions by ASIC under this Act ...................................... 301
328
Notice of reviewable decision and review rights ............... 301
Division 4--Regulations
303
329
Regulations......................................................................... 303
330
Regulations--where proceedings may be brought ............ 303
331
Regulations--infringement notices.................................... 303
Division 5--Other miscellaneous provisions
304
332
Civil penalty provisions contravened or offences
committed partly in and partly out of this jurisdiction....... 304
333
Contravention of Act does not generally affect
validity of transactions etc. ................................................ 304
334
Contracting out etc. ............................................................ 304
335
Indemnities ......................................................................... 305
336
Acquisition of property ...................................................... 306
337
Minister may delegate prescribed functions and
powers under this Act ........................................................ 306
Schedule 1--National Credit Code
307
Part 1--Preliminary
307
1
Short title............................................................................ 307
2
Interpretation generally ...................................................... 307
3
Meaning of credit and amount of credit............................. 307
4
Meaning of credit contract ................................................ 308
5
Provision of credit to which this Code applies .................. 308
6
Provision of credit to which this Code does not apply ...... 309
7
Mortgages to which this Code applies ............................... 313
8
Guarantees to which this Code applies .............................. 313
9
Goods leases with option to purchase to be regarded
as sale by instalments ......................................................... 314
10
Deciding application of Code to particular contracts
for the sale of land by instalments ..................................... 315
11
Deciding application of Code to particular contracts
for the sale of goods by instalments................................... 316
12
Deciding application of Code to particular contracts
for the sale of goods by instalments under related
contracts ............................................................................. 317
13
Presumptions relating to application of Code .................... 318
National Consumer Credit Protection Bill 2009 No. , 2009 xviii
Part 2--Credit contracts
320
Division 1--Negotiating and making credit contracts
320
14
Credit contract to be in form of written contract
document ............................................................................ 320
15
Other forms of contract ...................................................... 320
16
Precontractual disclosure ................................................... 321
17
Matters that must be in contract document ........................ 321
18
Form and expression of contract document ....................... 327
19
Alteration of contract document ........................................ 327
20
Copy of contract for debtor ................................................ 327
21
When debtor may terminate contract ................................. 327
22
Offence for noncompliance................................................ 328
Division 2--Debtor's monetary obligations
329
23
Prohibited monetary obligations ........................................ 329
24
Offences related to prohibited monetary obligations ......... 329
25
Loan to be in money or equivalent..................................... 330
26
Early payments and crediting of payments ........................ 330
Division 3--Interest charges
332
27
Definitions relating to interest............................................ 332
28
Limit on interest charges .................................................... 332
29
Early debit or payment of interest charges prohibited ....... 333
30
Default interest ................................................................... 333
Division 4--Fees and charges
334
31
Prohibited credit fees or charges ........................................ 334
32
Fees or charges passed on to other parties ......................... 334
Division 5--Credit provider's obligation to account
335
33
Statements of account ........................................................ 335
34
Information to be contained in statements of account ....... 336
35
Opening balance must not exceed closing balance of
previous statement.............................................................. 338
36
Statement of amount owing and other matters................... 339
37
Court may order statement to be provided......................... 340
38
Disputed accounts .............................................................. 340
39
Dating and adjustment of debits and credits in
accounts.............................................................................. 341
Division 6--Certain transactions not to be treated as contracts
343
40
Deferrals, waivers and changes under contracts ................ 343
xix National Consumer Credit Protection Bill 2009 No. , 2009
Part 3--Related mortgages and guarantees
344
Division 1--Mortgages
344
41
Application of Division...................................................... 344
42
Form of mortgage............................................................... 344
43
Copy of mortgage for mortgagor ....................................... 344
44
Mortgages over all property void....................................... 345
45
Restriction on mortgage of future property........................ 345
46
Mortgages and continuing credit contracts ........................ 345
47
All accounts mortgages ...................................................... 346
48
Third party mortgages prohibited ...................................... 346
49
Maximum amount which may be secured ......................... 347
50
Prohibited securities ........................................................... 347
51
Assignment or disposal of mortgaged property by
mortgagor ........................................................................... 348
52
Conditions on consent to assignment or disposal of
property subject to mortgage.............................................. 349
53
Offence for noncompliance................................................ 350
Division 2--Guarantees
351
54
Application of Division...................................................... 351
55
Form of guarantee .............................................................. 351
56
Disclosure........................................................................... 351
57
Copies of documents for guarantor .................................... 351
58
Guarantor may withdraw before credit is provided ........... 352
59
Extension of guarantee....................................................... 352
60
Limitation of guarantor's liability...................................... 353
61
Increase in guarantor's liabilities ....................................... 354
62
Offence for noncompliance................................................ 354
Part 4--Changes to obligations under credit contracts,
mortgages and guarantees
356
Division 1--Unilateral changes by credit provider
356
63
Application of Division...................................................... 356
64
Interest rate changes ........................................................... 356
65
Repayment changes............................................................ 358
66
Credit fees and charges changes ........................................ 359
67
Changes to credit limits etc. in continuing credit
contracts ............................................................................. 360
68
Other unilateral changes by credit provider ....................... 360
69
Particulars of matters as changed only required to be
given under this Division in certain cases .......................... 361
70
Prohibited increases in liabilities ....................................... 361
National Consumer Credit Protection Bill 2009 No. , 2009 xx
Division 2--Changes by agreement of parties
363
71
Changes by agreement ....................................................... 363
Division 3--Changes on grounds of hardship and unjust
transactions
364
72
Changes on grounds of hardship ........................................ 364
73
Notice of change ................................................................ 365
74
Changes by court................................................................ 366
75
Credit provider may apply for variation of change............ 366
76
Court may reopen unjust transactions ................................ 366
77
Orders on reopening of transactions .................................. 369
78
Court may review unconscionable interest and other
charges ............................................................................... 370
79
Applications by ASIC ........................................................ 371
80
Time limit........................................................................... 372
81
Joinder of parties ................................................................ 372
Part 5--Ending and enforcing credit contracts, mortgages and
guarantees
373
Division 1--Ending of credit contract by debtor
373
82
Debtor's or guarantor's right to pay out contract............... 373
83
Statement of pay out figure ................................................ 373
84
Court may determine pay out figure if credit provider
does not provide a pay out figure....................................... 374
85
Surrender of mortgaged goods and goods subject to
sale by instalments ............................................................. 374
86
Compensation to debtor or mortgagor ............................... 377
87
One-off notice to be given the first time a direct debit
default occurs ..................................................................... 377
Division 2--Enforcement of credit contracts, mortgages and
guarantees
379
88
Requirements to be met before credit provider can
enforce credit contract or mortgage against
defaulting debtor or mortgagor .......................................... 379
89
Defaults may be remedied.................................................. 382
90
Requirements to be met before credit provider can
enforce guarantee against guarantor .................................. 382
91
Requirements to be met before credit provider can
repossess mortgaged goods ................................................ 383
92
Acceleration clauses ........................................................... 383
93
Requirements to be met before credit provider can
enforce an acceleration clause............................................ 384
xxi National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Postponement of enforcement proceedings
386
94
Postponement of exercise of rights .................................... 386
95
Effect of negotiated postponement .................................... 386
96
Postponement by court....................................................... 387
97
Credit provider may apply for variation of
postponement order............................................................ 388
Division 4--Enforcement procedures for goods mortgaged
389
98
Information as to location of mortgaged goods ................. 389
99
Entry to residential property to take possession of
goods .................................................................................. 389
100
Court may order entry ........................................................ 390
101
Order for possession........................................................... 390
102
Procedures to be followed by credit provider after
taking possession of goods................................................. 390
103
Mortgagor may nominate purchaser of goods taken
by credit provider ............................................................... 392
104
Sale of goods by credit provider ........................................ 392
105
Matters for which account can be debited after
mortgagee sale of goods ..................................................... 393
106
Compensation to mortgagor............................................... 393
Division 5--Enforcement expenses
395
107
Recovery of enforcement expenses.................................... 395
Division 6--Mortgagor's remedies
396
108
Mortgagor may apply to regain possession of
mortgaged goods ................................................................ 396
109
Order for possession for mortgagor ................................... 396
110
Ancillary or consequential orders ...................................... 397
Part 6--Civil penalties for defaults of credit providers
398
Division 1--Civil penalties for breach of key disclosure and
other requirements
398
111
Key requirements ............................................................... 398
112
Application for order relating to key requirements............ 399
113
Civil penalty may be imposed for contravention of
key requirement.................................................................. 399
114
Penalty if application made by debtor or guarantor ........... 401
115
Payment of penalty to debtor or guarantor......................... 401
116
Penalty if application made by a credit provider or
ASIC................................................................................... 402
117
Payment of penalty............................................................. 402
118
Compensation for debtor or guarantor ............................... 402
National Consumer Credit Protection Bill 2009 No. , 2009 xxii
119
General provisions relating to applications by credit
providers or ASIC .............................................................. 403
120
ASIC may represent interests of debtors............................ 403
121
Directions pending court's decision................................... 403
122
Offences ............................................................................. 404
123
Time limit for application for orders under this
Division .............................................................................. 404
Division 2--Other civil penalties
405
124
Civil effect of other contraventions ................................... 405
Part 7--Related sale contracts
406
Division 1--Interpretation and application
406
125
Meaning of sale contract ................................................... 406
126
Sale contracts to which this Part applies ............................ 406
127
Linked credit providers and tied credit contracts............... 406
Division 2--Liability of credit providers for suppliers'
misrepresentations
408
128
Credit provider liable with respect to supplier's
misrepresentations etc. about tied credit contract .............. 408
Division 3--Liability of credit providers in relation to goods
409
129
Right to damages under sale contract against both
supplier and linked credit provider (cf. section 73 of
the Trade Practices Act 1974) ........................................... 409
130
Limits on debtor's right of action against linked
credit provider (cf. section 73 of the Trade Practices
Act 1974) ............................................................................ 410
131
Liability of supplier to linked credit provider (cf.
section 73 of the Trade Practices Act 1974)...................... 413
132
Interest may be awarded (cf. section 73 of the Trade
Practices Act 1974) ............................................................ 413
133
Subrogation of credit provider (cf. section 73 of the
Trade Practices Act 1974) ................................................. 413
Division 4--Termination of related transactions
415
134
Termination of sale contract which is conditional on
obtaining credit .................................................................. 415
135
Termination of (or recredit under) tied credit contract
if sale contract terminated .................................................. 415
136
Termination of linked maintenance services contract
if credit contract terminated ............................................... 417
137
Termination of contract under this Part to be in
writing ................................................................................ 418
xxiii National Consumer Credit Protection Bill 2009 No. , 2009
138
Powers of court with respect to termination of
contract under this Part ...................................................... 418
139
Part 5 not to apply to termination of contract under
this Part .............................................................................. 418
Division 5--Other provisions
419
140
Requirement as to source of credit for goods or
services ............................................................................... 419
141
Prohibition on payment for goods or services by
postdated bills of exchange or notes which exceed
cash price of goods or services .......................................... 419
Part 8--Related insurance contracts
420
142
Interpretation and application ............................................ 420
143
Requirement to take out insurance or to insure with
particular insurer or on particular terms............................. 420
144
Financing of insurance premiums over mortgaged
property .............................................................................. 421
145
Commission for consumer credit insurance....................... 422
146
Supply of copy of credit-related insurance contract
by insurer............................................................................ 423
147
Rejection of debtor's proposal for insurance ..................... 423
148
Termination of consumer credit insurance contract if
credit contract terminated................................................... 424
149
Termination of insurance contract over mortgaged
property if credit contract terminated................................. 424
Part 9--Advertising and related conduct
426
150
Advertising......................................................................... 426
151
Persons liable for advertisements....................................... 427
152
Defence .............................................................................. 427
153
Interest rates which may be disclosed................................ 427
154
False or misleading representations ................................... 428
155
Harassment......................................................................... 428
156
Canvassing of credit at home ............................................. 428
Part 10--Comparison rates
430
Division 1--Preliminary
430
157
Object of Part ..................................................................... 430
158
Part not to apply to continuing credit contracts ................. 430
159
Definitions.......................................................................... 430
Division 2--Comparison rate in credit advertising
432
160
Comparison rate mandatory in advertisements
containing annual percentage rate...................................... 432
National Consumer Credit Protection Bill 2009 No. , 2009 xxiv
161
The relevant comparison rate ............................................. 432
162
Information about comparison rate .................................... 432
163
Warning about comparison rate ......................................... 433
164
Other requirements for comparison rate ............................ 433
Division 3--Comparison rate in other documents
435
165
Comparison rates in documents other than credit
advertising .......................................................................... 435
Division 4--Miscellaneous
436
166
Calculation of comparison rates......................................... 436
167
Compliance grace period following changes in
interest or fees .................................................................... 436
168
Regulations--exemptions and other matters ..................... 436
Part 11--Consumer leases
437
Division 1--Interpretation and application
437
169
Meaning of consumer lease ............................................... 437
170
Consumer leases to which this Part applies ....................... 437
171
Consumer leases to which this Part does not apply ........... 438
172
Presumptions relating to application of this Part ............... 439
Division 2--Form of and information to be included in consumer
leases
441
173
Form of consumer lease ..................................................... 441
174
Disclosures in consumer leases .......................................... 441
175
Copy of lease etc. for lessee............................................... 442
176
Further goods and deferrals or waivers under
consumer leases.................................................................. 442
Division 3--Other provisions applicable to consumer leases
444
177
Application of certain Code provisions to consumer
leases .................................................................................. 444
178
Notice of repossession ....................................................... 444
179
Termination of lease........................................................... 445
Part 12--Miscellaneous
446
Division 1--Tolerances and assumptions
446
180
Tolerances and assumptions relating to information ......... 446
181
Tolerances relating to contracts and other documents ....... 447
182
Regulations......................................................................... 448
Division 2--Documentary provisions
449
183
Form of notices .................................................................. 449
184
Legibility and language...................................................... 449
xxv National Consumer Credit Protection Bill 2009 No. , 2009
185
Copies of contracts and other documents .......................... 450
186
Signing of documents......................................................... 450
187
Electronic transactions and documents .............................. 451
Division 3--General provisions
452
188
Assignment by credit provider ........................................... 452
189
Assignment by debtor, mortgagor or guarantor ................. 452
190
Appropriation of payments ................................................ 452
191
Contracting out................................................................... 453
192
Indemnities ......................................................................... 453
193
Effect of noncompliance .................................................... 454
194
Giving notice or other document ....................................... 454
195
Manner of giving notice or other document....................... 456
196
Date of notice or other document....................................... 457
197
Extensions of time.............................................................. 457
198
Orders of court ................................................................... 457
199
Conduct of agents and related matters ............................... 458
Division 4--Provisions relating to offences
459
200
Offences by officers, agents or employees ........................ 459
201
Offences by corporations ................................................... 459
202
Limitations ......................................................................... 459
203
Application of section 4K of the Crimes Act 1914 ............ 459
Part 13--Principal definitions
460
204
Principal definitions ........................................................... 460
Part 14--Miscellaneous provisions relating to interpretation
470
Division 1--Preliminary
470
205
Displacement of Part by contrary intention ....................... 470
Division 2--General
471
206
Material that is, and is not, part of this Code ..................... 471
207
References to particular Acts and to enactments ............... 471
208
Compliance with forms ...................................................... 471
Division 3--Terms and references
473
209
Provisions relating to defined terms and gender and
number ............................................................................... 473
210
Meaning of may and must etc. ........................................... 473
211
Effect of express references to bodies corporate and
individuals .......................................................................... 473
212
Reference to certain provisions of Code ............................ 474
213
Reference to provisions of this Code or an Act is
inclusive ............................................................................. 474
National Consumer Credit Protection Bill 2009 No. , 2009 xxvi
Division 4--Functions and powers
476
214
Power to make instrument or decision includes
power to amend or repeal................................................... 476
215
Matters for which statutory instruments may make
provision............................................................................. 476
216
Presumption of validity and power to make ...................... 477
217
Exercise of powers between enactment and
commencement .................................................................. 478
Division 5--Distance, time and age
481
218
Matters relating to distance, time and age.......................... 481
National Consumer Credit Protection Bill 2009 No. , 2009 1
A Bill for an Act relating to credit, and for related
1
purposes
2
The Parliament of Australia enacts:
3
Chapter 1--Introduction
4
Part 1-1--Introduction
5
6
1 Short title
7
This Act may be cited as the National Consumer Credit Protection
8
Act 2009.
9
Chapter 1 Introduction
Part 1-1 Introduction
Section 2
2 National Consumer Credit Protection Bill 2009 No. , 2009
2 Commence ment
1
(1) Each provision of this Act specified in column 1 of the table
2
commences, or is taken to have commenced, in accordance with
3
column 2 of the table. Any other statement in column 2 has effect
4
according to its terms.
5
6
Commencement information
Column 1
Column 2
Column 3
Provision(s)
Commencement
Date/Details
1. Sections 1 and
2 and anything in
this Act not
elsewhere covered
by this table
The day on which this Act receives the
Royal Assent.
2. Sections 3 to
337 and
Schedule 1
A single day to be fixed by Proclamation.
However, if any of the provision(s) do not
commence with in the period of 6 months
beginning on the day on which this Act
receives the Royal Assent, they commence
on the first day after the end of that period.
Note:
This table relates only to the provisions of this Act as originally
7
passed by both Houses of the Parliament and assented to. It will not be
8
expanded to deal with provisions inserted in this Act after assent.
9
(2) Column 3 of the table contains additional information that is not
10
part of this Act. Information in this column may be added to or
11
edited in any published version of this Act.
12
3 The National Credit Code
13
Schedule 1 (which is the National Credit Code) has effect as a law
14
of the Commonwealth.
15
16
Introduction Chapter 1
Definitions Part 1-2
Introduction Division 1
Section 4
National Consumer Credit Protection Bill 2009 No. , 2009 3
Part 1-2--Definitions
1
Division 1--Introduction
2
4 Guide to this Part
3
This Part is about the terms that are defined in this Act (other than
4
the National Credit Code). (For the terms that are defined in the
5
National Credit Code, see section 204 of that Code.)
6
Division 2 has the Dictionary (see section 5). The Dictionary is a
7
list of every term that is defined in this Act (other than the National
8
Credit Code). A term will either be defined in the Dictionary itself,
9
or in another provision of this Act. If another provision defines the
10
term, the Dictionary will have a signpost to that definition.
11
Division 3 has definitions relating to the meaning of credit activity.
12
Division 4 has some other definitions that apply across this Act
13
(other than the National Credit Code).
14
15
Chapter 1 Introduction
Part 1-2 Definitions
Division 2 The Dictionary
Section 5
4 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--The Dictionary
1
5 The Dictionary
2
(1) In this Act (other than the National Credit Code):
3
acts as an intermediary: see section 9.
4
ADI has the same meaning as in subsection 5(1) of the Banking Act
5
1959.
6
adverse publicity order: see section 182.
7
affairs, in relation to a person that is a body corporate, has the
8
same meaning as in Part 3 of the ASIC Act.
9
affidavit includes affirmation.
10
ancillary offence, in relation to another offence, means:
11
(a) an offence against section 6 of the Crimes Act 1914; or
12
(b) an ancillary offence within the meaning of the Criminal
13
Code;
14
that relates to the other offence.
15
appeal includes:
16
(a) an application for a new trial; and
17
(b) proceedings to review or call in question the proceedings,
18
decision or jurisdiction of a court or judge.
19
approved external dispute resolution scheme: see section 11.
20
APRA means the Australian Prudential Regulation Authority.
21
ASIC means the Australian Securities and Investments
22
Commission.
23
ASIC Act means the Australian Securities and Investments
24
Commission Act 2001, and includes instruments made under that
25
Act.
26
ASIC member means a member of ASIC within the meaning of the
27
ASIC Act.
28
Introduction Chapter 1
Definitions Part 1-2
The Dictionary Division 2
Section 5
National Consumer Credit Protection Bill 2009 No. , 2009 5
ASIC staff member means a staff member within the meaning of
1
subsection 5(1) of the ASIC Act.
2
Australia, when used in a geographical sense, does not include an
3
external Territory.
4
Note:
Paragraph 17(a) of the Acts Interpretation Act 1901 would otherwise
5
provide that Australia included the Territory of Christmas Island and
6
the Territory of Cocos (Keeling) Islands.
7
Australian credit licence: see subsection 35(1).
8
Australian credit licence number means the number given to a
9
licence under section 43.
10
Australian financial services licence has the same meaning as in
11
section 761A of the Corporations Act 2001.
12
authorised, in relation to a credit activity: see subsection 35(2).
13
banker has the same meaning as in section 9 of the Corporations
14
Act 2001.
15
banned from engaging in a credit activity under a law of a State
16
or Territory: a person is banned from engaging in a credit activity
17
under a law of a State or Territory if:
18
(a) the person holds a State or Territory credit licence that is
19
suspended (otherwise than by request of the person); or
20
(b) the person has held a State or Territory credit licence that has
21
been cancelled within the last 7 years (otherwise than by the
22
person's request); or
23
(c) an order of a court made under a law of a State or Territory
24
prohibits the person from engaging in a credit activity; or
25
(d) the person is otherwise prohibited under a law of a State or
26
Territory from engaging in a credit activity.
27
banning order: see subsection 81(1).
28
beneficiary of a guarantee means a person who is a party to a
29
guarantee and who has the benefit of the guarantee, and includes a
30
person who is a beneficiary of a guarantee because of section 10.
31
Chapter 1 Introduction
Part 1-2 Definitions
Division 2 The Dictionary
Section 5
6 National Consumer Credit Protection Bill 2009 No. , 2009
body regulated by APRA has the same meaning as in subsection
1
3(2) of the Australian Prudential Regulation Authority Act 1998.
2
book includes:
3
(a) a register; and
4
(b) any other record of information; and
5
(c) financial reports or financial records, however compiled,
6
recorded or stored; and
7
(d) a document.
8
business day has the same meaning as in section 204 of the
9
National Credit Code.
10
carried on in this jurisdiction has a meaning affected by
11
section 12.
12
civil penalty provision: a subsection of this Act (or a section of this
13
Act that is not divided into subsections) is a civil penalty provision
14
if:
15
(a) the words "civil penalty" and one or more amounts in penalty
16
units are set out at the foot of the subsection (or section); or
17
(b) another provision of this Act specifies that the subsection (or
18
section) is a civil penalty provision.
19
coastal sea:
20
(a) in relation to Australia--means:
21
(i) the territorial sea of Australia; and
22
(ii) the sea on the landward side of the territorial sea of
23
Australia and not within the limits of a State or internal
24
Territory;
25
and includes the airspace over, and the sea-bed and subsoil
26
beneath, any such sea; and
27
(b) in relation to a State or Territory--means so much of the
28
coastal sea of Australia as is within the area described in
29
Schedule 1 to the Offshore Petroleum and Greenhouse Gas
30
Storage Act 2006 under the heading that refers to that State or
31
Territory.
32
commission includes any financial or other benefit in the nature of
33
a commission.
34
Introduction Chapter 1
Definitions Part 1-2
The Dictionary Division 2
Section 5
National Consumer Credit Protection Bill 2009 No. , 2009 7
Commonwealth credit legislation means this Act and the
1
Transitional Act.
2
consumer means a natural person or a strata corporation.
3
consumer lease means a consumer lease to which Part 11 of the
4
National Credit Code applies.
5
contravention, in relation to a Commonwealth law, includes an
6
ancillary offence relating to an offence against that law.
7
credit has the same meaning as in subsection 3(1) of the National
8
Credit Code.
9
credit activity: see section 6.
10
credit assistance: see section 8.
11
credit book: see subsection 227(4).
12
credit contract has the same meaning as in section 4 of the
13
National Credit Code.
14
credit legislation means:
15
(a) this Act; and
16
(b) the Transitional Act; and
17
(c) Division 2 of Part 2 of the ASIC Act and regulations made
18
for the purpose of that Division; and
19
(d) any other Commonwealth, State or Territory legislation that
20
covers conduct relating to credit activities (whether or not it
21
also covers other conduct), but only in so far as it covers
22
conduct relating to credit activities.
23
credit limit of a credit contract means the maximum amount of
24
credit that may be provided under the contract.
25
credit provider has the same meaning as in section 204 of the
26
National Credit Code, and includes a person who is a credit
27
provider because of section 10.
28
credit registers: see section 213.
29
credit representative: see subsections 64(2) and 65(2).
30
Chapter 1 Introduction
Part 1-2 Definitions
Division 2 The Dictionary
Section 5
8 National Consumer Credit Protection Bill 2009 No. , 2009
credit representative number means the number given to a credit
1
representative under section 72.
2
credit service: see section 7.
3
criminal procedure: see section 205.
4
debtor has the same meaning as in section 204 of the National
5
Credit Code.
6
director has the same meaning as in section 9 of the Corporations
7
Act 2001.
8
disqualification order means an order of the court under
9
section 86.
10
document registers: see section 219.
11
engage in conduct means:
12
(a) do an act; or
13
(b) omit to perform an act.
14
examination, when used in Chapter 6 (which deals with
15
compliance and enforcement), means an examination of a person
16
pursuant to a requirement made under section 253.
17
expenses, in relation to an investigation under Part 6-1, includes
18
costs and expenses incurred by ASIC in relation to proceedings
19
brought under section 275 as a result of the investigation.
20
Federal Court means the Federal Court of Australia.
21
financial records: see subsection 88(2).
22
financial year: see subsection 100(6).
23
function includes a duty.
24
give:
25
(a) when used in Chapter 6 (which deals with compliance and
26
enforcement) in relation to a document--has a meaning
27
affected by section 314; and
28
(b) when used in relation to information, includes:
29
Introduction Chapter 1
Definitions Part 1-2
The Dictionary Division 2
Section 5
National Consumer Credit Protection Bill 2009 No. , 2009 9
(i) explaining or stating a matter; and
1
(ii) identifying a person, matter or thing; and
2
(iii) disclosing information; and
3
(iv) answering a question.
4
guarantee means a guarantee to which the National Credit Code
5
applies.
6
hearing, when used in Chapter 6 (which deals with compliance
7
and enforcement), means a hearing before ASIC and, in
8
sections 278, 280, 281 and 282 (which are in that Chapter),
9
includes part of such a hearing.
10
initial National Credit Act means this Act as originally enacted.
11
initial Transitional Act means the Transitional Act as originally
12
enacted.
13
insolvent means:
14
(a) in the case of a natural person--a person who is an insolvent
15
under administration (within the meaning of the
16
Corporations Act 2001); or
17
(b) in the case of a body corporate--a body corporate that is an
18
externally-administered body corporate (within the meaning
19
of the Corporations Act 2001); or
20
(c) in the case of a partnership--a partnership against which a
21
creditor's petition or a debtor's petition is presented under
22
Division 2 or 3 of Part IV of the Bankruptcy Act 1966.
23
investigate, in relation to ASIC, means investigate in the course of
24
performing any of ASIC's functions or exercising any of ASIC's
25
powers.
26
involved in: a person is involved in a contravention of a provision
27
of legislation if, and only if, the person:
28
(a) has aided, abetted, counselled or procured the contravention;
29
or
30
(b) has induced the contravention, whether by threats or
31
promises or otherwise; or
32
Chapter 1 Introduction
Part 1-2 Definitions
Division 2 The Dictionary
Section 5
10 National Consumer Credit Protection Bill 2009 No. , 2009
(c) has been in any way, by act or omission, directly or
1
indirectly, knowingly concerned in or party to the
2
contravention; or
3
(d) has conspired with others to effect the contravention.
4
judgment means a judgment, decree or order, whether final or
5
interlocutory.
6
law of a referring State or a Territory means a law of, or in force
7
in, a referring State or a Territory but does not include a law of the
8
Commonwealth in force in the referring State or the Territory.
9
law of a State or Territory means a law of, or in force in, a State or
10
Territory but does not include a law of the Commonwealth in force
11
in the State or Territory.
12
lawyer means a person who is admitted to the legal profession by a
13
federal court or a Supreme Court of a State or Territory.
14
lessee means the lessee under a consumer lease.
15
lessor means the lessor under a consumer lease, and includes a
16
person who is a lessor because of section 10.
17
licence means an Australian credit licence.
18
licensee means a person who holds a licence.
19
licensing anniversary: see subsection 53(7).
20
lodge with ASIC: see section 216.
21
lower court means:
22
(a) the Federal Magistrates Court; or
23
(b) a court of a State or Territory that is not a superior court.
24
malice: see subsection 16(2).
25
matter includes an act, an omission, a body, a person or a thing.
26
misleading: see section 13.
27
mortgage means a mortgage to which the National Credit Code
28
applies.
29
Introduction Chapter 1
Definitions Part 1-2
The Dictionary Division 2
Section 5
National Consumer Credit Protection Bill 2009 No. , 2009 11
mortgagee means the mortgagee under a mortgage, and includes a
1
person who is a mortgagee because of section 10.
2
mortgagor means the mortgagor under a mortgage.
3
National Credit Code means Schedule 1 to this Act, and includes:
4
(a) regulations made under section 329 for the purposes of that
5
Schedule; and
6
(b) instruments made under that Schedule.
7
officer of the Commonwealth has the same meaning as in
8
paragraph 75(v) of the Constitution.
9
penalty unit has the same meaning as in section 4AA of the Crimes
10
Act 1914.
11
person has a meaning affected by section 14 (which deals with
12
partnerships) and section 15 (which deals with multiple trustees).
13
power includes an authority.
14
premises includes:
15
(a) a structure, building, aircraft, vehicle or vessel; and
16
(b) any land or place (whether enclosed or built in or not); and
17
(c) a part of a structure, building, aircraft, vehicle, vessel or of
18
such a place.
19
prescribed State or Territory order means an order under a law of
20
a State or Territory, being an order of a kind prescribed by the
21
regulations.
22
proceedings:
23
(a) when used in Chapter 6 (which deals with compliance and
24
enforcement)--has the same meaning as the definition of
25
proceeding in subsection 5(1) of the ASIC Act; and
26
(b) otherwise--means proceedings, whether criminal or civil,
27
before a court.
28
qualified privilege has a meaning affected by section 16.
29
receiving court: see section 191.
30
Chapter 1 Introduction
Part 1-2 Definitions
Division 2 The Dictionary
Section 5
12 National Consumer Credit Protection Bill 2009 No. , 2009
record, when used in Chapter 6 (which deals with compliance and
1
enforcement) in relation to an examination, means the whole or
2
part of a record made under section 258 of statements made at the
3
examination.
4
referred credit matters: see section 20.
5
referring State: see section 19.
6
registered company auditor has the same meaning as in section 9
7
of the Corporations Act 2001.
8
related body corporate has the same meaning as in section 9 of the
9
Corporations Act 2001.
10
related criminal justice process decision: see section 188.
11
relevant criminal law: see subsection 204(5).
12
relevant superior court, in relation to a lower court, means:
13
(a) if the lower court is the Federal Magistrates Court--the
14
Federal Court; or
15
(b) if the lower court is a court of a State or Territory--the
16
Supreme Court of the State or Territory.
17
representative of a person means:
18
(a) if the person is a licensee:
19
(i) an employee or director of the licensee; or
20
(ii) an employee or director of a related body corporate of
21
the licensee; or
22
(iii) a credit representative of the licensee; or
23
(iv) any other person acting on behalf of the licensee; or
24
(b) otherwise:
25
(i) an employee or director of the person; or
26
(ii) an employee or director of a related body corporate of
27
the person; or
28
(iii) any other person acting on behalf of the person.
29
senior manager has the same meaning as in section 9 of the
30
Corporations Act 2001.
31
Introduction Chapter 1
Definitions Part 1-2
The Dictionary Division 2
Section 5
National Consumer Credit Protection Bill 2009 No. , 2009 13
serious fraud means an offence involving fraud or dishonesty,
1
being an offence:
2
(a) against a law of the Commonwealth, or of a State or
3
Territory, or any other law; and
4
(b) punishable by imprisonment for life or for a period, or
5
maximum period, of at least 3 months.
6
State, when used in a geographical sense, includes the coastal sea
7
of the State.
8
statement, when used in Chapter 6 (which deals with compliance
9
and enforcement) in relation to an examination, includes a question
10
asked, an answer given, and any other comment or remark made, at
11
the examination.
12
state of mind: the state of mind of a person includes:
13
(a) the knowledge, intention, opinion, belief or purpose of the
14
person; and
15
(b) the person's reasons for the intention, opinion, belief or
16
purpose.
17
State or Territory credit licence means a licence or registration
18
that:
19
(a) is granted under a law of a State or Territory; and
20
(b) authorises the licensee or registered person to engage in a
21
credit activity.
22
strata corporation has the same meaning as in section 204 of the
23
National Credit Code.
24
superior court means any of the following courts:
25
(a) the Federal Court;
26
(b) the Supreme Court of a State or Territory.
27
Territory means:
28
(a) the Australian Capital Territory; or
29
(b) the Northern Territory; or
30
(c) the Jervis Bay Territory;
31
and, when used in a geographical sense, includes the coastal sea of
32
the Territory.
33
Chapter 1 Introduction
Part 1-2 Definitions
Division 2 The Dictionary
Section 5
14 National Consumer Credit Protection Bill 2009 No. , 2009
this Act includes instruments made under this Act.
1
this jurisdiction: see subsections 21(2) and (3).
2
transfer matter: see section 191.
3
transferring court: see section 191.
4
Transitional Act means the National Consumer Credit Protection
5
(Transitional and Consequential Provisions) Act 2009, and
6
includes instruments made under that Act.
7
tribunal means:
8
(a) a tribunal in Australia; or
9
(b) any other body, authority or person in Australia having
10
power, by law or by consent of parties, to hear, receive or
11
examine evidence.
12
value of a credit contract, mortgage, guarantee or consumer
13
lease: see section 199.
14
within the authority: a representative's conduct is within the
15
authority of a person if:
16
(a) for a representative who is an employee of the person or of a
17
related body corporate of the person--the conduct is within
18
the scope of the employee's employment; or
19
(b) for a representative who is a director of the person or of a
20
related body corporate of the person--the conduct is within
21
the scope of the director's duties as director; or
22
(c) for a representative who is a credit representative of the
23
person--the conduct is within the scope of the authorisation
24
of the credit representative under subsection 64(1) or 65(1);
25
or
26
(d) otherwise--the conduct is within the scope of the authority
27
given by the person.
28
witness, in relation to a hearing before ASIC, means a person
29
appearing at the hearing to give evidence.
30
written record, when used in Chapter 6 (which deals with
31
compliance and enforcement) in relation to an examination, means:
32
Introduction Chapter 1
Definitions Part 1-2
The Dictionary Division 2
Section 5
National Consumer Credit Protection Bill 2009 No. , 2009 15
(a) a record of the examination:
1
(i) that is made in writing; or
2
(ii) as reduced to writing; or
3
(b) a part of such a record.
4
(2) In this Act (other than the National Credit Code), a reference to a
5
provision is a reference to a provision of this Act, unless the
6
contrary intention appears.
7
8
Chapter 1 Introduction
Part 1-2 Definitions
Division 3 Definitions relating to the meaning of cred it activity
Section 6
16 National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Definitions relating to the meaning of credit
1
activity
2
6 Meaning of credit activity
3
(1) The following table sets out when a person engages in a credit
4
activity.
5
6
Meaning of credit activity
Item Topic
A person eng ages in a credit activity if:
1
credit contracts
(a) the person is a credit provider under a credit contract;
or
(b) the person carries on a business of providing credit,
being credit the provision of which the National Credit
Code applies to; or
(c) the person performs the obligations, or exercises the
rights, of a credit p rovider in relation to a credit
contract or proposed credit contract (whether the
person does so as the credit provider or for or on behalf
of the credit provider); o r
2
credit service
the person provides a credit service; or
3
consumer leases (a) the person is a lessor under a consumer lease; or
(b) the person carries on a business of providing consumer
leases; or
(c) the person performs the obligations, or exercises the
rights, of a lessor in relation to a consumer lease or
proposed consumer lease (whether the person does so
as the lessor or for or on behalf of the lessor); or
4
mortgages
(a) the person is a mo rtgagee under a mortgage; or
(b) the person performs the obligations, or exercises the
rights, of a mortgagee in relation to a mortgage or
proposed mortgage (whether the person does so as the
mortgagee or for or on behalf of the mortgagee); or
5
guarantees
(a) the person is the beneficiary of a guarantee; or
(b) the person performs the obligations, or exercises the
rights, of another person who is a beneficiary of a
guarantee or proposed guarantee, in relation to the
guarantee or proposed guarantee (whether the person
Introduction Chapter 1
Definitions Part 1-2
Definitions relating to the meaning of credit activ ity Division 3
Section 7
National Consumer Credit Protection Bill 2009 No. , 2009 17
Meaning of credit activity
Item Topic
A person eng ages in a credit activity if:
does so on the person's own behalf or for or on behalf
of the other person); or
6
prescribed
activities
the person engages in an activity prescribed by the
regulations in relation to credit, being cred it the provision
of which the National Credit Code applies to, or would
apply to if the credit were provided.
(2) A subclass of any of the conduct referred to in the table in
1
subsection (1) is also a credit activity.
