NATIONAL CONSUMER CREDIT PROTECTION (TRANSITIONAL AND CONSEQUENTIAL PROVISIONS) BILL 2009

i National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009

Contents

Part 1--Preliminary

Short title ............................................................................................ 1

Commencement .................................................................................. 2

Schedule(s) ......................................................................................... 3

Part 2--Dictionary

Dictionary ........................................................................................... 4

Meaning of corresponds ..................................................................... 8

Part 3--Other matters

Regulations may deal with transitional matters................................ 10

Acquisition of property..................................................................... 11

Schedule 1--Transition from the old Cre dit Codes to the

National Credit Act

Part 1--Introduction

Part 2--Transition from the old Credit Codes to the new Credit

Code

Div ision 1--Object of this Part

Div ision 2--Treatment of contracts and other instruments made

before commencement

Div ision 3--Treatment of court and tribunal proceedings and orders

Div ision 4--General transitional provisions relating to other things

done etc. under the old Credit Code

Part 3--Application of the National Credit Act (other than the

new Credit Code) and Schedule 2 to this Act

Part 4--Transitional provisions relating to ASIC

Schedule 2--Registration of persons to engage in credit

activities

Part 1--Introduction

Part 2--Transitional prohibitions relating to credit activities

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 ii

Div ision 1--Prohib ition that applies only fro m 1 January 2010 to

30 June 2010, or in other prescribed period

Div ision 2--Prohib ition that applies only fro m 1 July 2010 to 30 June

2011, or in other prescribed period

Div ision 3--Application of Div ision 3 of Part 2-1 of the National

Cred it Act in relation to reg istered persons and this

Schedule

Part 3--Registration of persons who engage in credit activities

Div ision 1--How to become registered

Div ision 2--The conditions on the registration

Div ision 3--Obligations of registered persons

Div ision 4--When registrations can be suspended, cancelled or varied

Part 4--Application of other provisions of the National Credit

Act in relation to registered persons and this Schedule

Part 5--Exemptions and modifications relating to this

Schedule

Part 6--Regulations relating to infringement notices

Schedule 3--Consequential ame ndme nts

Australian Securities and Investments Commission Act 2001

Corporations Act 2001

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2009 No. , 2009

2 Commence ment

(1) Each provision of this Act specified in column 1 of the table

commences, or is taken to have commenced, in accordance with

column 2 of the table. Any other statement in column 2 has effect

according to its terms.

Commencement information

Column 1

Column 2

Column 3

Provision(s)

Commencement

Date/Details

1. Sections 1 to 7

and anything in

this Act not

elsewhere covered

by this table

The day on which this Act receives the

Royal Assent.

2. Schedule 1

At the same time as section 3 of the National

Consumer Credit Protection Act 2009

commences.

3. Schedule 2

The later of:

(a) the day on which this Act receives the

Royal Assent; and

(b) the day on which section 3 of the

National Consumer Credit Protection

Act 2009 commences.

However, the provision(s) do not commence

at all if the event mentioned in paragraph (b )

does not occur.

4. Schedule 3

At the same time as section 3 of the National

Consumer Credit Protection Act 2009

commences.

Note:

This table relates only to the provisions of this Act as originally

passed by both Houses of the Parliament and assented to. It will not be

expanded to deal with provisions inserted in this Act after assent.

(2) Column 3 of the table contains additional information that is not

part of this Act. Information in this column may be added to or

edited in any published version of this Act.

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2009 No. , 2009

Part 2--Dictionary

4 Dictionary

(1) In this Act:

appeal or review proceedings, in relation to an order of a court or

tribunal, means proceedings by way of appeal, or otherwise

seeking review, of the order.

carried over provision of the old Credit Code of a referring State

or a Territory means a provision of the old Credit Code of that

State or Territory that:

(a) was in force immediately before commencement; and

(b) corresponds to a provision of the new Credit Code.

civil penalty provision: a subitem of a Schedule to this Act (or an

item of a Schedule to this Act that is not divided into subitems) is a

civil penalty provision if:

(a) the words "civil penalty" and one or more amounts in penalty

units are set out at the foot of the subitem (or item); or

(b) another provision of this Act specifies that the subitem (or

item) is a civil penalty provision.

commencement means the day section 3 of the National Credit Act

commences.

contract or other instrument includes credit contracts, mortgages,

guarantees, consumer leases and sale contracts.

corresponds: see section 5.

enforcement proceedings, in relation to an order made by a court

or tribunal, means:

(a) proceedings to enforce the order; or

(b) any other proceedings in relation to a contravention of the

order.

interlocutory application means an application that:

(a) is made during the course of proceedings; and

(b) is for an order that is incidental to the principal object of

those proceedings, including, for example:

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No. , 2009 5

(i) an order about the conduct of those proceedings; or

(ii) an order assisting a party to those proceedings to present

their case in those proceedings; or

(iii) an order protecting or otherwise dealing with property

that is the subject matter of those proceedings;

but not including an order making a final determination of

existing rights or liabilities.

interlocutory order means:

(a) an order made in relation to an interlocutory application; or

(b) an order or direction about the conduct of proceedings.

interlocutory proceedings means proceedings:

(a) dealing only with; or

(b) to the extent it deals with;

an interlocutory application.

liability includes a duty or obligation.

made includes issued, given or published.

