On 17 September 2009, the Federal Government announced a number of amendments to the National Consumer Credit Protection Bill 2009 (Cth) (Bill). These amendments are intended to implement recommendations made by the Senate Economics Committee as a result of public consultation.
Key changes to the Bill include:
- delaying the commencement of the Bill for six months to give the credit industry more time to make preparations for the new national consumer credit regulatory regime. While the announcement does not explicitly refer to the revised timetable, we would expect that, based on the Government's previous timetable:
- current credit services providers and credit providers would need to register with ASIC between 1 April 2010 and 30 June 2010 (previously 1 November 2009 - 31 December 2009);
- licensing requirements for credit services providers and credit providers should commence on 1 July 2010 (previously 1 January 2010);
- the responsible lending obligation for most credit services providers and credit providers should
- commence on 1 July 2011 (previously 1 January 2011). However, for authorised deposit taking institutions and registered financial corporations, the new responsible lending obligations should still commence on 1 January 2011;
- enhancing credit hardship provisions by requiring lenders to provide consumers with reasons for rejecting applications for hardship variation and stays of enforcement;
- removing subsection 130(3) from the Bill so that credit providers (ie lenders) will have to independently verify information provided in a preliminary assessment rather than rely on verification made by a credit assistant;
- clarification that consumers will have access to remedies without having a formal finding by a court in relation to civil penalty;
- amending the definition of residential property so that it excludes properties which are not predominantly used for residential purposes. Accordingly, credit and refinancing credit provided in respect of investing in residential properties not predominantly used for residential purposes will be excluded from regulation under the Bill and the National Credit Code; and
- other administrative changes relating to ASIC decisions; power to make exemptions; and the transfer of information, assets and liabilities from States to ASIC prior to the commencement of the National Credit Code.