All consumer credit agreements, irrespective of their duration, will become subject to financial supervision in the course of this year. This follows from a draft bill implementing the Consumer Credit Directive1.
The Consumer Credit Directive aims to offer more protection to consumers entering into credit agreements and to ensure that credit providers and consumers are subject to uniform rules throughout the EU. This will make it easier for consumers to compare offers made by credit providers from their home state and from other EU member states. In their advertisements, credit providers will have to provide more clarity on the costs of the loan. They may no longer advertise special offer rates.
New consumer credit rules will be incorporated into Book 7 of the Dutch Civil Code. The Consumer Credit Act, the FMSA, and related regulations will also be amended. The new provisions in the Civil Code relate to rights of consumers and information to be provided. The 1 2008/48/EC changes in the FMSA concern credit advertising, pre-contractual information, and the creditworthiness assessment. More detailed rules will be added to the Decree on Conduct of Business Supervision of Financial Undertakings FMSA (see the consultation version of the amendment decree).
The Directive is based largely on complete harmonisation, but article 2 does list types of credit agreements that are not covered by the Directive. With regard to those excluded credit agreements the member states may maintain existing national rules or introduce new ones. They may also declare provisions of the Directive applicable to these agreements. The draft bill opts for the latter where it concerns:
- credit agreements involving a total amount of credit of extending less than EUR 200 or more than EUR 75,0002;
- credit agreements entered into with investment companies or banks, allowing a consumer to execute a transaction in respect of certain financial instruments where the investment company or bank is involved in such transaction3.
Tailor-made rules will be drawn up for securities credit. The other exclusions in the Directive will be (partly) incorporated. The Directive has to be implemented into national legislation by 11 June 2010. This is also the date on which the Dutch implementation bill is to come into force.