National Credit Act means the National Consumer Credit

Protection Act 2009 and includes instruments made under that Act.

new Credit Code means Schedule 1 to the National Credit Act and

includes:

(a) regulations made under section 329 of the National Credit

Act for the purposes of that Schedule; and

(b) instruments made under subsection 6(14) or (17) of that

Schedule.

old Credit Code means the following:

(a) for New South Wales--the Consumer Credit (New South

Wales) Code, and the Consumer Credit (New South Wales)

Regulations, within the meaning of the Consumer Credit

(New South Wales) Act 1995 of New South Wales, as in force

from time to time before commencement;

(b) for Victoria--the Consumer Credit (Victoria) Code, and the

Consumer Credit (Victoria) Regulations, within the meaning

of the Consumer Credit (Victoria) Act 1995 of Victoria, as in

force from time to time before commencement;

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2009 No. , 2009

and the Consumer Credit (Queensland) Regulations, within

the meaning of the Consumer Credit (Queensland) Act 1994

of Queensland, as in force from time to time before

commencement;

(d) for Western Australia--the Consumer Credit (Western

Australia) Code, and the Consumer Credit (Western

Australia) Code Regulations, within the meaning of the

Consumer Credit (Western Australia) Act 1996 of Western

Australia, as in force from time to time before

commencement;

(e) for South Australia--the Consumer Credit (South Australia)

Code, and the Consumer Credit (South Australia)

Regulations, within the meaning of the Consumer Credit

(South Australia) Act 1995 of South Australia, as in force

from time to time before commencement;

(f) for Tasmania--the Consumer Credit (Tasmania) Code, and

the Consumer Credit (Tasmania) Regulations, within the

meaning of the Consumer Credit (Tasmania) Act 1996 of

Tasmania, as in force from time to time before

commencement;

(g) for the Australian Capital Territory--the Consumer Credit

(Australian Capital Territory) Code, and the Consumer Credit

(Australian Capital Territory) Regulations, within the

meaning of the Consumer Credit Act 1995 of the Australian

Capital Territory, as in force from time to time before

commencement;

(h) for the Northern Territory--the Consumer Credit (Northern

Territory) Code, and the Consumer Credit (Northern

Territory) Regulations, within the meaning of the Consumer

Credit (Northern Territory) Act 1995 of the Northern

Territory, as in force from time to time before

commencement.

old right or liability: see subitem 11(1) or 12(1) of Schedule 1 to

this Act.

order of a court or tribunal includes any judgment, conviction or

sentence of the court or tribunal.

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preserved instrument means an instrument that, because of item 10

of Schedule 1 to this Act, has effect after commencement as if it

were made under the new Credit Code.

primary proceedings means proceedings other than interlocutory

proceedings.

proceedings means proceedings, whether criminal or civil, before a

court or tribunal.

registered means registered under item 12 of Schedule 2 to this

Act.

registered person means a person who is registered under item 12

of Schedule 2 to this Act.

registered to engage in a credit activity: a person is registered to

engage in a credit activity if the person is registered, and the

registration authorises the person to engage in the credit activity.

registration means registration under item 12 of Schedule 2 to this

Act.

representative of a person means:

(a) if the person is a registered person:

(i) a credit representative of the registered person; or

(ii) an employee or director of the registered person; or

(iii) an employee or director of a related body corporate of

the registered person; or

(iv) any other person acting on behalf of the registered

person; or

(b) in any other case:

(i) an employee or director of the person; or

(ii) an employee or director of a related body corporate of

the person; or

(iii) any other person acting on behalf of the person.

right includes an interest or status.

sale contract: has the same meaning as in section 125 of the new

Credit Code.

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2009 No. , 2009

substituted right or liability: see subitem 11(2) or 12(3) of

Schedule 1 to this Act.

this Act includes instruments made under this Act.

tribunal means tribunal in Australia.

(2) In this Act, expressions that are defined in the National Credit Act

(other than in the new Credit Code) have the same meanings as

they have in that Act.