2
Note:
For example, ASIC could impose a condition on a licence under
3
subsection 45(6) that provides that a person is authorised to be a credit
4
provider only under particular types of credit contracts (such as credit
5
contracts for credit cards).
6
7 Meaning of credit service
7
A person provides a credit service if the person:
8
(a) provides credit assistance to a consumer; or
9
(b) acts as an intermediary.
10
8 Meaning of credit assistance
11
A person provides credit assistance to a consumer if, by dealing
12
directly with the consumer or the consumer's agent in the course
13
of, as part of, or incidentally to, a business carried on in this
14
jurisdiction by the person or another person, the person:
15
(a) suggests that the consumer apply for a particular credit
16
contract with a particular credit provider; or
17
(b) suggests that the consumer apply for an increase to the credit
18
limit of a particular credit contract with a particular credit
19
provider; or
20
(c) suggests that the consumer remain in a particular credit
21
contract with a particular credit provider; or
22
(d) assists the consumer to apply for a particular credit contract
23
with a particular credit provider; or
24
Chapter 1 Introduction
Part 1-2 Definitions
Division 3 Definitions relating to the meaning of cred it activity
Section 9
18 National Consumer Credit Protection Bill 2009 No. , 2009
(e) assists the consumer to apply for an increase to the credit
1
limit of a particular credit contract with a particular credit
2
provider; or
3
(f) suggests that the consumer apply for a particular consumer
4
lease with a particular lessor; or
5
(g) suggests that the consumer remain in a particular consumer
6
lease with a particular lessor; or
7
(h) assists the consumer to apply for a particular consumer lease
8
with a particular lessor.
9
It does not matter whether the person does so on the person's own
10
behalf or for or on behalf of another person.
11
9 Meaning of acts as an intermediary
12
A person acts as an intermediary if, in the course of, as part of, or
13
incidentally to, a business carried on in this jurisdiction by the
14
person or another person, the person:
15
(a) acts as an intermediary (whether directly or indirectly)
16
between a credit provider and a consumer wholly or partly
17
for the purposes of securing a provision of credit for the
18
consumer under a credit contract for the consumer with the
19
credit provider; or
20
(b) acts as an intermediary (whether directly or indirectly)
21
between a lessor and a consumer wholly or partly for the
22
purposes of securing a consumer lease for the consumer with
23
the lessor.
24
It does not matter whether the person does so on the person's own
25
behalf or for or on behalf of another person.
26
10 Assignees of credit providers, lessors, mortgagees and
27
beneficiaries of a guarantee
28
(1) For the purposes of this Act (other than the National Credit Code),
29
a person is a credit provider, lessor, mortgagee or beneficiary of a
30
guarantee whether the person is:
31
(a) the original credit provider, lessor, mortgagee or beneficiary
32
of a guarantee under a credit contract, consumer lease,
33
mortgage or guarantee; or
34
Introduction Chapter 1
Definitions Part 1-2
Definitions relating to the meaning of credit activ ity Division 3
Section 10
National Consumer Credit Protection Bill 2009 No. , 2009 19
(b) a person to whom the rights of a credit provider, lessor,
1
mortgagee or beneficiary of a guarantee under a credit
2
contract, consumer lease, mortgage or guarantee have been
3
assigned or passed by law.
4
Note:
For example, a person who is assigned the rights of a credit provider
5
under a credit contract would engage in a credit activity within the
6
meaning of paragraph (a) of item 1 of the table in subsection 6(1).
7
(2) For the purposes of paragraph (1)(b), it does not matter whether an
8
assignment or passing by law of rights is the first or a subsequent
9
assignment or passing by law of those rights.
10
11
Chapter 1 Introduction
Part 1-2 Definitions
Division 4 Other definitions
Section 11
20 National Consumer Credit Protection Bill 2009 No. , 2009
Division 4--Other definitions
1
11 Meaning of approved external dispute resolution scheme
2
(1) A person is a member of an approved external dispute resolution
3
scheme if the person is a member of one or more external dispute
4
resolution schemes that:
5
(a) is, or are, approved by ASIC in accordance with the
6
regulations; and
7
(b) covers, or together cover, disputes in relation to the credit
8
activities engaged in by the person or its representatives.
9
(2) Regulations made for the purpose of paragraph (1)(a) may also
10
deal with the variation or revocation of approvals given by ASIC.
11
12 When a business is carried on in this jurisdiction
12
(1) Division 3 of Part 1.2 of the Corporations Act 2001 applies for the
13
purposes of working out whether a business is carried on in this
14
jurisdiction.
15
(2) Without limiting subsection (1), a business is taken to be carried
16
on in this jurisdiction by a person if, in the course of carrying on
17
the business, the person engages in conduct that is:
18
(a) intended to induce people in this jurisdiction to use the goods
19
or services the person provides; or
20
(b) is likely to have that effect;
21
whether or not the conduct is intended, or likely, to have that effect
22
in other places as well.
23
13 Meaning of misleading
24
(1) A representation made by a person is misleading if:
25
(a) the representation relates to a future matter (including the
26
doing of, or refusing to do, any act); and
27
(b) the person does not have reasonable grounds for making the
28
representation.
29
(2) Subsection (1) does not limit the circumstances in which a
30
representation may be misleading.
31
Introduction Chapter 1
Definitions Part 1-2
Other defin itions Division 4
Section 14
National Consumer Credit Protection Bill 2009 No. , 2009 21
14 Meaning of person--gene rally includes a partnership
1
(1) This Act (other than the National Credit Code) applies to a
2
partnership as if the partnership were a person, but it applies with
3
the following changes:
4
(a) obligations that would be imposed on the partnership are
5
imposed instead on each partner, but may be discharged by
6
any of the partners;
7
(b) any contravention of this Act (other than the National Credit
8
Code) that would otherwise be a contravention by the
9
partnership is taken (whether for the purposes of criminal or
10
civil liability) to have been a contravention by each partner
11
who:
12
(i) aided, abetted, counselled or procured the relevant act or
13
omission; or
14
(ii) was in any way knowingly concerned in, or party to, the
15
relevant act or omission (whether directly or indirectly
16
and whether by any act or omission of the partner).
17
Note:
For the purposes of paragraph (b), to determine whether the
18
partnership has contravened this Act, see section 325.
19
(2) For the purposes of this Act (other than the National Credit Code),
20
a change in the composition of a partnership does not affect the
21
continuity of the partnership.
22
(3) Subsections (1) and (2) have effect subject to:
23
(a) an express or implied contrary intention in a provision of this
24
Act (other than the National Credit Code); and
25
(b) the regulations, which may exclude or modify the effect of
26
those subsections in relation to specified provisions.
27
15 Meaning of person--gene rally includes multiple trustees
28
(1) This section applies in relation to a trust during a period while the
29
trust continues to have:
30
(a) 2 or more trustees; or
31
(b) a single trustee who was a trustee of the trust at a time when
32
it had 2 or more trustees.
33
Chapter 1 Introduction
Part 1-2 Definitions
Division 4 Other definitions
Section 15
22 National Consumer Credit Protection Bill 2009 No. , 2009
(2) Subject to subsections (3) and (4), during the period this Act (other
1
than the National Credit Code) applies to the trust as if the trustee
2
or trustees of the trust from time to time during the period were a
3
single person (the notional person) that remained the same for the
4
duration of that period.
5
Note:
So, for example, a licence granted under this Act during the period to
6
the trustees of the trust will continue in force, despite a change in the
7
persons who are the trustees.
8
(3) If, during the period or any part of the period, the trust has 2 or
9
more trustees, this Act (other than the National Credit Code)
10
applies to the trustees as referred to in subsection (2), but it applies
11
with the following changes:
12
(a) obligations that would be imposed on the notional person are
13
imposed instead on each trustee, but may be discharged by
14
any of the trustees;
15
(b) any contravention of this Act (other than the National Credit
16
Code) that would otherwise be a contravention by the
17
notional person is taken (whether for the purposes of criminal
18
or civil liability) to have been a contravention by each trustee
19
who:
20
(i) aided, abetted, counselled or procured the relevant act or
21
omission; or
22
(ii) was in any way knowingly concerned in, or party to, the
23
relevant act or omission (whether directly or indirectly
24
and whether by any act or omission of the trustee).
25
Note:
For the purposes of paragraph (b), to determine whether the notional
26
person has contravened this Act, see section 325.
27
(4) If, during the period or any part of the period, the trust has only one
28
trustee, this Act (other than the National Credit Code) applies to
29
the trustee as referred to in subsection (2), but it applies with the
30
following changes:
31
(a) obligations that would be imposed on the notional person are
32
imposed instead on that single trustee;
33
(b) any contravention of this Act (other than the National Credit
34
Code) that would otherwise be a contravention by the
35
notional person is taken (whether for the purposes of criminal
36
or civil liability) to have been a contravention by that single
37
trustee.
38
Introduction Chapter 1
Definitions Part 1-2
Other defin itions Division 4
Section 16
National Consumer Credit Protection Bill 2009 No. , 2009 23
(5) Subsections (2), (3) and (4) have effect subject to:
1
(a) an express or implied contrary intention in a provision of this
2
Act (other than the National Credit Code); and
3
(b) the regulations, which may exclude or modify the effect of
4
those subsections in relation to specified provisions.
5
16 Qualified privilege
6
(1) If this Act provides that a person has qualified privilege in relation
7
to an act, matter or thing, then the person:
8
(a) has qualified privilege in proceedings for defamation; or
9
(b) is not, in the absence of malice on the person's part, liable to
10
an action for defamation at the suit of a person;
11
in relation to that act, matter or thing.
12
(2) Malice includes ill will to the person concerned or any other
13
improper motive.
14
(3) Neither this section nor a provision of this Act that provides as
15
referred to in subsection (1) limits or affects any right, privilege or
16
immunity that a person has, apart from this section or such a
17
provision, as defendant in proceedings, or an action, for
18
defamation.
19
20
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 1 Introduction
Section 17
24 National Consumer Credit Protection Bill 2009 No. , 2009
Part 1-3--Application of this Act and the
1
Transitional Act
2
Division 1--Introduction
3
17 Guide to this Part
4
This Part deals with the application of this Act and the Transitional
5
Act.
6
Division 2 is about the constitutional basis and geographical
7
application of those Acts. It also deals with the application of those
8
Acts to the Crown.
9
Division 3 deals with the interaction between those Acts and laws
10
of the States and Territories.
11
12
Introduction Chapter 1
Application of this Act and the Transitional Act Part 1 -3
Constitutional basis and application of this Act and the Transitional Act Division 2
Section 18
National Consumer Credit Protection Bill 2009 No. , 2009 25
Division 2--Constitutional basis and application of this Act
1
and the Transitional Act
2
18 Constitutional basis for this Act and the Transitional Act
3
Application in a referring State
4
(1) The application of this Act and the Transitional Act in the referring
5
States is based on:
6
(a) the legislative powers that the Commonwealth Parliament has
7
under section 51 of the Constitution (other than paragraph
8
51(xxxvii)); and
9
(b) the legislative powers that the Commonwealth Parliament has
10
in relation to matters to which this Act relates because those
11
matters are referred to it by the Parliaments of the referring
12
States under paragraph 51(xxxvii) of the Constitution.
13
Note:
The State referrals fully supplement the Commonwealth Parliament's
14
other powers by referring the matters to the Commonwealth
15
Parliament to the extent to which they are not otherwise included in
16
the legislative powers of the Commonwealth Parliament.
17
Application in a Territory
18
(2) The application of this Act and the Transitional Act in a Territory
19
is based on:
20
(a) the legislative powers that the Commonwealth Parliament has
21
under section 122 of the Constitution to make laws for the
22
government of a Territory; and
23
(b) the legislative powers that the Commonwealth Parliament has
24
under section 51 of the Constitution.
25
Despite subsection 22(3) of the Acts Interpretation Act 1901, this
26
Act and the Transitional Act as applying in the Territory are laws
27
of the Commonwealth.
28
Application outside Australia
29
(3) The operation of this Act and the Transitional Act outside Australia
30
is based on:
31
(a) the legislative power the Commonwealth Parliament has
32
under paragraph 51(xxix) of the Constitution; and
33
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 2 Constitutional basis and application of this Act and the Transitional Act
Section 19
26 National Consumer Credit Protection Bill 2009 No. , 2009
(b) the other legislative powers that the Commonwealth
1
Parliament has under section 51 of the Constitution; and
2
(c) the legislative powers that the Commonwealth Parliament has
3
under section 122 of the Constitution to make laws for the
4
government of a Territory.
5
Application in a non-referring State
6
(4) The application of this Act and the Transitional Act in a State that
7
is not a referring State is based on:
8
(a) the legislative powers that the Commonwealth Parliament has
9
under section 51 (other than paragraph 51(xxxvii)) and
10
section 122 of the Constitution; and
11
(b) the legislative powers that the Commonwealth Parliament has
12
in relation to matters to which this Act relates because those
13
matters are referred to it by the Parliaments of the referring
14
States under paragraph 51(xxxvii) of the Constitution.
15
19 Meaning of referring State
16
Reference of matters by State Parliament to Commonwealth
17
Parliament
18
(1) A State is a referring State if the Parliament of the State has
19
referred the matters covered by subsections (3) and (4) to the
20
Parliament of the Commonwealth for the purposes of paragraph
21
51(xxxvii) of the Constitution:
22
(a) if and to the extent that the matters are not otherwise included
23
in the legislative powers of the Parliament of the
24
Commonwealth (otherwise than by a reference under
25
paragraph 51(xxxvii) of the Constitution); and
26
(b) if and to the extent to which the matters are included in the
27
legislative powers of the Parliament of the State.
28
Introduction Chapter 1
Application of this Act and the Transitional Act Part 1 -3
Constitutional basis and application of this Act and the Transitional Act Division 2
Section 19
National Consumer Credit Protection Bill 2009 No. , 2009 27
(2) A State is a referring State even if a law of the State provides that
1
the reference to the Commonwealth Parliament of either or both of
2
the matters covered by subsections (3) and (4) is to terminate in
3
particular circumstances.
4
Reference covering initial National Credit Act and initial
5
Transitional Act
6
(3) This subsection covers the matters to which the referred provisions
7
relate to the extent of making laws with respect to those matters by
8
including the referred provisions in the initial National Credit Act
9
and the initial Transitional Act.
10
Reference covering amendments of this Act, the Transitional Act or
11
the Trade Practices Act
12
(4) This subsection covers the referred credit matters (see section 20)
13
to the extent of the making of laws with respect to those matters by
14
making express amendments of this Act, the Transitional Act or
15
the Trade Practices Act.
16
Effect of termination of reference
17
(5) A State ceases to be a referring State if the State's initial reference
18
terminates.
19
(6) A State ceases to be a referring State if:
20
(a) the State's amendment reference terminates; and
21
(b) subsection (7) does not apply to the termination.
22
(7) A State does not cease to be a referring State because of the
23
termination of its amendment reference if:
24
(a) the termination is effected by the Governor of that State
25
fixing a day by Proclamation as the day on which the
26
reference terminates; and
27
(b) the day fixed is no earlier than the first day after the end of
28
the period of 6 months beginning on the day on which the
29
Proclamation is published; and
30
(c) that State's amendment reference, and the amendment
31
reference of every other State, terminates on the same day.
32
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 2 Constitutional basis and application of this Act and the Transitional Act
Section 20
28 National Consumer Credit Protection Bill 2009 No. , 2009
Definitions
1
(8) In this section:
2
amendment reference of a State means the reference by the
3
Parliament of the State to the Parliament of the Commonwealth of
4
the matters covered by subsection (4).
5
express amendment of this Act, the Transitional Act or the Trade
6
Practices Act means the direct amendment of the text of this Act,
7
the Transitional Act or the Trade Practices Act (whether by the
8
insertion, omission, repeal, substitution or relocation of words or
9
matter) by another Commonwealth Act or by an instrument under a
10
Commonwealth Act, but does not include the enactment by a
11
Commonwealth Act of a provision that has, or will have,
12
substantive effect otherwise than as part of the text of this Act, the
13
Transitional Act or the Trade Practices Act.
14
initial reference of a State means the reference by the Parliament
15
of the State to the Parliament of the Commonwealth of the matters
16
covered by subsection (3).
17
referred provisions means:
18
(a) the initial National Credit Act; and
19
(b) the initial Transitional Act;
20
to the extent to which they deal with matters that are included in
21
the legislative powers of the Parliaments of the States.
22
Trade Practices Act means the Trade Practices Act 1974.
23
20 Meaning of referred credit matters
24
(1) Referred credit matters means any of the following:
25
(a) the matter of the regulation of credit or personal property
26
leases;
27
(b) the matter of the regulation of securities (including
28
mortgages), guarantees or insurance insofar as they relate to
29
credit or personal property leases;
30
(c) the matter of the regulation of credit activities;
31
Introduction Chapter 1
Application of this Act and the Transitional Act Part 1 -3
Constitutional basis and application of this Act and the Transitional Act Division 2
Section 20
National Consumer Credit Protection Bill 2009 No. , 2009 29
(d) in relation to sales of goods or supplies of services where the
1
sale or supply is financed, or proposed to be financed, wholly
2
or partly by the provision of credit, the following matters:
3
(i) in the case of such a sale or supply where the person
4
providing the credit is linked in any way to the person
5
supplying the goods or services:
6
(A) the liability of the person providing credit for
7
any representation, warranty or statement by the
8
person supplying the goods or services; and
9
(B) the liability of the person providing the credit or
10
supplying the goods or services for loss or
11
damage;
12
and matters arising out of any such liability; and
13
(ii) the termination of any transaction in relation to such a
14
sale of goods or supply of services and matters arising
15
out of any such termination.
16
(2) However, referred credit matters does not include the matter of
17
making provision with respect to:
18
(a) a matter in a manner that excludes or limits the operation of a
19
law of a State to the extent that the law makes provision with
20
respect to:
21
(i) the creation, holding, transfer, assignment, disposal or
22
forfeiture of a State statutory right; or
23
(ii) limitations, restrictions or prohibitions concerning the
24
kinds of interests that may be created or held in, or the
25
kinds of persons or bodies that may create or hold
26
interests in, a State statutory right; or
27
(iii) without limiting the generality of subparagraph (i) or
28
(ii)--any of the following matters:
29
(A) the forfeiture of property or interests in property
30
(or the disposal of forfeited property or
31
interests) in connection with the enforcement of
32
the general law or any law of a State;
33
(B) the transfer, by operation of that law of a State,
34
of property or interests in property from any
35
specified person or body to any other specified
36
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 2 Constitutional basis and application of this Act and the Transitional Act
Section 20
30 National Consumer Credit Protection Bill 2009 No. , 2009
person or body (whether or not for valuable
1
consideration or a fee or other reward); or
2
(b) an excluded State statutory right.
3
(3) In this section, despite section 5 (the Dictionary):
4
credit means:
5
(a) credit within the meaning of subsection 3(1) of the initial
6
National Credit Code if a charge is or may be made for
7
providing the credit; and
8
(b) credit because of the operation of sections 9, 10, 11 and 12 of
9
the initial National Credit Code (either because credit is
10
regarded as having been provided or because a contract is to
11
be taken to be a credit contract).
12
credit activity means any activity associated with the provision of
13
credit or the entering into of personal property leases and includes
14
(but is not limited to) any conduct that constitutes a credit activity
15
for the purposes of the initial National Credit Act.
16
excluded State statutory right means a State statutory right that is
17
declared by the law of a State by or under which it is granted to be
18
an excluded State statutory right for the purposes of that State's
19
reference Act.
20
forfeiture means confiscation, seizure, extinguishment,
21
cancellation, suspension or any other forfeiture.
22
general law means the principles and rules of the common law and
23
equity to the extent to which they have effect in a State from time
24
to time.
25
initial National Credit Code means the National Credit Code
26
within the meaning of the initial National Credit Act.
27
interest, in relation to property, includes a right in the property.
28
law of a State means any Act of a State or any instrument made
29
under such an Act, whenever enacted or made and as in force from
30
time to time.
31
licence means either of the following:
32
Introduction Chapter 1
Application of this Act and the Transitional Act Part 1 -3
Constitutional basis and application of this Act and the Transitional Act Division 2
Section 20
National Consumer Credit Protection Bill 2009 No. , 2009 31
(a) a transferable right, entitlement or authority to do one or
1
more of the following:
2
(i) to manufacture, produce, sell, transport or otherwise
3
deal with property;
4
(ii) to provide services;
5
(iii) to explore for, exploit or use a resource;
6
(b) a transferable water right.
7
personal property lease means a contract for the hire of goods
8
(whether or not the person to whom the goods are hired has a right
9
or obligation to purchase the goods) if:
10
(a) a charge is or may be made for hiring the goods; and
11
(b) the charge, together with any other amount payable under or
12
in connection with the contract (including, if the person
13
hiring the goods has a right or obligation to purchase the
14
goods, any amount payable to purchase the goods or to
15
exercise an option to do so or any amount equal to any
16
agreed or residual value of the goods), exceeds the cash price
17
for the goods; and
18
(c) the goods are provided in the course of a business of
19
providing goods for hire or as part of or incidentally to any
20
other business carried on by the person who provides the
21
goods.
22
property includes a licence.
23
reference Act of a State is the law under which the initial reference
24
and the amendment reference are given as referred to in section 19.
25
State statutory right means a right, entitlement or authority that is
26
granted by or under a law of a State.
27
transferable, in relation to a right, entitlement or authority, means
28
transferable under the general law or a law of a State by the holder
29
of the right, entitlement or authority (whether or not the right,
30
entitlement or authority is exclusive, and whether or not a transfer
31
is restricted or requires consent).
32
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 2 Constitutional basis and application of this Act and the Transitional Act
Section 21
32 National Consumer Credit Protection Bill 2009 No. , 2009
water right means a right, entitlement or authority, whether or not
1
exclusive, that is granted by or under the general law or a law of a
2
State in relation to the control, use or flow of water.
3
21 General application of this Act and the Transitional Act
4
Application in this jurisdiction
5
(1) Each provision of this Act and the Transitional Act applies in this
6
jurisdiction.
7
Geographical coverage of "this jurisdiction"
8
(2) This jurisdiction means the geographical area that consists of:
9
(a) each referring State (including its coastal sea); and
10
(b) each Territory (including its coastal sea).
11
(3) Throughout this Act and the Transitional Act, this jurisdiction
12
therefore consists of either:
13
(a) if all of the States are referring States--the whole of
14
Australia; or
15
(b) if one or more States are not referring States--Australia
16
(other than any State that is not a referring State).
17
Application outside this jurisdiction
18
(4) Subject to subsection (5), each provision of this Act and the
19
Transitional Act also applies, according to its tenor, in relation to
20
acts and omissions outside this jurisdiction.
21
Application in non-referring States
22
(5) This Act does not apply to an act or omission in a State that is not a
23
referring State to the extent to which that application would be
24
beyond the legislative powers of the Parliament (including powers
25
it has under paragraphs 51(xxxvii) and (xxxix) of the Constitution).
26
Residence, place of formation etc.
27
(6) Each provision of this Act and the Transitional Act applies,
28
according to its tenor, to:
29
Introduction Chapter 1
Application of this Act and the Transitional Act Part 1 -3
Constitutional basis and application of this Act and the Transitional Act Division 2
Section 22
National Consumer Credit Protection Bill 2009 No. , 2009 33
(a) natural persons whether:
1
(i) resident in this jurisdiction or not; and
2
(ii) resident in Australia or not; and
3
(iii) Australian citizens or not; and
4
(b) all bodies corporate and unincorporated bodies whether:
5
(i) formed or carrying on a business in this jurisdiction or
6
not; and
7
(ii) formed or carrying on a business in Australia or not.
8
22 Acts bind Crown
9
(1) This Act (other than Chapter 3 and the National Credit Code) and
10
the Transitional Act bind the Crown in each of its capacities.
11
(2) However, those Acts do not make the Crown liable to be
12
prosecuted for an offence or to any pecuniary penalty.
13
14
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 3 Interaction between the Co mmonwealth credit legislation and State and
Territory laws
Section 23
34 National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Interaction between the Commonwealth credit
1
legislation and State and Territory laws
2
23 Concurre nt operation intended
3
(1) This Act and the Transitional Act (the Commonwealth credit
4
legislation) are not intended to exclude or limit the concurrent
5
operation of any law of a State or Territory.
6
(2) If:
7
(a) an act or omission of a person is both an offence against the
8
Commonwealth credit legislation and an offence against the
9
law of a State or Territory; and
10
(b) the person is convicted of either of those offences;
11
the person is not liable to be convicted of the other of those
12
offences.
13
(3) This section does not apply to a law of a State or Territory if there
14
is a direct inconsistency between that law and the Commonwealth
15
credit legislation.
16
Note:
Section 25 avoids direct inconsistency arising in some cases by
17
limiting the operation of the Commonwealth credit legislation.
18
24 When Commonwealth credit legislation does not apply
19
(1) Subsection (2) applies if a provision of a law of a referring State or
20
a Territory declares a matter to be an excluded matter for the
21
purposes of this section in relation to:
22
(a) the whole of the Commonwealth credit legislation; or
23
(b) a specified provision of the Commonwealth credit legislation;
24
or
25
(c) the Commonwealth credit legislation other than a specified
26
provision; or
27
(d) the Commonwealth credit legislation otherwise than to a
28
specified extent.
29
(2) By force of this subsection:
30
(a) none of the provisions of the Commonwealth credit
31
legislation (other than this section) applies in or in relation to
32
Introduction Chapter 1
Application of this Act and the Transitional Act Part 1 -3
Interaction between the Commonwealth cred it leg islation and State and Territory laws
Division 3
Section 25
National Consumer Credit Protection Bill 2009 No. , 2009 35
the State or Territory with respect to the matter if the
1
declaration is one to which paragraph (1)(a) applies; and
2
(b) the specified provision of the Commonwealth credit
3
legislation does not apply in or in relation to the State or
4
Territory with respect to the matter if the declaration is one to
5
which paragraph (1)(b) applies; and
6
(c) the provisions of the Commonwealth credit legislation (other
7
than this section and the specified provisions) do not apply in
8
or in relation to the State or Territory with respect to the
9
matter if the declaration is one to which paragraph (1)(c)
10
applies; and
11
(d) the provisions of the Commonwealth credit legislation (other
12
than this section and otherwise than to the specified extent)
13
do not apply in or in relation to the State or Territory with
14
respect to the matter if the declaration is one to which
15
paragraph (1)(d) applies.
16
(3) Subsection (2) does not apply to the declaration to the extent to
17
which the regulations provide that that subsection does not apply to
18
that declaration.
19
25 Avoiding direct inconsistency between Commonwealth and State
20
and Te rritory laws
21
This section overrides other Commonwealth credit legislation
22
(1) This section has effect despite anything else in the Commonwealth
23
credit legislation.
24
When this section does not apply to a State or Territory law
25
(2) This section does not apply to a provision of a law of a referring
26
State or a Territory that is capable of concurrent operation with the
27
Commonwealth credit legislation.
28
Note:
This kind of provision is dealt with by section 23.
29
When this section applies to a State or Territory law
30
(3) This section applies to the interaction between a provision (the
31
displacement provision) of a law of a referring State or a Territory
32
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 3 Interaction between the Co mmonwealth credit legislation and State and
Territory laws
Section 26
36 National Consumer Credit Protection Bill 2009 No. , 2009
and a provision (the Commonwealth provision) of the
1
Commonwealth credit legislation only if the displacement
2
provision is declared by a law of the State or Territory to be a
3
Commonwealth credit legislation displacement provision for the
4
purposes of this section (either generally or specifically in relation
5
to the Commonwealth provision).
6
Effect of displacement provision
7
(4) The Commonwealth provision does not:
8
(a) prohibit the doing of an act; or
9
(b) impose a liability (whether civil or criminal) for doing an act;
10
if the displacement provision specifically permits, authorises or
11
requires the doing of that act.
12
(5) The Commonwealth provision does not operate in or in relation to
13
the State or Territory to the extent necessary to ensure that no
14
inconsistency arises between:
15
(a) the Commonwealth provision; and
16
(b) the displacement provision to the extent to which the
17
displacement provision would, apart from this subsection, be
18
inconsistent with the Commonwealth provision.
19
Note 1:
The displacement provision is not covered by this subsection if
20
subsection (4) applies to the displacement provision: if that subsection
21
applies there would be no potential inconsistency to be dealt with by
22
this subsection.
23
Note 2:
The operation of the displacement provision will be supported by
24
section 23 to the extent to which it can operate concurrently with the
25
Commonwealth provision.
26
(6) Subsections (4) and (5) do not apply in relation to the displacement
27
provision to the extent to which the regulations provide that those
28
subsections do not apply in relation to the displacement provision.
29
26 Regulations to deal with interaction between laws
30
(1) The regulations may modify the operation of the Commonwealth
31
credit legislation so that:
32
Introduction Chapter 1
Application of this Act and the Transitional Act Part 1 -3
Interaction between the Commonwealth cred it leg islation and State and Territory laws
Division 3
Section 26
National Consumer Credit Protection Bill 2009 No. , 2009 37
(a) provisions of the Commonwealth credit legislation do not
1
apply to a matter that is dealt with by a law of a referring
2
State or a Territory specified in the regulations; or
3
(b) no inconsistency arises between the operation of a provision
4
of the Commonwealth credit legislation and the operation of
5
a provision of a law of a referring State or a Territory
6
specified in the regulations.
7
(2) Without limiting subsection (1), regulations made for the purposes
8
of that subsection may provide that a provision of the
9
Commonwealth credit legislation:
10
(a) does not apply to:
11
(i) a person specified in the regulations; or
12
(ii) a body specified in the regulations; or
13
(iii) circumstances specified in the regulations; or
14
(iv) a person or body specified in the regulations in the
15
circumstances specified in the regulations; or
16
(b) does not prohibit an act to the extent to which the prohibition
17
would otherwise give rise to an inconsistency with a law of a
18
referring State or a Territory; or
19
(c) does not require a person to do an act to the extent to which
20
the requirement would otherwise give rise to an
21
inconsistency with a law of a referring State or a Territory; or
22
(d) does not authorise a person to do an act to the extent to which
23
the conferral of that authority on the person would otherwise
24
give rise to an inconsistency with a law of a referring State or
25
a Territory; or
26
(e) does not impose an obligation on a person to the extent to
27
which complying with that obligation would require the
28
person not to comply with an obligation imposed on the
29
person under a law of a referring State or a Territory; or
30
(f) authorises a person to do something for the purposes of the
31
Commonwealth credit legislation that the person:
32
(i) is authorised to do under a law of a referring State or a
33
Territory; and
34
(ii) would not otherwise be authorised to do under the
35
Commonwealth credit legislation; or
36
Chapter 1 Introduction
Part 1-3 Application of this Act and the Transitional Act
Division 3 Interaction between the Co mmonwealth credit legislation and State and
Territory laws
Section 26
38 National Consumer Credit Protection Bill 2009 No. , 2009
(g) will be taken to be satisfied if a law of a referring State or a
1
Territory is satisfied.
2
3
Licensing of persons who engage in credit activities Chapter 2
Requirement to be licensed to engage in credit activ ities Part 2 -1
Introduction Division 1
Section 27
National Consumer Credit Protection Bill 2009 No. , 2009 39
Chapter 2--Licensing of persons who engage
1
in credit activities
2
Part 2-1--Requirement to be licensed to engage in
3
credit activities
4
Division 1--Introduction
5
27 Guide to this Part
6
This Part is about the licensing of persons to engage in credit
7
activities. In general, a person cannot engage in a credit activity if
8
the person does not hold an Australian credit licence.
9
Division 2 prohibits a person from engaging in credit activities
10
without an Australian credit licence. However, the prohibition does
11
not apply to employees and directors of licensees or related bodies
12
corporate of licensees, or to credit representatives of licensees.
13
Division 3 deals with other prohibitions relating to the requirement
14
to be licensed and to credit activities. These prohibitions relate to
15
holding out and advertising, conducting business with unlicensed
16
persons, charging fees for unlicensed conduct, and giving
17
misleading information.
18
19
Chapter 2 Licensing of persons who engage in credit activities
Part 2-1 Requirement to be licensed to engage in credit activ ities
Division 2 Engaging in credit activities without a licence
Section 28
40 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Engaging in credit activities without a licence
1
28 Application of this Division
2
This Division applies on or after 1 July 2011, or a later day
3
prescribed by the regulations.
4
29 Prohibition on engaging in credit activities without a licence
5
Prohibition on engaging in credit activities without a licence
6
(1) A person must not engage in a credit activity if the person does not
7
hold a licence authorising the person to engage in the credit
8
activity.
9
Civil penalty:
2,000 penalty units.
10
Offence
11
(2) A person commits an offence if:
12
(a) the person is subject to a requirement under subsection (1);
13
and
14
(b) the person engages in conduct; and
15
(c) the conduct contravenes the requirement.
16
Criminal penalty: 200 penalty units, or 2 years imprisonment, or
17
both.
18
Defence
19
(3) For the purposes of subsections (1) and (2), it is a defence if:
20
(a) the person engages in the credit activity on behalf of another
21
person (the principal); and
22
(b) the person is:
23
(i) an employee or director of the principal or of a related
24
body corporate of the principal; or
25
(ii) a credit representative of the principal; and
26
(c) the person's conduct in engaging in the credit activity is
27
within the authority of the principal; and
28
Licensing of persons who engage in credit activities Chapter 2
Requirement to be licensed to engage in credit activ ities Part 2 -1
Engaging in credit activ ities without a licence Division 2
Section 29
National Consumer Credit Protection Bill 2009 No. , 2009 41
(d) the principal holds a licence authorising the principal to
1
engage in the credit activity.
2
Note:
For the purposes of subsection (2), a defendant bears an evidential
3
burden in relation to the matter in subsection (3) (see subsection
4
13.3(3) of the Criminal Code).
5
6
Chapter 2 Licensing of persons who engage in credit activities
Part 2-1 Requirement to be licensed to engage in credit activ ities
Division 3 Other prohib itions relating to the requirement to be licensed and to credit
activities
Section 30
42 National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Other prohibitions relating to the requirement
1
to be licensed and to credit activities
2
30 Prohibitions on holding out and advertising etc.
3
Prohibitions on holding out and advertising etc.
4
(1) A person must not hold out:
5
(a) that the person holds a licence; or
6
(b) that the person holds a licence authorising the person to
7
engage in a particular credit activity; or
8
(c) that a credit activity engaged in by the person or by someone
9
else is exempt from a requirement to hold a licence; or
10
(d) that, in engaging in a credit activity, the person acts on behalf
11
of another person; or
12
(e) that conduct, or proposed conduct, of the person is within the
13
authority of a licensee;
14
if that is not the case.
15
Civil penalty:
2,000 penalty units.
16
(2) A person must not hold out or advertise that the person engages or
17
is able to engage in a credit activity if the person would, if the
18
person engaged in the credit activity, contravene section 29 (which
19
deals with the requirement to be licensed).
20
Civil penalty:
2,000 penalty units.
21
Offence
22
(3) A person commits an offence if:
23
(a) the person is subject to a requirement under subsection (1) or
24
(2); and
25
(b) the person engages in conduct; and
26
(c) the conduct contravenes the requirement.
27
Criminal penalty: 50 penalty units, or 1 year imprisonment, or
28
both.
29
Licensing of persons who engage in credit activities Chapter 2
Requirement to be licensed to engage in credit activ ities Part 2 -1
Other prohibitions relating to the requirement to be licensed and to credit activities
Division 3
Section 31
National Consumer Credit Protection Bill 2009 No. , 2009 43
31 Prohibition on conducting business with unlicensed persons
1
Prohibition on conducting business with unlicensed persons
2
(1) A licensee must not:
3
(a) engage in a credit activity; and
4
(b) in the course of engaging in that credit activity, conduct
5
business with another person who is engaging in a credit
6
activity;
7
if, by engaging in the credit activity, the other person contravenes
8
section 29 (which deals with the requirement to be licensed).
9
Civil penalty:
2,000 penalty units.
10
Offence
11
(2) A person commits an offence if:
12
(a) the person is subject to a requirement under subsection (1);
13
and
14
(b) the person engages in conduct; and
15
(c) the conduct contravenes the requirement.
16
Criminal penalty: 200 penalty units, or 2 years imprisonment, or
17
both.
18
32 Prohibition on charging a fee etc.
19
Prohibition on charging a fee etc.
20
(1) A person must not demand, receive or accept any fee, charge or
21
other amount from a consumer for engaging in a credit activity if,
22
by engaging in that credit activity, the person contravenes, or
23
would contravene, section 29 (which deals with the requirement to
24
be licensed).
25
Civil penalty:
2,000 penalty units.
26
Offence
27
(2) A person commits an offence if:
28
Chapter 2 Licensing of persons who engage in credit activities
Part 2-1 Requirement to be licensed to engage in credit activ ities
Division 3 Other prohib itions relating to the requirement to be licensed and to credit
activities
Section 33
44 National Consumer Credit Protection Bill 2009 No. , 2009
(a) the person is subject to a requirement under subsection (1);
1
and
2
(b) the person engages in conduct; and
3
(c) the conduct contravenes the requirement.
