Consumer Credit Reforms – Senate Amendments

17 September 2009

 The Government has announced a number of enhancements to the National Consumer Credit Protection legislation. The key change will enable the commencement of the consumer credit reforms to be deferred by six months to 1 July 2010 as recommended by the Senate Economics Committee.

Amendments will be moved that address the recommendations of the Senate Economics Committee including:

• Recommendation 6 – the Removal of subsection 130(3) from the Credit Bill so that credit providers will have to verify information provided in a preliminary assessment;
• Recommendation 8 – To clarify that consumers have access to remedies without having a formal finding by a court in relation to civil penalty; and
• Recommendation 11 – To require lenders to provide consumers with reasons for rejecting applications for hardship variations and stays of enforcement.

Other amendments include:

• Modifying the definition of residential property so that it excludes properties which are not predominantly used for residential purposes;
• Clarifying that certain ASIC decisions, particularly regarding enforcement action, are excluded from Administrative Appeals Tribunal review;
• Enabling ASIC to issue certain documents in a form prescribed by regulations;
• Clarifying that ASIC may exempt a person and all their credit representatives in a single determination;
• Increasing flexibility for ASIC to grant exemptions to some parts of the National Credit Code or subject to conditions; and
• Allowing for the transfer of information documents, assets or liabilities from a State or Territory to ASIC prior to the commencement of the National Credit Code.

For further information, please contact:

Jane Newman | Associate
Mullins Lawyers
t +61 7 3224 0369
f +61 7 3224 0333
jnewman@mullinslaw.com.au