5 Meaning of corresponds

(1) A provision (the old provision) of the old Credit Code of a

referring State or a Territory corresponds to a provision (the new

provision) of the new Credit Code (and vice versa) if:

(a) the old provision and the new provision are substantially the

same, unless the regulations specify that the 2 provisions do

not correspond; or

(b) the regulations specify that the 2 provisions correspond.

Note:

The range of provisions of the new Credit Code that may be

corresponding provisions for the purposes of this Act is affected by

item 12 of Schedule 1 to this Act, which takes certain provisions of

the old Credit Code to be included in the new Credit Code.

(2) For the purposes of paragraph (1)(a), differences of all or any of

the following kinds are not sufficient to mean that 2 provisions are

not substantially the same:

(a) differences in the numbering of the provisions;

(b) differences of a minor technical nature (for example,

differences in punctuation, or differences that are attributable

to the correction of incorrect cross references) or of style;

(i) the old provision allowed a tribunal to exercise powers

but the new provision only allows a court to do so; or

(ii) the old provision allowed proceedings to be brought in a

tribunal but the new provision only allows proceedings

to be brought in a court; or

(iii) the old provision allowed or required a particular

agency to exercise powers or perform functions but the

new provision allows or requires ASIC to do so;

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(d) other differences that are attributable to the fact that the new

Credit Code applies as a Commonwealth law;

(e) other differences of a kind prescribed by the regulations.

(3) Subsection (2) is not intended to otherwise limit the circumstances

in which 2 provisions are, for the purposes of paragraph (1)(a),

substantially the same.

(4) The regulations may provide that a specified provision of the old

Credit Code of a referring State or a Territory does, or does not,

correspond to a specified provision of the new Credit Code.

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Part 3--Other matters

6 Regulations may deal with transitional matters

(1) The Governor-General may make regulations prescribing matters:

(a) required or permitted by this Act to be prescribed; or

(b) necessary or convenient to be prescribed for carrying out or

giving effect to this Act.

(2) The regulations may prescribe matters of a transitional nature

(including matters of an application or saving nature):

(a) arising out of the enactment of the National Credit Act; or

(b) relating to the transition from the application of provisions of

the old Credit Codes, or related laws, of the referring States

and the Territories to the application of provisions of the

National Credit Act.

The regulations have effect despite anything else in this Act.

(3) The regulations may provide that certain provisions of this Act are

taken to be modified as set out in the regulations. Those provisions

then have effect as if they were so modified.

(4) Despite subsection 12(2) of the Legislative Instruments Act 2003,

regulations made under this section may be expressed to take effect

from a date before the regulations are registered under that Act.

(5) If:

(a) regulations are expressed to take effect from a date (the

registration date) before the regulations are registered under

the Legislative Instruments Act 2003; and

(b) a person engaged in conduct before the registration date; and

conduct would not have contravened:

(i) this Act; or

(ii) the National Credit Act (including the new Credit Code)

as it applies because of this Act;

then a court must not convict the person of an offence, or order the

person to pay a pecuniary penalty, in relation to the conduct on the

grounds that it contravened either of those Acts.

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(6) The provisions of this Act that provide for regulations to deal with

matters do not limit each other.

7 Acquisition of property

(1) A provision of this Act does not apply, and is taken never to have

applied, to the extent that the operation of the provision would

result in an acquisition of property from a person otherwise than on

just terms.

(2) In subsection (1), acquisition of property and just terms have the

same meanings as in paragraph 51(xxxi) of the Constitution.

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 1 Introduction

12 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

Schedule 1

Transition from the old Credit

Codes to the National Credit Act

Part 1

Introduction

1 Guide to this Schedule

This Schedule deals with the transition from the regime provided

for in the old Credit Codes of the referring States and the

Territories to the new regime provided for in the National Credit

Act (including the new Credit Code) and Schedule 2 to this Act.

Regulations made under section 6 may also deal with that

transition. Those regulations may provide for matters in addition to

those provided in this Schedule and they may modify how this

Schedule applies.

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transition fro m the old Credit Codes to the new Credit Code Part 2

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Part 2

Transition from the old Credit Codes to the

new Credit Code

Division 1

Object of this Part

2 Object of this Part

(1)

The object of this Part is to provide for a smooth transition from the

regime provided for in the old Credit Code of a referring State or a

Territory to the regime provided for in the new Credit Code, so that

natural persons, bodies corporate and other bodies are, to the greatest

extent possible, put in the same position immediately after

commencement as they would have been if:

(a) that old Credit Code had, from time to time when it was in

force, been valid Commonwealth legislation applying in that

State or Territory; and

(b) the new Credit Code (to the extent it contains provisions that

correspond to provisions of the old Credit Code as in force

immediately before commencement) were a continuation of

that old Credit Code as so applying.