4
Criminal penalty: 50 penalty units, or 1 year imprisonment, or
5
both.
6
33 Prohibition on giving misleading information etc.
7
Prohibition on giving misleading information etc.
8
(1) A person (the giver) must not, in the course of engaging in a credit
9
activity, give information or a document to another person if the
10
giver knows, or is reckless as to whether, the information or
11
document is false in a material particular or materially misleading.
12
Civil penalty:
2,000 penalty units.
13
Offence
14
(2) A person commits an offence if:
15
(a) the person gives information or a document to another
16
person; and
17
(b) the person does so in the course of engaging in a credit
18
activity; and
19
(c) the information or document is false in a material particular
20
or materially misleading.
21
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
22
both.
23
24
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
Introduction Division 1
Section 34
National Consumer Credit Protection Bill 2009 No. , 2009 45
Part 2-2--Australian credit licences
1
Division 1--Introduction
2
34 Guide to this Part
3
This Part is about Australian credit licences.
4
Division 2 explains what an Australian credit licence is and the
5
credit activities that are authorised by it.
6
Division 3 is about how to get an Australian credit licence,
7
including how to apply for it and when ASIC may grant or refuse
8
to grant it.
9
Division 4 is about the conditions that may be imposed on an
10
Australian credit licence.
11
Division 5 is about conduct obligations of licensees.
12
Division 6 is about the suspension, cancellation or variation of an
13
Australian credit licence.
14
15
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 2 Australian credit licences
Section 35
46 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Australian credit licences
1
35 Australian credit licences
2
(1) An Australian credit licence is a licence that authorises the
3
licensee to engage in particular credit activities.
4
(2) The credit activities that the licensee is authorised to engage in are
5
those credit activities specified in a condition of the licence as the
6
credit activities that the licensee is authorised to engage in.
7
8
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
How to get an Australian credit licence Division 3
Section 36
National Consumer Credit Protection Bill 2009 No. , 2009 47
Division 3--How to get an Australian credit licence
1
36 Applying for a licence
2
(1) A person may apply for a licence by lodging an application with
3
ASIC on or after 1 January 2010, or a later day prescribed by the
4
regulations.
5
(2) The application must be in the approved form.
6
37 When a licence may be granted--applicants othe r than ADIs
7
When ASIC must grant a licence
8
(1) ASIC must grant a person (other than an ADI) a licence if (and
9
must not grant the person a licence unless):
10
(a) the person has applied for the licence in accordance with
11
section 36; and
12
(b) ASIC has no reason to believe that the person is likely to
13
contravene the obligations that will apply under section 47 if
14
the licence is granted; and
15
(c) ASIC has no reason to believe that the person is not a fit and
16
proper person to engage in credit activities; and
17
(d) the person has given ASIC any additional information or
18
audit report requested by ASIC under subsection (4); and
19
(e) the person meets any other requirements prescribed by the
20
regulations.
21
Note:
ASIC must not grant a licence to a person contrary to a banning order
22
or disqualification order, or if a prescribed State or Territory order is
23
in force against the person or certain representatives of the person (see
24
section 40).
25
Matters ASIC must have regard to
26
(2) For the purposes of paragraphs (1)(b) and (c), ASIC must (subject
27
to Part VIIC of the Crimes Act 1914) have regard to the following:
28
(a) whether a registration under the Transitional Act, a licence or
29
an Australian financial services licence of the person has ever
30
been suspended or cancelled;
31
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 3 How to get an Australian credit licence
Section 37
48 National Consumer Credit Protection Bill 2009 No. , 2009
(b) whether a banning order or disqualification order under
1
Part 2-4 has ever been made against the person;
2
(c) whether a banning order or disqualification order under
3
Division 8 of Part 7.6 of the Corporations Act 2001 has ever
4
been made against the person;
5
(d) whether the person has ever been banned from engaging in a
6
credit activity under a law of a State or Territory;
7
(e) any relevant information given to ASIC by a State or
8
Territory, or an authority of a State or Territory, in relation to
9
the person;
10
(f) if the person is not the trustees of a trust--whether the person
11
has ever been insolvent;
12
(g) if the person is a single natural person:
13
(i) whether the person has ever been disqualified from
14
managing corporations under Part 2D.6 of the
15
Corporations Act 2001; and
16
(ii) any criminal conviction of the person, within 10 years
17
before the application was made;
18
(h) if the person is not a single natural person, whether ASIC has
19
reason to believe that any of the following persons is not a fit
20
and proper person to engage in credit activities:
21
(i) if the person is a body corporate--each director,
22
secretary or senior manager of the body corporate who
23
would perform duties in relation to the credit activities
24
to be authorised by the licence;
25
(ii) if the person is a partnership or the trustees of a trust--
26
each partner or trustee who would perform duties in
27
relation to the credit activities to be authorised by the
28
licence;
29
(i) any other matter ASIC considers relevant;
30
(j) any other matter prescribed by the regulations.
31
Note:
Part VIIC of the Crimes Act 1914 includes provisions that, in certain
32
circumstances, relieve persons from the requirement to disclose spent
33
convictions and require persons aware of such convictions to disregard
34
them.
35
(3) ASIC must (subject to Part VIIC of the Crimes Act 1914), in
36
considering whether it has reason to believe that a person referred
37
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
How to get an Australian credit licence Division 3
Section 38
National Consumer Credit Protection Bill 2009 No. , 2009 49
to in paragraph (2)(h) is not a fit and proper person to engage in
1
credit activities, have regard to:
2
(a) the matters set out in paragraphs (2)(a) to (g); and
3
(b) any other matter ASIC considers relevant; and
4
(c) any other matter prescribed by the regulations;
5
in relation to that person.
6
ASIC may request information or audit report from applicant
7
(4) ASIC may give a written notice to a person who has applied for a
8
licence requesting the person to lodge with ASIC, within the time
9
specified in the notice, either or both of the following:
10
(a) additional information specified in the notice in relation to
11
any matters that ASIC may have regard to in deciding
12
whether to grant the licence;
13
(b) an audit report, prepared by a suitably qualified person
14
specified in the notice, in relation to matters that ASIC may
15
have regard to in deciding whether to grant the licence.
16
(5) If the person does not lodge with ASIC the additional information
17
or audit report requested by ASIC under subsection (4) within the
18
time specified in the notice, the person is taken to have withdrawn
19
the application. ASIC may extend the time by giving a written
20
notice to the person.
21
38 When a licence may be granted--ADIs
22
If:
23
(a) an ADI applies under section 36 for a licence; and
24
(b) the application includes a statement (in accordance with the
25
requirements of the approved form) to the effect that the ADI
26
will, if granted the licence, comply with its obligations as a
27
licensee;
28
then ASIC must grant the ADI a licence authorising the ADI to
29
engage in credit activities that equate (as closely as possible) to the
30
credit activities in relation to which the application was made.
31
Note:
ASIC must not grant a licence to a person contrary to a banning order
32
or disqualification order, or if a prescribed State or Territory order is
33
in force against the person or certain representatives of the person (see
34
section 40).
35
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 3 How to get an Australian credit licence
Section 39
50 National Consumer Credit Protection Bill 2009 No. , 2009
39 Regulations may prescribe streamlined process for other
1
applicants
2
Despite sections 36 and 37, the regulations may provide that:
3
(a) some or all of sections 36 and 37 do not apply in relation to
4
particular classes of applicants; and
5
(b) alternative processes apply to applications for licences by,
6
and the grant of licences to, those classes of applicants.
7
40 Licences must not be granted to certain applicants
8
Banning or disqualification order in force against person
9
(1) Despite subsection 37(1) and section 38, ASIC must not grant a
10
licence that authorises a person to engage in a credit activity if a
11
banning order or disqualification order under Part 2-4 is in force
12
against the person in relation to that credit activity.
13
Prescribed State or Territory order in force against person etc.
14
(2) Despite subsection 37(1) and section 38, ASIC must not grant a
15
licence to a person if:
16
(a) the person is a natural person against whom a prescribed
17
State or Territory order is in force; or
18
(b) the person is a body corporate, and a prescribed State or
19
Territory order is in force against a director, secretary or
20
senior manager of the body corporate who would perform
21
duties in relation to the credit activities to be authorised by
22
the licence; or
23
(c) the person is a partnership or the trustees of a trust, and a
24
prescribed State or Territory order is in force against a
25
partner or trustee who would perform duties in relation to the
26
credit activities to be authorised by the licence.
27
41 Applicant must be given hearing before refusal of licence
28
ASIC may only refuse to grant a licence after giving the person
29
who applied for the licence an opportunity:
30
(a) to appear, or be represented, at a hearing before ASIC that
31
takes place in private; and
32
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
How to get an Australian credit licence Division 3
Section 42
National Consumer Credit Protection Bill 2009 No. , 2009 51
(b) to make submissions to ASIC in relation to the refusal.
1
42 Notice of grant or refusal of licence and date of effect
2
(1) ASIC must give a person (the applicant) who has applied for a
3
licence written notice of:
4
(a) ASIC's decision on the application; and
5
(b) if the decision is to grant the applicant a licence--the day on
6
which the licence takes effect; and
7
(c) if the decision is not to grant the applicant a licence--the
8
reasons for the decision.
9
(2) The licence comes into force on the day specified in the notice,
10
which must not be before the day on which the decision to grant
11
the licence was made.
12
43 Australian credit licence numbers
13
(1) ASIC must allocate each licence a unique Australian credit licence
14
number when it is granted.
15
(2) If:
16
(a) a person is granted a licence; and
17
(b) the person holds an Australian financial services licence;
18
then the Australian credit licence number that ASIC gives to the
19
licence held by that person must be the same number as the
20
person's Australian financial services licence number.
21
(3) ASIC must give the licensee written notice of the Australian credit
22
licence number.
23
44 Basis on which licence is granted
24
A licence granted under this Division is granted on the basis that:
25
(a) conditions on the licence may be imposed, varied or revoked
26
under section 45 or 46; and
27
(b) the licence may be suspended under section 54, 55 or 56; and
28
(c) the licence may be cancelled under section 54, 55 or 56; and
29
(d) the licence may be varied under section 57; and
30
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 3 How to get an Australian credit licence
Section 44
52 National Consumer Credit Protection Bill 2009 No. , 2009
(e) the licence may be cancelled, revoked, terminated or varied
1
by or under later legislation; and
2
(f) no compensation is payable if:
3
(i) conditions on the licence are imposed, varied or revoked
4
as referred to in paragraph (a); or
5
(ii) the licence is suspended, cancelled, varied, revoked or
6
terminated as referred to in paragraphs (b) to (e).
7
8
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
Conditions on an Australian credit licence Division 4
Section 45
National Consumer Credit Protection Bill 2009 No. , 2009 53
Division 4--Conditions on an Australian credit licence
1
45 The conditions on the licence
2
ASIC may impose, vary or revoke conditions on licences
3
(1) ASIC may, at any time:
4
(a) impose conditions, or additional conditions, on a licence; and
5
(b) vary or revoke conditions imposed on a licence.
6
(2) ASIC may do so:
7
(a) on its own initiative; or
8
(b) if the licensee lodges an application with ASIC for the
9
imposition, variation or revocation.
10
(3) The application must be in the approved form.
11
Notice and effect of imposition, variation or revocation of
12
conditions
13
(4) ASIC must give the licensee written notice of the imposition,
14
variation or revocation of the conditions. The imposition, variation
15
or revocation of the conditions comes into force on the day
16
specified in the notice, which must not be before the day on which
17
the decision to impose, vary or revoke the conditions was made.
18
ASIC must give the licensee a hearing
19
(5) Despite subsection (1), ASIC may only impose conditions or
20
additional conditions, or vary or revoke the conditions, on the
21
licence after giving the licensee an opportunity:
22
(a) to appear, or be represented, at a hearing before ASIC that
23
takes place in private; and
24
(b) to make submissions to ASIC in relation to the conditions.
25
This subsection does not apply to ASIC imposing conditions when
26
the licence is granted.
27
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 4 Conditions on an Australian credit licence
Section 46
54 National Consumer Credit Protection Bill 2009 No. , 2009
Condition in relation to credit activities authorised
1
(6) ASIC must ensure that the licence is subject to a condition that
2
specifies the credit activities or classes of credit activities that the
3
licensee is authorised to engage in.
4
Regulations may prescribe conditions
5
(7) The licence is subject to such other conditions as are prescribed by
6
the regulations. However, ASIC cannot vary or revoke those
7
conditions.
8
46 Licence conditions--special procedures for APRA-regulated
9
bodies
10
Special procedures for APRA-regulated bodies (other than ADIs)
11
(1) If the licensee, or a related body corporate, is a body (the APRA
12
body) regulated by APRA (other than an ADI), then the following
13
provisions apply:
14
(a) ASIC cannot:
15
(i) impose, vary or revoke a condition on the licence that,
16
in ASIC's opinion, has or would have the result of
17
preventing the APRA body from being able to carry on
18
all or any of its usual activities (being activities in
19
relation to which APRA has regulatory or supervisory
20
responsibilities); or
21
(ii) vary a condition so that it would, in ASIC's opinion,
22
become a condition that would have a result as
23
described in subparagraph (i);
24
unless ASIC has first consulted APRA about the proposed
25
action;
26
(b) if ASIC imposes, varies or revokes a condition on the licence
27
and paragraph (a) does not apply to that action, ASIC must,
28
within one week, inform APRA of the action that has been
29
taken.
30
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
Conditions on an Australian credit licence Division 4
Section 46
National Consumer Credit Protection Bill 2009 No. , 2009 55
Special procedures for ADIs
1
(2) If the licensee, or a related body corporate, is an ADI, then the
2
following provisions apply:
3
(a) subject to paragraphs (b) and (c), the powers that ASIC
4
would otherwise have under section 45:
5
(i) to impose, vary or revoke a condition on the licence
6
that, in ASIC's opinion, has or would have the result of
7
preventing the ADI from being able to carry on all or
8
any of its banking business (within the meaning of the
9
Banking Act 1959); or
10
(ii) to vary a condition so that it would, in ASIC's opinion,
11
become a condition that would have a result as
12
described in subparagraph (i);
13
are instead powers of the Minister;
14
(b) the following provisions apply in relation to a power to
15
which paragraph (a) applies:
16
(i) the procedures for the exercise of the power are the
17
same as would apply if ASIC could exercise the power,
18
except that the Minister must not exercise the power
19
unless he or she has first considered advice from ASIC
20
on the proposed action, being advice given after ASIC
21
has consulted APRA about the proposed action;
22
(ii) ASIC (rather than the Minister) must still conduct any
23
hearing required under paragraph 45(5)(a) and receive
24
any submissions under paragraph 45(5)(b);
25
(c) if ASIC imposes, varies or revokes a condition on the licence
26
and paragraph (a) does not apply to that action, ASIC must,
27
within one week, inform APRA of the action that has been
28
taken.
29
30
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 5 Obligations of licensees
Section 47
56 National Consumer Credit Protection Bill 2009 No. , 2009
Division 5--Obligations of licensees
1
47 General conduct obligations of licensees
2
General conduct obligations
3
(1) A licensee must:
4
(a) do all things necessary to ensure that the credit activities
5
authorised by the licence are engaged in efficiently, honestly
6
and fairly; and
7
(b) have in place adequate arrangements to ensure that clients of
8
the licensee are not disadvantaged by any conflict of interest
9
that may arise wholly or partly in relation to credit activities
10
engaged in by the licensee or its representatives; and
11
(c) comply with the conditions on the licence; and
12
(d) comply with the credit legislation; and
13
(e) take reasonable steps to ensure that its representatives
14
comply with the credit legislation; and
15
(f) maintain the competence to engage in the credit activities
16
authorised by the licence; and
17
(g) ensure that its representatives are adequately trained, and are
18
competent, to engage in the credit activities authorised by the
19
licence; and
20
(h) have an internal dispute resolution procedure that:
21
(i) complies with standards and requirements made or
22
approved by ASIC in accordance with the regulations;
23
and
24
(ii) covers disputes in relation to the credit activities
25
engaged in by the licensee or its representatives; and
26
(i) be a member of an approved external dispute resolution
27
scheme; and
28
(j) have compensation arrangements in accordance with
29
section 48; and
30
(k) have adequate arrangements and systems to ensure
31
compliance with its obligations under this section, and a
32
written plan that documents those arrangements and systems;
33
and
34
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
Obligations of licensees Division 5
Section 48
National Consumer Credit Protection Bill 2009 No. , 2009 57
(l) unless the licensee is a body regulated by APRA:
1
(i) have available adequate resources (including financial,
2
technological and human resources) to engage in the
3
credit activities authorised by the licence and to carry
4
out supervisory arrangements; and
5
(ii) have adequate risk management systems; and
6
(m) comply with any other obligations that are prescribed by the
7
regulations.
8
Assessment of whether compliance is adequate
9
(2) For the purposes of paragraphs (1)(b), (g), (k) and (l), in
10
considering whether a matter is adequate, the nature, scale and
11
complexity of the credit activities engaged in by the licensee must
12
be taken into account.
13
Regulations in relation to internal dispute resolution procedures
14
(3) Regulations made for the purposes of paragraph (1)(h) may also
15
deal with the variation or revocation of:
16
(a) standards or requirements made by ASIC; or
17
(b) approvals given by ASIC.
18
48 Requirements for compensation arrangements
19
Requirement to have adequate compensation arrangements
20
(1) A licensee must have adequate arrangements for compensating
21
persons for loss or damage suffered because of a contravention of
22
this Act by the licensee or its representatives.
23
When arrangements are adequate
24
(2) For the purposes of subsection (1), arrangements are adequate if,
25
and only if, they:
26
(a) satisfy any requirements prescribed by the regulations; or
27
(b) are approved in writing by ASIC.
28
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 5 Obligations of licensees
Section 49
58 National Consumer Credit Protection Bill 2009 No. , 2009
Approval of arrangements by ASIC
1
(3) Before approving arrangements under paragraph (2)(b), ASIC must
2
have regard to:
3
(a) the credit activities authorised by the licence; and
4
(b) whether the arrangements will continue to cover persons after
5
the licensee ceases to engage in credit activities, and the
6
length of time for which that cover will continue; and
7
(c) any other matters that are prescribed by the regulations.
8
(4) Without limiting paragraph (3)(c), the regulations may, in
9
particular, prescribe additional details in relation to the matters to
10
which ASIC must have regard under paragraphs (3)(a) and (b).
11
49 Obligation to provide a statement or obtain an audit report if
12
directed by ASIC
13
Notice to licensee to provide a statement
14
(1) ASIC may give a licensee a written notice directing the licensee to
15
lodge with ASIC a written statement containing specified
16
information about the credit activities engaged in by the licensee or
17
its representatives.
18
(2) Notices under subsection (1):
19
(a) may be given at any time; and
20
(b) may be given to one or more particular licensees, or to each
21
licensee in one or more classes of licensee, or to all licensees;
22
and
23
(c) may require all the same information, or may contain
24
differences as to the information they require; and
25
(d) may require a statement containing information to be given
26
on a periodic basis, or each time a particular event or
27
circumstance occurs, without ASIC having to give a further
28
written notice.
29
Notice to licensee to obtain an audit report
30
(3) ASIC may also give a licensee a written notice directing the
31
licensee to obtain an audit report, prepared by a suitably qualified
32
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
Obligations of licensees Division 5
Section 49
National Consumer Credit Protection Bill 2009 No. , 2009 59
person specified in the notice, on a statement, or on each statement
1
in a class of statements, under subsection (1) before the statement
2
is given to ASIC.
3
(4) A notice under subsection (3) is not a legislative instrument.
4
Notice must specify day by which licensee must comply
5
(5) A notice given under this section must specify the day by which
6
the licensee must comply with the notice (which must be a
7
reasonable period after the notice is given). ASIC may extend the
8
day by giving a written notice to the licensee.
9
Requirement to comply with notice
10
(6) The licensee must comply with a notice given under this section
11
within the time specified in the notice.
12
Civil penalty:
2,000 penalty units.
13
Offence
14
(7) A person commits an offence if:
15
(a) the person is subject to a requirement under subsection (6);
16
and
17
(b) the person engages in conduct; and
18
(c) the conduct contravenes the requirement.
19
Criminal penalty: 25 penalty units, or 6 months imprisonment,
20
or both.
21
Strict liability offence
22
(8) A person commits an offence if:
23
(a) the person is subject to a requirement under subsection (6);
24
and
25
(b) the person engages in conduct; and
26
(c) the conduct contravenes the requirement.
27
Criminal penalty: 10 penalty units.
28
(9) Subsection (8) is an offence of strict liability.
29
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 5 Obligations of licensees
Section 50
60 National Consumer Credit Protection Bill 2009 No. , 2009
Note:
For strict liability, see section 6.1 of the Criminal Code.
1
50 Obligation to give ASIC information require d by the regulations
2
Regulations may require licensee to give information
3
(1) The regulations may require a licensee, or each licensee in a class
4
of licensees, to give ASIC specified information about the credit
5
activities engaged in by the licensee or its representatives.
6
Requirement to comply with regulations
7
(2) If regulations under subsection (1) require a licensee to give ASIC
8
information, the licensee must give ASIC that information.
9
Civil penalty:
2,000 penalty units.
10
Offence
11
(3) A person commits an offence if:
12
(a) the person is subject to a requirement to give ASIC
13
information under subsection (2); and
14
(b) the person engages in conduct; and
15
(c) the conduct contravenes the requirement.
16
Criminal penalty: 25 penalty units, or 6 months imprisonment,
17
or both.
18
Strict liability offence
19
(4) A person commits an offence if:
20
(a) the person is subject to a requirement to give ASIC
21
information under subsection (2); and
22
(b) the person engages in conduct; and
23
(c) the conduct contravenes the requirement.
24
Criminal penalty: 10 penalty units.
25
(5) Subsection (4) is an offence of strict liability.
26
Note:
For strict liability, see section 6.1 of the Criminal Code.
27
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
Obligations of licensees Division 5
Section 51
National Consumer Credit Protection Bill 2009 No. , 2009 61
51 Obligation to provide ASIC with assistance if reasonably
1
requested
2
Requirement to provide assistance
3
(1) If ASIC, or a person authorised by ASIC, reasonably requests
4
assistance from a licensee in relation to whether the licensee and its
5
representatives are complying with the credit legislation, the
6
licensee must give ASIC or the authorised person the requested
7
assistance.
8
Civil penalty:
2,000 penalty units.
9
(2) If the request is in writing, it is not a legislative instrument.
10
Offence
11
(3) A person commits an offence if:
12
(a) the person is subject to a requirement to give ASIC or an
13
authorised person assistance under subsection (1); and
14
(b) the person engages in conduct; and
15
(c) the conduct contravenes the requirement.
16
Criminal penalty: 25 penalty units, or 6 months imprisonment,
17
or both.
18
Assistance may include showing ASIC credit books etc.
19
(4) The assistance referred to in subsection (1) may include showing
20
ASIC the person's credit books or giving ASIC other information.
21
52 Obligation to cite Australian credit licence numbe r
22
When this section applies
23
(1) This section applies on or after the day that is 2 years after the day
24
section 3 commences.
25
Requirement to include licence number in documents
26
(2) Whenever a licensee identifies itself in a document of a kind
27
prescribed by the regulations, the licensee must:
28
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 5 Obligations of licensees
Section 53
62 National Consumer Credit Protection Bill 2009 No. , 2009
(a) include in the document the licensee's Australian credit
1
licence number; and
2
(b) identify in the document that the number is the licensee's
3
Australian credit licence number.
4
Civil penalty:
2,000 penalty units.
5
Strict liability offence
6
(3) A person commits an offence if:
7
(a) the person is subject to a requirement under subsection (2) to
8
include and identify its Australian credit licence number in a
9
document; and
10
(b) the person engages in conduct; and
11
(c) the conduct contravenes the requirement.
12
Criminal penalty: 10 penalty units.
13
(4) Subsection (3) is an offence of strict liability.
14
Note:
For strict liability, see section 6.1 of the Criminal Code.
15
53 Obligation to lodge annual compliance certificate
16
Requirement to lodge annual compliance certificate
17
(1) A licensee must, no later than 45 days after the licensee's licensing
18
anniversary in each year, lodge a compliance certificate with ASIC
19
in accordance with this section. ASIC may extend the day by
20
giving a written notice to the licensee.
21
Civil penalty:
2,000 penalty units.
22
Compliance certificate must be in approved form
23
(2) The compliance certificate must be in the approved form.
24
Who must sign compliance certificate
25
(3) The compliance certificate must be signed by:
26
(a) if the licensee is a single natural person--the licensee; or
27
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
Obligations of licensees Division 5
Section 53
National Consumer Credit Protection Bill 2009 No. , 2009 63
(b) if the licensee is a body corporate--a person of a kind
1
prescribed by the regulations; or
2
(c) if the licensee is a partnership or the trustees of a trust--a
3
partner or trustee who performs duties in relation to credit
4
activities.
5
Requirement to ensure compliance certificate is lodged
6
(4) Each person by whom the compliance certificate may be signed
7
under subsection (3) must ensure that the licensee lodges the
8
compliance certificate with ASIC in accordance with this section.
9
Civil penalty:
2,000 penalty units.
10
Strict liability offence
11
(5) A person commits an offence if:
12
(a) the person is subject to a requirement under subsection (1) or
13
(4); and
14
(b) the person engages in conduct; and
15
(c) the conduct contravenes the requirement.
16
Criminal penalty: 60 penalty units.
17
(6) Subsection (5) is an offence of strict liability.
18
Meaning of licensing anniversary
19
(7) Licensing anniversary of a licensee means the anniversary of the
20
day on which the licensee's licence came into force under
21
section 42.
22
23
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 6 When a licence can be suspended, cancelled or varied
Section 54
64 National Consumer Credit Protection Bill 2009 No. , 2009
Division 6--When a licence can be suspended, cancelled or
1
varied
2
Subdivision A--Suspensions and cancellations
3
54 Suspension or cancellation without hearing
4
(1) ASIC may suspend or cancel a licensee's licence if:
5
(a) the licensee lodges with ASIC an application for the
6
suspension or cancellation; or
7
(b) the licensee ceases to engage in credit activities; or
8
(c) any of the matters set out in subsection (2) applies to any of
9
the following persons:
10
(i) the licensee;
11
(ii) if the licensee is a body corporate--a director, secretary
12
or senior manager of the body corporate who performs
13
duties in relation to credit activities;
14
(iii) if the licensee is a partnership or the trustees of a trust--
15
a partner or trustee who performs duties in relation to
16
credit activities.
17
(2) For the purposes of paragraph (1)(c), the matters are as follows:
18
(a) if the person is not the trustees of a trust--the person is
19
insolvent;
20
(b) if the person is a natural person:
21
(i) the person is convicted of serious fraud; or
22
(ii) the person is incapable of managing his or her affairs
23
because of physical or mental incapacity; or
24
(iii) a prescribed State or Territory order is in force against
25
the person.
26
(3) An application for suspension or cancellation of a licence must be
27
in the approved form.
28
55 Suspension or cancellation after offering a hearing
29
(1) ASIC may suspend or cancel a licensee's licence (subject to
30
complying with subsection (4)) if:
31
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
When a licence can be suspended, cancelled or varied Division 6
Section 55
National Consumer Credit Protection Bill 2009 No. , 2009 65
(a) the licensee has contravened an obligation under section 47
1
(which deals with general conduct obligations of licensees);
2
or
3
(b) ASIC has reason to believe that the licensee is likely to
4
contravene an obligation under that section; or
5
(c) ASIC has reason to believe that the licensee is not a fit and
6
proper person to engage in credit activities; or
7
(d) the application for the licence:
8
(i) was false in a material particular or materially
9
misleading; or
10
(ii) omitted a material matter.
11
(2) For the purposes of paragraphs (1)(b) and (c), ASIC must (subject
12
to Part VIIC of the Crimes Act 1914) have regard to the following:
13
(a) if the person is a natural person--the matters set out in
14
paragraphs 37(2)(a) to (f) and subparagraph 37(2)(g)(i) in
15
relation to the person;
16
(b) if the person is not a natural person:
17
(i) the matters set out in paragraphs 37(2)(a) to (f) in
18
relation to the person; and
19
(ii) whether ASIC has reason to believe that any of the
20
persons referred to in paragraph 37(2)(h) in relation to
21
the person is not a fit and proper person to engage in
22
credit activities;
23
(c) any criminal conviction of the person, within 10 years before
24
the licence is proposed to be suspended or cancelled;
25
(d) any other matter ASIC considers relevant;
26
(e) any other matter prescribed by the regulations.
27
Note:
Part VIIC of the Crimes Act 1914 includes provisions that, in certain
28
circumstances, relieve persons from the requirement to disclose spent
29
convictions and require persons aware of such convictions to disregard
30
them.
31
(3) ASIC must (subject to Part VIIC of the Crimes Act 1914), in
32
considering whether it has reason to believe that a person referred
33
to in subparagraph (2)(b)(ii) is not a fit and proper person to
34
engage in credit activities, have regard to the matters set out in
35
paragraphs (2)(a), (c), (d) and (e) in relation to the person.
36
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 6 When a licence can be suspended, cancelled or varied
Section 56
66 National Consumer Credit Protection Bill 2009 No. , 2009
(4) ASIC may only suspend or cancel a licensee's licence under this
1
section after giving the licensee an opportunity:
2
(a) to appear, or be represented, at a hearing before ASIC that
3
takes place in private; and
4
(b) to make submissions to ASIC on the matter.
5
56 Suspension and cancellation--special procedures for
6
APRA-regulated bodies
7
Special procedures for APRA-regulated bodies (other than ADIs)
8
(1) If a licensee, or a related body corporate, is a body (the APRA
9
body) regulated by APRA (other than an ADI), then the following
10
provisions apply:
11
(a) ASIC cannot suspend or cancel the licensee's licence if doing
12
so would, in ASIC's opinion, have the result of preventing
13
the APRA body from being able to carry on all or any of its
14
usual activities (being activities in relation to which APRA
15
has regulatory or supervisory responsibilities), unless ASIC
16
has first consulted APRA about the proposed action;
17
(b) if ASIC suspends or cancels the licensee's licence and
18
paragraph (a) does not apply to that action, ASIC must,
19
within one week, inform APRA of the action that has been
20
taken.
21
Special procedures for ADIs
22
(2) If:
23
(a) a licensee is an ADI; or
24
(b) a related body corporate of a licensee is an ADI, and
25
cancellation or suspension of the licensee's licence would, in
26
ASIC's opinion, have the result of preventing the ADI from
27
being able to carry on all or any of its banking business
28
(within the meaning of the Banking Act 1959);
29
then the following provisions have effect:
30
(c) subject to paragraph (d), the powers that ASIC would
31
otherwise have under this Division to cancel or suspend the
32
licensee's licence, or to revoke a suspension to which this
33
subsection applied, are instead powers of the Minister;
34
Licensing of persons who engage in credit activities Chapter 2
Australian cred it licences Part 2-2
When a licence can be suspended, cancelled or varied Division 6
Section 57
National Consumer Credit Protection Bill 2009 No. , 2009 67
(d) the procedures for the exercise of a power to which
1
paragraph (c) applies are the same as would apply if ASIC
2
could exercise the power, except that the Minister must not
3
exercise the power unless he or she has first considered
4
advice from ASIC on the proposed action, being advice given
5
after ASIC has consulted APRA about the proposed action;
6
(e) ASIC (rather than the Minister) must still conduct any
7
hearing required under paragraph 55(4)(a) and receive any
8
submissions under paragraph 55(4)(b).
9
Subdivision B--Variations
10
57 Varying licences
11
ASIC may vary a person's licence to take account of a change in
12
the person's name.
13
Note:
The conditions on the licence can be varied under section 45.
14
Subdivision C--Miscellaneous rules about suspensions,
15
cancellations and variations
16
58 Effect of suspe nsion
17
(1) A suspended licence has no effect while it remains suspended.
18
(2) Subsection (1) has effect subject to section 62 (which deals with
19
the continued effect of some suspended or cancelled licences).
20
59 Revocation of suspension
21
ASIC may at any time revoke the suspension of a licence.
22
60 Date of effect, notice and publication of variation, cancellation or
23
suspension etc.
24
(1) ASIC must give a licensee written notice of a variation,
25
suspension, revocation of a suspension, or cancellation of the
26
licensee's licence.
27
Chapter 2 Licensing of persons who engage in credit activities
Part 2-2 Australian cred it licences
Division 6 When a licence can be suspended, cancelled or varied
Section 61
68 National Consumer Credit Protection Bill 2009 No. , 2009
(2) A variation, suspension, revocation of a suspension, or cancellation
1
of a licence comes into force when the written notice of that action
2
is given to the licensee.
3
(3) As soon as practicable after the notice is given to the licensee,
4
ASIC must publish a notice of the action on ASIC's website. The
5
notice must state when the action took effect.
6
61 Statement of reasons
7
A notice of suspension or cancellation given to a licensee must be
8
accompanied by a statement of reasons for the action taken.
9
62 ASIC may allow licence to continue in force
10
(1) If ASIC gives a written notice of suspension or cancellation to a
11
licensee, ASIC may include terms in the notice specifying that the
12
licence continues in force as though the suspension or cancellation
13
had not happened for the purposes of specified provisions of this
14
Act in relation to specified matters, a specified period, or both.
15
(2) If ASIC includes terms in a notice under subsection (1), the licence
16
continues in force in accordance with the terms of the notice.
17
18
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Introduction Division 1
Section 63
National Consumer Credit Protection Bill 2009 No. , 2009 69
Part 2-3--Credit representatives and other
1
representatives of licensees
2
Division 1--Introduction
3
63 Guide to this Part
4
This Part is about credit representatives of licensees (which are a
5
particular type of representative of licensees). A person who is
6
authorised as a credit representative of a licensee does not need to
7
hold an Australian credit licence when engaging in credit activities
8
on behalf of the licensee.
9
This Part also deals with information that ASIC may give to
10
licensees about their representatives (such as their employees,
11
directors and credit representatives, and persons who act on their
12
behalf), and the liability of licensees for their representatives.
13
Division 2 deals with how a credit representative may be
14
authorised to engage in credit activities on behalf of a licensee. It
15
also deals with certain obligations of licensees in relation to the
16
authorisation of their credit representatives.
17
Division 3 deals with information about representatives that ASIC
18
may give to a licensee and the use of that information.
19
Division 4 deals with the liability of licensees for the conduct of
20
their representatives.
21
22
Chapter 2 Licensing of persons who engage in credit activities
Part 2-3 Cred it representatives and other representatives of licensees
Division 2 Authorisation of credit representatives
Section 64
70 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Authorisation of credit representatives
1
64 Licensee may authorise credit representatives
2
Authorisation of credit representative by licensee
3
(1) A licensee may give a person a written notice authorising the
4
person to engage in specified credit activities on behalf of the
5
licensee.
6
(2) A person who is authorised under subsection (1) is a credit
7
representative of the relevant licensee.
8
(3) The credit activities specified may be some or all of the credit
9
activities authorised by the licensee's licence.
10
When authorisation is of no effect
11
(4) The authorisation:
12
(a) is of no effect if subsection (5) applies to it when it is given;
13
and
14
(b) ceases to have effect if and when subsection (5) starts to
15
apply to it after it is given;
16
to the extent that subsection (5) applies.
17
(5) This section applies to the authorisation to the extent that it
18
purports to authorise:
19
(a) a person to engage in a credit activity that is not authorised
20
by the licensee's licence; or
21
(b) a person to engage in a credit activity, and a banning order or
22
disqualification order under Part 2-4 is in force against the
23
person in relation to the credit activity; or
24
(c) a person who is not a member of an approved external
25
dispute resolution scheme; or
26
(d) a person who is banned from engaging in a credit activity
27
under a law of a State or Territory; or
28
(e) a natural person who has been convicted, within the last 10
29
years, of serious fraud; or
30
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Authorisation of credit representatives Division 2
Section 65
National Consumer Credit Protection Bill 2009 No. , 2009 71
(f) a natural person against whom a prescribed State or Territory
1
order is in force; or
2
(g) a person that is a body corporate, if a prescribed State or
3
Territory order is in force against a director, secretary or
4
senior manager of the body corporate who would perform
5
duties in relation to the credit activities specified in the
6
authorisation; or
7
(h) a person that is a partnership or the trustees of a trust, if a
8
prescribed State or Territory order is in force against a
9
partner or trustee who would perform duties in relation to the
10
credit activities specified in the authorisation.
11
65 Credit re presentative that is a body corporate may sub-authorise
12
natural persons as credit re presentatives
13
Authorisation of natural person as credit representative by credit
14
representative that is a body corporate
15
(1) A body corporate that is a credit representative of a licensee may,
16
in that capacity, give a natural person a written notice authorising
17
that natural person to engage in specified credit activities on behalf
18
of the licensee.
19
(2) A natural person who is authorised under subsection (1) is a credit
20
representative of the relevant licensee.
21
(3) The credit activities specified may be some or all of the credit
22
activities authorised by the licensee's licence.
23
Licensee must give consent to authorisation
24
(4) The authorisation can only be given if the licensee gives the body
25
corporate its written consent to the authorisation. The licensee may
26
give consent in relation to either a specified natural person or a
27
specified class of natural persons (the membership of which might
28
change from time to time).
29
When authorisation is of no effect
30
(5) The authorisation:
31
Chapter 2 Licensing of persons who engage in credit activities
Part 2-3 Cred it representatives and other representatives of licensees
Division 2 Authorisation of credit representatives
Section 66
72 National Consumer Credit Protection Bill 2009 No. , 2009
(a) is of no effect if subsection (6) applies to it when it is given;
1
and
2
(b) ceases to have effect if and when subsection (6) starts to
3
apply to it after it is given;
4
to the extent that subsection (6) applies.
5
(6) This subsection applies to the authorisation to the extent that it
6
purports to authorise:
7
(a) a natural person to engage in a credit activity that is not
8
authorised by the licensee's licence; or
9
(b) a natural person to engage in a credit activity, and a banning
10
order or disqualification order under Part 2-4 is in force
11
against the natural person in relation to the credit activity; or
12
(c) a natural person who is not a member of an approved external
13
dispute resolution scheme; or
14
(d) a natural person who is banned from engaging in a credit
15
activity under a law of a State or Territory; or
16
(e) a natural person who has been convicted, within the last 10
17
years, of serious fraud; or
18
(f) a natural person against whom a prescribed State or Territory
19
order is in force; or
20
(g) a natural person in relation to the authorisation of whom the
21
licensee has not given its written consent in accordance with
22
subsection (4).
23
(7) To avoid doubt, an authorisation under subsection (1) is taken, for
24
the purposes of sections 66 to 72, to be given by the body
25
corporate, not the licensee.
26
66 Credit re presentative of 2 or more licensees
27
(1) One person can be the credit representative of 2 or more licensees,
28
but only if:
29
(a) each of those licensees has consented to the person also being
30
the credit representative of each of the other licensees; or
31
(b) each of the licensees is a related body corporate of each of
32
the other licensees.
33
(2) An authorisation:
34
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Authorisation of credit representatives Division 2
Section 67
National Consumer Credit Protection Bill 2009 No. , 2009 73
(a) is of no effect if it contravenes subsection (1) when it is
1
given; and
2
(b) ceases to have effect if and when it starts to contravene
3
subsection (1) after it is given.
4
67 A pe rson cannot be a credit representative in relation to credit
5
activities authorised by a person's licence
6
(1) A person must not authorise another person to engage in a credit
7
activity as a credit representative under subsection 64(1) or 65(1) if
8
the other person holds a licence authorising the person to engage in
9
the credit activity.
10
(2) An authorisation:
11
(a) is of no effect if it contravenes subsection (1) when it is
12
given; and
13
(b) ceases to have effect if and when it starts to contravene
14
subsection (1) after it is given.
15
68 Variation and revocation of authorisations and
16
sub-authorisations
17
Variation and revocation of authorisations
18
(1) An authorisation under subsection 64(1) may be varied or revoked
19
at any time by the licensee giving written notice to the credit
20
representative.
21
Variation and revocation of sub-authorisations
22
(2) An authorisation under subsection 65(1) may be varied or revoked
23
at any time by:
24
(a) the licensee in relation to whom the authorisation was given;
25
or
26
(b) the body corporate that gave the authorisation;
27
giving written notice to the credit representative.
28
(3) If a person varies or revokes an authorisation under subsection (2),
29
that person must give the other person who could have varied or
30
Chapter 2 Licensing of persons who engage in credit activities
Part 2-3 Cred it representatives and other representatives of licensees
Division 2 Authorisation of credit representatives
Section 69
74 National Consumer Credit Protection Bill 2009 No. , 2009
revoked the authorisation written notice of the variation or
1
revocation.
2
69 Obligation not to give authorisation that has no effect
3
Requirement not to give authorisation
4
(1) A person must not purport to authorise a credit representative
5
under subsection 64(1) or 65(1) if, at the time the person first
6
purports to give the authorisation, it is of no effect, to any extent,
7
under this Division.
8
Civil penalty:
2,000 penalty units.
9
Offence
10
(2) A person commits an offence if:
11
(a) the person is subject to a requirement under subsection (1);
12
and
13
(b) the person engages in conduct; and
14
(c) the conduct contravenes the requirement.
15
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
16
both.
17
70 Obligation to vary or revoke authorisation that ceases to have
18
effect
19
Requirement to vary or revoke authorisation
20
(1) If a person:
21
(a) has authorised a credit representative under subsection 64(1)
22
or 65(1); and
23
(b) becomes aware of a matter because of which the
24
authorisation of the credit representative has ceased to have
25
effect under this Division;
26
the person must, as soon as practicable:
27
(c) revoke the authorisation; or
28
(d) vary the authorisation so that it is no longer, to any extent, of
29
no effect under this Division.
30
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Authorisation of credit representatives Division 2
Section 71
National Consumer Credit Protection Bill 2009 No. , 2009 75
Civil penalty:
2,000 penalty units.
1
Offence
2
(2) A person commits an offence if:
3
(a) the person is required to vary or revoke an authorisation
4
under subsection (1); and
5
(b) the person engages in conduct; and
6
(c) the conduct contravenes subsection (1).
7
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
8
both.
9
71 Obligation to notify ASIC etc. about credit representatives
10
Requirement to notify ASIC when credit representative authorised
11
(1) If a person authorises a credit representative under subsection
12
64(1) or 65(1), the person must, within 15 business days of the
13
authorisation, lodge with ASIC a written notice in accordance with
14
subsection (3).
15
Civil penalty:
2,000 penalty units.
16
Requirement to notify licensee of sub-authorisation
17
(2) If:
18
(a) a person authorises a natural person as a credit representative
19
of a licensee under subsection 65(1) (which deals with
20
sub-authorisations); and
21
(b) the consent of the licensee to the authorisation was given in
22
relation to a specified class of natural persons;
23
then the person must, within 15 business days of the authorisation,
24
give the licensee written notice of the authorisation in accordance
25
with subsection (3).
26
Civil penalty:
2,000 penalty units.
27
Details to be included in notice
28
(3) The notice must include the following details:
29
Chapter 2 Licensing of persons who engage in credit activities
Part 2-3 Cred it representatives and other representatives of licensees
Division 2 Authorisation of credit representatives
Section 71
76 National Consumer Credit Protection Bill 2009 No. , 2009
(a) the name and business address of the credit representative;
1
(b) details of the authorisation, including the date on which it
2
was made and what the credit representative is authorised to
3
do on behalf of the licensee;
4
(c) details of the external dispute resolution scheme of which the
5
credit representative is a member;
6
(d) details of each other licensee on behalf of whom the credit
7
representative is a credit representative.
8
Requirement to notify ASIC of change in details etc.
9
(4) If:
10
(a) a person authorises a credit representative under subsection
11
64(1) or 65(1); and
12
(b) either:
13
(i) any of the details that are referred to in subsection (3) in
14
relation to the credit representative changes; or
15
(ii) the person revokes the authorisation;
16
then the person must, within 10 business days of the change or
17
revocation, lodge with ASIC a written notice of the change or
18
revocation.
19
Civil penalty:
2,000 penalty units.
20
(5) A notice given under subsection (1), (2) or (4) must be in the
21
approved form.
22
Strict liability offence
23
(6) A person commits an offence if:
24
(a) the person is subject to a requirement to give a notice under
25
subsection (1), (2) or (4); and
26
(b) the person engages in conduct; and
27
(c) the conduct contravenes the requirement.
28
Criminal penalty: 25 penalty units, or 6 months imprisonment,
29
or both.
30
(7) Subsection (6) is an offence of strict liability.
31
Note:
For strict liability, see section 6.1 of the Criminal Code.
32
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Authorisation of credit representatives Division 2
Section 72
National Consumer Credit Protection Bill 2009 No. , 2009 77
72 Credit re presentative numbe rs
1
(1) Within a reasonable period after receiving a notice under
2
subsection 71(1) of the authorisation of a credit representative,
3
ASIC must allocate the credit representative a unique credit
4
representative number.
5
(2) ASIC must give written notice of the credit representative number
6
to:
7
(a) the credit representative; and
8
(b) the person who authorised the credit representative.
9
(3) This section does not apply in relation to a credit representative
10
that has already been allocated a credit representative number.
11
12
Chapter 2 Licensing of persons who engage in credit activities
Part 2-3 Cred it representatives and other representatives of licensees
Division 3 Information about representatives
Section 73
78 National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Information about representatives
1
73 ASIC may give licensee information about representatives
2
ASIC may give licensee information about representatives
3
(1) If ASIC considers it appropriate to do so, it may give information
4
to a licensee about a person whom ASIC believes is, or will be, a
5
representative of the licensee. However, ASIC may only do so if it
6
believes, on reasonable grounds, that the information is true.
7
Requirements about use of information
8
(2) A licensee to whom information is given under subsection (1) may
9
make use of, make a record of, or give to another person, the
10
information for a purpose connected with:
11
(a) the licensee making a decision about what action (if any) to
12
take in relation to the representative, as a consequence of
13
receiving the information; or
14
(b) the licensee taking action pursuant to such a decision.
15
(3) A licensee to whom information is given under subsection (1) must
16
not make use of, make a record of, or give to another person, the
17
information other than as permitted by subsection (2).
18
Civil penalty:
2,000 penalty units.
19
(4) A person to whom information has been given for a purpose or
20
purposes under subsection (2) or this subsection may make use of,
21
make a record of, or give to another person, that information for
22
that purpose or any of those purposes.
23
(5) A person to whom information has been given for a purpose or
24
purposes under subsection (2) or (4) must not make use of, make a
25
record of, or give to another person, the information other than as
26
permitted by subsection (4).
27
Civil penalty:
2,000 penalty units.
28
Offence
29
(6) A person commits an offence if:
30
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Information about representatives Division 3
Section 73
National Consumer Credit Protection Bill 2009 No. , 2009 79
(a) the person is subject to a requirement under subsection (3) or
1
(5); and
2
(b) the person engages in conduct; and
3
(c) the conduct contravenes the requirement.
4
Criminal penalty: 50 penalty units, or 1 year imprisonment, or
5
both.
6
Qualified privilege
7
(7) A person has qualified privilege in relation to an act done by the
8
person under subsection (2) or (4).
9
Use of information obtained under this section in court
10
(8) A person to whom information is given in accordance with this
11
section must not give any of the information to a court, or produce
12
in a court a document that sets out some or all of the information,
13
except:
14
(a) for a purpose connected with:
15
(i) a licensee making a decision about what action (if any)
16
to take in relation to the representative, as a
17
consequence of receiving some or all of the information;
18
or
19
(ii) a licensee taking action pursuant to that decision; or
20
(iii) proving in proceedings in that court that particular
21
action taken by a licensee in relation to the
22
representative was taken pursuant to that decision; or
23
(b) in proceedings in that court, in so far as the proceedings
24
relate to an alleged contravention of this section; or
25
(c) in proceedings about giving to a court false information
26
some, at least, of which was the information given under this
27
section.
28
(9) For the purposes of subsection (8), a licensee takes action in
29
relation to a representative if the licensee:
30
(a) takes action by way of making, terminating or varying the
31
terms and conditions of an agreement; or
32
(b) otherwise takes action in relation to an agreement;
33
Chapter 2 Licensing of persons who engage in credit activities
Part 2-3 Cred it representatives and other representatives of licensees
Division 3 Information about representatives
Section 73
80 National Consumer Credit Protection Bill 2009 No. , 2009
to the extent that the agreement relates to the representative acting
1
on behalf of the licensee.
2
(10) Subsection (8) also has the effect it would have if:
3
(a) a reference in it to a court were a reference to a court of an
4
external Territory or of a country outside Australia and the
5
external Territories; and
6
(b) paragraph (8)(b) were omitted.
7
8
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Liability of licensees for representatives Division 4
Section 74
National Consumer Credit Protection Bill 2009 No. , 2009 81
Division 4--Liability of licensees for representatives
1
74 Application of this Division
2
This Division applies to any conduct of a representative of a
3
licensee:
4
(a) that relates to a credit activity; and
5
(b) on which a third person (the client) could reasonably be
6
expected to rely; and
7
(c) on which the client in fact relied in good faith.
8
75 Responsibility if representative of only one licensee
9
If the representative is the representative of only one licensee, the
10
licensee is responsible, as between the licensee and the client, for
11
the conduct of the representative, whether or not the
12
representative's conduct is within the authority of the licensee.
13
76 Representatives of multiple licensees
14
When this section applies
15
(1) This section applies if the representative is the representative of
16
more than one licensee.
17
Conduct covered by only one authority
18
(2) If:
19
(a) the representative is the representative of one of the licensees
20
only in relation to a particular class of credit activity; and
21
(b) the conduct relates to that class of credit activity;
22
that licensee is responsible for the conduct, as between that
23
licensee and the client, whether or not the conduct is within the
24
authority of the licensee.
25
Conduct covered by multiple authorities
26
(3) If:
27
Chapter 2 Licensing of persons who engage in credit activities
Part 2-3 Cred it representatives and other representatives of licensees
Division 4 Liab ility of licensees for representatives
Section 77
82 National Consumer Credit Protection Bill 2009 No. , 2009
(a) the representative is the representative of more than one of
1
the licensees in relation to a particular class of credit activity;
2
and
3
(b) the conduct relates to that class of credit activity; and
4
(c) the conduct is within the authority of:
5
(i) only one of those licensees (the authorising licensee);
6
or
7
(ii) 2 or more of those licensees (the authorising licensees);
8
then:
9
(d) if subparagraph (c)(i) applies--the authorising licensee is
10
responsible for the conduct, as between that licensee and the
11
client; or
12
(e) if subparagraph (c)(ii) applies--the authorising licensees are
13
jointly and severally responsible for the conduct, as between
14
themselves and the client.
15
All other cases
16
(4) In any other case, all of the licensees are jointly and severally
17
responsible for the conduct, as between themselves and the client,
18
whether or not the representative's conduct is within the authority
19
of any of them.
20
77 Responsibility extends to loss or damage suffered by client
21
The responsibility of a licensee under this Division extends so as to
22
make the licensee liable to the client in relation to any loss or
23
damage suffered by the client as a result of the representative's
24
conduct.
25
78 Effect of this Division
26
(1) If a licensee is responsible for the conduct of its representative
27
under this Division, the client has the same remedies against the
28
licensee that the client has against the representative.
29
(2) The licensee and the representative (along with any other licensees
30
that are also responsible) are all jointly and severally liable to the
31
client in relation to those remedies.
32
Licensing of persons who engage in credit activities Chapter 2
Cred it representatives and other representatives of licensees Part 2 -3
Liability of licensees for representatives Division 4
Section 78
National Consumer Credit Protection Bill 2009 No. , 2009 83
(3) However, nothing in this Division imposes:
1
(a) any criminal responsibility; or
2
(b) any civil liability under a provision of this Act apart from this
3
Division;
4
on a licensee that would not otherwise be imposed on the licensee.
5
(4) This Division does not relieve a representative of a licensee of any
6
liability that the representative has to the client or the licensee.
7
(5) An agreement has no effect in so far as it purports to alter or
8
restrict the operation of section 75, 76 or 77.
9
(6) However, subsection (5) does not apply to the extent that the
10
agreement:
11
(a) provides for a representative of a licensee to indemnify the
12
licensee for a liability of the licensee in relation to the
13
representative; or
14
(b) provides for a licensee, for whom a representative acts, to
15
indemnify another licensee for a liability in relation to the
16
representative.
17
(7) A licensee must not make, or offer to make, an agreement that has,
18
or would have, no effect under subsection (5).
19
20
Chapter 2 Licensing of persons who engage in credit activities
Part 2-4 Banning or disqualification of persons fro m engaging in cred it activities
Division 1 Introduction
Section 79
84 National Consumer Credit Protection Bill 2009 No. , 2009
Part 2-4--Banning or disqualification of persons
1
from engaging in credit activities
2
Division 1--Introduction
3
79 Guide to this Part
4
This Part is about the banning and disqualification of persons from
5
engaging in credit activities.
6
Division 2 deals with banning orders, which are orders made by
7
ASIC that prohibit a person from engaging in credit activities.
8
Division 3 deals with disqualification orders, which are orders of
9
the court that disqualify a person from engaging in credit activities.
10
11
Licensing of persons who engage in credit activities Chapter 2
Banning or disqualification of persons from engaging in cred it activities Part 2-4
Banning orders Division 2
Section 80
National Consumer Credit Protection Bill 2009 No. , 2009 85
Division 2--Banning orders
1
80 ASIC's powe r to make a banning order
2
(1) ASIC may make a banning order against a person:
3
(a) if ASIC suspends or cancels a licence of the person; or
4
(b) for a person other than the trustees of a trust--if the person
5
becomes insolvent; or
6
(c) for a natural person--if the person is convicted of fraud; or
7
(d) if the person has:
8
(i) contravened any credit legislation; or
9
(ii) been involved in a contravention of a provision of any
10
credit legislation by another person; or
11
(e) if ASIC has reason to believe that the person is likely to:
12
(i) contravene any credit legislation; or
13
(ii) be involved in a contravention of a provision of any
14
credit legislation by another person; or
15
(f) if ASIC has reason to believe that the person is not a fit and
16
proper person to engage in credit activities; or
17
(g) if a prescribed State or Territory order is in force against the
18
person; or
19
(h) in any other circumstances prescribed by the regulations.
20
(2) For the purposes of paragraphs (1)(e) and (f), ASIC must (subject
21
to Part VIIC of the Crimes Act 1914) have regard to the following:
22
(a) if the person is a natural person--the matters set out in
23
paragraphs 37(2)(a) to (f) and subparagraph 37(2)(g)(i) in
24
relation to the person;
25
(b) if the person is not a natural person:
26
(i) the matters set out in paragraphs 37(2)(a) to (f) in
27
relation to the person; and
28
(ii) whether ASIC has reason to believe that any of the
29
persons referred to in paragraph 37(2)(h) in relation to
30
the person is not a fit and proper person to engage in
31
credit activities;
32
(c) any criminal conviction of the person, within 10 years before
33
the banning order is proposed to be made;
34
Chapter 2 Licensing of persons who engage in credit activities
Part 2-4 Banning or disqualification of persons fro m engaging in cred it activities
Division 2 Banning orders
Section 81
86 National Consumer Credit Protection Bill 2009 No. , 2009
(d) any other matter ASIC considers relevant;
1
(e) any other matter prescribed by the regulations.
2
Note:
Part VIIC of the Crimes Act 1914 includes provisions that, in certain
3
circumstances, relieve persons from the requirement to disclose spent
4
convictions and require persons aware of such convictions to disregard
5
them.
6
(3) ASIC must (subject to Part VIIC of the Crimes Act 1914), in
7
considering whether it has reason it has reason to believe that a
8
person referred to in subparagraph (2)(b)(ii) is not a fit and proper
9
person to engage in credit activities, have regard to the matters set
10
out in paragraphs (2)(a), (c), (d) and (e) in relation to the person.
11
(4) Despite subsection (1), ASIC may only make a banning order
12
against a person after giving the person an opportunity:
13
(a) to appear, or be represented, at a hearing before ASIC that
14
takes place in private; and
15
(b) to make submissions to ASIC on the matter.
16
(5) Subsection (4) does not apply if:
17
(a) ASIC's grounds for making the banning order against the
18
person include that ASIC has suspended or cancelled a
19
licence of the person (see paragraph (1)(a)); and
20
(b) the suspension or cancellation took place without a hearing
21
under section 54.
22
(6) Subsection (4) also does not apply if:
23
(a) ASIC's grounds for making the banning order against the
24
person include that the person has been convicted of fraud
25
(see paragraph (1)(c)); and
26
(b) the person has been convicted of serious fraud.
27
(7) ASIC must give a copy of the banning order to the person against
28
whom it was made.
29
81 What is a banning order?
30
(1) A banning order is a written order that prohibits a person from
31
engaging in any credit activities or specified credit activities in
32
specified circumstances or capacities.
33
Licensing of persons who engage in credit activities Chapter 2
Banning or disqualification of persons from engaging in cred it activities Part 2-4
Banning orders Division 2
Section 82
National Consumer Credit Protection Bill 2009 No. , 2009 87
(2) The order may prohibit the person against whom it is made from
1
engaging in a credit activity:
2
(a) permanently; or
3
(b) for a specified period.
4
(3) A banning order may include a provision allowing the person
5
against whom it was made, subject to any specified conditions:
6
(a) to do specified acts; or
7
(b) to do specified acts in specified circumstances;
8
that the order would otherwise prohibit them from doing.
9
(4) A banning order is not a legislative instrument.
10
82 Effect of banning orde rs
11
Requirement not to engage in conduct contrary to banning order
12
(1) A person must not engage in conduct that is contrary to a banning
13
order that is in force against the person.
14
Civil penalty:
2,000 penalty units.
15
Offence
16
(2) A person commits an offence if:
17
(a) the person is subject to a requirement under subsection (1);
18
and
19
(b) the person engages in conduct; and
20
(c) the conduct contravenes the requirement.
21
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
22
both.
23
Note:
A person against whom a banning order is in force cannot be granted a
24
licence authorising the person to engage in a credit activity to which
25
the banning order applies (see subsection 40(1)).
26
Chapter 2 Licensing of persons who engage in credit activities
Part 2-4 Banning or disqualification of persons fro m engaging in cred it activities
Division 2 Banning orders
Section 83
88 National Consumer Credit Protection Bill 2009 No. , 2009
83 Variation or cancellation of banning orders
1
(1) ASIC may vary or cancel a banning order if ASIC is satisfied that
2
it is appropriate to do so because of a change in any of the
3
circumstances based on which ASIC made the order.
4
(2) ASIC may do so:
5
(a) on its own initiative; or
6
(b) if the person against whom the order was made lodges with
7
ASIC an application for the variation or cancellation.
8
(3) The application must be in the approved form.
9
(4) If ASIC proposes not to vary or cancel a banning order in
10
accordance with an application given by a person under
11
paragraph (2)(b), ASIC must give the person an opportunity:
12
(a) to appear, or be represented, at a hearing before ASIC that
13
takes place in private; and
14
(b) to make submissions to ASIC on the matter.
15
(5) ASIC must give written notice of the variation or cancellation of a
16
banning order to the person against whom the order was made.
17
84 Date of effect, notice and publication of banning order, variation
18
or cancellation
19
(1) A banning order comes into force when it is given to the person
20
against whom it is made.
21
(2) A variation or cancellation of a banning order comes into force
22
when written notice of the variation or cancellation is given to the
23
person against whom the order was made.
24
(3) ASIC must publish a notice on ASIC's website as soon as
25
practicable after making, varying or cancelling a banning order.
26
The notice must state when the banning order, or variation or
27
cancellation of the banning order, came into force and:
28
(a) in the case of the making of a banning order--set out a copy
29
of the banning order; or
30
(b) in the case of the variation of a banning order--set out a copy
31
of the banning order as varied.
32
Licensing of persons who engage in credit activities Chapter 2
Banning or disqualification of persons from engaging in cred it activities Part 2-4
Banning orders Division 2
Section 85
National Consumer Credit Protection Bill 2009 No. , 2009 89
(4) However, if the banning order contains a provision of the kind
1
referred to in subsection 81(3) and ASIC considers that the notice
2
on its website would be unreasonably long if that provision were
3
included, the notice may instead set out a summary of the
4
provision's effect.
5
85 Statement of reasons
6
(1) A copy of a banning order given to a person must be accompanied
7
by a statement of reasons for the order.
8
(2) If ASIC varies a banning order made against a person, ASIC must,
9
on request by the person, give the person a statement of reasons for
10
the variation.
11
12
Chapter 2 Licensing of persons who engage in credit activities
Part 2-4 Banning or disqualification of persons fro m engaging in cred it activities
Division 3 Disqualification by the court
Section 86
90 National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Disqualification by the court
1
86 Disqualification by the court
2
(1) ASIC may apply to the court for an order under subsection (2) in
3
relation to a person if ASIC:
4
(a) cancels a licence of the person; or
5
(b) makes a banning order against the person that is to operate
6
permanently.
7
(2) The court may make:
8
(a) an order disqualifying the person, permanently or for a
9
specified period, from engaging in credit activities, or
10
specified credit activities, in specified circumstances or
11
capacities; or
12
(b) any other order the court considers appropriate.
13
Note:
A person against whom a disqualification order is in force cannot be
14
granted a licence authorising the person to engage in a credit activity
15
to which the disqualification order applies (see subsection 40(1)).
16
17
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Introduction Division 1
Section 87
National Consumer Credit Protection Bill 2009 No. , 2009 91
Part 2-5--Financial records, trust accounts and
1
audit reports
2
Division 1--Introduction
3
87 Guide to this Part
4
This Part is about financial records, trust accounts and matters
5
relating to audit reports required under this Act.
6
Division 2 deals with the requirement for licensees to keep certain
7
financial records, and provides for how those records must be kept.
8
Division 3 deals with trust accounts. Licensees that provide credit
9
services and that receive money on behalf of others in the course of
10
those services are required to maintain a trust account. Those
11
licensees must also comply with requirements in relation to trust
12
account money, trust account statements and trust account audit
13
reports.
14
Division 4 has requirements relating to audit reports required by
15
this Act, and the auditors that prepare those reports.
16
17
Chapter 2 Licensing of persons who engage in credit activities
Part 2-5 Financial records, trust accounts and audit reports
Division 2 Financial records of licensees
Section 88
92 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Financial records of licensees
1
88 Obligation to keep financial records
2
Requirement to keep financial records
3
(1) A licensee must:
4
(a) keep financial records that correctly record and explain the
5
transactions and financial position of any business of
6
engaging in credit activities carried on by the licensee; and
7
(b) keep those records in accordance with this Division; and
8
(c) comply with subsection 90(2) in relation to the conversion of
9
records into the English language; and
10
(d) comply with section 91 in relation to the location and
11
production of records and particulars.
12
Civil penalty:
2,000 penalty units.
13
Meaning of financial records
14
(2) Financial records includes:
15
(a) invoices, receipts, orders for the payment of money, bills of
16
exchange, cheques, promissory notes and vouchers; and
17
(b) documents of prime entry; and
18
(c) any trust account statement or trust account report required
19
under section 100.
20
Offence
21
(3) A person commits an offence if:
22
(a) the person is subject to a requirement in relation to financial
23
records under subsection (1); and
24
(b) the person engages in conduct; and
25
(c) the conduct contravenes subsection (1).
26
Criminal penalty: 200 penalty units, or 5 years imprisonment, or
27
both.
28
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Financial records of licensees Division 2
Section 89
National Consumer Credit Protection Bill 2009 No. , 2009 93
Financial records may be kept with other records
1
(4) A licensee does not contravene this Division merely because some
2
or all of the financial records are prepared as a part of, or in
3
conjunction with, the records relating to any other business that is
4
carried on by the licensee.
5
Note:
For the purposes of subsection (3), a defendant bears an evidential
6
burden in relation to the matter in subsection (4) (see subsection
7
13.3(3) of the Criminal Code).
8
89 How financial records are to be kept
9
The financial records must be kept in a way that:
10
(a) enables true and fair profit and loss statements, and balance
11
sheets, of the business referred to in paragraph 88(1)(a) to be
12
prepared from time to time; and
13
(b) allows those statements and balance sheets to be
14
conveniently and properly audited in accordance with the
15
auditing standards (if any) prescribed by regulations made
16
under section 106.
17
90 Language of financial records
18
(1) The financial records must be kept in writing in the English
19
language, or in a manner that enables them to be readily accessible
20
and readily converted into writing in the English language.
21
(2) If any of the financial records are not kept in writing in the English
22
language, the licensee must, if required to convert the financial
23
records concerned into writing in the English language by a person
24
who is entitled to examine the financial records concerned, comply
25
with the requirement within a reasonable time.
26
91 Location of financial records
27
If any of the financial records are kept outside this jurisdiction, the
28
licensee must:
29
(a) cause to be sent to and retained at a place in this jurisdiction
30
such particulars in relation to the business dealt with in those
31
Chapter 2 Licensing of persons who engage in credit activities
Part 2-5 Financial records, trust accounts and audit reports
Division 2 Financial records of licensees
Section 92
94 National Consumer Credit Protection Bill 2009 No. , 2009
financial records as will enable true and fair profit and loss
1
statements and balance sheets to be prepared; and
2
(b) if required by ASIC to produce those financial records at a
3
place in this jurisdiction, comply with the requirement not
4
later than 28 days after the requirement is made.
5
92 Information to be shown in financial records
6
The financial records must be kept in sufficient detail to show
7
particulars of:
8
(a) all money received or paid by the licensee; and
9
(b) for each credit contract under which the licensee is the credit
10
provider:
11
(i) the amount and day of all payments made by or on
12
behalf of the debtor under the credit contract; and
13
(ii) all amounts (including principal, interest, fees and
14
charges) owed by the debtor under the credit contract;
15
and
16
(c) for each consumer lease under which the licensee is the
17
lessor--the amount and day of all payments made by or on
18
behalf of the lessee under the consumer lease; and
19
(d) for each guarantee under which the licensee is the beneficiary
20
of the guarantee--the amount and day of all payments made
21
by or on behalf of the guarantor under the guarantee; and
22
(e) all income received by the licensee from commissions,
23
interest, and other sources, and all expenses, commissions,
24
and interest paid by the licensee; and
25
(f) all the assets and liabilities (including contingent liabilities)
26
of the licensee; and
27
(g) any other matters prescribed by the regulations.
28
93 Regulations may impose additional require ments
29
The regulations may impose additional requirements to be
30
complied with in relation to the financial records including, for
31
example:
32
(a) requirements for things to be contained in the records; and
33
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Financial records of licensees Division 2
Section 94
National Consumer Credit Protection Bill 2009 No. , 2009 95
(b) requirements relating to the level of detail to be shown in the
1
records.
2
94 Financial records taken to be made with licensee's authority
3
An entry in the records is, unless the contrary is proved, to be taken
4
to have been made by, or with the authority of, the licensee.
5
95 Obligation to retain financial records for 7 years
6
Requirement to retain financial records
7
(1) A licensee that is required by this Division to make a financial
8
record must retain it for 7 years after the transactions covered by
9
the record are completed.
10
Civil penalty:
2,000 penalty units.
11
Regulations
12
(2) The regulations may prescribe financial records to which
13
subsection (1) does not apply.
14
Records to be kept even if person stops carrying on business
15
(3) Financial records must be retained in accordance with this section,
16
even if the person stops carrying on any business to which they
17
relate.
18
Offence
19
(4) A person commits an offence if:
20
(a) the person is subject to a requirement under subsection (1);
21
and
22
(b) the person engages in conduct; and
23
(c) the conduct contravenes the requirement.
24
Criminal penalty: 50 penalty units, or 6 months imprisonment,
25
or both.
26
Chapter 2 Licensing of persons who engage in credit activities
Part 2-5 Financial records, trust accounts and audit reports
Division 2 Financial records of licensees
Section 96
96 National Consumer Credit Protection Bill 2009 No. , 2009
96 Financial records are prima facie evidence of matters
1
(1) In proceedings in a court, a financial record kept under this
2
Division is admissible as prima facie evidence of any matter in the
3
financial record.
4
(2) A document purporting to be a financial record kept by a licensee
5
under this Division is, unless the contrary is proved, presumed to
6
be a financial record kept by the licensee under this Division.
7
(3) If:
8
(a) because of subsection (1) a financial record is prima facie
9
evidence of a matter; and
10
(b) the financial record, or a part of the financial, is kept or
11
prepared by recording or storing matters (including that
12
matter) by means of a mechanical, electronic or other device;
13
a written reproduction of that matter as so recorded or stored is
14
admissible as prima facie evidence of that matter in a proceeding in
15
a court.
16
(4) A written document that purports to reproduce a matter recorded or
17
stored by means of a mechanical, electronic or other device is,
18
unless the contrary is proved, presumed to be a reproduction of that
19
matter.
20
21
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Trust accounts of credit service licensees Division 3
Section 97
National Consumer Credit Protection Bill 2009 No. , 2009 97
Division 3--Trust accounts of credit service licensees
1
97 Application of this Division
2
This Division applies to a licensee (the credit service licensee)
3
that:
4
(a) holds a licence that authorises the licensee to provide a credit
5
service; and
6
(b) in the course of providing the credit service, receives money
7
for or on behalf of another person.
8
98 Obligation for credit service lice nsees to maintain trust account
9
Requirement to maintain trust account
10
(1) The credit service licensee must maintain one more trust accounts
11
(the trust account) in accordance with this section.
12
Civil penalty:
2,000 penalty units.
13
Requirements for trust accounts
14
(2) The trust account must be maintained with an Australian ADI
15
(within the meaning of section 9 of the Corporations Act 2001).
16
(3) The trust account must be designated as the credit service
17
licensee's trust account.
18
Offence
19
(4) The credit service licensee commits an offence if:
20
(a) the credit service licensee is subject to a requirement under
21
subsection (1); and
22
(b) the credit service licensee engages in conduct; and
23
(c) the conduct contravenes the requirement.
24
Criminal penalty: 25 penalty units, or 6 months imprisonment,
25
or both.
26
Chapter 2 Licensing of persons who engage in credit activities
Part 2-5 Financial records, trust accounts and audit reports
Division 3 Trust accounts of credit service licensees
Section 99
98 National Consumer Credit Protection Bill 2009 No. , 2009
99 Obligations in relation to trust account money
1
Requirement to pay money to credit of trust account
2
(1) The credit service licensee must pay to the credit of the trust
3
account any money received by the credit service licensee for or on
4
behalf of another person in relation to the credit service provided
5
by the licensee.
6
Civil penalty:
2,000 penalty units.
7
Requirement in relation to withdrawal of money from trust account
8
(2) The credit service licensee must not withdraw any money paid into
9
the trust account, other than for the purpose of paying the money in
10
accordance with subsection (3).
11
Civil penalty:
2,000 penalty units.
12
Requirement in relation to payment of money from trust account
13
(3) The credit service licensee must pay any money withdrawn from
14
the trust account to the person or persons lawfully entitled to
15
receive that money.
16
Civil penalty:
2,000 penalty units.
17
Offence
18
(4) The credit service licensee commits an offence if:
19
(a) the credit service licensee is subject to a requirement under
20
subsection (1), (2) or (3); and
21
(b) the credit service licensee engages in conduct; and
22
(c) the conduct contravenes the requirement.
23
Criminal penalty: 25 penalty units, or 6 months imprisonment,
24
or both.
25
Trust account money not available for payment of debts etc.
26
(5) Money paid into a trust account by the credit service licensee under
27
this section:
28
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Trust accounts of credit service licensees Division 3
Section 100
National Consumer Credit Protection Bill 2009 No. , 2009 99
(a) is not available for the payment of a debt of any other
1
creditor of the credit service licensee; and
2
(b) is not liable to be attached or taken in execution under the
3
order or process of a court at the instance of any such
4
creditors.
5
100 Obligation to lodge trust account statement and trust account
6
audit report
7
Requirement to prepare and lodge trust account statement
8
(1) The credit service licensee must, for each financial year of the
9
credit service licensee:
10
(a) prepare a written statement in relation to the trust account
11
(the trust account statement) in accordance with this section;
12
and
13
(b) lodge the trust account statement with ASIC in accordance
14
with this section.
15
Civil penalty:
2,000 penalty units.
16
Requirement to prepare and lodge trust account audit report
17
(2) The credit service licensee must, with the trust account statement,
18
lodge with ASIC an auditor's report (the trust account audit
19
report) in accordance with this section.
20
Civil penalty:
2,000 penalty units.
21
Requirements for statement and audit report
22
(3) Each of the trust account statement and trust account audit report
23
must:
24
(a) be in the approved form; and
25
(b) contain the information and matters prescribed by the
26
regulations; and
27
(c) be lodged with ASIC in accordance with section 101.
28
Chapter 2 Licensing of persons who engage in credit activities
Part 2-5 Financial records, trust accounts and audit reports
Division 3 Trust accounts of credit service licensees
Section 101
100 National Consumer Credit Protection Bill 2009 No. , 2009
(4) The trust account audit report must be prepared by a person who
1
complies with any eligibility requirements prescribed by the
2
regulations.
3
Offence
4
(5) The credit service licensee commits an offence if:
5
(a) the credit service licensee is subject to a requirement under
6
subsection (1) or (2); and
7
(b) the credit service licensee engages in conduct; and
8
(c) the conduct contravenes the requirement.
9
Criminal penalty: 200 penalty units, or 5 years imprisonment, or
10
both.
11
Meaning of financial year
12
(6) A financial year of the credit service licensee means:
13
(a) if the credit service licensee is not a body corporate--a year
14
ending on 30 June; and
15
(b) if the credit service licensee is a body corporate--a financial
16
year of the body corporate (within the meaning of
17
section 323D of the Corporations Act 2001).
18
101 Time of lodgme nt of trust account statement and trust account
19
audit report
20
(1) Unless an extension is granted under subsection (3), the trust
21
account statement and trust account audit report must be lodged
22
with ASIC before the day that is 3 months after the end of the
23
financial year of the credit service licensee to which they relate.
24
(2) If an extension is granted under subsection (3), the trust account
25
statement and trust account audit report must be lodged with ASIC
26
before the end of the extended period.