Note:

The new Credit Code contains provisions that correspond to many of the provisions of

the old Credit Code.

(2)

In resolving any ambiguity as to the meaning of any of the other

provisions of this Part, an interpretation that is consistent with the object

of this Part is to be preferred to an interpretation that is not consistent

with that object.

Division 2

Treatment of contracts and other

instruments made before commencement

3 Application of the new Credit Code

(1)

The new Credit Code does not apply in relation to a contract or other

instrument that was made before commencement.

(2)

Despite subitem (1), the new Credit Code applies in relation to a

contract or other instrument (the old instrument) that:

(a) was made before commencement; and

(b) was in force immediately before commencement; and

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 2 Transition fro m the old Credit Codes to the new Credit Code

14 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

to immediately before commencement;

in the same way it would apply if the old instrument had been made

after commencement.

(3)

Despite subitem (2), the following provisions of the new Credit Code do

not apply to the old instrument:

(a) section 5;

(b) subsection 6(2);

(d) subsections 50(2), (3), (4), (5) and (8);

(e) subsections 72(5) and 94(4);

(f) section 172.

(4)

Sections 6, 11 and 150 of the old Credit Code of a referring State or a

Territory, as in force immediately before commencement, apply to the

old instrument after commencement as if those provisions were

sections 5, 13 and 172 of the new Credit Code.

(5)

The following provision applies to the old instrument after

commencement as if the provision were subsection 72(5) of the new

Credit Code:

Application

(5) This section and sections 73 to 75 do not apply to a credit contract

under which the maximum amount of credit that is or may be

provided is more than an amount equal to 110% of the amount of

the average loan size for the purchase of new dwellings in New

South Wales as set out in the Table of Housing Finance

Commitments in the most recent publication entitled Housing

Finance, Australia, as published from time to time by the

Australian Bureau of Statistics.

(6)

The following provision applies to the old instrument after

commencement as if the provision were subsection 94(4) of the new

Credit Code:

(4) This Division does not apply to a credit contract in respect of

which the maximum amount of credit that is or may be provided is

more than an amount equal to 110% of the amount of the average

loan size for the purchase of new dwellings in New South Wales as

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transition fro m the old Credit Codes to the new Credit Code Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 15

set out in the Table of Housing Finance Commitments in the most

recent publication entitled Housing Finance, Australia, as

published from time to time by the Australian Bureau of Statistics.

Division 3

Treatment of court and tribunal proceedings

and orders

4 Treatment of proceedings brought in a court under the old

Credit Code before commencement

(1)

This item applies to proceedings (the old proceedings) in relation to

which the following paragraphs are satisfied:

(a) the proceedings were brought in a court before

commencement;

(b) the proceedings were brought in relation to a provision (the

old provision) of the old Credit Code of a referring State or a

Territory;

or review proceedings, in relation to an order of a court;

(d) the proceedings had not been concluded or terminated before

commencement;

(e) either:

(i) if the proceedings are primary proceedings--no final

determination of any of the existing rights or liabilities

at issue in the proceedings had been made before

commencement; or

(ii) if the proceedings are interlocutory proceedings--this

item applies to the primary proceedings to which the

interlocutory proceedings relate.

Note:

This item does not apply to proceedings in a tribunal that were brought under the old

Credit Code before commencement. For proceedings in a tribunal, see item 6.

(2)

Proceedings (the new proceedings) equivalent to the old proceedings

are, on commencement, taken to have been brought in the same court,

exercising federal jurisdiction under the provision of the new Credit

Code that corresponds to the old provision.

Note:

This means that the new proceedings will stay in the same court as the old proceedings,

but the court will now be exercising federal jurisdiction for the new proceedings.

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 2 Transition fro m the old Credit Codes to the new Credit Code

16 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(3)

To the extent that the old proceedings, before commencement, related to

old rights or liabilities, the new proceedings relate to the substituted

rights and liabilities in relation to those old rights or liabilities.

Note 1: See items 11 and 12 for the creation of substituted rights and liabilities.

Note 2: In all cases, there will be a provision of the new Credit Code that corresponds to the

relevant old provision, either because the new Credit Code actually contains a provision

that corresponds to the relevant old provision or because the new Credit Code, because

of item 12, is taken to include the relevant old provision.

(4)

The following provisions apply in relation to the new proceeding:

(a) the parties to the new proceedings are the same as the parties

to the old proceedings;

(b) subject to subitems (5) and (6) and to any order to the

contrary made by the court, the court must deal with the new

proceedings as if the steps that had been taken for the

purposes of the old proceedings before commencement had

been taken for the purposes of the new proceedings.