27
(3) ASIC may, on application made:
28
(a) by the credit service licensee and the auditor that is to prepare
29
the trust account audit report; and
30
(b) before the end of the period that would otherwise apply;
31
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Trust accounts of credit service licensees Division 3
Section 101
National Consumer Credit Protection Bill 2009 No. , 2009 101
approve an extension of the period for lodging the trust account
1
statement and trust account audit report. The extension may be of
2
the period originally applicable or the period applicable under a
3
previous extension.
4
(4) An approval may be given subject to any conditions imposed by
5
ASIC.
6
(5) If an approval is given subject to conditions, the licensee must
7
comply with those conditions.
8
9
Chapter 2 Licensing of persons who engage in credit activities
Part 2-5 Financial records, trust accounts and audit reports
Division 4 Matters relating to audit reports
Section 102
102 National Consumer Credit Protection Bill 2009 No. , 2009
Division 4--Matters relating to audit reports
1
102 Auditor's right of access to records, information etc.
2
Auditor is entitled to access and assistance etc. from licensee
3
(1) An auditor (the auditor) who prepares one of the following audit
4
reports (the audit report):
5
(a) an audit report required under subsection 49(3) in relation to
6
a licensee;
7
(b) a trust account audit report required under subsection 100(2)
8
in relation to a licensee;
9
has a right of access at all reasonable times to the financial records
10
or other credit books of the licensee for purposes relating to the
11
audit report.
12
(2) The auditor is entitled to require:
13
(a) from the licensee; or
14
(b) if the licensee is a body corporate--from any director,
15
secretary or senior manager of the licensee;
16
any assistance and explanations that the auditor desires for
17
purposes relating to the audit report.
18
Requirement to give auditor access and assistance etc.
19
(3) The licensee, or a director, secretary or senior manager of the
20
licensee if it is a body corporate, must not:
21
(a) refuse or fail to allow the auditor access, in accordance with
22
subsection (1), to financial records or other credit books of
23
the licensee; or
24
(b) refuse or fail to give assistance, or an explanation, to the
25
auditor as and when required under subsection (2); or
26
(c) otherwise hinder, obstruct or delay the auditor in the
27
performance or exercise of the auditor's duties or powers.
28
Civil penalty:
2,000 penalty units.
29
Offence
30
(4) A person commits an offence if:
31
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Matters relating to audit reports Division 4
Section 103
National Consumer Credit Protection Bill 2009 No. , 2009 103
(a) the person is subject to a requirement under subsection (3);
1
and
2
(b) the person engages in conduct; and
3
(c) the person's conduct contravenes the requirement.
4
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
5
both.
6
103 Auditor's fees and expenses
7
(1) The reasonable fees and expenses of the auditor for preparing the
8
audit report are payable by the licensee.
9
(2) The auditor may recover those fees by action against the licensee.
10
104 Auditor to report on certain matters
11
Requirement for auditor to disclose maters
12
(1) If the auditor, in the performance of duties relating to the audit
13
report, becomes aware of a matter referred to in subsection (2), the
14
auditor must, within 7 days after becoming aware of the matter:
15
(a) lodge a written report on the matter with ASIC; and
16
(b) give a copy of the report to the licensee.
17
Civil penalty:
2,000 penalty units.
18
Matters that must be disclosed
19
(2) A report must be given in relation to any matter that, in the opinion
20
of the auditor:
21
(a) has adversely affected, is adversely affecting or may
22
adversely affect the ability of the licensee to meet the
23
licensee's obligations as a licensee; or
24
(b) constitutes or may constitute a contravention of:
25
(i) Division 2 or 3 (or regulations made under those
26
Divisions); or
27
(ii) a condition of the licensee's licence; or
28
Chapter 2 Licensing of persons who engage in credit activities
Part 2-5 Financial records, trust accounts and audit reports
Division 4 Matters relating to audit reports
Section 105
104 National Consumer Credit Protection Bill 2009 No. , 2009
(c) constitutes an attempt to unduly influence, coerce,
1
manipulate or mislead the auditor in the preparation of the
2
audit report.
3
Offence
4
(3) The auditor commits an offence if:
5
(a) the auditor is subject to a requirement under subsection (1);
6
and
7
(b) the auditor engages in conduct; and
8
(c) the auditor's conduct contravenes the requirement.
9
Criminal penalty: 50 penalty units, or 1 year imprisonment, or
10
both.
11
105 Qualified privilege for auditor etc.
12
Qualified privilege for auditor
13
(1) The auditor has qualified privilege in relation to:
14
(a) a statement that the auditor makes, orally or in writing, in the
15
course of its duties relating to the audit report; or
16
(b) the lodging of a report with ASIC under subsection 104(1);
17
or
18
(c) the giving of a report to the licensee under subsection 104(1).
19
Note:
If the auditor is a company, the company has qualified privilege under
20
this subsection in relation to statements made, and reports lodged or
21
sent, by natural persons on behalf of the company if those statements
22
and notices can be properly attributed to the company.
23
Qualified privilege for registered company auditor acting on
24
behalf of company
25
(2) If the auditor is a company registered under the Corporations Act
26
2001, a registered company auditor acting on behalf of the
27
company has qualified privilege in relation to:
28
(a) a statement that the registered company auditor makes (orally
29
or in writing) in the course of the performance, on behalf of
30
the company, of the company's duties relating to the audit
31
report; or
32
Licensing of persons who engage in credit activities Chapter 2
Financial records, trust accounts and audit reports Part 2-5
Matters relating to audit reports Division 4
Section 106
National Consumer Credit Protection Bill 2009 No. , 2009 105
(b) the lodging by the registered company auditor, on behalf of
1
the company, of a report with ASIC under subsection 104(1);
2
or
3
(c) the giving by the registered company auditor, on behalf of the
4
company, of a report to the licensee under subsection 104(1).
5
Qualified privilege for subsequent publication
6
(3) A person has qualified privilege in relation to the publishing of a
7
document prepared by the auditor in the course of the auditor's
8
duties relating to the audit report.
9
(4) A person has qualified privilege in relation to the publishing of a
10
statement:
11
(a) made by the auditor as referred to in subsection (1); or
12
(b) made by a registered company auditor as referred to in
13
subsection (2).
14
106 Regulations in relation to audit reports etc.
15
The regulations may make provision in relation to:
16
(a) the audit reports referred to in subsection 102(1); and
17
(b) audit reports that persons who have applied for a licence may
18
be requested to lodge under subsection 37(4); and
19
(c) the auditors that prepare those reports; and
20
(d) auditing standards that must be complied with in relation to
21
those reports.
22
23
Chapter 2 Licensing of persons who engage in credit activities
Part 2-6 Exemptions and modifications relating to this Chapter
Division 1 Introduction
Section 107
106 National Consumer Credit Protection Bill 2009 No. , 2009
Part 2-6--Exemptions and modifications relating to
1
this Chapter
2
Division 1--Introduction
3
107 Guide to this Part
4
This Part is about exemptions from, and modifications of, the
5
provisions of this Chapter.
6
Division 2 deals with how exemptions and modifications may be
7
made by ASIC or by the regulations.
8
9
Licensing of persons who engage in credit activities Chapter 2
Exemptions and modifications relating to this Chapter Part 2-6
Exemptions and modifications relating to this Chapter Division 2
Section 108
National Consumer Credit Protection Bill 2009 No. , 2009 107
Division 2--Exemptions and modifications relating to this
1
Chapter
2
108 Provisions to which this Part applies
3
The provisions to which this Part applies are:
4
(a) this Chapter; and
5
(b) definitions in this Act, as they apply to references in this
6
Chapter; and
7
(c) instruments made for the purposes of this Chapter.
8
109 Exemptions and modifications by ASIC
9
Exemptions and modifications
10
(1) ASIC may:
11
(a) exempt a person from all or specified provisions to which
12
this Part applies; or
13
(b) exempt a credit activity that is engaged in in relation to a
14
specified credit contract, mortgage, guarantee or consumer
15
lease from all or specified provisions to which this Part
16
applies; or
17
(c) declare that provisions to which this Part applies apply in
18
relation to a person, or a credit activity referred to in
19
paragraph (1)(b), as if specified provisions were omitted,
20
modified or varied as specified in the declaration.
21
(2) An exemption or declaration under subsection (1) is not a
22
legislative instrument.
23
(3) ASIC may, by legislative instrument:
24
(a) exempt a class of persons from all or specified provisions to
25
which this Part applies; or
26
(b) exempt a credit activity (other than a credit activity referred
27
to in paragraph (1)(b)) from all or specified provisions to
28
which this Part applies; or
29
(c) exempt a class of credit activities from all or specified
30
provisions to which this Part applies; or
31
Chapter 2 Licensing of persons who engage in credit activities
Part 2-6 Exemptions and modifications relating to this Chapter
Division 2 Exemptions and modifications relating to this Chapter
Section 110
108 National Consumer Credit Protection Bill 2009 No. , 2009
(d) declare that provisions to which this Part applies apply in
1
relation to a credit activity (other than a credit activity
2
referred to in paragraph (1)(b)), or a class of persons or credit
3
activities, as if specified provisions were omitted, modified
4
or varied as specified in the declaration.
5
Conditions on exemptions
6
(4) An exemption may apply unconditionally or subject to specified
7
conditions. A person to whom a condition specified in an
8
exemption applies must comply with the condition. The court may
9
order the person to comply with the condition in a specified way.
10
Only ASIC may apply to the court for the order.
11
Publication of exemptions and declarations
12
(5) An exemption or declaration under subsection (1) must be in
13
writing and ASIC must publish notice of it on its website.
14
Special rules in relation to offences
15
(6) If conduct (including an omission) of a person would not have
16
constituted an offence if a particular declaration under
17
paragraph (1)(c) or (3)(d) had not been made, that conduct does not
18
constitute an offence unless, before the conduct occurred:
19
(a) the text of the declaration was published by ASIC on its
20
website; or
21
(b) ASIC gave written notice setting out the text of the
22
declaration to the person;
23
(in addition to complying with the requirements of the Legislative
24
Instruments Act 2003 if the declaration is made under
25
subsection (3)).
26
(7) In a prosecution for an offence to which subsection (6) applies, the
27
prosecution must prove that paragraph (6)(a) or (b) was complied
28
with before the conduct occurred.
29
110 Exemptions and modifications by the regulations
30
The regulations may:
31
Licensing of persons who engage in credit activities Chapter 2
Exemptions and modifications relating to this Chapter Part 2-6
Exemptions and modifications relating to this Chapter Division 2
Section 110
National Consumer Credit Protection Bill 2009 No. , 2009 109
(a) exempt a person or class of persons from all or specified
1
provisions to which this Part applies; or
2
(b) exempt a credit activity or a class of credit activities from all
3
or specified provisions to which this Part applies; or
4
(c) provide that the provisions to which this Part applies apply as
5
if specified provisions were omitted, modified or varied as
6
specified in the regulations.
7
8
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 1 Introduction
Section 111
110 National Consumer Credit Protection Bill 2009 No. , 2009
Chapter 3--Responsible lending conduct
1
Part 3-1--Licensees that provide credit assistance
2
in relation to credit contracts
3
Division 1--Introduction
4
111 Guide to this Part
5
This Part has rules that apply to licensees that provide credit
6
assistance in relation to credit contracts. These rules are aimed at
7
better informing consumers and preventing them from being in
8
unsuitable credit contracts. However, these rules do not apply to a
9
licensee that will be the credit provider under the credit contract.
10
Division 2 requires a licensee to give its credit guide to a
11
consumer. The credit guide has information about the licensee and
12
some of the licensee's obligations under this Act.
13
Division 3 requires a licensee to give a quote before providing
14
credit assistance to a consumer. The quote must set out the
15
maximum amount the consumer will be required to pay to the
16
licensee. The licensee must not charge more than that amount.
17
Division 4 requires a licensee, before providing credit assistance to
18
a consumer in relation to a credit contract, to make a preliminary
19
assessment as to whether the contract will be unsuitable for the
20
consumer. To do this, the licensee must make inquiries and
21
verifications about the consumer's requirements, objectives and
22
financial situation. The licensee must give the consumer a copy of
23
the assessment if requested.
24
Division 5 requires a licensee, when providing credit assistance to
25
a consumer in relation to a credit contract, to give the consumer a
26
document that discloses certain information (for example, the
27
commission the licensee is likely to receive).
28
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Introduction Division 1
Section 112
National Consumer Credit Protection Bill 2009 No. , 2009 111
Division 6 prohibits a licensee from providing credit assistance to a
1
consumer in relation to a credit contract if the contract will be
2
unsuitable for the consumer.
3
112 Application of this Part
4
This Part does not apply in relation to credit assistance provided by
5
a licensee in relation to a credit contract if the licensee is or will be
6
the credit provider under the contract.
7
8
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 2 Credit guide of credit assistance providers
Section 113
112 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Credit guide of credit assistance providers
1
113 Credit guide of credit assistance providers
2
Requirement to give credit guide
3
(1) A licensee must, as soon as practicable after it becomes apparent to
4
the licensee that it is likely to provide credit assistance to a
5
consumer in relation to a credit contract, give the consumer the
6
licensee's credit guide in accordance with subsection (2).
7
Civil penalty:
2,000 penalty units.
8
(2) The licensee's credit guide must:
9
(a) be in writing; and
10
(b) be in the form (if any) prescribed by the regulations; and
11
(c) specify the licensee's name and contact details; and
12
(d) specify the licensee's Australian credit licence number; and
13
(e) give information about:
14
(i) any fees that are payable by a consumer to the licensee
15
for the licensee's credit assistance; and
16
(ii) any charges that are payable by a consumer to the
17
licensee for matters associated with providing the credit
18
assistance; and
19
(iii) the method for working out the amount of the fees and
20
charges; and
21
(f) give information about:
22
(i) if there are 6 or fewer credit providers that the licensee
23
conducts business with when providing credit assistance
24
in relation to credit contracts--the names of those credit
25
providers; and
26
(ii) if there are more than 6 credit providers that the licensee
27
conducts business with when providing credit assistance
28
in relation to credit contracts--the names of the 6 credit
29
providers with whom the licensee reasonably believes it
30
conducts the most business; and
31
(g) give information about:
32
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Cred it guide of cred it assistance providers Division 2
Section 113
National Consumer Credit Protection Bill 2009 No. , 2009 113
(i) any commissions that the licensee, or an employee,
1
director or credit representative of the licensee, is likely
2
to receive, directly or indirectly, from credit providers in
3
relation to credit contracts for which the licensee has
4
provided credit assistance; and
5
(ii) a reasonable estimate of the amounts of those
6
commissions or the range of those amounts; and
7
(iii) the method for working out those amounts; and
8
(h) give information about the licensee's procedure for resolving
9
disputes with a consumer, including contact details for a
10
consumer to access:
11
(i) the licensee's internal dispute resolution procedure; and
12
(ii) the approved external dispute resolution scheme of
13
which the licensee is a member; and
14
(i) give information about the licensee's obligations under
15
sections 120 and 123; and
16
(j) comply with any other requirements prescribed by the
17
regulations.
18
(3) The regulations may prescribe:
19
(a) information that need not be included in the credit guide,
20
despite subsection (2); and
21
(b) for the purposes of paragraph (2)(g):
22
(i) the method for working out amounts of commissions;
23
and
24
(ii) how commissions or amounts of commissions must be
25
described.
26
Manner of giving credit guide
27
(4) The licensee must give the consumer the licensee's credit guide in
28
the manner (if any) prescribed by the regulations.
29
Strict liability offence
30
(5) A person commits an offence if:
31
(a) the person is subject to a requirement under subsection (1);
32
and
33
(b) the person engages in conduct; and
34
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 2 Credit guide of credit assistance providers
Section 113
114 National Consumer Credit Protection Bill 2009 No. , 2009
(c) the conduct contravenes the requirement.
1
Criminal penalty: 50 penalty units.
2
(6) Subsection (5) is an offence of strict liability.
3
Note:
For strict liability, see section 6.1 of the Criminal Code.
4
5
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Quote for providing cred it assistance etc. in relation to credit contracts Division 3
Section 114
National Consumer Credit Protection Bill 2009 No. , 2009 115
Division 3--Quote for providing credit assistance etc. in
1
relation to credit contracts
2
114 Quote for providing credit assistance etc.
3
Requirement to give quote
4
(1) A licensee must not provide credit assistance to a consumer by:
5
(a) suggesting that the consumer apply, or assisting the consumer
6
to apply, for a particular credit contract with a particular
7
credit provider; or
8
(b) suggesting that the consumer apply, or assisting the consumer
9
to apply, for an increase to the credit limit of a particular
10
credit contract with a particular credit provider; or
11
(c) suggesting that the consumer remain in a particular credit
12
contract with a particular credit provider;
13
unless:
14
(d) the licensee has given the consumer a quote in accordance
15
with subsection (2); and
16
(e) the consumer has signed and dated that quote or otherwise
17
indicated the consumer's acceptance of it (and the day that
18
happens) in the manner (if any) prescribed by the regulations;
19
and
20
(f) the licensee has given the consumer a copy of the accepted
21
quote.
22
Civil penalty:
2,000 penalty units.
23
(2) The quote must:
24
(a) be in writing; and
25
(b) give information about the credit assistance and other
26
services that the quote covers; and
27
(c) specify the maximum amount that will be payable by the
28
consumer to the licensee in relation to the licensee's credit
29
assistance and other services; and
30
(d) give information about what that amount relates to,
31
including:
32
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 3 Quote for provid ing credit assistance etc. in relation to credit contracts
Section 114
116 National Consumer Credit Protection Bill 2009 No. , 2009
(i) the maximum amount of the licensee's fee for providing
1
the credit assistance and other services; and
2
(ii) the maximum amount of charges that will be incurred
3
by the licensee for matters associated with providing the
4
credit assistance and other services; and
5
(iii) the maximum amount of fees or charges that will be
6
payable by the licensee to another person on the
7
consumer's behalf; and
8
(e) state whether the maximum amount or any other amount will
9
be payable by the consumer to the licensee if a credit contract
10
is not entered or a credit limit is not increased; and
11
(f) comply with any other requirements prescribed by the
12
regulations.
13
Manner of giving quote
14
(3) The licensee must give the quote to the consumer in the manner (if
15
any) prescribed by the regulations.
16
No demanding payment of amount exceeding quoted amount
17
(4) The licensee must not request or demand payment of an amount
18
that exceeds the maximum amount set out in the quote.
19
Civil penalty:
2,000 penalty units.
20
No demanding payment before credit assistance provided
21
(5) The licensee must not request or demand payment of an amount for
22
the licensee's credit assistance before the licensee provides the
23
assistance.
24
Civil penalty:
2,000 penalty units.
25
Caveats
26
(6) The licensee must not lodge, or threaten to lodge, a caveat in
27
relation to land to induce the consumer to pay an amount to the
28
licensee for the licensee's credit assistance or other services.
29
Civil penalty:
2,000 penalty units.
30
31
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Obligations of credit assistance providers before providing credit assistance for credit
contracts Division 4
Section 115
National Consumer Credit Protection Bill 2009 No. , 2009 117
Division 4--Obligations of credit assistance providers
1
before providing credit assistance for credit
2
contracts
3
115 Obligations of credit assistance provide rs before providing
4
credit assistance for credit contracts
5
(1) A licensee must not provide credit assistance to a consumer on a
6
day (the assistance day) by:
7
(a) suggesting that the consumer apply, or assisting the consumer
8
to apply, for a particular credit contract with a particular
9
credit provider; or
10
(b) suggesting that the consumer apply, or assisting the consumer
11
to apply, for an increase to the credit limit of a particular
12
credit contract with a particular credit provider;
13
unless the licensee has, within 90 days (or other period prescribed
14
by the regulations) before the assistance day:
15
(c) made a preliminary assessment that:
16
(i) is in accordance with subsection 116(1); and
17
(ii) covers the period proposed for the entering of the
18
contract or the increase of the credit limit; and
19
(d) made the inquiries and verification in accordance with
20
section 117.
21
Civil penalty:
2,000 penalty units.
22
(2) A licensee must not provide credit assistance to a consumer on a
23
day (the assistance day) by suggesting that the consumer remain in
24
a particular credit contract with a particular credit provider unless
25
the licensee has, within 90 days (or other period prescribed by the
26
regulations) before the assistance day:
27
(a) made a preliminary assessment that:
28
(i) is in accordance with subsection 116(2); and
29
(ii) covers a period in which the assistance day occurs; and
30
(b) made the inquiries and verification in accordance with
31
section 117.
32
Civil penalty:
2,000 penalty units.
33
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 4 Obligations of credit assistance providers before providing credit assistance
for cred it contracts
Section 116
118 National Consumer Credit Protection Bill 2009 No. , 2009
116 Preliminary assessment of unsuitability of the credit contract
1
(1) For the purposes of paragraph 115(1)(c), the licensee must make a
2
preliminary assessment that:
3
(a) specifies the period the assessment covers; and
4
(b) assesses whether the credit contract will be unsuitable for the
5
consumer if the contract is entered or the credit limit is
6
increased in that period.
7
(2) For the purposes of paragraph 115(2)(a), the licensee must make a
8
preliminary assessment that:
9
(a) specifies the period the assessment covers; and
10
(b) assesses whether the credit contract will be unsuitable for the
11
consumer if the consumer remains in the contract in that
12
period.
13
Note:
The licensee is not required to make a preliminary assessment under
14
this section if the credit assistance is not provided.
15
117 Reasonable inquiries etc. about the consumer
16
(1) For the purposes of paragraph 115(1)(d) or 115(2)(b), the licensee
17
must, before making the preliminary assessment:
18
(a) make reasonable inquiries about the consumer's requirements
19
and objectives in relation to the credit contract; and
20
(b) make reasonable inquiries about the consumer's financial
21
situation; and
22
(c) take reasonable steps to verify the consumer's financial
23
situation; and
24
(d) make any inquiries prescribed by the regulations about any
25
matter prescribed by the regulations; and
26
(e) take any steps prescribed by the regulations to verify any
27
matter prescribed by the regulations.
28
Civil penalty:
2,000 penalty units.
29
(2) The regulations may prescribe particular inquiries or steps that
30
must be made or taken, or do not need to be made or taken, for the
31
purposes of paragraph (1)(a), (b) or (c).
32
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Obligations of credit assistance providers before providing credit assistance for credit
contracts Division 4
Section 118
National Consumer Credit Protection Bill 2009 No. , 2009 119
118 When the credit contract must be assessed as unsuitable--
1
entering contract or increasing the credit limit
2
Requirement to assess the contract as unsuitable
3
(1) For a preliminary assessment under subsection 116(1) about
4
entering a credit contract or increasing a credit limit of a credit
5
contract, the licensee must assess that the contract will be
6
unsuitable for the consumer if the contract will be unsuitable for
7
the consumer under subsection (2).
8
Civil penalty:
2,000 penalty units.
9
Note:
Even if the contract will not be unsuitable for the consumer under
10
subsection (2), the licensee may still assess that the contract will be
11
unsuitable for other reasons.
12
Particular circumstances when the contract will be unsuitable
13
(2) The contract will be unsuitable for the consumer if, at the time of
14
the preliminary assessment, it is likely that:
15
(a) the consumer will be unable to comply with the consumer's
16
financial obligations under the contract, or could only comply
17
with substantial hardship, or
18
(b) the contract will not meet the consumer's requirements or
19
objectives; or
20
(c) if the regulations prescribe circumstances in which a credit
21
contract is unsuitable--those circumstances will apply to the
22
contract;
23
if the contract is entered in the period proposed for it to be entered
24
or the credit limit is increased in the period proposed for it to be
25
increased.
26
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
27
consumer could only comply with the consumer's financial
28
obligations under the contract by selling the consumer's principal
29
place of residence, the consumer could only comply with those
30
obligations with substantial hardship, unless the contrary is proved.
31
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 4 Obligations of credit assistance providers before providing credit assistance
for cred it contracts
Section 119
120 National Consumer Credit Protection Bill 2009 No. , 2009
Information to be used to determine if contract will be unsuitable
1
(4) For the purposes of determining under subsection (2) whether the
2
contract will be unsuitable, only information that satisfies both of
3
the following paragraphs is to be taken into account:
4
(a) the information is about the consumer's financial situation,
5
requirements or objectives, or any other matter prescribed by
6
the regulations under paragraph 117(1)(d) or (e);
7
(b) at the time of the preliminary assessment:
8
(i) the licensee had reason to believe that the information
9
was true; or
10
(ii) the licensee would have had reason to believe that the
11
information was true if the licensee had made the
12
inquiries or verification under section 117.
13
119 When the credit contract must be assessed as unsuitable--
14
re maining in credit contract
15
Requirement to assess the contract as unsuitable
16
(1) For a preliminary assessment under subsection 116(2) about
17
remaining in a credit contract, the licensee must assess that the
18
contract will be unsuitable for the consumer if the contract will be
19
unsuitable for the consumer under subsection (2).
20
Civil penalty:
2,000 penalty units.
21
Note:
Even if the contract will not be unsuitable for the consumer under
22
subsection (2), the licensee may still assess that the contract will be
23
unsuitable for other reasons.
24
Particular circumstances when the contract will be unsuitable
25
(2) The contract will be unsuitable for the consumer if, at the time of
26
the preliminary assessment, it is likely that:
27
(a) the consumer will be unable to comply with the consumer's
28
financial obligations under the contract, or could only comply
29
with substantial hardship, if the consumer remains in the
30
contract in the period covered by the preliminary assessment;
31
or
32
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Obligations of credit assistance providers before providing credit assistance for credit
contracts Division 4
Section 120
National Consumer Credit Protection Bill 2009 No. , 2009 121
(b) the contract will not meet the consumer's requirements or
1
objectives if the consumer remains in the contract in the
2
period covered by the preliminary assessment; or
3
(c) if the regulations prescribe circumstances in which a credit
4
contract is unsuitable--those circumstances will apply to the
5
contract if the consumer remains in the contract in the period
6
covered by the preliminary assessment.
7
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
8
consumer could only comply with the consumer's financial
9
obligations under the contract by selling the consumer's principal
10
place of residence, the consumer could only comply with those
11
obligations with substantial hardship, unless the contrary is proved.
12
Information to be used to determine if contract will be unsuitable
13
(4) For the purposes of determining under subsection (2) whether the
14
contract will be unsuitable, only information that satisfies both of
15
the following paragraphs is to be taken into account:
16
(a) the information is about the consumer's financial situation,
17
requirements or objectives, or any other matter prescribed by
18
the regulations under paragraph 117(1)(d) or (e);
19
(b) at the time of the preliminary assessment:
20
(i) the licensee had reason to believe that the information
21
was true; or
22
(ii) the licensee would have had reason to believe that the
23
information was true if the licensee had made the
24
inquiries or verification under section 117.
25
120 Providing the consume r with the preliminary assessment
26
Requirement to give assessment if requested
27
(1) If the consumer requests the licensee for a copy of the preliminary
28
assessment within 7 years of the date of the credit assistance quote
29
under section 114, the licensee must give the consumer a written
30
copy of the assessment:
31
(a) if the request is made within 2 years of the quote--before the
32
end of 7 business days after the day the licensee receives the
33
request; and
34
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 4 Obligations of credit assistance providers before providing credit assistance
for cred it contracts
Section 120
122 National Consumer Credit Protection Bill 2009 No. , 2009
(b) otherwise--before the end of 21 business days after the day
1
the licensee receives the request.
2
Note:
The licensee is not required to give the consumer a copy of the
3
preliminary assessment if the licensee does not provide credit
4
assistance to the consumer.
5
Civil penalty:
2,000 penalty units.
6
Manner of giving assessment
7
(2) The licensee must give the consumer the copy of the assessment in
8
the manner (if any) prescribed by the regulations.
9
No payment for assessment
10
(3) The licensee must not request or demand payment of an amount for
11
giving the consumer a copy of the preliminary assessment.
12
Civil penalty:
2,000 penalty units.
13
Strict liability offence
14
(4) A person commits an offence if:
15
(a) the person is subject to a requirement under subsection (1) or
16
(3); and
17
(b) the person engages in conduct; and
18
(c) the conduct contravenes the requirement.
19
Criminal penalty: 50 penalty units.
20
(5) Subsection (4) is an offence of strict liability.
21
Note:
For strict liability, see section 6.1 of the Criminal Code.
22
23
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Fees, commissions etc. relating to credit contracts Division 5
Section 121
National Consumer Credit Protection Bill 2009 No. , 2009 123
Division 5--Fees, commissions etc. relating to credit
1
contracts
2
121 Fees, commissions etc. relating to credit contracts
3
Requirement for disclosure
4
(1) A licensee must, at the same time as providing credit assistance to
5
a consumer by:
6
(a) suggesting that the consumer apply, or assisting the consumer
7
to apply, for a particular credit contract with a particular
8
credit provider; or
9
(b) suggesting that the consumer apply, or assisting the consumer
10
to apply, for an increase to the credit limit of a particular
11
credit contract with a particular credit provider; or
12
(c) suggesting that the consumer remain in a particular credit
13
contract with a particular credit provider;
14
give the consumer a credit proposal disclosure document in
15
accordance with subsection (2).
16
Civil penalty:
2,000 penalty units.
17
(2) The credit proposal disclosure document must contain the
18
following:
19
(a) the total amount of any fees or charges that the consumer is
20
liable to pay to the licensee in relation to the credit contract
21
and the method used for working out that amount;
22
(b) a reasonable estimate of the total amount of any commissions
23
that the licensee, or an employee, director or credit
24
representative of the licensee, is likely to receive in relation
25
to the credit contract and the method used for working out
26
that amount;
27
(c) a reasonable estimate of the total amount of any fees or
28
charges that the consumer is likely to be liable to pay to the
29
credit provider in relation to applying for the credit contract;
30
(d) a reasonable estimate of the total amount of any fees or
31
charges that the consumer is likely to be liable to pay to any
32
other person in relation to applying for the credit contract;
33
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 5 Fees, commissions etc. relating to credit contracts
Section 122
124 National Consumer Credit Protection Bill 2009 No. , 2009
(e) if the credit is to be applied to pay any of the amounts in the
1
above paragraphs--a reasonable estimate of the likely
2
amount of credit that will be available to the consumer after
3
payments under paragraphs (a), (c) and (d) are made.
4
(3) For the purposes of paragraph (2)(b), the regulations may
5
prescribe:
6
(a) the method for working out amounts of commissions; and
7
(b) how amounts of commissions must be described.
8
Manner of giving credit proposal disclosure document
9
(4) The licensee must give the credit proposal disclosure document to
10
the consumer in the manner (if any) prescribed by the regulations.
11
122 No profiting from fees etc. paid to third parties
12
Requirement not to profit
13
(1) If, in the course of providing credit assistance to a consumer in
14
relation to a credit contract, a licensee pays an amount (the third
15
party amount) to another person on behalf of the consumer, the
16
licensee must not request or demand payment of an amount, as
17
reimbursement for the third party amount, that exceeds the third
18
party amount.
19
Civil penalty:
2,000 penalty units.
20
Offence
21
(2) A person commits an offence if:
22
(a) the person is subject to a requirement under subsection (1);
23
and
24
(b) the person engages in conduct; and
25
(c) the conduct contravenes the requirement.
26
Criminal penalty: 25 penalty units, or 6 months imprisonment,
27
or both.
28
29
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Prohibition on suggesting, or assisting with, unsuitable credit contracts Division 6
Section 123
National Consumer Credit Protection Bill 2009 No. , 2009 125
Division 6--Prohibition on suggesting, or assisting with,
1
unsuitable credit contracts
2
123 Prohibition on suggesting or assisting consume rs to enter, or
3
increase the credit limit under, unsuitable credit contracts
4
Prohibition on suggesting, or assisting with, unsuitable contracts
5
(1) A licensee must not provide credit assistance to a consumer by:
6
(a) suggesting that the consumer apply, or assisting the consumer
7
to apply, for a particular credit contract with a particular
8
credit provider; or
9
(b) suggesting that the consumer apply, or assisting the consumer
10
to apply, for an increase to the credit limit of a particular
11
credit contract with a particular credit provider;
12
if the contract will be unsuitable for the consumer under
13
subsection (2).
14
Civil penalty:
2,000 penalty units.
15
When the contract will be unsuitable
16
(2) The contract will be unsuitable for the consumer if, at the time the
17
licensee provides the credit assistance, it is likely that:
18
(a) the consumer will be unable to comply with the consumer's
19
financial obligations under the contract, or could only comply
20
with substantial hardship; or
21
(b) the contract will not meet the consumer's requirements or
22
objectives; or
23
(c) if the regulations prescribe circumstances in which a credit
24
contract is unsuitable--those circumstances will apply to the
25
contract;
26
if the contract is entered in the period proposed for it to be entered
27
or the credit limit is increased in the period proposed for it to be
28
increased.
29
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
30
consumer could only comply with the consumer's financial
31
obligations under the contract by selling the consumer's principal
32
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 6 Prohib ition on suggesting, or assisting with, unsuitable credit contracts
Section 123
126 National Consumer Credit Protection Bill 2009 No. , 2009
place of residence, the consumer could only comply with those
1
obligations with substantial hardship, unless the contrary is proved.
2
Information to be used to determine if contract will be unsuitable
3
(4) For the purposes of determining under subsection (2) whether the
4
contract will be unsuitable, only information that satisfies both of
5
the following paragraphs is to be taken into account:
6
(a) the information is about the consumer's financial situation,
7
requirements or objectives, or any other matter prescribed by
8
the regulations under paragraph 117(1)(d) or (e);
9
(b) at the time the licensee provides the credit assistance:
10
(i) the licensee had reason to believe that the information
11
was true; or
12
(ii) the licensee would have had reason to believe that the
13
information was true if the licensee had made the
14
inquiries or verification under section 117.
15
Credit contract not unsuitable under regulations
16
(5) The regulations may prescribe particular situations in which a
17
credit contract is taken not to be unsuitable for a consumer, despite
18
subsection (2).
19
Offence
20
(6) A person commits an offence if:
21
(a) the person is subject to a requirement under subsection (1);
22
and
23
(b) the person engages in conduct; and
24
(c) the conduct contravenes the requirement.
25
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
26
both.
27
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to credit contracts Part 3-1
Prohibition on suggesting, or assisting with, unsuitable credit contracts Division 6
Section 124
National Consumer Credit Protection Bill 2009 No. , 2009 127
124 Prohibition on suggesting to consumers to remain in unsuitable
1
credit contracts
2
Prohibition on suggesting to remain in unsuitable contracts
3
(1) A licensee must not provide credit assistance to a consumer by
4
suggesting that the consumer remain in a particular credit contract
5
with a particular credit provider if the contract is unsuitable for the
6
consumer under subsection (2).
7
Civil penalty:
2,000 penalty units.
8
When the contract is unsuitable
9
(2) The credit contract is unsuitable for the consumer if, at that time
10
the licensee provides the credit assistance:
11
(a) the consumer is, or is likely to be, unable to comply with the
12
consumer's financial obligations under the contract, or only
13
able to comply with substantial hardship; or
14
(b) the contract does not meet the consumer's requirements or
15
objectives; or
16
(c) if the regulations prescribe circumstances in which a credit
17
contract is unsuitable--those circumstances apply to the
18
contract.
19
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
20
consumer could only comply with the consumer's financial
21
obligations under the contract by selling the consumer's principal
22
place of residence, the consumer could only comply with those
23
obligations with substantial hardship, unless the contrary is proved.
24
Information to be used to determine if contract is unsuitable
25
(4) For the purposes of determining under subsection (2) whether the
26
contract is unsuitable, only information that satisfies both of the
27
following paragraphs is to be taken into account:
28
(a) the information is about the consumer's financial situation,
29
requirements or objectives, or any other matter prescribed by
30
the regulations under paragraph 117(1)(d) or (e);
31
(b) at the time the licensee provides the credit assistance:
32
Chapter 3 Responsible lending conduct
Part 3-1 Licensees that provide credit assistance in relation to credit contracts
Division 6 Prohib ition on suggesting, or assisting with, unsuitable credit contracts
Section 124
128 National Consumer Credit Protection Bill 2009 No. , 2009
(i) the licensee had reason to believe that the information
1
was true; or
2
(ii) the licensee would have had reason to believe that the
3
information was true if the licensee had made the
4
inquiries or verification under section 117.
5
Credit contract not unsuitable under regulations
6
(5) The regulations may prescribe particular situations in which a
7
credit contract is taken not to be unsuitable for a consumer, despite
8
subsection (2).
9
Offence
10
(6) A person commits an offence if:
11
(a) the person is subject to a requirement under subsection (1);
12
and
13
(b) the person engages in conduct; and
14
(c) the conduct contravenes the requirement.
15
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
16
both.
17
Defence
18
(7) For the purposes of subsections (1) and (6), it is a defence if:
19
(a) the licensee suggested that the consumer remain in the credit
20
contract because, after making reasonable inquiries, the
21
licensee reasonably believed that there was no other credit
22
contract that was not unsuitable for the consumer; and
23
(b) the licensee informed the consumer that there is a procedure
24
under sections 72 and 94 of the National Credit Code for
25
consumers in hardship.