(5)

If:

(a) an interlocutory order was made before commencement for

the purpose of, or in relation to, the old proceedings; and

(b) that interlocutory order was in force immediately before

commencement;

the rights and liabilities of all persons (including rights and liabilities

arising wholly or partly because of conduct occurring before

commencement) are taken to be, for all purposes, the same as if the

interlocutory order had instead been made by the same court, in the

exercise of federal jurisdiction, for the purpose of, or in relation to, the

new proceedings.

(6)

The court may make orders doing all or any of the following:

(a) cancelling or varying rights or liabilities that a person has

because of subitem (5);

(b) substituting other rights or liabilities for rights or liabilities a

person has because of subitem (5);

has because of subitem (5);

(d) enforcing, or otherwise dealing with conduct contrary to, a

right or liability a person has because of subitem (5) in the

same way as it could enforce, or deal with, the right, liability

or conduct if the right or liability had arisen under or because

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transition fro m the old Credit Codes to the new Credit Code Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 17

of an order made by the court in the exercise of federal

jurisdiction under the new Credit Code.

5 References to court proceedings and orders in the new

Credit Code

(1)

A reference in the new Credit Code to the bringing of proceedings, or

the taking of a step in proceedings, in a court under or in relation to a

provision of the new Credit Code includes a reference to the bringing of

proceedings, or the taking of the equivalent step in proceedings, in a

court before commencement under or in relation to the corresponding

provision of the old Credit Code of a referring State or a Territory.

Note:

This subitem only relates to proceedings in a court (not proceedings in a tribunal). For

proceedings in a tribunal, see item 6.

(2)

A reference in the new Credit Code to an order made by a court under

or in relation to a provision of the new Credit Code includes a reference

to an order made by a court before commencement under or in relation

to the corresponding provision of the old Credit Code of a referring

State or a Territory.

Note:

This subitem only relates to orders of a court (not orders of a tribunal). For orders of a

tribunal, see item 6.

(3)

Nothing in subitem (2) is taken to produce a result that would:

(a) make a person liable, under the new Credit Code, to any

penalty (whether civil or criminal) provided for in an order

referred to in subitem (2); or

(b) enable enforcement proceedings, or appeal or review

proceedings, in relation to such an order to be taken in a court

under the new Credit Code; or

such an order to be taken in a court under the new Credit

Code.

(4)

If, after commencement, an order referred to in subitem (2) is varied or

set aside on appeal or review, subitem (2) applies, or is taken to have

applied, from the time from which the variation or setting aside takes or

took effect, as if:

(a) if the order is varied--the order had been made as so varied;

(b) if the order is set aside--the order had not been made.

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 2 Transition fro m the old Credit Codes to the new Credit Code

18 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(5)

Despite, subitems (1) and (2), the regulations may provide that

subitem (1) or (2) does not apply in relation to a particular reference or

class of references in the new Credit Code.

6 Treatment of tribunal proceedings and orders under the old

Credit Code before or after commencement

(1)

The new Credit Code does not apply in relation to:

(a) proceedings that are brought in a tribunal under the old

Credit Code of a referring State or a Territory before or after

commencement; or

(b) orders that are made by a tribunal under the old Credit Code

of a referring State or a Territory before or after

commencement; or

brought in, or orders that are made by, a tribunal under the

old Credit Code of a referring State or a Territory before or

after commencement.

(2)

This Act and the National Credit Act are not intended to exclude or

limit the operation of a law of a referring State or a Territory relating to:

(a) proceedings that are brought in a tribunal under the old

Credit Code of a referring State or a Territory before or after

commencement; or

(b) orders that are made by a tribunal under the old Credit Code

of a referring State or a Territory before or after

commencement; or

brought in, or orders that are made by, a tribunal under the

old Credit Code of a referring State or a Territory before or

after commencement.

7 Interlocutory proceedings

For the purpose of this Part, if interlocutory proceedings (the first

proceedings) relate to other interlocutory proceedings (the second

proceedings), the first proceedings are taken to relate also to the

primary proceedings to which the second proceedings relate.

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transition fro m the old Credit Codes to the new Credit Code Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 19

Division 4

General transitional provisions relating to

other things done etc. under the old Credit

Code

8 Limitations on scope of this Division

(1)

This Division has effect subject to Divisions 2 and 3 (which deal with

matters in more specific terms).

(2)

This Division does not apply in relation to:

(a) an order made by a court or tribunal before commencement;

(b) a right or liability under an order made by a court or tribunal

before commencement; or

enforcement proceedings) in a court or tribunal before

commencement, or a step in such proceedings; or

(d) a right to:

(i) appeal to a court or tribunal against an order made by a

court or tribunal before commencement; or

(ii) apply to a court or tribunal for review of such an order;

(iii) bring appeal or review proceedings, or enforcement

proceedings, in relation to such an order.