26
Note:
For the purposes of subsection (6), a defendant bears an evidential
27
burden in relation to the matter in subsection (7) (see subsection
28
13.3(3) of the Criminal Code).
29
(8) The regulations may prescribe particular inquiries that must be
30
made, or do not need to be made, for the purposes of
31
paragraph (7)(a).
32
33
Responsible lending conduct Chapter 3
Licensees that are credit providers under credit contracts Part 3-2
Introduction Division 1
Section 125
National Consumer Credit Protection Bill 2009 No. , 2009 129
Part 3-2--Licensees that are credit providers under
1
credit contracts
2
Division 1--Introduction
3
125 Guide to this Part
4
This Part has rules that apply to licensees that are credit providers.
5
These rules are aimed at better informing consumers and
6
preventing them from being in unsuitable credit contracts.
7
Division 2 requires a licensee to give its credit guide to a
8
consumer. The credit guide has information about the licensee and
9
some of the licensee's obligations under this Act.
10
Division 3 requires a licensee, before entering or increasing the
11
credit limit of a credit contract, to make an assessment as to
12
whether the contract will be unsuitable. To do this, the licensee
13
must make inquiries and verifications about the consumer's
14
requirements, objectives and financial situation. The licensee must
15
give the consumer a copy of the assessment if requested.
16
Division 4 prohibits a licensee from entering or increasing the
17
credit limit of a credit contract that is unsuitable for a consumer.
18
19
Chapter 3 Responsible lending conduct
Part 3-2 Licensees that are credit providers under credit contracts
Division 2 Credit guide of credit providers
Section 126
130 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Credit guide of credit providers
1
126 Credit guide of credit providers
2
Requirement to give credit guide
3
(1) A licensee must, as soon as practicable after it becomes apparent to
4
the licensee that it is likely to enter a credit contract with a
5
consumer who will be the debtor under the contract, give the
6
consumer the licensee's credit guide in accordance with
7
subsection (2).
8
Civil penalty:
2,000 penalty units.
9
(2) The licensee's credit guide must:
10
(a) be in writing; and
11
(b) be in the form (if any) prescribed by the regulations; and
12
(c) specify the licensee's name and contact details; and
13
(d) specify the licensee's Australian credit licence number; and
14
(e) give information about the licensee's procedure for resolving
15
disputes with a consumer, including contact details for a
16
consumer to access:
17
(i) the licensee's internal dispute resolution procedure; and
18
(ii) the approved external dispute resolution scheme of
19
which the licensee is a member; and
20
(f) give information about the licensee's obligations under
21
sections 132 and 133; and
22
(g) comply with any other requirements prescribed by the
23
regulations.
24
(3) The regulations may prescribe information that need not be
25
included in the credit guide, despite subsection (2).
26
Manner of giving credit guide
27
(4) The licensee must give the consumer the licensee's credit guide in
28
the manner (if any) prescribed by the regulations.
29
Responsible lending conduct Chapter 3
Licensees that are credit providers under credit contracts Part 3-2
Cred it guide of cred it providers Division 2
Section 127
National Consumer Credit Protection Bill 2009 No. , 2009 131
Strict liability offence
1
(5) A person commits an offence if:
2
(a) the person is subject to a requirement under subsection (1);
3
and
4
(b) the person engages in conduct; and
5
(c) the conduct contravenes the requirement.
6
Criminal penalty: 50 penalty units.
7
(6) Subsection (5) is an offence of strict liability.
8
Note:
For strict liability, see section 6.1 of the Criminal Code.
9
127 Credit guide of credit providers who are assignees
10
Requirement to give credit guide
11
(1) A licensee must, as soon as practicable after it has been assigned
12
any rights or obligations of a credit provider under a credit
13
contract, give the debtor under the contract the licensee's credit
14
guide in accordance with subsection (2).
15
Civil penalty:
2,000 penalty units.
16
(2) The licensee's credit guide must:
17
(a) be in writing; and
18
(b) be in the form (if any) prescribed by the regulations; and
19
(c) specify the licensee's name and contact details; and
20
(d) specify the licensee's Australian credit licence number; and
21
(e) give information about the licensee's procedure for resolving
22
disputes with a consumer, including contact details for a
23
consumer to access:
24
(i) the licensee's internal dispute resolution procedure; and
25
(ii) the approved external dispute resolution scheme of
26
which the licensee is a member; and
27
(f) comply with any other requirements prescribed by the
28
regulations.
29
(3) The regulations may prescribe information that need not be
30
included in the credit guide, despite subsection (2).
31
Chapter 3 Responsible lending conduct
Part 3-2 Licensees that are credit providers under credit contracts
Division 2 Credit guide of credit providers
Section 127
132 National Consumer Credit Protection Bill 2009 No. , 2009
Manner of giving credit guide
1
(4) The licensee must give the consumer the licensee's credit guide in
2
the manner (if any) prescribed by the regulations.
3
Strict liability offence
4
(5) A person commits an offence if:
5
(a) the person is subject to a requirement under subsection (1);
6
and
7
(b) the person engages in conduct; and
8
(c) the conduct contravenes the requirement.
9
Criminal penalty: 50 penalty units.
10
(6) Subsection (5) is an offence of strict liability.
11
Note:
For strict liability, see section 6.1 of the Criminal Code.
12
13
Responsible lending conduct Chapter 3
Licensees that are credit providers under credit contracts Part 3-2
Obligations of credit providers before entering cred it contracts or increasing credit
limits Division 3
Section 128
National Consumer Credit Protection Bill 2009 No. , 2009 133
Division 3--Obligations of credit providers before entering
1
credit contracts or increasing credit limits
2
128 Obligations of credit providers before entering credit contracts
3
or increasing credit limits
4
A licensee must not:
5
(a) enter a credit contract with a consumer who will be the
6
debtor under the contract; or
7
(b) increase the credit limit of a credit contract with a consumer
8
who is the debtor under the contract;
9
on a day (the credit day) unless the licensee has, within 90 days (or
10
other period prescribed by the regulations) before the credit day:
11
(c) made an assessment that:
12
(i) is in accordance with section 129; and
13
(ii) covers the period in which the credit day occurs; and
14
(d) made the inquiries and verification in accordance with
15
section 130.
16
Civil penalty:
2,000 penalty units.
17
129 Assessment of unsuitability of the credit contract
18
For the purposes of paragraph 128(1)(c), the licensee must make an
19
assessment that:
20
(a) specifies the period the assessment covers; and
21
(b) assesses whether the credit contract will be unsuitable for the
22
consumer if the contract is entered or the credit limit is
23
increased in that period.
24
Note:
The licensee is not required to make the assessment under this section
25
if the contract is not entered or the credit limit is not increased.
26
130 Reasonable inquiries etc. about the consumer
27
Requirement to make inquiries and take steps to verify
28
(1) For the purposes of paragraph 128(1)(d), the licensee must, before
29
making the assessment:
30
Chapter 3 Responsible lending conduct
Part 3-2 Licensees that are credit providers under credit contracts
Division 3 Obligations of credit providers before entering credit contracts or increasing
credit limits
Section 130
134 National Consumer Credit Protection Bill 2009 No. , 2009
(a) make reasonable inquiries about the consumer's requirements
1
and objectives in relation to the credit contract; and
2
(b) make reasonable inquiries about the consumer's financial
3
situation; and
4
(c) take reasonable steps to verify the consumer's financial
5
situation; and
6
(d) make any inquiries prescribed by the regulations about any
7
matter prescribed by the regulations; and
8
(e) take any steps prescribed by the regulations to verify any
9
matter prescribed by the regulations.
10
Civil penalty:
2,000 penalty units.
11
(2) The regulations may prescribe particular inquiries or steps that
12
must be made or taken, or do not need to be made or taken, for the
13
purposes of paragraph (1)(a), (b) or (c).
14
When not required to take steps to verify
15
(3) Despite subsection (1), if:
16
(a) a preliminary assessment under subsection 116(1) about the
17
entering of the credit contract or the increase to the credit
18
limit has been made; and
19
(b) the preliminary assessment was made no more than 90 days
20
before the day of entering the contract or increasing the credit
21
limit; and
22
(c) the preliminary assessment assesses the contract as not being
23
unsuitable for the consumer; and
24
(d) the preliminary assessment contains the information that was
25
used for the purposes of making the preliminary assessment;
26
the licensee is not required, for the purposes of paragraph (1)(c) or
27
(e), to verify that information.
28
Responsible lending conduct Chapter 3
Licensees that are credit providers under credit contracts Part 3-2
Obligations of credit providers before entering cred it contracts or increasing credit
limits Division 3
Section 131
National Consumer Credit Protection Bill 2009 No. , 2009 135
131 When credit contract must be assessed as unsuitable
1
Requirement to assess the contract as unsuitable
2
(1) The licensee must assess that the credit contract will be unsuitable
3
for the consumer if the contract will be unsuitable for the consumer
4
under subsection (2).
5
Note:
Even if the contract will not be unsuitable for the consumer under
6
subsection (2), the licensee may still assess that the contract will be
7
unsuitable for other reasons.
8
Particular circumstances when the contract will be unsuitable
9
(2) The contract will be unsuitable for the consumer if, at the time of
10
the assessment, it is likely that:
11
(a) the consumer will be unable to comply with the consumer's
12
financial obligations under the contract, or could only comply
13
with substantial hardship, if the contract is entered or the
14
credit limit is increased in the period covered by the
15
assessment; or
16
(b) the contract will not meet the consumer's requirements or
17
objectives if the contract is entered or the credit limit is
18
increased in the period covered by the assessment; or
19
(c) if the regulations prescribe circumstances in which a credit
20
contract is unsuitable--those circumstances will apply to the
21
contract if the contract is entered or the credit limit is
22
increased in the period covered by the assessment.
23
Civil penalty:
2,000 penalty units.
24
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
25
consumer could only comply with the consumer's financial
26
obligations under the contract by selling the consumer's principal
27
place of residence, the consumer could only comply with those
28
obligations with substantial hardship, unless the contrary is proved.
29
Information to be used to determine if contract will be unsuitable
30
(4) For the purposes of determining under subsection (2) whether the
31
contract will be unsuitable, only information that satisfies both of
32
the following paragraphs is to be taken into account:
33
Chapter 3 Responsible lending conduct
Part 3-2 Licensees that are credit providers under credit contracts
Division 3 Obligations of credit providers before entering credit contracts or increasing
credit limits
Section 132
136 National Consumer Credit Protection Bill 2009 No. , 2009
(a) the information is about the consumer's financial situation,
1
requirements or objectives, or any other matter prescribed by
2
the regulations under paragraph 130(1)(d) or (e);
3
(b) at the time of the assessment:
4
(i) the licensee had reason to believe that the information
5
was true; or
6
(ii) the licensee would have had reason to believe that the
7
information was true if the licensee had made the
8
inquiries or verification under section 130.
9
132 Giving the consumer the assessment
10
Requirement to give assessment if requested
11
(1) If, before entering the credit contract or increasing the credit limit,
12
the consumer requests the licensee for a copy of the assessment,
13
the licensee must give the consumer a written copy of the
14
assessment before entering the contract or increasing the credit
15
limit.
16
Note:
The licensee is not required to give the consumer a copy of the
17
assessment if the contract is not entered or the credit limit is not
18
increased.
19
Civil penalty:
2,000 penalty units.
20
(2) If, during the period that:
21
(a) starts on the day (the credit day) the credit contract is entered
22
or the credit limit is increased; and
23
(b) ends 7 years after that day;
24
the consumer requests the licensee for a copy of the assessment,
25
the licensee must give the consumer a written copy of the
26
assessment:
27
(c) if the request is made within 2 years of the credit day--
28
before the end of 7 business days after the day the licensee
29
receives the request; and
30
(d) otherwise--before the end of 21 business days after the day
31
the licensee receives the request.
32
Civil penalty:
2,000 penalty units.
33
Responsible lending conduct Chapter 3
Licensees that are credit providers under credit contracts Part 3-2
Obligations of credit providers before entering cred it contracts or increasing credit
limits Division 3
Section 132
National Consumer Credit Protection Bill 2009 No. , 2009 137
Manner of giving assessment
1
(3) The licensee must give the consumer the copy of the assessment in
2
the manner (if any) prescribed by the regulations.
3
No payment for assessment
4
(4) The licensee must not request or demand payment of an amount for
5
giving the consumer a copy of the assessment.
6
Civil penalty:
2,000 penalty units.
7
Strict liability offence
8
(5) A person commits an offence if:
9
(a) the person is subject to a requirement under subsection (1),
10
(2) or (4); and
11
(b) the person engages in conduct; and
12
(c) the conduct contravenes the requirement.
13
Criminal penalty: 50 penalty units.
14
(6) Subsection (5) is an offence of strict liability.
15
Note:
For strict liability, see section 6.1 of the Criminal Code.
16
17
Chapter 3 Responsible lending conduct
Part 3-2 Licensees that are credit providers under credit contracts
Division 4 Prohib ition on entering, or increasing the credit limit of, unsuitable credit
contracts
Section 133
138 National Consumer Credit Protection Bill 2009 No. , 2009
Division 4--Prohibition on entering, or increasing the
1
credit limit of, unsuitable credit contracts
2
133 Prohibition on entering, or increasing the credit limit of,
3
unsuitable credit contracts
4
Prohibition on entering etc. unsuitable contracts
5
(1) A licensee must not:
6
(a) enter a credit contract with a consumer who will be the
7
debtor under the contract; or
8
(b) increase the credit limit of a credit contract with a consumer
9
who is the debtor under the contract;
10
if the contract is unsuitable for the consumer under subsection (2).
11
Civil penalty:
2,000 penalty units.
12
When the contract is unsuitable
13
(2) The contract is unsuitable for the consumer if, at the time it is
14
entered or the credit limit is increased:
15
(a) it is likely that the consumer will be unable to comply with
16
the consumer's financial obligations under the contract, or
17
could only comply with substantial hardship; or
18
(b) the contract does not meet the consumer's requirements or
19
objectives; or
20
(c) if the regulations prescribe circumstances in which a credit
21
contract is unsuitable--those circumstances apply to the
22
contract.
23
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
24
consumer could only comply with the consumer's financial
25
obligations under the contract by selling the consumer's principal
26
place of residence, the consumer could only comply with those
27
obligations with substantial hardship, unless the contrary is proved.
28
Responsible lending conduct Chapter 3
Licensees that are credit providers under credit contracts Part 3-2
Prohibition on entering, or increasing the credit limit of, unsuitable credit contracts
Division 4
Section 133
National Consumer Credit Protection Bill 2009 No. , 2009 139
Information to be used to determine if contract will be unsuitable
1
(4) For the purposes of determining under subsection (2) whether the
2
contract will be unsuitable, only information that satisfies both of
3
the following paragraphs is to be taken into account:
4
(a) the information is about the consumer's financial situation,
5
requirements or objectives, or any other matter prescribed by
6
the regulations under paragraph 130(1)(d) or (e);
7
(b) at the time of the contract is entered or the credit limit is
8
increased, the information:
9
(i) the licensee had reason to believe that the information
10
was true; or
11
(ii) the licensee would have had reason to believe that the
12
information was true if the licensee had made the
13
inquiries or verification under section 130.
14
Credit contract not unsuitable under regulations
15
(5) The regulations may prescribe particular situations in which a
16
credit contract is taken not to be unsuitable for a consumer, despite
17
subsection (2).
18
Offence
19
(6) A person commits an offence if:
20
(a) the person is subject to a requirement under subsection (1);
21
and
22
(b) the person engages in conduct; and
23
(c) the conduct contravenes the requirement.
24
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
25
both.
26
27
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 1 Introduction
Section 134
140 National Consumer Credit Protection Bill 2009 No. , 2009
Part 3-3--Licensees that provide credit assistance
1
in relation to consumer leases
2
Division 1--Introduction
3
134 Guide to this Part
4
This Part has rules that apply to licensees that provide credit
5
assistance in relation to consumer leases. These rules are aimed at
6
better informing consumers and preventing them from being in
7
unsuitable consumer leases. However, these rules do not apply to a
8
licensee that will be the lessor under the consumer lease.
9
Division 2 requires a licensee to give its credit guide to a
10
consumer. The credit guide has information about the licensee and
11
some of the licensee's obligations under this Act.
12
Division 3 requires a licensee to give a quote before providing
13
credit assistance to a consumer. The quote must set out the
14
maximum amount the consumer will be required to pay to the
15
licensee. The licensee must not charge more than that amount.
16
Division 4 requires a licensee, before providing credit assistance to
17
a consumer in relation to a consumer lease, to make a preliminary
18
assessment as to whether the lease will be unsuitable for the
19
consumer. To do this, the licensee must make inquiries and
20
verifications about the consumer's requirements, objectives and
21
financial situation. The licensee must give the consumer a copy of
22
the assessment if requested.
23
Division 5 requires a licensee, when providing credit assistance to
24
a consumer in relation to a consumer lease, to give the consumer a
25
document that discloses certain information (for example, the
26
commission the licensee is likely to receive).
27
Division 6 prohibits a licensee from providing credit assistance to a
28
consumer in relation to a consumer lease if the lease will be
29
unsuitable for the consumer.
30
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Introduction Division 1
Section 135
National Consumer Credit Protection Bill 2009 No. , 2009 141
135 Application of this Part
1
This Part does not apply in relation to credit assistance provided by
2
a licensee in relation to a consumer lease if the licensee is or will
3
be the lessor under the consumer lease.
4
5
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 2 Credit guide of credit assistance providers
Section 136
142 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Credit guide of credit assistance providers
1
136 Credit guide of credit assistance providers
2
Requirement to give credit guide
3
(1) A licensee must, as soon as practicable after it becomes apparent to
4
the licensee that it is likely to provide credit assistance to a
5
consumer in relation to a consumer lease, give the consumer the
6
licensee's credit guide in accordance with subsection (2).
7
Civil penalty:
2,000 penalty units.
8
(2) The licensee's credit guide must:
9
(a) be in writing; and
10
(b) be in the form (if any) prescribed by the regulations; and
11
(c) specify the licensee's name and contact details; and
12
(d) specify the licensee's Australian credit licence number; and
13
(e) give information about:
14
(i) any fees that are payable by a consumer to the licensee
15
for the licensee's credit assistance; and
16
(ii) any charges that are payable by a consumer to the
17
licensee for matters associated with providing the credit
18
assistance; and
19
(iii) the method for working out the amount of the fees and
20
charges; and
21
(f) give information about:
22
(i) if there are 6 or fewer lessors that the licensee conducts
23
business with when providing credit assistance in
24
relation to consumer leases--the names of those lessors;
25
and
26
(ii) if there are more than 6 lessors that the licensee
27
conducts business with when providing credit assistance
28
in relation to consumer leases--the names of the 6
29
lessors with whom the licensee reasonably believes it
30
conducts the most business; and
31
(g) give information about:
32
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Cred it guide of cred it assistance providers Division 2
Section 136
National Consumer Credit Protection Bill 2009 No. , 2009 143
(i) any commissions that the licensee, or an employee,
1
director or credit representative of the licensee, is likely
2
to receive, directly or indirectly, from lessors in relation
3
to consumer leases for which the licensee has provided
4
credit assistance; and
5
(ii) a reasonable estimate of the amounts of those
6
commissions or the range of those amounts; and
7
(iii) the method for working out those amounts; and
8
(h) give information about the licensee's procedure for resolving
9
disputes with a consumer, including contact details for a
10
consumer to access:
11
(i) the licensee's internal dispute resolution procedure; and
12
(ii) the approved external dispute resolution scheme of
13
which the licensee is a member; and
14
(i) give information about the licensee's obligations under
15
sections 143 and 146; and
16
(j) comply with any other requirements prescribed by the
17
regulations.
18
(3) The regulations may prescribe:
19
(a) information that need not be included in the credit guide,
20
despite subsection (2); and
21
(b) for the purposes of paragraph (2)(g):
22
(i) the method for working out amounts of commissions;
23
and
24
(ii) how commissions or amounts of commissions must be
25
described.
26
Manner of giving credit guide
27
(4) The licensee must give the consumer the licensee's credit guide in
28
the manner (if any) prescribed by the regulations.
29
Strict liability offence
30
(5) A person commits an offence if:
31
(a) the person is subject to a requirement under subsection (1);
32
and
33
(b) the person engages in conduct; and
34
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 2 Credit guide of credit assistance providers
Section 136
144 National Consumer Credit Protection Bill 2009 No. , 2009
(c) the conduct contravenes the requirement.
1
Criminal penalty: 50 penalty units.
2
(6) Subsection (5) is an offence of strict liability.
3
Note:
For strict liability, see section 6.1 of the Criminal Code.
4
5
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Quote for providing cred it assistance etc. in relation to consumer leases Division 3
Section 137
National Consumer Credit Protection Bill 2009 No. , 2009 145
Division 3--Quote for providing credit assistance etc. in
1
relation to consumer leases
2
137 Quote for providing credit assistance etc.
3
Requirement to give quote
4
(1) A licensee must not provide credit assistance to a consumer by:
5
(a) suggesting that the consumer apply, or assisting the consumer
6
to apply, for a particular consumer lease with a particular
7
lessor; or
8
(b) suggesting that the consumer remain in a particular consumer
9
lease with a particular lessor;
10
unless:
11
(c) the licensee has given the consumer a quote in accordance
12
with subsection (2); and
13
(d) the consumer has signed and dated that quote or otherwise
14
indicated the consumer's acceptance of it (and the day that
15
happens) in the manner (if any) prescribed by the regulations;
16
and
17
(e) the licensee has given the consumer a copy of the accepted
18
quote.
19
Civil penalty:
2,000 penalty units.
20
(2) The quote must:
21
(a) be in writing; and
22
(b) give information about the credit assistance and other
23
services that the quote covers; and
24
(c) specify the maximum amount that will be payable by the
25
consumer to the licensee in relation to the licensee's credit
26
assistance and other services; and
27
(d) give information about what that amount relates to,
28
including:
29
(i) the maximum amount of the licensee's fee for providing
30
the credit assistance and other services; and
31
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 3 Quote for provid ing credit assistance etc. in relation to consumer leases
Section 137
146 National Consumer Credit Protection Bill 2009 No. , 2009
(ii) the maximum amount of charges that will be incurred
1
by the licensee for matters associated with providing the
2
credit assistance and other services; and
3
(iii) the maximum amount of fees or charges that will be
4
payable by the licensee to another person on the
5
consumer's behalf; and
6
(e) state whether the maximum amount or any other amount will
7
be payable by the consumer to the licensee if a consumer
8
lease is not entered; and
9
(f) comply with any other requirements prescribed by the
10
regulations.
11
Manner of giving quote
12
(3) The licensee must give the quote to the consumer in the manner (if
13
any) prescribed by the regulations.
14
No demanding payment of amount exceeding quoted amount
15
(4) The licensee must not request or demand payment of an amount
16
that exceeds the maximum amount set out in the quote.
17
Civil penalty:
2,000 penalty units.
18
No demanding payment before credit assistance provided
19
(5) The licensee must not request or demand payment of an amount for
20
the licensee's credit assistance before the licensee provides the
21
assistance.
22
Civil penalty:
2,000 penalty units.
23
Caveats
24
(6) The licensee must not lodge, or threaten to lodge, a caveat in
25
relation to land to induce the consumer to pay an amount to the
26
licensee for the licensee's credit assistance or other services.
27
Civil penalty:
2,000 penalty units.
28
29
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Obligations of credit assistance providers before providing credit assistance for
consumer leases Division 4
Section 138
National Consumer Credit Protection Bill 2009 No. , 2009 147
Division 4--Obligations of credit assistance providers
1
before providing credit assistance for consumer
2
leases
3
138 Obligations of credit assistance provide rs before providing
4
credit assistance for consume r leases
5
(1) A licensee must not provide credit assistance to a consumer on a
6
day (the assistance day) by:
7
(a) suggesting that the consumer apply for a particular consumer
8
lease with a particular lessor; or
9
(b) assisting the consumer to apply for a particular consumer
10
lease with a particular lessor;
11
unless the licensee has, within 90 days (or other period prescribed
12
by the regulations) before the assistance day:
13
(c) made a preliminary assessment that:
14
(i) is in accordance with subsection 139(1); and
15
(ii) covers the period proposed for the entering of the lease;
16
and
17
(d) made the inquiries and verification in accordance with
18
section 140.
19
Civil penalty:
2,000 penalty units.
20
(2) A licensee must not provide credit assistance to a consumer on a
21
day (the assistance day) by suggesting that the consumer remain in
22
a particular consumer lease with a particular lessor unless the
23
licensee has, within 90 days (or other period prescribed by the
24
regulations) before the assistance day:
25
(a) made a preliminary assessment that:
26
(i) is in accordance with subsection 139(2); and
27
(ii) covers a period in which the assistance day occurs; and
28
(b) made the inquiries and verification in accordance with
29
section 140.
30
Civil penalty:
2,000 penalty units.
31
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 4 Obligations of credit assistance providers before providing credit assistance
for consumer leases
Section 139
148 National Consumer Credit Protection Bill 2009 No. , 2009
139 Preliminary assessment of unsuitability of the consumer lease
1
(1) For the purposes of paragraph 138(1)(c), the licensee must make a
2
preliminary assessment that:
3
(a) specifies the period the assessment covers; and
4
(b) assesses whether the consumer lease will be unsuitable for
5
the consumer if the lease is entered in that period.
6
(2) For the purposes of paragraph 138(2)(a), the licensee must make a
7
preliminary assessment that:
8
(a) specifies the period the assessment covers; and
9
(b) assesses whether the consumer lease will be unsuitable for
10
the consumer if the consumer remains in the lease in that
11
period.
12
Note:
The licensee is not required to make a preliminary assessment under
13
this section if the credit assistance is not provided.
14
140 Reasonable inquiries etc. about the consumer
15
(1) For the purposes of paragraph 138(1)(d) or 138(2)(b), the licensee
16
must, before making the preliminary assessment:
17
(a) make reasonable inquiries about the consumer's requirements
18
and objectives in relation to the consumer lease; and
19
(b) make reasonable inquiries about the consumer's financial
20
situation; and
21
(c) take reasonable steps to verify the consumer's financial
22
situation; and
23
(d) make any inquiries prescribed by the regulations about any
24
matter prescribed by the regulations; and
25
(e) take any steps prescribed by the regulations to verify any
26
matter prescribed by the regulations.
27
Civil penalty:
2,000 penalty units.
28
(2) The regulations may prescribe particular inquiries or steps that
29
must be made or taken, or do not need to be made or taken, for the
30
purposes of paragraph (1)(a), (b) or (c).
31
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Obligations of credit assistance providers before providing credit assistance for
consumer leases Division 4
Section 141
National Consumer Credit Protection Bill 2009 No. , 2009 149
141 When the consume r lease must be assessed as unsuitable--
1
entering lease
2
Requirement to assess the lease as unsuitable
3
(1) For a preliminary assessment under subsection 139(1) about
4
entering a consumer lease, the licensee must assess that the lease
5
will be unsuitable for the consumer if the lease will be unsuitable
6
for the consumer under subsection (2).
7
Civil penalty:
2,000 penalty units.
8
Note:
Even if the lease will not be unsuitable for the consumer under
9
subsection (2), the licensee may still assess that the lease will be
10
unsuitable for other reasons.
11
Particular circumstances when the lease will be unsuitable
12
(2) The lease will be unsuitable for the consumer if, at the time of the
13
preliminary assessment, it is likely that:
14
(a) the consumer will be unable to comply with the consumer's
15
financial obligations under the lease, or could only comply
16
with substantial hardship, if the lease is entered in the period
17
proposed for it to be entered; or
18
(b) the lease will not meet the consumer's requirements or
19
objectives if the lease is entered in the period proposed for it
20
to be entered; or
21
(c) if the regulations prescribe circumstances in which a
22
consumer lease is unsuitable--those circumstances will apply
23
to the lease if the lease is entered in the period proposed for it
24
to be entered.
25
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
26
consumer could only comply with the consumer's financial
27
obligations under the lease by selling the consumer's principal
28
place of residence, the consumer could only comply with those
29
obligations with substantial hardship, unless the contrary is proved.
30
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 4 Obligations of credit assistance providers before providing credit assistance
for consumer leases
Section 142
150 National Consumer Credit Protection Bill 2009 No. , 2009
Information to be used to determine if lease will be unsuitable
1
(4) For the purposes of determining under subsection (2) whether the
2
lease will be unsuitable, only information that satisfies both of the
3
following paragraphs is to be taken into account:
4
(a) the information is about the consumer's financial situation,
5
requirements or objectives, or any other matter prescribed by
6
the regulations under paragraph 140(1)(d) or (e);
7
(b) at the time of the preliminary assessment:
8
(i) the licensee had reason to believe that the information
9
was true; or
10
(ii) the licensee would have had reason to believe that the
11
information was true if the licensee had made the
12
inquiries or verification under section 140.
13
142 When the consume r lease must be assessed as unsuitable--
14
re maining in lease
15
Requirement to assess the lease as unsuitable
16
(1) For a preliminary assessment under subsection 139(2) about
17
remaining in a consumer lease, the licensee must assess that the
18
lease will be unsuitable for the consumer if the lease will be
19
unsuitable for the consumer under subsection (2).
20
Civil penalty:
2,000 penalty units.
21
Note:
Even if the lease will not be unsuitable for the consumer under
22
subsection (2), the licensee may still assess that the lease will be
23
unsuitable for other reasons.
24
Particular circumstances when the lease will be unsuitable
25
(2) The lease will be unsuitable for the consumer if, at the time of the
26
preliminary assessment, it is likely that:
27
(a) the consumer will be unable to comply with the consumer's
28
financial obligations under the lease, or could only comply
29
with substantial hardship if the consumer remains in the lease
30
in the period covered by the preliminary assessment; or
31
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Obligations of credit assistance providers before providing credit assistance for
consumer leases Division 4
Section 143
National Consumer Credit Protection Bill 2009 No. , 2009 151
(b) the lease will not meet the consumer's requirements or
1
objectives if the consumer remains in the lease in the period
2
covered by the preliminary assessment; or
3
(c) if the regulations prescribe circumstances in which a
4
consumer lease is unsuitable--those circumstances will apply
5
to the lease if the consumer remains in the lease in the period
6
covered by the preliminary assessment.
7
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
8
consumer could only comply with the consumer's financial
9
obligations under the lease by selling the consumer's principal
10
place of residence, the consumer could only comply with those
11
obligations with substantial hardship, unless the contrary is proved.
12
Information to be used to determine if lease will be unsuitable
13
(4) For the purposes of determining under subsection (2) whether the
14
lease will be unsuitable, only information that satisfies both of the
15
following paragraphs is to be taken into account:
16
(a) the information is about the consumer's financial situation,
17
requirements or objectives, or any other matter prescribed by
18
the regulations under paragraph 140(1)(d) or (e);
19
(b) at the time of the preliminary assessment:
20
(i) the licensee had reason to believe that the information
21
was true; or
22
(ii) the licensee would have had reason to believe that the
23
information was true if the licensee had made the
24
inquiries or verification under section 140.
25
143 Providing the consume r with the preliminary assessment
26
Requirement to give assessment if requested
27
(1) If the consumer requests the licensee for a copy of the preliminary
28
assessment within 7 years of the date of the credit assistance quote
29
under section 137, the licensee must give the consumer a written
30
copy of the assessment:
31
(a) if the request is made within 2 years of the quote--before the
32
end of 7 business days after the day the licensee receives the
33
request; and
34
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 4 Obligations of credit assistance providers before providing credit assistance
for consumer leases
Section 143
152 National Consumer Credit Protection Bill 2009 No. , 2009
(b) otherwise--before the end of 21 business days after the day
1
the licensee receives the request.
2
Note:
The licensee is not required to give the consumer a copy of the
3
preliminary assessment if the licensee does not provide credit
4
assistance to the consumer.
5
Civil penalty:
2,000 penalty units.
6
Manner of giving assessment
7
(2) The licensee must give the consumer the copy of the assessment in
8
the manner (if any) prescribed by the regulations.
9
No payment for assessment
10
(3) The licensee must not request or demand payment of an amount for
11
giving the consumer a copy of the preliminary assessment.
12
Civil penalty:
2,000 penalty units.
13
Strict liability offence
14
(4) A person commits an offence if:
15
(a) the person is subject to a requirement under subsection (1) or
16
(3); and
17
(b) the person engages in conduct; and
18
(c) the conduct contravenes the requirement.
19
Criminal penalty: 50 penalty units.
20
(5) Subsection (4) is an offence of strict liability.
21
Note:
For strict liability, see section 6.1 of the Criminal Code.
22
23
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Fees, commissions etc. relating to consumer leases Division 5
Section 144
National Consumer Credit Protection Bill 2009 No. , 2009 153
Division 5--Fees, commissions etc. relating to consumer
1
leases
2
144 Fees, commissions etc. relating to consumer leases
3
Requirement for disclosure
4
(1) A licensee must, at the same time as providing credit assistance to
5
a consumer by:
6
(a) suggesting that the consumer apply, or assisting the consumer
7
to apply, for a particular consumer lease with a particular
8
lessor; or
9
(b) suggesting that the consumer remain in a particular consumer
10
lease with a particular lessor;
11
give the consumer a lease proposal disclosure document in
12
accordance with subsection (2).
13
Civil penalty:
2,000 penalty units.
14
(2) The lease proposal disclosure document must contain the
15
following:
16
(a) the total amount of any fees or charges that the consumer is
17
liable to pay to the licensee in relation to the consumer lease
18
and the method used for working out that amount;
19
(b) a reasonable estimate of the total amount of any commissions
20
that the licensee, or an employee, director or credit
21
representative of the licensee, is likely to receive in relation
22
to the consumer lease and the method used for working out
23
that amount;
24
(c) a reasonable estimate of the total amount of any fees or
25
charges that the consumer is likely to be liable to pay to the
26
lessor in relation to applying for the consumer lease;
27
(d) a reasonable estimate of the total amount of any fees or
28
charges that the consumer is likely to be liable to pay to
29
another person in relation to applying for the consumer lease.
30
(3) For the purposes of paragraph (2)(b), the regulations may
31
prescribe:
32
(a) the method for working out amounts of commissions; and
33
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 5 Fees, commissions etc. relating to consumer leases
Section 145
154 National Consumer Credit Protection Bill 2009 No. , 2009
(b) how amounts of commissions must be described.
1
Manner of giving lease proposal disclosure document
2
(4) The licensee must give the lease proposal disclosure document to
3
the consumer in the manner (if any) prescribed by the regulations.
4
145 No profiting from fees etc. paid to third parties
5
Requirement not to profit
6
(1) If, in the course of providing credit assistance to a consumer in
7
relation to a consumer lease, a licensee pays an amount (the third
8
party amount) to another person on behalf of the consumer, the
9
licensee must not request or demand payment of an amount, as
10
reimbursement for the third party amount, that exceeds the third
11
party amount.
12
Civil penalty:
2,000 penalty units.
13
Offence
14
(2) A person commits an offence if:
15
(a) the person is subject to a requirement under subsection (1);
16
and
17
(b) the person engages in conduct; and
18
(c) the conduct contravenes the requirement.
19
Criminal penalty: 25 penalty units, or 6 months imprisonment,
20
or both.
21
22
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Prohibition on suggesting, or assisting with, unsuitable consumer leases Division 6
Section 146
National Consumer Credit Protection Bill 2009 No. , 2009 155
Division 6--Prohibition on suggesting, or assisting with,
1
unsuitable consumer leases
2
146 Prohibition on suggesting, or assisting with, unsuitable
3
consume r leases
4
Prohibition on suggesting, or assisting with, unsuitable leases
5
(1) A licensee must not provide credit assistance to a consumer by:
6
(a) suggesting that the consumer apply for a particular consumer
7
lease with a particular lessor; or
8
(b) assisting the consumer to apply for a particular consumer
9
lease with a particular lessor;
10
if the lease will be unsuitable for the consumer under
11
subsection (2).
12
Civil penalty:
2,000 penalty units.
13
When the lease will be unsuitable
14
(2) The lease will be unsuitable for the consumer if, at the time the
15
licensee provides the credit assistance, it is likely that:
16
(a) the consumer will be unable to comply with the consumer's
17
financial obligations under the lease, or could only comply
18
with substantial hardship, if the lease is entered in the period
19
proposed for it to be entered; or
20
(b) the lease will not meet the consumer's requirements or
21
objectives if the lease is entered in the period proposed for it
22
to be entered; or
23
(c) if the regulations prescribe circumstances in which a
24
consumer lease is unsuitable--those circumstances will apply
25
to the lease if the lease is entered in the period proposed for it
26
to be entered.
27
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
28
consumer could only comply with the consumer's financial
29
obligations under the lease by selling the consumer's principal
30
place of residence, the consumer could only comply with those
31
obligations with substantial hardship, unless the contrary is proved.