Note:

Division 3 deals with orders and proceedings made or begun in courts or tribunals

before commencement, and with related matters.

(3)

Despite paragraph (2)(c), items 11 and 12 apply to any right or liability

to which proceedings to which item 4 applies relate.

(4)

Except as mentioned in subitems (1) to (3), Divisions 2 and 3, and

regulations made under section 6, do not limit this Division.

9 Provisions of this Division may have an overlapping effect

(1)

This Division deals at a broad level with concepts and matters in a way

that is intended to achieve the object of this Part as set out in item 2.

(2)

Some of the provisions of this Division will (depending on the

situation) have an effect that overlaps or interacts to some extent with

the effect of other provisions of this Division. This is intended, and the

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 2 Transition fro m the old Credit Codes to the new Credit Code

20 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

provisions of this Division should be not be regarded as dealing with

mutually exclusive situations.

10 Things done by or under carried over provisions continue

to have effect

(1)

A thing that:

(a) was done before commencement by, under, or for the

purposes of, a carried over provision of the old Credit Code

of a referring State or a Territory; and

(b) had an ongoing significance (see subitems (3) and (4))

immediately before commencement for the purposes of that

that Code;

has effect (and may be dealt with) after commencement, for the

purposes of the new Credit Code, as if it were done by, under, or for the

purposes of, the corresponding provision of the new Credit Code.

Note:

This item does not apply in relation to things done before commencement that relate to

court or tribunal orders or proceedings: see subitem 8(2).

(2)

Without limiting subitem (1), examples of things done include:

(a) the making of an instrument or order (but not including the

making of an order by a court or tribunal); and

(b) the making of an application or claim (but not including the

making of an application or claim to a court or tribunal); and

granting of an application or claim by a court or tribunal);

and

(d) the making of an appointment or delegation; and

(e) the commencement of a procedure or the taking of a step in a

procedure (but not including the bringing of proceedings in a

court or tribunal); and

(f) requiring a person to do, or not to do, something (but not

including a requirement contained in an order made by a

court or tribunal); and

(g) the giving of a notice or document.

(3)

A thing done by, under, or for the purposes of, a carried over provision

of the old Credit Code of a referring State or a Territory had an ongoing

significance immediately before commencement for the purposes of

that Code if:

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transition fro m the old Credit Codes to the new Credit Code Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 21

(a) if the thing done was the making of an instrument or order--

the instrument or order was still in force immediately before

commencement; or

(b) if the thing done was the making of an application or claim--

the application or claim had not been decided, and had not

otherwise ceased to have effect, before commencement; or

claim--the thing granted had not been revoked, and had not

otherwise ceased to have effect, before commencement; or

(d) if the thing done was the making of an appointment or

delegation--the appointment or delegation had not been

revoked, and had not otherwise ceased to have effect, before

commencement; or

(e) if the thing done was the commencement of a procedure or

the taking of a step in a procedure--the procedure was still in

progress immediately before commencement or was

otherwise still having an effect; or

(f) if the thing done was requiring a person to do, or not to do

something--the requirement was still in force immediately

before commencement; or

(g) if the thing done was the giving of a notice or document, or

the doing of some other thing--the notice or document (or

the giving of the notice or document), or the thing (or the

doing of the thing), had an ongoing effect or significance

immediately before commencement for the purposes of the

old Credit Code of the State or Territory.

(4)

Despite subitem (3), the regulations may provide that a specified thing

done under, or for the purposes of, a carried over provision of the old

Credit Code of a referring State or a Territory did, or did not, have an

ongoing significance immediately before commencement for the

purposes of that Code.

11 Creation of equivalent rights and liabilities to those that

existed before commencement under carried over

provisions of the old Credit Code

(1)

This item applies in relation to a right or liability (the old right or

liability), whether civil or criminal, that:

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 2 Transition fro m the old Credit Codes to the new Credit Code

22 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(a) was acquired, accrued or incurred under a carried over

provision of the old Credit Code of a referring State or a

Territory; and

(b) was in existence immediately before commencement.

Note:

This item does not apply in relation to a right or liability under orders made by a court

or tribunal before commencement: see subitem 8(2).

(2)

On commencement, the person acquires, accrues or incurs a right or

liability (the substituted right or liability), equivalent to the old right or

liability, under the corresponding provision of the new Credit Code, as

if that provision applied to the conduct or circumstances that gave rise

to the old right or liability.

Note:

If a time limit applied in relation to the old right or liability under the old Credit Code,

that same time limit (calculated from the same starting point) will apply under the new

Credit Code to the substituted right or liability: see subitem 13(3).