32
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 6 Prohib ition on suggesting, or assisting with, unsuitable consumer leases
Section 147
156 National Consumer Credit Protection Bill 2009 No. , 2009
Information to be used to determine if lease will be unsuitable
1
(4) For the purposes of determining under subsection (2) whether the
2
lease will be unsuitable, only information that satisfies both of the
3
following paragraphs is to be taken into account:
4
(a) the information is about the consumer's financial situation,
5
requirements or objectives, or any other matter prescribed by
6
the regulations under paragraph 140(1)(d) or (e);
7
(b) at the time the licensee provides the credit assistance:
8
(i) the licensee had reason to believe that the information
9
was true; or
10
(ii) the licensee would have had reason to believe that the
11
information was true if the licensee had made the
12
inquiries or verification under section 140.
13
Consumer lease not unsuitable under regulations
14
(5) The regulations may prescribe particular situations in which a
15
consumer lease is taken not to be unsuitable for a consumer,
16
despite subsection (2).
17
Offence
18
(6) A person commits an offence if:
19
(a) the person is subject to a requirement under subsection (1);
20
and
21
(b) the person engages in conduct; and
22
(c) the conduct contravenes the requirement.
23
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
24
both.
25
147 Prohibition on suggesting to consumers to remain in unsuitable
26
consume r leases
27
Prohibition on suggesting to remain in unsuitable lease
28
(1) A licensee must not provide credit assistance to a consumer by
29
suggesting that the consumer remain in a particular consumer lease
30
Responsible lending conduct Chapter 3
Licensees that provide credit assistance in relation to consumer leases Part 3 -3
Prohibition on suggesting, or assisting with, unsuitable consumer leases Division 6
Section 147
National Consumer Credit Protection Bill 2009 No. , 2009 157
with a particular lessor if the lease is unsuitable for the consumer
1
under subsection (2).
2
Civil penalty:
2,000 penalty units.
3
When the lease is unsuitable
4
(2) The lease is unsuitable for the consumer if, at that time the licensee
5
provides the credit assistance:
6
(a) the consumer is, or is likely to be, unable to comply with the
7
consumer's financial obligations under the lease, or only able
8
to comply with substantial hardship; or
9
(b) the lease does not meet the consumer's requirements or
10
objectives; or
11
(c) if the regulations prescribe circumstances in which a
12
consumer lease is unsuitable--those circumstances apply to
13
the lease.
14
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
15
consumer could only comply with the consumer's financial
16
obligations under the lease by selling the consumer's principal
17
place of residence, the consumer could only comply with those
18
obligations with substantial hardship, unless the contrary is proved.
19
Information to be used to determine if lease is unsuitable
20
(4) For the purposes of determining under subsection (2) whether the
21
lease is unsuitable, only information that satisfies both of the
22
following paragraphs is to be taken into account:
23
(a) the information is about the consumer's financial situation,
24
requirements or objectives, or any other matter prescribed by
25
the regulations under paragraph 140(1)(d) or (e);
26
(b) at the time the licensee provides the credit assistance:
27
(i) the licensee had reason to believe that the information
28
was true; or
29
(ii) the licensee would have had reason to believe that the
30
information was true if the licensee had made the
31
inquiries or verification under section 140.
32
Chapter 3 Responsible lending conduct
Part 3-3 Licensees that provide credit assistance in relation to consumer leases
Division 6 Prohib ition on suggesting, or assisting with, unsuitable consumer leases
Section 147
158 National Consumer Credit Protection Bill 2009 No. , 2009
Consumer lease not unsuitable under regulations
1
(5) The regulations may prescribe particular situations in which a
2
consumer lease is taken not to be unsuitable for a consumer,
3
despite subsection (2).
4
Offence
5
(6) A person commits an offence if:
6
(a) the person is subject to a requirement under subsection (1);
7
and
8
(b) the person engages in conduct; and
9
(c) the conduct contravenes the requirement.
10
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
11
both.
12
Defence
13
(7) For the purposes of subsections (1) and (6), it is a defence if:
14
(a) the licensee suggested that the consumer remain in the
15
consumer lease because the licensee reasonably believed that
16
there was no other consumer lease that was not unsuitable for
17
the consumer; and
18
(b) the licensee informed the consumer that there is a procedure
19
under sections 72 and 94 of the National Credit Code for
20
consumers in hardship.
21
Note 1:
For the purposes of subsection (6), a defendant bears an evidential
22
burden in relation to the matter in subsection (7) (see subsection
23
13.3(3) of the Criminal Code).
24
Note 2:
Sections 72 and 94 of the National Credit Code apply in relation to
25
consumer leases because of section 177 of the Code.
26
(8) The regulations may prescribe particular inquiries that must be
27
made, or do not need to be made, for the purposes of
28
paragraph (7)(a).
29
30
Responsible lending conduct Chapter 3
Licensees that are lessors under consumer leases Part 3 -4
Introduction Division 1
Section 148
National Consumer Credit Protection Bill 2009 No. , 2009 159
Part 3-4--Licensees that are lessors under
1
consumer leases
2
Division 1--Introduction
3
148 Guide to this Part
4
This Part has rules that apply to licensees that are lessors. These
5
rules are aimed at better informing consumers and preventing them
6
from being in unsuitable consumer leases.
7
Division 2 requires a licensee to give its credit guide to a
8
consumer. The credit guide has information about the licensee and
9
some of the licensee's obligations under this Act.
10
Division 3 requires a licensee, before entering a consumer lease, to
11
make an assessment as to whether the lease will be unsuitable. To
12
do this, the licensee must make inquiries and verifications about
13
the consumer's requirements, objectives and financial situation.
14
The licensee must give the consumer a copy of the assessment if
15
requested.
16
Division 4 prohibits a licensee from entering a consumer lease that
17
is unsuitable for a consumer.
18
19
Chapter 3 Responsible lending conduct
Part 3-4 Licensees that are lessors under consumer leases
Division 2 Credit guide of lessors
Section 149
160 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Credit guide of lessors
1
149 Credit guide of lessors
2
Requirement to give credit guide
3
(1) A licensee must, as soon as practicable after it becomes apparent to
4
the licensee that it is likely to enter a consumer lease with a
5
consumer who will be the lessee under the lease, give the consumer
6
the licensee's credit guide in accordance with subsection (2).
7
Civil penalty:
2,000 penalty units.
8
(2) The licensee's credit guide must:
9
(a) be in writing; and
10
(b) be in the form (if any) prescribed by the regulations; and
11
(c) specify the licensee's name and contact details; and
12
(d) specify the licensee's Australian credit licence number; and
13
(e) give information about the licensee's procedure for resolving
14
disputes with a consumer, including contact details for a
15
consumer to access:
16
(i) the licensee's internal dispute resolution procedure; and
17
(ii) the approved external dispute resolution scheme of
18
which the licensee is a member; and
19
(f) give information about the licensee's obligations under
20
sections 155 and 156; and
21
(g) comply with any other requirements prescribed by the
22
regulations.
23
(3) The regulations may prescribe information that need not be
24
included in the credit guide, despite subsection (2).
25
Manner of giving credit guide
26
(4) The licensee must give the consumer the licensee's credit guide in
27
the manner (if any) prescribed by the regulations.
28
Strict liability offence
29
(5) A person commits an offence if:
30
Responsible lending conduct Chapter 3
Licensees that are lessors under consumer leases Part 3 -4
Cred it guide of lessors Division 2
Section 150
National Consumer Credit Protection Bill 2009 No. , 2009 161
(a) the person is subject to a requirement under subsection (1);
1
and
2
(b) the person engages in conduct; and
3
(c) the conduct contravenes the requirement.
4
Criminal penalty: 50 penalty units.
5
(6) Subsection (5) is an offence of strict liability.
6
Note:
For strict liability, see section 6.1 of the Criminal Code.
7
150 Credit guide of lessors who are assignees
8
Requirement to give credit guide
9
(1) A licensee must, as soon as practicable after it has been assigned
10
any rights or obligations of a lessor under a consumer lease, give
11
the lessee under the lease the licensee's credit guide in accordance
12
with subsection (2).
13
Civil penalty:
2,000 penalty units.
14
(2) The licensee's credit guide must:
15
(a) be in writing; and
16
(b) be in the form (if any) prescribed by the regulations; and
17
(c) specify the licensee's name and contact details; and
18
(d) specify the licensee's Australian credit licence number; and
19
(e) give information about the licensee's procedure for resolving
20
disputes with a consumer, including contact details for a
21
consumer to access:
22
(i) the licensee's internal dispute resolution procedure; and
23
(ii) the approved external dispute resolution scheme of
24
which the licensee is a member; and
25
(f) comply with any other requirements prescribed by the
26
regulations.
27
(3) The regulations may prescribe information that need not be
28
included in the credit guide, despite subsection (2).
29
Chapter 3 Responsible lending conduct
Part 3-4 Licensees that are lessors under consumer leases
Division 2 Credit guide of lessors
Section 150
162 National Consumer Credit Protection Bill 2009 No. , 2009
Manner of giving credit guide
1
(4) The licensee must give the consumer the licensee's credit guide in
2
the manner (if any) prescribed by the regulations.
3
Strict liability offence
4
(5) A person commits an offence if:
5
(a) the person is subject to a requirement under subsection (1);
6
and
7
(b) the person engages in conduct; and
8
(c) the conduct contravenes the requirement.
9
Criminal penalty: 50 penalty units.
10
(6) Subsection (5) is an offence of strict liability.
11
Note:
For strict liability, see section 6.1 of the Criminal Code.
12
13
Responsible lending conduct Chapter 3
Licensees that are lessors under consumer leases Part 3 -4
Obligations of lessors before entering consumer leases Division 3
Section 151
National Consumer Credit Protection Bill 2009 No. , 2009 163
Division 3--Obligations of lessors before entering
1
consumer leases
2
151 Obligations of lessors before entering consume r leases
3
A licensee must not enter a consumer lease with a consumer who
4
will be the lessee under the lease on a day (the lease day) unless
5
the licensee has, within 90 days (or other period prescribed by the
6
regulations) before the lease day:
7
(a) made an assessment that:
8
(i) is in accordance with section 152; and
9
(ii) covers a period in which the lease day occurs; and
10
(b) made the inquiries and verification in accordance with
11
section 130.
12
Civil penalty:
2,000 penalty units.
13
152 Assessment of unsuitability of the consumer lease
14
For the purposes of paragraph 151(a), the licensee must make an
15
assessment that:
16
(a) specifies the period the assessment covers; and
17
(b) assesses whether the consumer lease will be unsuitable for
18
the consumer if the lease is entered in that period.
19
Note:
The licensee is not required to make the assessment under this section
20
if the lease is not entered.
21
153 Reasonable inquiries etc. about the consumer
22
Requirement to make inquiries and take steps to verify
23
(1) For the purposes of paragraph 151(b), the licensee must, before
24
making the assessment:
25
(a) make reasonable inquiries about the consumer's requirements
26
and objectives in relation to the consumer lease; and
27
(b) make reasonable inquiries about the consumer's financial
28
situation; and
29
Chapter 3 Responsible lending conduct
Part 3-4 Licensees that are lessors under consumer leases
Division 3 Obligations of lessors before entering consumer leases
Section 154
164 National Consumer Credit Protection Bill 2009 No. , 2009
(c) take reasonable steps to verify the consumer's financial
1
situation; and
2
(d) make any inquiries prescribed by the regulations about any
3
matter prescribed by the regulations; and
4
(e) take any steps prescribed by the regulations to verify any
5
matter prescribed by the regulations.
6
Civil penalty:
2,000 penalty units.
7
(2) The regulations may prescribe particular inquiries or steps that
8
must be made or taken, or do not need to be made or taken, for the
9
purposes of paragraph (1)(a), (b) or (c).
10
When not required to take steps to verify
11
(3) Despite subsection (1), if:
12
(a) a preliminary assessment under subsection 139(1) about the
13
entering of the consumer lease has been made; and
14
(b) the preliminary assessment was made no more than 90 days
15
before the day of entering the lease; and
16
(c) the preliminary assessment assesses the lease as not being
17
unsuitable for the consumer; and
18
(d) the preliminary assessment contains the information that was
19
used for the purposes of making the preliminary assessment;
20
the licensee is not required, for the purposes of paragraph (1)(c) or
21
(e), to verify that information.
22
154 When consume r lease must be assessed as unsuitable
23
Requirement to assess the lease as unsuitable
24
(1) The licensee must assess that the consumer lease will be unsuitable
25
for the consumer if the lease will be unsuitable for the consumer
26
under subsection (2).
27
Note:
Even if the lease will not be unsuitable for the consumer under
28
subsection (2), the licensee may still assess that the lease will be
29
unsuitable for other reasons.
30
Responsible lending conduct Chapter 3
Licensees that are lessors under consumer leases Part 3 -4
Obligations of lessors before entering consumer leases Division 3
Section 154
National Consumer Credit Protection Bill 2009 No. , 2009 165
Particular circumstances when the lease will be unsuitable
1
(2) The lease will be unsuitable for the consumer if, at the time of the
2
assessment, it is likely that:
3
(a) the consumer will be unable to comply with the consumer's
4
financial obligations under the lease, or could only comply
5
with substantial hardship, if the lease is entered in the period
6
covered by the assessment; or
7
(b) the lease will not meet the consumer's requirements or
8
objectives if the lease is entered in the period covered by the
9
assessment; or
10
(c) if the regulations prescribe circumstances in which a
11
consumer lease is unsuitable--those circumstances will apply
12
to the lease if the lease is entered in the period covered by the
13
assessment.
14
Civil penalty:
2,000 penalty units.
15
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
16
consumer could only comply with the consumer's financial
17
obligations under the lease by selling the consumer's principal
18
place of residence, the consumer could only comply with those
19
obligations with substantial hardship, unless the contrary is proved.
20
Information to be used to determine if lease will be unsuitable
21
(4) For the purposes of determining under subsection (2) whether the
22
lease will be unsuitable, only information that satisfies both of the
23
following paragraphs is to be taken into account:
24
(a) the information is about the consumer's financial situation,
25
requirements or objectives, or any other matter prescribed by
26
the regulations under paragraph 153(1)(d) or (e);
27
(b) at the time of the preliminary assessment:
28
(i) the licensee had reason to believe that the information
29
was true; or
30
(ii) the licensee would have had reason to believe that the
31
information was true if the licensee had made the
32
inquiries or verification under section 153.
33
Chapter 3 Responsible lending conduct
Part 3-4 Licensees that are lessors under consumer leases
Division 3 Obligations of lessors before entering consumer leases
Section 155
166 National Consumer Credit Protection Bill 2009 No. , 2009
155 Giving the consumer the assessment
1
Requirement to give assessment if requested
2
(1) If, before entering the consumer lease, the consumer requests the
3
licensee for a copy of the assessment, the licensee must give the
4
consumer a written copy of the assessment before entering the
5
lease.
6
Note:
The licensee is not required to give the consumer a copy of the
7
assessment if the lease is not entered.
8
Civil penalty:
2,000 penalty units.
9
(2) If, during the period that:
10
(a) starts on the day (the lease day) the consumer lease is
11
entered; and
12
(b) ends 7 years after that day;
13
the consumer requests the licensee for a copy of the assessment,
14
the licensee must give the consumer a written copy of the
15
assessment:
16
(c) if the request is made within 2 years of the lease day--before
17
the end of 7 business days after the day the licensee receives
18
the request; and
19
(d) otherwise--before the end of 21 business days after the day
20
the licensee receives the request.
21
Civil penalty:
2,000 penalty units.
22
Manner of giving assessment
23
(3) The licensee must give the consumer the copy of the assessment in
24
the manner (if any) prescribed by the regulations.
25
No payment for assessment
26
(4) The licensee must not request or demand payment of an amount for
27
giving the consumer a copy of the assessment.
28
Civil penalty:
2,000 penalty units.
29
Responsible lending conduct Chapter 3
Licensees that are lessors under consumer leases Part 3 -4
Obligations of lessors before entering consumer leases Division 3
Section 155
National Consumer Credit Protection Bill 2009 No. , 2009 167
Strict liability offence
1
(5) A person commits an offence if:
2
(a) the person is subject to a requirement under subsection (1),
3
(2) or (4); and
4
(b) the person engages in conduct; and
5
(c) the conduct contravenes the requirement.
6
Criminal penalty: 50 penalty units.
7
(6) Subsection (5) is an offence of strict liability.
8
Note:
For strict liability, see section 6.1 of the Criminal Code.
9
10
Chapter 3 Responsible lending conduct
Part 3-4 Licensees that are lessors under consumer leases
Division 4 Prohib ition on entering unsuitable consumer leases
Section 156
168 National Consumer Credit Protection Bill 2009 No. , 2009
Division 4--Prohibition on entering unsuitable consumer
1
leases
2
156 Prohibition on entering unsuitable consume r leases
3
Prohibition on entering unsuitable lease
4
(1) A licensee must not enter a consumer lease with a consumer who
5
will be the lessee under the lease if the lease is unsuitable for the
6
consumer under subsection (2).
7
Civil penalty:
2,000 penalty units.
8
When the lease is unsuitable
9
(2) The lease is unsuitable for the consumer if, at the time it is entered:
10
(a) it is likely that the consumer will be unable to comply with
11
the consumer's financial obligations under the lease, or could
12
only comply with substantial hardship; or
13
(b) the lease does not meet the consumer's requirements or
14
objectives; or
15
(c) if the regulations prescribe circumstances in which a
16
consumer lease is unsuitable--those circumstances apply to
17
the lease.
18
(3) For the purposes of paragraph (2)(a), it is presumed that, if the
19
consumer could only comply with the consumer's financial
20
obligations under the lease by selling the consumer's principal
21
place of residence, the consumer could only comply with those
22
obligations with substantial hardship, unless the contrary is proved.
23
Information to be used to determine if lease is unsuitable
24
(4) For the purposes of determining under subsection (2) whether the
25
lease is unsuitable, only information that satisfies both of the
26
following paragraphs is to be taken into account:
27
(a) the information is about the consumer's financial situation,
28
requirements or objectives, or any other matter prescribed by
29
the regulations under paragraph 153(1)(d) or (e);
30
(b) at the time the lease is entered:
31
Responsible lending conduct Chapter 3
Licensees that are lessors under consumer leas es Part 3 -4
Prohibition on entering unsuitable consumer leases Division 4
Section 156
National Consumer Credit Protection Bill 2009 No. , 2009 169
(i) the licensee had reason to believe that the information
1
was true; or
2
(ii) the licensee would have had reason to believe that the
3
information was true if the licensee had made the
4
inquiries or verification under section 153.
5
Consumer lease not unsuitable under regulations
6
(5) The regulations may prescribe particular situations in which a
7
consumer lease is taken not to be unsuitable for a consumer,
8
despite subsection (2).
9
Offence
10
(6) A person commits an offence if:
11
(a) the person is subject to a requirement under subsection (1);
12
and
13
(b) the person engages in conduct; and
14
(c) the conduct contravenes the requirement.
15
Criminal penalty: 100 penalty units, or 2 years imprisonment, or
16
both.
17
18
Chapter 3 Responsible lending conduct
Part 3-5 Cred it representatives
Division 1 Introduction
Section 157
170 National Consumer Credit Protection Bill 2009 No. , 2009
Part 3-5--Credit representatives
1
Division 1--Introduction
2
157 Guide to this Part
3
This Part has rules that apply to credit representatives when they
4
act on behalf of a licensee under Part 3-1, 3-2, 3-3 or 3-4. These
5
rules are aimed at better informing consumers.
6
Division 2 requires a credit representative to give its credit guide to
7
a consumer. The credit guide has information about the credit
8
representative.
9
10
Responsible lending conduct Chapter 3
Cred it representatives Part 3-5
Cred it guide of cred it representatives Division 2
Section 158
National Consumer Credit Protection Bill 2009 No. , 2009 171
Division 2--Credit guide of credit representatives
1
158 Credit guide of credit representatives
2
Requirement to give credit guide
3
(1) If a credit representative of a licensee gives a consumer the
4
licensee's credit guide when acting on behalf of the licensee under
5
Part 3-1, 3-2, 3-3 or 3-4, the credit representative must at the same
6
time give the consumer the credit representative's credit guide in
7
accordance with subsection (2).
8
Civil penalty:
2,000 penalty units.
9
(2) The credit representative's credit guide must:
10
(a) be in writing; and
11
(b) be in the form (if any) prescribed by the regulations; and
12
(c) specify the credit representative's name and contact details;
13
and
14
(d) specify the credit representative's credit representative
15
number; and
16
(e) give information about:
17
(i) any fees that are payable by a consumer to the credit
18
representative for acting as a credit representative; and
19
(ii) any charges that are payable by a consumer to the credit
20
representative for matters associated with acting as a
21
credit representative; and
22
(iii) the method for working out the amount of the fees and
23
charges; and
24
(f) give information about:
25
(i) if there are 6 or fewer licensees for whom the credit
26
representative is a credit representative--the names of
27
those licensees; and
28
(ii) if there are more than 6 licensees for whom the credit
29
representative is a credit representative--the names of
30
the 6 licensees for whom the credit representative
31
reasonably believes it conducts the most business; and
32
Chapter 3 Responsible lending conduct
Part 3-5 Cred it representatives
Division 2 Credit guide of credit representatives
Section 158
172 National Consumer Credit Protection Bill 2009 No. , 2009
(iii) the credit activities the credit representative is
1
authorised to engage in on behalf of the licensees
2
referred to in subparagraph (i) or (ii); and
3
(g) give information about:
4
(i) any commissions the credit representative is likely to
5
receive, directly or indirectly, from those licensees; and
6
(ii) a reasonable estimate of the amounts of those
7
commissions or the range of those amounts; and
8
(iii) the method for working out those amounts; and
9
(h) give information about the credit representative's procedure
10
for resolving disputes with a consumer, including contact
11
details for a consumer to access the approved external dispute
12
resolution scheme of which the credit representative's is a
13
member; and
14
(i) comply with any other requirements prescribed by the
15
regulations.
16
(3) The regulations may prescribe:
17
(a) information that need not be included in the credit guide,
18
despite subsection (2); and
19
(b) for the purposes of paragraph (2)(g):
20
(i) the method for working out amounts of commissions;
21
and
22
(ii) how commissions or amounts of commissions must be
23
described.
24
Manner of giving credit guide
25
(4) The credit representative must give the consumer the credit
26
representative's credit guide in the manner (if any) prescribed by
27
the regulations.
28
Strict liability offence
29
(5) A person commits an offence if:
30
(a) the person is subject to a requirement under subsection (1);
31
and
32
(b) the person engages in conduct; and
33
(c) the conduct contravenes the requirement.
34
Responsible lending conduct Chapter 3
Cred it representatives Part 3-5
Cred it guide of cred it representatives Division 2
Section 158
National Consumer Credit Protection Bill 2009 No. , 2009 173
Criminal penalty: 50 penalty units.
1
(6) Subsection (5) is an offence of strict liability.
2
Note:
For strict liability, see section 6.1 of the Criminal Code.
3
4
Chapter 3 Responsible lending conduct
Part 3-6 Debt collectors
Division 1 Introduction
Section 159
174 National Consumer Credit Protection Bill 2009 No. , 2009
Part 3-6--Debt collectors
1
Division 1--Introduction
2
159 Guide to this Part
3
This Part has rules that apply to a person who is authorised to
4
collect payments under a credit contract or consumer lease from a
5
debtor or lessee. These rules are aimed at better informing
6
consumers.
7
Division 2 requires the person to give the person's credit guide to
8
the consumer. The credit guide has information about the person.
9
10
Responsible lending conduct Chapter 3
Debt collectors Part 3-6
Cred it guide of debt collectors Division 2
Section 160
National Consumer Credit Protection Bill 2009 No. , 2009 175
Division 2--Credit guide of debt collectors
1
160 Credit guide of debt collectors
2
Requirement to give credit guide
3
(1) A person who is a licensee or credit representative must, as soon as
4
practicable after it becomes authorised by a credit provider to
5
collect, on the credit provider's behalf, repayments made by a
6
debtor under a credit contract, give the debtor the person's credit
7
guide in accordance with subsection (3).
8
Civil penalty:
2,000 penalty units.
9
(2) A person who is a licensee or credit representative must, as soon as
10
practicable after it becomes authorised by a lessor to collect, on the
11
lessor's behalf, payments made by a lessee under a consumer lease,
12
give the lessee the person's credit guide in accordance with
13
subsection (3).
14
Civil penalty:
2,000 penalty units.
15
(3) The person's credit guide must:
16
(a) be in writing; and
17
(b) be in the form (if any) prescribed by the regulations; and
18
(c) specify the person's name and contact details; and
19
(d) if the person is a licensee--specify the person's Australian
20
credit licence number; and
21
(e) if the person is a credit representative--specify the person's
22
credit representative number; and
23
(f) give information about the person's procedure for resolving
24
disputes with a consumer, including contact details for a
25
consumer to access:
26
(i) if the person is a licensee--the person's internal dispute
27
resolution procedure; and
28
(ii) in all cases--the approved external dispute resolution
29
scheme of which the person is a member; and
30
(g) comply with any other requirements prescribed by the
31
regulations.
32
Chapter 3 Responsible lending conduct
Part 3-6 Debt collectors
Division 2 Credit guide of debt collectors
Section 160
176 National Consumer Credit Protection Bill 2009 No. , 2009
(4) The regulations may prescribe information that need not be
1
included in the credit guide, despite subsection (3).
2
Manner of giving credit guide
3
(5) The person must give the consumer the person's credit guide in the
4
manner (if any) prescribed by the regulations.
5
Strict liability offence
6
(6) A person commits an offence if:
7
(a) the person is subject to a requirement under subsection (1);
8
and
9
(b) the person engages in conduct; and
10
(c) the conduct contravenes the requirement.
11
Criminal penalty: 50 penalty units.
12
(7) Subsection (6) is an offence of strict liability.
13
Note:
For strict liability, see section 6.1 of the Criminal Code.
14
15
Responsible lending conduct Chapter 3
Exemptions and modifications relating to this Chapter Part 3-7
Introduction Division 1
Section 161
National Consumer Credit Protection Bill 2009 No. , 2009 177
Part 3-7--Exemptions and modifications relating to
1
this Chapter
2
Division 1--Introduction
3
161 Guide to this Part
4
This Part is about exemptions from, and modifications of, the
5
provisions of this Chapter.
6
Division 2 deals with how exemptions and modifications may be
7
made by ASIC or by the regulations.
8
9
Chapter 3 Responsible lending conduct
Part 3-7 Exemptions and modifications relating to this Chapter
Division 2 Exemptions and modifications relating to this Chapter
Section 162
178 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Exemptions and modifications relating to this
1
Chapter
2
162 Provisions to which this Part applies
3
The provisions to which this Part applies are:
4
(a) this Chapter; and
5
(b) definitions in this Act, as they apply to references in this
6
Chapter; and
7
(c) instruments made for the purposes of this Chapter.
8
163 Exemptions and modifications by ASIC
9
(1) ASIC may:
10
(a) exempt a person from all or specified provisions to which
11
this Part applies; or
12
(b) exempt a credit contract from all or specified provisions to
13
which this Part applies; or
14
(c) exempt a consumer lease from all or specified provisions to
15
which this Part applies; or
16
(d) declare that provisions to which this Part applies apply in
17
relation to a person, credit contract or consumer lease as if
18
specified provisions were omitted, modified or varied as
19
specified in the declaration.
20
(2) An exemption or declaration under subsection (1) is not a
21
legislative instrument.
22
(3) ASIC may, by legislative instrument:
23
(a) exempt a class of persons from all or specified provisions to
24
which this Part applies; or
25
(b) exempt a class of credit contracts from all or specified
26
provisions to which this Part applies; or
27
(c) exempt a class of consumer leases from all or specified
28
provisions to which this Part applies; or
29
(d) declare that provisions to which this Part applies apply in
30
relation to a class of persons, credit contracts or consumer
31
Responsible lending conduct Chapter 3
Exemptions and modifications relating to this Chapter Part 3-7
Exemptions and modifications relating to this Chapter Division 2
Section 164
National Consumer Credit Protection Bill 2009 No. , 2009 179
leases, as if specified provisions were omitted, modified or
1
varied as specified in the declaration.
2
(4) An exemption may apply unconditionally or subject to specified
3
conditions. A person to whom a condition specified in an
4
exemption applies must comply with the condition. The court may
5
order the person to comply with the condition in a specified way.
6
Only ASIC may apply to the court for the order.
7
(5) An exemption or declaration under subsection (1) must be in
8
writing and ASIC must publish notice of it on its website.
9
(6) If conduct (including an omission) of a person would not have
10
constituted an offence if a particular declaration under
11
paragraph (1)(d) or (3)(d) had not been made, that conduct does not
12
constitute an offence unless, before the conduct occurred:
13
(a) the text of the declaration was published by ASIC on its
14
website; or
15
(b) ASIC gave written notice setting out the text of the
16
declaration to the person;
17
(in addition to complying with the requirements of the Legislative
18
Instruments Act 2003 if the declaration is made under
19
subsection (3)).
20
(7) In a prosecution for an offence to which subsection (6) applies, the
21
prosecution must prove that paragraph (6)(a) or (b) was complied
22
with before the conduct occurred.
23
164 Exemptions and modifications by the regulations
24
The regulations may:
25
(a) exempt a person or class of persons from all or specified
26
provisions to which this Part applies; or
27
(b) exempt a credit contract or a class of credit contracts from all
28
or specified provisions to which this Part applies; or
29
(c) exempt a consumer lease or a class of consumer leases from
30
all or specified provisions to which this Part applies; or
31
(d) provide that the provisions to which this Part applies apply as
32
if specified provisions were omitted, modified or varied as
33
specified in the regulations.
34
Chapter 4 Remed ies
Part 4-1 Civil penalty provisions
Division 1 Introduction
Section 165
180 National Consumer Credit Protection Bill 2009 No. , 2009
Chapter 4--Remedies
1
Part 4-1--Civil penalty provisions
2
Division 1--Introduction
3
165 Guide to this Part
4
This Part is about civil penalty provisions. Civil penalty provisions
5
impose obligations on certain persons. Civil remedies may be
6
sought in relation to contraventions of these provisions.
7
Division 2 authorises the court to make a declaration that a person
8
has contravened a civil penalty provision and order the person to
9
pay a pecuniary penalty. Only ASIC may apply to the court for the
10
declaration or order.
11
Division 3 has general provisions relating to civil penalty
12
provisions, including rules about evidence and procedure.
13
14
Remedies Chapter 4
Civil penalty provisions Part 4 -1
Declarations and pecuniary penalty orders for contraventions of civil penalty provisions
Division 2
Section 166
National Consumer Credit Protection Bill 2009 No. , 2009 181
Division 2--Declarations and pecuniary penalty orders for
1
contraventions of civil penalty provisions
2
166 Declaration of contravention of civil penalty provision
3
Application for declaration of contravention
4
(1) Within 6 years of a person contravening a civil penalty provision,
5
ASIC may apply to the court for a declaration that the person
6
contravened the provision.
7
Declaration of contravention
8
(2) The court must make the declaration if it is satisfied that the person
9
has contravened the provision.
10
(3) The declaration must specify the following:
11
(a) the court that made the declaration;
12
(b) the civil penalty provision that was contravened;
13
(c) the person who contravened the provision;
14
(d) the conduct that constituted the contravention.
15
Declaration of contravention conclusive evidence
16
(4) The declaration is conclusive evidence of the matters referred to in
17
subsection (3).
18
167 Court may order pe rson to pay pecuniary penalty for
19
contravening civil penalty provision
20
Application for order
21
(1) Within 6 years of a person contravening a civil penalty provision,
22
ASIC may apply to the court for an order that the person pay the
23
Commonwealth a pecuniary penalty.
24
Court may order person to pay pecuniary penalty
25
(2) If a declaration has been made under section 166 that the person
26
has contravened the provision, the court may order the person to
27
Chapter 4 Remed ies
Part 4-1 Civil penalty provisions
Division 2 Declarations and pecuniary penalty orders for contraventions of civil
penalty provisions
Section 167
182 National Consumer Credit Protection Bill 2009 No. , 2009
pay to the Commonwealth a pecuniary penalty that the court
1
considers is appropriate (but not more than the amount specified in
2
subsection (3)).
3
Determining amount of pecuniary penalty
4
(3) The pecuniary penalty must not be more than:
5
(a) if the person is a natural person--the maximum number of
6
penalty units referred to in the civil penalty provision; or
7
(b) if the person is a body corporate, a partnership or multiple
8
trustees--5 times the maximum number of penalty units
9
referred to in the civil penalty provision.
10
Note:
This Act treats partnerships and multiple trustees as if they were
11
persons (see sections 14 and 15).
12
Recovery of penalty as a debt
13
(4) The pecuniary penalty may be recovered as a debt due to the
14
Commonwealth.
15
16
Remedies Chapter 4
Civil penalty provisions Part 4 -1
General provisions relating to civil penalty provisions Division 3
Section 168
National Consumer Credit Protection Bill 2009 No. , 2009 183
Division 3--General provisions relating to civil penalty
1
provisions
2
168 Contravening a civil penalty provision is not an offence
3
A contravention of a civil penalty provision is not an offence.
4
169 Involvement in contravention treated in same way as actual
5
contravention
6
A person who is involved in a contravention of a civil penalty
7
provision is taken to have contravened that provision.
8
170 Civil evidence and procedure rules for proceedings relating to
9
civil penalty provisions
10
The court must apply the rules of evidence and procedure for civil
11
matters when hearing proceedings relating to a contravention, or
12
proposed contravention, of a civil penalty provision.
13
171 Criminal proceedings before civil proceedings
14
The court must not make a declaration of contravention or a
15
pecuniary penalty order against a person for a contravention of a
16
civil penalty provision if the person has been convicted of an
17
offence constituted by conduct that is substantia lly the same as the
18
conduct constituting the contravention.
19
172 Criminal proceedings during civil proceedings
20
(1) Proceedings for a declaration of contravention or a pecuniary
21
penalty order against a person for a contravention of a civil penalty
22
provision are stayed if:
23
(a) criminal proceedings are brought or have already been
24
brought against the person for an offence; and
25
(b) the offence is constituted by conduct that is substantially the
26
same as the conduct in relation to which the declaration or
27
order would be made.
28
Chapter 4 Remed ies
Part 4-1 Civil penalty provisions
Division 3 General provisions relating to civ il penalty provisions
Section 173
184 National Consumer Credit Protection Bill 2009 No. , 2009
(2) The proceedings for the declaration or order may be resumed if the
1
person is not convicted of the offence. Otherwise, the proceedings
2
for the declaration or order are dismissed.
3
173 Criminal proceedings after civil proceedings
4
Criminal proceedings may be brought against a person for conduct
5
that is substantially the same as conduct constituting a
6
contravention of a civil penalty provision regardless of whether a
7
declaration of contravention or a pecuniary penalty order has been
8
made against the person under this Division.
9
174 Evidence given in proceedings for pecuniary penalty not
10
admissible in criminal proceedings
11
(1) Evidence of information given, or evidence of production of
12
documents, by a natural person is not admissible in criminal
13
proceedings against the natural person if:
14
(a) the natural person previously gave the information or
15
produced the documents in proceedings for a declaration of
16
contravention or a pecuniary penalty order against the natural
17
person for a contravention of a civil penalty provision
18
(whether or not the declaration or order was made); and
19
(b) the conduct alleged to constitute the offence is substantially
20
the same as the conduct in relation to which the declaration
21
or order was sought.
22
(2) However, this does not apply to criminal proceedings in relation to
23
the falsity of the evidence given by the natural person in the
24
proceedings for the declaration or order.
25
175 Civil double jeopardy
26
If a person is ordered to pay a pecuniary penalty under a civil
27
penalty provision in relation to particular conduct, the person is not
28
liable to be ordered to pay a pecuniary penalty under some other
29
provision of a law of the Commonwealth in relation to that
30
conduct.
31
Remedies Chapter 4
Civil penalty provisions Part 4 -1
General provisions relating to civil penalty provisions Division 3
Section 175
National Consumer Credit Protection Bill 2009 No. , 2009 185
Note:
A court may make other orders, such as an order for compensation, in
1
relation to particular conduct even if the court has made a pecuniary
2
penalty order in relation to that conduct (see section 184).
3
4
Chapter 4 Remed ies
Part 4-2 Po wer o f the court to grant remed ies
Division 1 Introduction
Section 176
186 National Consumer Credit Protection Bill 2009 No. , 2009
Part 4-2--Power of the court to grant remedies
1
Division 1--Introduction
2
176 Guide to this Part
3
This Part is about the remedies the court may grant.
4
Division 2 authorises the court to grant a range of remedies,
5
including injunctions, compensation orders and other orders
6
against those who engage in credit activities unlawfully.
7
8
Remedies Chapter 4
Power o f the court to grant remed ies Part 4-2
Power o f the court to grant remed ies Division 2
Section 177
National Consumer Credit Protection Bill 2009 No. , 2009 187
Division 2--Power of the court to grant remedies
1
177 Injunctions
2
(1) If, on the application of ASIC or any other person, the court is
3
satisfied that a person has engaged or is proposing to engage in
4
conduct that constitutes or would constitute:
5
(a) a contravention of this Act; or
6
(b) attempting to contravene this Act; or
7
(c) aiding, abetting, counselling or procuring a person to
8
contravene this Act; or
9
(d) inducing or attempting to induce, whether by threats,
10
promises or otherwise, a person to contravene this Act; or
11
(e) being in any way, directly or indirectly, knowingly concerned
12
in, or party to, the contravention by a person of this Act; or
13
(f) conspiring with others to contravene this Act;
14
the court may grant an injunction on such terms as the court
15
considers appropriate.
16
(2) If an application for an injunction under subsection (1) has been
17
made, the court may, if the court considers it appropriate, grant an
18
injunction by consent of all the parties to the proceedings, whether
19
or not the court is satisfied that the person has engaged, or is
20
proposing to engage, in conduct of a kind referred to in
21
subsection (1).
22
(3) The court may, if the court considers it appropriate, grant an
23
interim injunction pending determination of an application under
24
subsection (1).
25
(4) The court may revoke or vary an injunction granted under
26
subsection (1) or (3).
27
(5) The power of the court to grant an injunction restraining a person
28
from engaging in conduct may be exercised:
29
(a) whether or not it appears to the court that the person intends
30
to engage again, or to continue to engage, in conduct of that
31
kind; and
32
Chapter 4 Remed ies
Part 4-2 Po wer o f the court to grant remed ies
Division 2 Power of the court to grant remedies
Section 178
188 National Consumer Credit Protection Bill 2009 No. , 2009
(b) whether or not the person has previously engaged in conduct
1
of that kind; and
2
(c) whether or not there is an imminent danger of substantial
3
damage to another person if the person engages in conduct of
4
that kind.
5
(6) The power of the court to grant an injunction requiring a person to
6
do an act or thing may be exercised:
7
(a) whether or not it appears to the court that the person intends
8
to refuse or fail again, or to continue to refuse or fail, to do
9
that act or thing; and
10
(b) whether or not the person has previously refused or failed to
11
do that act or thing; and
12
(c) whether or not there is an imminent danger of substantial
13
damage to another person if the person refuses or fails to do
14
that act or thing.
15
(7) If ASIC applies to the court for the grant of an injunction under
16
this section, the court must not require ASIC or another person, as
17
a condition of granting an interim injunction, to give an
18
undertaking as to damages.
19
(8) If the court has power under this section to grant an injunction
20
against a person, the court may, either in addition to or in
21
substitution for the grant of the injunction, order the person to pay
22
damages to another person.
23
178 Compensation orders
24
Court may order person to pay compensation
25
(1) The court may order a person (the defendant) to compensate
26
another person (the plaintiff) for loss or damage suffered by the
27
plaintiff if:
28
(a) the defendant has contravened a civil penalty provision or has
29
committed an offence against this Act (other than the
30
National Credit Code); and
31
(b) the loss or damage resulted from the contravention or
32
commission of the offence.
33
The order must specify the amount of compensation.
34
Remedies Chapter 4
Power o f the court to grant remed ies Part 4-2
Power o f the court to grant remed ies Division 2
Section 179
National Consumer Credit Protection Bill 2009 No. , 2009 189
When order may be made
1
(2) The court may make the order only if:
2
(a) the plaintiff or ASIC (on behalf of the plaintiff) applies for an
3
order under this section; and
4
(b) the application is made within 6 years of the day the cause of
5
action that relates to the contravention or commission of the
6
offence accrued.
7
Applications for order
8
(3) For the purposes of paragraph (2)(a), ASIC may make an
9
application on behalf of the plaintiff, but only if the plaintiff has
10
given consent in writing before the application is made.
11
Recovery of compensation as a debt
12
(4) If the court makes the order, the amount of compensation specified
13
in the order that is to be paid to the plaintiff may be recovered as a
14
debt due to the plaintiff.
15
179 Other orders to compensate loss or damage
16
Court may make other orders to compensate loss or damage
17
(1) If:
18
(a) a person (the defendant) has contravened a civil penalty
19
provision or has committed an offence against this Act (other
20
than the National Credit Code); and
21
(b) another person (the plaintiff) has suffered, or is likely to
22
suffer, loss or damage as a result of the contravention or
23
commission of the offence;
24
the court may make such order as the court considers appropriate
25
against the defendant to:
26
(c) compensate the plaintiff, in whole or in part, for the loss or
27
damage; or
28
(d) prevent or reduce the loss or damage suffered, or likely to be
29
suffered, by the plaintiff.
30
Chapter 4 Remed ies
Part 4-2 Po wer o f the court to grant remed ies
Division 2 Power of the court to grant remedies
Section 179
190 National Consumer Credit Protection Bill 2009 No. , 2009
(2) Without limiting subsection (1), examples of orders the court may
1
make include:
2
(a) an order declaring the whole or any part of a contract, deed or
3
arrangement made between the defendant and the plaintiff to
4
be void and, if the court considers it appropriate, to have been
5
void from the time it was entered or at all times on and after a
6
specified day before the order is made; and
7
(b) an order varying such a contract, deed or arrangement in such
8
manner as is specified in the order and, if the court considers
9
it appropriate, declaring the contract, deed or arrangement to
10
have had effect as so varied on and after a specified day
11
before the order is made; and
12
(c) an order refusing to enforce any or all of the terms of such a
13
contract, deed or arrangement; and
14
(d) an order directing the defendant to refund money or return
15
property to the plaintiff; and
16
(e) an order directing the defendant to pay to the plaintiff the
17
amount of loss or damage the plaintiff suffered; and
18
(f) an order directing the defendant, at the defendant's own
19
expense, to supply specified services to the plaintiff.
20
When order may be made
21
(3) The court may make the order only if:
22
(a) the plaintiff or ASIC (on behalf of the plaintiff) applies for an
23
order under this section; and
24
(b) the application is made within 6 years of the day the cause of
25
action that relates to the contravention or commission of the
26
offence accrued.
27
Applications for order
28
(4) For the purposes of paragraph (3)(a), ASIC may make an
29
application on behalf of the plaintiff, but only if the plaintiff has
30
given consent in writing before the application is made.
31
Remedies Chapter 4
Power o f the court to grant remed ies Part 4-2
Power o f the court to grant remed ies Division 2
Section 180
National Consumer Credit Protection Bill 2009 No. , 2009 191
Recovery of amount as a debt
1
(5) If the court makes an order that the defendant pay an amount
2
specified in the order to the plaintiff, the plaintiff may recover the
3
amount as a debt due to the plaintiff.
4
180 Orde rs in relation to unlawful credit activities
5
Court may make orders in relation to unlawful credit activities
6
(1) If:
7
(a) a person (the defendant) engages in a credit activity in
8
relation to another person (the plaintiff); and
9
(b) the engaging in the activity contravenes section 29 (which
10
requires the holding of licence);
11
the court may make such order as the court considers appropriate
12
against the defendant:
13
(c) to prevent the defendant from profiting from the plaintiff by
14
engaging in that activity; or
15
(d) to compensate the plaintiff, in whole or in part, for any loss
16
or damage suffered as a result of the defendant engaging in
17
that activity; or
18
(e) to prevent or reduce the loss or damage suffered, or likely to
19
be suffered, by the plaintiff as a result of the defendant
20
engaging in that activity.
21
(2) Without limiting subsection (1), examples of orders the court may
22
make include:
23
(a) an order declaring the whole or any part of a contract, deed or
24
arrangement made between the defendant and the plaintiff to
25
be void and, if the court considers it appropriate, to have been
26
void from the time it was entered or at all times on and after a
27
specified day before the order is made; and
28
(b) an order varying such a contract, deed or arrangement in such
29
manner as is specified in the order and, if the court considers
30
it appropriate, declaring the contract, deed or arrangement to
31
have had effect as so varied on and after a specified day
32
before the order is made; and
33
Chapter 4 Remed ies
Part 4-2 Po wer o f the court to grant remed ies
Division 2 Power of the court to grant remedies
Section 181
192 National Consumer Credit Protection Bill 2009 No. , 2009
(c) an order refusing to enforce any or all of the terms of such a
1
contract, deed or arrangement; and
2
(d) an order directing the defendant to refund money or return
3
property to the plaintiff; and
4
(e) an order directing the defendant to pay to the plaintiff the
5
amount of loss or damage the plaintiff suffered; and
6
(f) an order directing the defendant, at the defendant's own
7
expense, to supply specified services to the plaintiff.
8
When order may be made
9
(3) The court may make the order only if:
10
(a) the plaintiff or ASIC (on behalf of the plaintiff) applies for an
11
order under this section; and
12
(b) the application is made within 6 years of the day the cause of
13
action that relates to the contravention or commission of the
14
offence accrued.
15
Applications for order
16
(4) For the purposes of paragraph (3)(a), ASIC may make an
17
application on behalf of the plaintiff, but only if the plaintiff has
18
given consent in writing before the application is made.
19
Recovery of amount as a debt
20
(5) If the court makes an order that the defendant pay an amount
21
specified in the order to the plaintiff, the plaintiff may recover the
22
amount as a debt due to the plaintiff.
23
181 Preference must be given to compe nsate consumers
24
If the court considers that:
25
(a) it is appropriate to make a pecuniary penalty order against a
26
person in relation to a contravention of a civil penalty
27
provision or impose a fine against a person in relation to a
28
commission of an offence against this Act (other than the
29
National Credit Code); and
30
Remedies Chapter 4
Power o f the court to grant remed ies Part 4-2
Power o f the court to grant remed ies Division 2
Section 182
National Consumer Credit Protection Bill 2009 No. , 2009 193
(b) it is appropriate to make an order under 178, 179 or 180 that
1
the person pay compensation to a consumer who has suffered
2
loss or damage in relation to the contravention; and
3
(c) the person does not have sufficient financial resources to pay
4
both the pecuniary penalty or fine and the compensation;
5
the court must give preference to making the order for
6
compensation.
7
182 Adve rse publicity orders
8
(1) The court may, on application by ASIC, make an adverse publicity
9
order against a person who has:
10
(a) contravened a civil penalty provision; or
11
(b) committed an offence against this Act.
12
(2) An adverse publicity order is an order that:
13
(a) requires a person to disclose, in the way and to the persons
14
specified in the order, such information as is so specified,
15
being information that the person has possession of or access
16
to; or
17
(b) requires a person to publish, at the person's expense and in
18
the way specified in the order, an advertisement in the terms
19
specified in, or determined in accordance with, the order.
20
(3) The court may make the order only if:
21
(a) ASIC applies for an order under this section; and
22
(b) the application is made within 6 years of the contravention or
23
the commission of the offence.
24
183 Relief from liability for contravention of civil penalty provision
25
(1) If:
26
(a) proceedings for a contravention of a civil penalty provision
27
are brought against a person; and
28
(b) in the proceedings it appears to the court that the person has,
29
or may have, contravened a civil penalty provision but that:
30
(i) the person has acted honestly; and
31
(ii) having regard to all the circumstances of the case, the
32
person ought fairly to be excused for the contravention;
33
Chapter 4 Remed ies
Part 4-2 Po wer o f the court to grant remed ies
Division 2 Power of the court to grant remedies
Section 184
194 National Consumer Credit Protection Bill 2009 No. , 2009
the court may relieve the person either wholly or partly from a
1
liability to which the person would otherwise be subject, or that
2
might otherwise be imposed on the person, because of the
3
contravention.
4
(2) If a person considers that proceedings for a contravention of a civil
5
penalty provision will or may be brought against the person, the
6
person may apply to the court for relief.
7
(3) On an application under subsection (2), the court may grant relief
8
under subsection (1) as if the proceedings had been begun in the
9
court.
10
184 Multiple remedies may be granted
11
To avoid doubt, the court may make an order under a provision of
12
this Act in addition to one or more orders under another provision
13
of this Act.
14
15
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Introduction Division 1
Section 185
National Consumer Credit Protection Bill 2009 No. , 2009 195
Part 4-3--Jurisdiction and procedure of courts
1
Division 1--Introduction
2
185 Guide to this Part
3
This Part is about court jurisdiction and procedure.
4
Division 2 deals with civil proceedings. It confers jurisdiction on
5
the Federal Court, the Federal Magistrates Court and State and
6
Territory courts, subject to specified limits. It also contains rules
7
about the transfer of civil proceedings between courts and other
8
matters (such as when proceedings may be dealt with as small
9
claims proceedings and when adverse cost orders can be made).
10
Division 3 deals with criminal proceedings. It confers criminal
11
jurisdiction on the State and Territory courts and sets out the laws
12
that are to be applied in relation to criminal proceedings.
13
Division 4 contains rules about proceedings generally (such as
14
ASIC's power to intervene in proceedings and the power of courts
15
to punish for contempt).
16
17
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 2 Civil p roceedings
Section 186
196 National Consumer Credit Protection Bill 2009 No. , 2009
Division 2--Civil proceedings
1
Subdivision A--Application of this Division
2
186 Application of this Division
3
(1) This Division applies to the exclusion of:
4
(a) the Jurisdiction of Courts (Cross-vesting) Act 1987; and
5
(b) section 39B of the Judiciary Act 1903.
6
(2) This Division does not limit the application of the provisions of the
7
Judiciary Act 1903 (other than section 39B). In particular, it does
8
not limit the application of subsection 39(2) of that Act in relation
9
to matters arising under this Act.
10
(3) Nothing in this Division affects any other jurisdiction of any court.
11
(4) Despite anything else in this Division, jurisdiction is conferred on
12
the courts of a Territory only to the extent that the Constitution
13
permits.
14
Subdivision B--Conferral of civil jurisdiction
15
187 Civil jurisdiction of courts
16
(1) Jurisdiction is conferred on a court referred to in an item in the
17
following table in relation to civil matters arising under this Act,
18
subject to the limits on the court's jurisdiction (if any) specified in
19
the item:
20
21
Civil jurisdiction of courts
Item
Court on which civil jurisdiction is
conferred
Limits of jurisdiction
1
The Federal Court
No specified limits.
2
The Federal Mag istrates Court
The court does not have jurisdiction
to award an amount for loss or
damage that exceeds:
(a) $750,000; or
(b) if another amount is prescribed
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Civil proceedings Division 2
Section 188
National Consumer Credit Protection Bill 2009 No. , 2009 197
Civil jurisdiction of courts
Item
Court on which civil jurisdiction is
conferred
Limits of jurisdiction
by the regulations--that other
amount.
3
A superior court, or lo wer court, of a
State or Territory
The court's general jurisdictional
limits, including limits as to locality
and subject matter.
(2) This section has effect subject to section 188.
1
188 Jurisdiction--decisions to prosecute and related criminal justice
2
process decisions made by Commonwealth officers
3
(1) If a decision to prosecute a person for an offence against this Act
4
has been made by an officer of the Commonwealth, and the
5
prosecution is proposed to be brought in a court of a State or
6
Territory:
7
(a) the Federal Court does not have jurisdiction in relation to any
8
matter in which a person seeks a writ of mandamus or
9
prohibition, or an injunction, against the officer in relation to
10
that decision; and
11
(b) jurisdiction in relation to any such matter is conferred on the
12
Supreme Court of the State or Territory in which the
13
prosecution is proposed to be brought.
14
(2) Subject to subsection (4), at any time when:
15
(a) a prosecution for an offence against this Act is before a court
16
of a State or Territory; or
17
(b) an appeal arising out of such a prosecution is before a court
18
of a State or Territory;
19
the following apply:
20
(c) the Federal Court does not have jurisdiction in relation to any
21
matter in which the person who is or was the defendant in the
22
prosecution seeks a writ of mandamus or prohibition, or an
23
injunction, against an officer of the Commonwealth in
24
relation to a related criminal justice process decision;
25
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 2 Civil p roceedings
Section 188
198 National Consumer Credit Protection Bill 2009 No. , 2009
(d) jurisdiction in relation to any such matter is conferred on the
1
Supreme Court of the State or Territory in which the
2
prosecution or appeal is before a court.
3
(3) A related criminal justice process decision, in relation to an
4
offence, means a decision (other than a decision to prosecute)
5
made in the criminal justice process in relation to the offence,
6
including:
7
(a) a decision in connection with the investigation, committal for
8
trial or prosecution of the defendant; and
9
(b) a decision in connection with the appointment of
10
investigators or inspectors for the purposes of such an
11
investigation; and
12
(c) a decision in connection with the issue of a warrant,
13
including a search warrant or a seizure warrant; and
14
(d) a decision requiring the production of documents, the giving
15
of information or the summoning of persons as witnesses;
16
and
17
(e) a decision in connection with an appeal arising out of the
18
prosecution.
19
(4) Subsection (2) does not apply if a person has applied for a writ of
20
mandamus or prohibition, or an injunction, against an officer of the
21
Commonwealth in relation to a related criminal justice process
22
decision before the commencement of a prosecution for an offence
23
against a law of the Commonwealth, or of a State or a Territory.
24
(5) If subsection (4) applies, the prosecutor may apply to the court for
25
a permanent stay of the proceedings referred to in that subsection
26
and the court may grant such a stay if the court determines that:
27
(a) the matters that are the subject of the proceedings are more
28
appropriately dealt with in the criminal justice process; and
29
(b) a stay of proceedings will not substantially prejudice the
30
person.
31
(6) Subsections (1), (2), (4) and (5) have effect despite anything in this
32
Act or in any other law. In particular:
33
(a) neither this Act, nor any other law, has the effect of giving
34
the Federal Court jurisdiction contrary to subsection (1) or
35
(2); and
36
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Civil proceedings Division 2
Section 189
National Consumer Credit Protection Bill 2009 No. , 2009 199
(b) neither section 9 of the Administrative Decisions (Judicial
1
Review) Act 1977, nor any other law, has the effect of
2
removing from the Supreme Court of a State or Territory the
3
jurisdiction given to that court by subsection (1) or (2).
4
189 Cross-jurisdictional appeals
5
The following table has effect:
6
7
Cross-jurisdictional appeals
Item
Despite any other law of the
Commonwealth, an appeal in
relation to a matter arising under
this Act does not lie from a
decision of ...
to any of the following courts:
1
the Federal Court
(a) a court of a State;
(b) a court of a Territory;
(c) the Federal Magistrates Court.
2
the Federal Magistrates Court
(a) a court of a State;
(b) a court of a Territory.
3
a court of a State
(a) the Federal Court;
(b) the Federal Magistrates Court;
(c) a court of another State;
(d) a court of a Territory.
4
a court of the Australian Capital
Territory
(a) the Federal Court;
(b) the Federal Magistrates Court;
(c) a court of a State;
(d) a court of another Territory.
5
a court of the Northern Territory
(a) the Federal Court;
(b) the Federal Magistrates Court;
(c) a court of a State;
(d) a court of another Territory.
190 Courts to act in aid of each othe r
8
All of the following must severally act in aid of, and be auxiliary
9
to, each other in civil matters arising under this Act:
10
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 2 Civil p roceedings
Section 191
200 National Consumer Credit Protection Bill 2009 No. , 2009
(a) courts on which jurisdiction is conferred under this Division;
1
(b) officers of, or under the control of, those courts.
2
Subdivision C--Transfers between courts
3
191 Transfers--application of Subdivision
4
Scope of Subdivision
5
(1) This Subdivision applies if all the following conditions are
6
satisfied:
7
(a) proceedings in relation to a civil matter arising under this Act
8
are pending, or have come, before a court (the transferring
9
court) on which jurisdiction is conferred under this Division
10
in relation to the matter;
11
(b) jurisdiction is also conferred on another court (the receiving
12
court) under this Division in relation to either of the
13
following (the transfer matter):
14
(i) the entire proceedings;
15
(ii) an application in the proceedings;
16
(c) the receiving court has the power to grant the remedies
17
sought before the transferring court in relation to the transfer
18
matter.
19
Transfers to which other legislation applies
20
(2) This Subdivision does not apply to a transfer between the Federal
21
Court and the Federal Magistrates Court, except as provided by
22
paragraph 192(2)(b).
23
Note 1:
Paragraph 192(2)(b) gives the Federal Magistrates Court the power to
24
transfer a matter to the Federal Court with a recommendation that the
25
Federal Court transfer the matter to another superior court.
26
Note 2:
Transfers from the Federal Court are covered by section 32AB of the
27
Federal Court of Australia Act 1976 and transfers from the Federal
28
Magistrates Court are covered by section 39 of the Federal
29
Magistrates Act 1999.
30
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Civil proceedings Division 2
Section 192
National Consumer Credit Protection Bill 2009 No. , 2009 201
192 Transfers--exercise of transfer powe r
1
General rule
2
(1) If section 193 (which deals with the criteria for transfers) is
3
satisfied, the transferring court may transfer to the receiving court:
4
(a) the transfer matter; and
5
(b) if the transferring court considers it necessary or
6
convenient--any related application (or all related
7
applications) in the proceedings.
8
Cross-jurisdictional transfers between lower courts and superior
9
courts
10
(2) However, if the transferring court is a lower court, and the
11
transferring court considers that section 193 is satisfied in relation
12
to the transfer of a matter referred to in subsection (1) of this
13
section to a receiving court that is a superior court other than the
14
relevant superior court:
15
(a) the transferring court does not have the power to transfer the
16
matter to that receiving court; but
17
(b) the transferring court may:
18
(i) transfer the matter to the relevant superior court; and
19
(ii) give the relevant superior court a recommendation that
20
the matter be transferred to that receiving court by the
21
relevant superior court.
22
193 Transfers--criteria for transfer
23
General
24
(1) The transferring court may make a transfer under section 192 only
25
if it appears to the transferring court, taking into account the
26
considerations covered by subsection (2) of this section, that:
27
(a) the transfer matter arises out of, or is related to, other
28
proceedings pending, or that have come, before the receiving
29
court; or
30
(b) it is otherwise in the interests of justice that the transfer
31
matter be determined by the receiving court.
32
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 2 Civil p roceedings
Section 194
202 National Consumer Credit Protection Bill 2009 No. , 2009
Relevant considerations
1
(2) The considerations covered by this subsection include the
2
following:
3
(a) the principal location, or place of business, of the parties in
4
relation to the transfer matter;
5
(b) where the event (or events) that are the subject of the transfer
6
matter took place;
7
(c) if the transfer matter involves secured real property--the
8
jurisdiction in which the real property is located;
9
(d) the desirability of related proceedings being heard in the
10
same State or Territory;
11
(e) any relevant recommendation received under subsection
12
192(2);
13
(f) the suitability (taking into account the considerations referred
14
to in paragraphs (a) to (e) and any other consideration) of
15
having the transfer matter determined by the receiving court.
16
194 Transfers--how initiated
17
A court may make a transfer under section 192:
18
(a) on the application of a party made at any stage; or
19
(b) at the court's own initiative.
20
195 Transfers--documents and procedure
21
If the transferring court transfers proceedings or an application to
22
the receiving court under section 192:
23
(a) the Registrar (or other proper officer) of the transferring court
24
must give the Registrar (or other proper officer) of the
25
receiving court all documents filed in the transferring court in
26
relation to the proceedings or application; and
27
(b) the receiving court must proceed as if:
28
(i) the proceedings or application had been originally
29
brought or made in the receiving court; and
30
(ii) the same proceedings had been taken in the receiving
31
court as were taken in the transferring court.
32
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Civil proceedings Division 2
Section 196
National Consumer Credit Protection Bill 2009 No. , 2009 203
196 Transfers--conduct of proceedings
1
(1) Subject to any applicable rules of court, in dealing with the transfer
2
matter transferred to the court under section 192, the receiving
3
court must apply rules of evidence and procedure that:
4
(a) are applied in any superior court; and
5
(b) the court considers appropriate to be applied in the
6
circumstances.
7
(2) If proceedings are transferred under section 192 from the
8
transferring court to the receiving court, the receiving court must
9
deal with the proceedings as if, subject to any order of the
10
transferring court, the steps that had been taken for the purposes of
11
the proceedings in the transferring court (including the making of
12
an order), or similar steps, had been taken in the receiving court.
13
197 Transfers--entitle ment to practise as a lawyer
14
(1) If proceedings (the transferred proceedings) in the transferring
15
court are transferred to the receiving court under section 192, a
16
person who is entitled to practise as a lawyer (however described)
17
in the transferring court has the same entitlements to practise in
18
relation to the matters covered by subsection (2) in the receiving
19
court that the person would have if the receiving court were a
20
federal court exercising federal jurisdiction.
21
(2) This subsection covers the following matters:
22
(a) the transferred proceedings;
23
(b) any other proceedings out of which the transferred
24
proceedings arise or to which the transferred proceedings are
25
related, if the other proceedings are to be determined together
26
with the transferred proceedings.
27
198 Transfers--limitation on appeals
28
An appeal does not lie from a decision of a court:
29
(a) in relation to the transfer of proceedings under section 192;
30
or
31
(b) as to which rules of evidence and procedure are to be applied
32
under subsection 196(1).
33
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 2 Civil p roceedings
Section 199
204 National Consumer Credit Protection Bill 2009 No. , 2009
Subdivision D--Other matters
1
199 Plaintiffs may choose small claims procedure
2
Application for small claims procedure
3
(1) Proceedings are to be dealt with as small claims proceedings under
4
this section if:
5
(a) a person applies to a magistrates court, local court or the
6
Federal Magistrates Court for an order covered by
7
subsection (2); and
8
(b) the person indicates, in the manner (if any) prescribed by the
9
regulations or by the rules of the court, that the person wants
10
the small claims procedure to apply to the proceedings.
11
Orders for which small claims procedure triggered
12
(2) The following table sets out when an order is covered by this
13
subsection:
14
15
Orders for which small claims procedure triggered
Item
An order is covered by this
subsection if it is made under ...
but only if (if applicable) ...
1
Section 178
the order is for an amount that is not
more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
2
Section 37 of the National Credit
Code
the value of the credit contract,
mortgage, guarantee or consumer
lease to which the order relates is
not more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
3
Subsection 38(7) of the National
the value of the credit contract,
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Civil proceedings Division 2
Section 199
National Consumer Credit Protection Bill 2009 No. , 2009 205
Orders for which small claims procedure triggered
Item
An order is covered by this
subsection if it is made under ...
but only if (if applicable) ...
Cred it Code
mortgage, guarantee or consumer
lease to which the order relates is
not more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
4
Section 74 of the National Credit
Code
not applicable.
5
Section 75 of the National Credit
Code
not applicable.
6
Section 76 of the National Credit
Code
the value of the credit contract,
mortgage, guarantee or consumer
lease to which the order relates is
not more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
7
Section 78 of the National Credit
Code
the value of the credit contract,
mortgage, guarantee or consumer
lease to which the order relates is
not more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
8
Section 96 of the National Credit
Code
not applicable.
9
Section 101 of the National Cred it
Code
the value of the credit contract,
mortgage, guarantee or consumer
lease to which the order relates is
not more than:
(a) $40,000; or
(b) if a higher amount is prescribed
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 2 Civil p roceedings
Section 199
206 National Consumer Credit Protection Bill 2009 No. , 2009
Orders for which small claims procedure triggered
Item
An order is covered by this
subsection if it is made under ...
but only if (if applicable) ...
by the regulations--that higher
amount.
10
Section 106 of the National Cred it
Code
the order is for an amount that is not
more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
11
Subsection 107(3) of the National
Cred it Code
the order is for an amount that is not
more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
12
Section 108 of the National Cred it
Code
the value of the credit contract,
mortgage, guarantee or consumer
lease to which the order relates is
not more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
13
Section 118 of the National Cred it
Code
the order is for an amount that is not
more than:
(a) $40,000; or
(b) if a higher amount is prescribed
by the regulations--that higher
amount.
(3) The value of a credit contract, mortgage, guarantee or consumer
1
lease is:
2
(a) worked out in accordance with the regulations; or
3
(b) if there are no regulations in force for the purposes of
4
paragraph (a):
5
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Civil proceedings Division 2
Section 199
National Consumer Credit Protection Bill 2009 No. , 2009 207
(i) for a credit contract--the amount of credit that has been,
1
or may be, provided under the contract; and
2
(ii) for a mortgage--the amount of credit that has been, or
3
may be, provided under the credit contract to which the
4
mortgage relates; and
5
(iii) for a guarantee--the amount of credit that has been, or
6
may be, provided under the credit contract to which the
7
guarantee relates; and
8
(iv) for a consumer lease--the amount payable under the
9
consumer lease, as referred to in paragraph 170(1)(b) of
10
the National Credit Code.
11
Court may make ancillary or consequential orders
12
(4) To avoid doubt, the court may make any ancillary or consequential
13
orders it considers appropriate in relation to the orders made under
14
the provisions referred to in subsection (2). The limits referred to in
15
column 3 of the table do not apply to those ancillary or
16
consequential orders.
17
Procedure
18
(5) In small claims proceedings, the court is not bound by any rules of
19
evidence and procedure and may act:
20
(a) in an informal manner; and
21
(b) without regard to legal forms and technicalities.
22
(6) At any stage of the small claims proceedings, the court may amend
23
the papers commencing the proceedings if sufficient notice is given
24
to any party adversely affected by the amendment.
25
Legal representation
26
(7) A party to small claims proceedings may be represented in the
27
proceedings by a lawyer only with the leave of the court.
28
(8) If the court grants leave for a party to the proceedings to be
29
represented by a lawyer, the court may, if it considers appropriate,
30
do so subject to conditions designed to ensure that no other party is
31
unfairly disadvantaged.
32
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 2 Civil p roceedings
Section 200
208 National Consumer Credit Protection Bill 2009 No. , 2009
(9) For the purposes of this section, a person is taken not to be
1
represented by a lawyer if the lawyer is an employee or officer of
2
the person.
3
200 Costs only if proceedings brought vexatiously etc.
4
(1) In proceedings that:
5
(a) are dealt with as small claims proceedings (see section 199);
6
or
7
(b) relate to section 74 or 96 of the National Credit Code (which
8
deal with hardship and postponement orders);
9
a party to the proceedings may be ordered by the court to pay costs
10
incurred by another party to the proceedings only in accordance
11
with subsection (2).
12
(2) The party may be ordered to pay the costs only if:
13
(a) the court is satisfied that the party brought the proceedings
14
vexatiously or without reasonable cause; or
15
(b) the court is satisfied that the party's unreasonable act or
16
omission caused the other party to incur the costs.
17
201 Civil proceedings not to be stayed
18
No civil proceedings under this Act are to be stayed merely
19
because the proceedings disclose, or arise out of, the commission
20
of an offence.
21
202 Standard of proof in civil proceedings
22
If, in proceedings (other than proceedings for an offence), it is
23
necessary to establish, or for the court to be satisfied, for any
24
purpose relating to a matter arising under this Act, that:
25
(a) a person has contravened a provision of this Act; or
26
(b) default has been made in complying with a provision of this
27
Act; or
28
(c) an act or omission was unlawful because of a provision of
29
this Act; or
30
(d) a person has been in any way, by act or omission, directly or
31
indirectly, knowingly concerned in or party to a
32
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Civil proceedings Division 2
Section 202
National Consumer Credit Protection Bill 2009 No. , 2009 209
contravention, or a default in complying with, a provision of
1
this Act;
2
it is sufficient if the matter referred to in paragraph (a), (b), (c) or
3
(d) is established, or the court is so satisfied on the balance of
4
probabilities.
5
6
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 3 Criminal proceedings
Section 203
210 National Consumer Credit Protection Bill 2009 No. , 2009
Division 3--Criminal proceedings
1
Subdivision A--Application of this Division
2
203 Application of this Division
3
(1) This Division applies to the exclusion of sections 68, 70 and 70A
4
of the Judiciary Act 1903.
5
(2) However, this Division does not limit the application of the
6
provisions of the Judiciary Act 1903 (other than sections 68, 70
7
and 70A). In particular, it does not limit the application of
8
subsection 39(2) of that Act in relation to criminal matters arising
9
under this Act.
10
(3) Despite anything else in this Division, jurisdiction is conferred on
11
the courts of a Territory only to the extent that the Constitution
12
permits.
13
Subdivision B--Conferral of criminal jurisdiction
14
204 Criminal jurisdiction of courts
15
Cross-vesting of criminal jurisdiction of courts
16
(1) Subject to this section, if a court of a State or Territory exercises
17
jurisdiction in relation to a matter covered by subsection (2) in
18
relation to offenders or persons (State offenders) charged with
19
offences against the laws of the State or Territory, the court has the
20
equivalent jurisdiction in relation to offenders or persons charged
21
with offences against this Act.
22
(2) The matters covered by this subsection are as follows:
23
(a) the summary conviction of State offenders;
24
(b) their examination and commitment for trial on indictment;
25
(c) their trial and conviction on indictment;
26
(d) their sentencing, punishment and release;
27
(e) the liability to make reparation in connection with their
28
offences;
29
(f) the forfeiture of property in connection with their offences;
30
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Criminal proceedings Division 3
Section 204
National Consumer Credit Protection Bill 2009 No. , 2009 211
(g) the proceeds of their crimes;
1
(h) the hearing and determination of:
2
(i) proceedings connected with; or
3
(ii) appeals arising out of; or
4
(iii) appeals arising out of proceedings connected with;
5
any trial or conviction referred to in paragraph (a), (b) or (c),
6
or any matter of a kind referred to in paragraph (d), (e), (f) or
7
(g).
8
Certain aspects of jurisdiction to be exercised only by magistrate
9
(3) Only a magistrate may exercise the jurisdiction conferred by
10
subsection (1) in relation to the summary conviction, or
11
examination and commitment for trial, of any person.
12
Person who pleads guilty to an indictable offence may be
13
sentenced or otherwise dealt with without trial
14
(4) The jurisdiction conferred by subsection (1) includes jurisdiction in
15
accordance with provisions of a relevant criminal law of a State or
16
Territory, and:
17
(a) the reference in paragraph (2)(h) to "any trial or conviction"
18
includes a reference to any conviction or sentencing in
19
accordance with the provisions of a relevant criminal law;
20
and
21
(b) unless the contrary intention appears, a reference to
22
jurisdiction conferred by subsection (1) includes a reference
23
to such included jurisdiction.
24
(5) Relevant criminal law means a law providing that if, in
25
proceedings before a court, a person pleads guilty to a charge for
26
which the person could be prosecuted on indictment, the person
27
may be committed, to a court having jurisdiction to try offences on
28
indictment, to be sentenced or otherwise dealt with without being
29
tried in that last-mentioned court.
30
(6) A person may be dealt with in accordance with a relevant criminal
31
law even if, apart from this section, the offence concerned:
32
(a) would be required to be prosecuted on indictment; or
33
Chapter 4 Remed ies
Part 4-3 Jurisdiction and procedure of courts
Division 3 Criminal proceedings
Section 204
212 National Consumer Credit Protection Bill 2009 No. , 2009
(b) would be required to be prosecuted either summarily or on
1
indictment.
2
(7) For the purposes of the application of a relevant criminal law as
3
provided by subsection (4):
4
(a) a reference in that law to an indictable offence is taken to
5
include a reference to an offence that may be prosecuted on
6
indictment; and
7
(b) in order to determine the sentence that may be imposed on a
8
person by a court pursuant to the relevant criminal law, the
9
person is taken to have been prosecuted and convicted on
10
indictment in that court.
11
Jurisdiction in relation to summary offences is unlimited
12
(8) Subject to subsection (10), the jurisdiction conferred on a court of a
13
State or Territory by subsection (1) is conferred despite any limits
14
as to locality of the jurisdiction of that court under the law of that
15
State or Territory.
16
Court may decline to exercise jurisdiction in relation to summary
17
offences
18
(9) If:
19
(a) jurisdiction is conferred on a court of a State or Territory in
20
relation to the summary conviction of persons charged with
21
offences against this Act by subsection (1); and
22
(b) the court is satisfied that it is appropriate to do so, having
23
regard to all the circumstances (including the public interest);
24
the court may decline to exercise that jurisdiction in relation to an
25
offence committed in another State or Territory.
26
Limits on jurisdiction in relation to indictable offences
27
(10) The jurisdiction conferred on a court of a State or Territory by
28
subsection (1) in relation to:
29
(a) the examination and commitment for trial on indictment; and
30
(b) the trial and conviction on indictment;
31
of offenders or persons charged with offences against this Act is
32
conferred only in relation to:
33
Remedies Chapter 4
Jurisdiction and procedure of courts Part 4-3
Criminal proceedings Division 3
Section 205
National Consumer Credit Protection Bill 2009 No. , 2009 213
(c) offences committed outside Australia (not including the
1
coastal sea); and
2
(d) offences committed, begun or completed in the State or the
3
Territory concerned.
4
205 Criminal proceedings--laws to be applied
5
Laws to be applied
6
(1) Subject to this Division, the laws of a State or Territory in relation
7
to:
8
(a) the arrest and custody in the State or Territory of offenders or
9
persons charged with offences; and
10
(b) criminal procedure in the State or Territory in relation to such
11
persons; and
12
(c) the rules of evidence applied in criminal procedure in the
13
State or Territory in relation to such persons;
14
apply in the State or Territory, so far as they are applicable, to
15
persons who are charged with offences against this Act.
16
Meaning of criminal procedure
17
(2) Criminal procedure means the procedure for:
18
(a) the summary conviction; and
19
(b) the examination and commitment for trial on indictment; and
20
(c) the trial and conviction on indictment; and
21
(d) the hearing and determination of appeals arising out of any
22
such trial or conviction or out of any related proceedings;
23
of offenders or persons charged with offences, and includes the
24
procedure for holding accused persons to bail.
25
206 Criminal proceedings--how taken
26
(1) In an