(3)

A procedure, proceeding or remedy in relation to the substituted right or

liability may be brought after commencement under the new Credit

Code, as if that provision applied to the conduct or circumstances that

gave rise to the old right or liability.

Note:

For pre-commencement proceedings in relation to substituted rights and liabilities, see

item 4.

12 Creation of equivalent rights and liabilities to those that

existed before commencement under repealed

provisions of the old Credit Code

(1)

This item applies in relation to a right or liability (the old right or

liability), whether civil or criminal, that:

(a) was acquired, accrued or incurred under a provision of the

old Credit Code of a referring State or a Territory that was no

longer in force immediately before commencement; and

(b) was in existence immediately before commencement.

Note:

This item does not apply in relation to a right or liability under orders made by a court

or tribunal before commencement: see subitem 8(2).

(2)

For the purposes of subitems (3) and (4), the new Credit Code is taken

to include:

(a) the provision of the old Credit Code (with such modifications

(if any) as are necessary) under which the old right or

liability was acquired, accrued or incurred; and

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transition fro m the old Credit Codes to the new Credit Code Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 23

(b) the other provisions of the old Credit Code (with such

modifications (if any) as are necessary) that applied in

relation to the old right or liability;

other than to the extent that the provision relates to proceedings in, or

orders of, a tribunal.

(3)

On commencement, the person acquires, accrues or incurs a right or

liability (the substituted right or liability), equivalent to the old right or

liability, under the provision taken to be included in the new Credit

Code by paragraph (2)(a), as if that provision applied to the conduct or

circumstances that gave rise to the old right or liability.

Note:

If a time limit applied in relation to the old right or liability under the old Credit Code,

that same time limit (calculated from the same starting point) will apply under the new

Credit Code to the substituted right or liability: see subitem 13(3).

(4)

A procedure, proceeding or remedy in relation to the substituted right or

liability may be instituted after commencement under the provisions

taken to be included in the new Credit Code by subitem (2), as if those

provisions applied to the conduct or circumstances that gave rise to the

old right or liability.

Note:

For pre-commencement proceedings in relation to substituted rights and liabilities, see

item 4.

13 Old Credit Code time limits etc.

(1)

An old Credit Code time limit (see subitem (2)):

(a) the starting point of which:

(i) was known or had been determined before

commencement (whether that starting point occurred or

would occur before, on or after commencement); or

(ii) would have become known, or have been determined,

after commencement if the old Credit Code of the

referring State or the Territory had continued to apply

(whether that starting point would have occurred before,

on or after commencement); and

(b) that had not ended at or before commencement;

continues to run, or starts or started to run, as if that same time limit

(starting from the same starting point) were applicable under the new

Credit Code.

(2)

An old Credit Code time limit includes:

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 2 Transition fro m the old Credit Codes to the new Credit Code

24 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(a) a period for the doing of a thing specified or determined

under the old Credit Code of a referring State or a Territory;

(b) a period specified or determined under a provision of the old

Credit Code of a referring State or a Territory as the duration

of a particular instrument or status.

(3)

If:

(a) under the old Credit Code of a referring State or a Territory, a

process, a status of a person or body, or an instrument,

commenced from a particular time before commencement;

and

(b) that process, status or instrument is continued after

commencement for the purposes of the new Credit Code by a

provision of this Schedule;

that process, status or instrument as so continued is still taken to

have commenced from the time referred to in paragraph (a).

(4)

If an old Credit Code time limit related to an old right or liability, the

same time limit applies in relation to the substituted right or liability.

14 Preservation of significance etc. of events or

circumstances

(1)

An event, circumstance or other thing:

(a) that occurred or arose before commencement under or as

mentioned in a provision of the old Credit Code of a referring

State or a Territory; and

(b) that had a particular significance, status or effect for the

purposes of a carried over provision of that Code (including

because of an interpretive provision);

has that same significance, status and effect after commencement for

the purposes of the provision of the new Credit Code that corresponds

to that carried over provision.

(2)

Without limiting subitem (1), an event, circumstance or other thing had

a particular significance for the purposes of a carried over provision of

the old Credit Code of a referring State or a Territory if:

(a) the carried over provision created an obligation in relation to

the event, circumstance or thing (whenever it arose); or

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transition fro m the old Credit Codes to the new Credit Code Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 25

(b) the carried over provision provided for the event,

circumstance or thing to be dealt with in a particular way; or

or thing (whenever it arose) was to be disregarded for the

purposes of that provision or was not covered by that

provision.

15 References in the new Credit Code generally include

references to events, circumstances or things that

happened or arose before commencement

(1)

A reference in the new Credit Code to an event, circumstance or thing

of a particular kind that happens or arises, or that has happened or

arisen, is taken to include a reference to an event, circumstance or thing

of that kind that happened or arose at a time before commencement,

unless a contrary intention is expressed.

(2)

The fact that the provision uses only the present tense in referring to an

event, circumstance or thing is not, of itself, to be regarded as an

expression of a contrary intention.

(3)

Nothing in subitem (1) is taken to produce a result that a right or

liability exists under a provision of the new Credit Code that relates

solely to events, circumstances or things that occurred before

commencement.

Note:

Instead, an equivalent right or liability will be created by item 11 or 12.

(4)

Despite subitem (1), the regulations may provide that subitem (1) does

not apply in relation to a particular reference or class of references in

the new Credit Code.

16 References to things taken or deemed to be the case etc.

If:

(a) a law of a referring State or a Territory had effect before

commencement:

(i) to take or deem something to have happened or to be the

case, or to have a particular effect, under or for the

purposes of the old Credit Code of that State or

Territory (or a provision of that Code); or

(ii) to give something an effect for the purposes of the old

Credit Code of that State or Territory (or a provision of

that Code) that it would not otherwise have had; and

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 2 Transition fro m the old Credit Codes to the new Credit Code

26 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(b) that effect was continuing immediately before

commencement;

this Part applies as if that thing had actually happened or were actually

the case, or as if that thing actually had that other effect.

17 Penalty units in relation to pre-commencement conduct

remain at $100

(1)

If, because of this Part, an offence can be prosecuted after

commencement in relation to conduct that occurred solely before

commencement, the amount of a penalty unit in relation to that offence

is $100.

(2)

Subitem (1) has effect despite section 4AA of the Crimes Act 1914.

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Application of the National Credit Act (other than the new Credit Code) and Schedule 2

to this Act Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 27

Part 3

Application of the National Credit Act (other

than the new Credit Code) and Schedule 2 to

this Act

18 Application of the National Credit Act

Application of National Credit Act generally

(1)

The National Credit Act does not apply in relation to a contract or other

instrument made before commencement, subject to item 3 (which deals

with the application of the new Credit Code).

Note 1: For example, a person does not engage in a credit activity after commencement merely

because the person is the credit provider under a credit contract made before

commencement.

Note 2: See item 3 for the application of the new Credit Code to contracts and other instruments

made before commencement.

(2)

Despite subitem (1), the regulations may provide for the application of

the National Credit Act to a person (including the licensing of that

person) in relation to credit activities engaged in after commencement

in relation to a contract or other instrument that:

(a) was made before commencement; and

(b) was in force immediately before commencement; and

to immediately before commencement.

Application of Part 4-3 of the National Credit Act

(3)

Despite subitem (1), Part 4-3 of the National Credit Act (which deals

with the jurisdiction and procedure of courts) applies to proceedings

brought under the new Credit Code after commencement in relation to a

contract or other instrument that:

(a) was made before commencement; and

(b) was in force immediately before commencement; and

to immediately before commencement.

Application of regulations made under the National Credit Act

(4)

Despite subitem (1), regulations made under section 329 of the National

Credit Act for the purposes of section 330 of that Act or the new Credit

Schedule 1 Transition fro m the old Credit Codes to the National Credit Act

Part 3 Application of the National Credit Act (other than the new Credit Code) and

Schedule 2 to this Act

28 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

Code may make provision in relation to proceedings brought after

commencement in relation to a contract or other instrument that:

(a) was made before commencement; and

(b) was in force immediately before commencement; and

to immediately before commencement.

19 Application of Chapter 3 of the National Credit Act

(1)

Chapter 3 of the National Credit Act (which deals with responsible

lending conduct) applies in relation to conduct engaged in on and after

1 January 2011 in relation to a contract or other instrument made after

commencement.

(2)

Subitem (1) is subject to subitems 18(2) and 20(2) (which deal with

regulations that provide for the application to a person of the National

Credit Act and Schedule 2 to this Act).

20 Application of Schedule 2 to this Act

(1)

Schedule 2 to this Act (which deals with registration) does not apply in

relation to a contract or other instrument made before commencement.

(2)

Despite subitem (1), the regulations may provide for the application of

Schedule 2 to a person (including the registration of that person) in

relation to credit activities engaged in after commencement in relation

to a contract or other instrument that:

(a) was made before commencement; and

(b) was in force immediately before commencement; and

to immediately before commencement.

Transition fro m the old Credit Codes to the National Credit Act Schedule 1

Transitional provisions relating to ASIC Part 4

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 29

Part 4

Transitional provisions relating to ASIC

Regulations about ASIC's a

pproach during the transitional

period

The regulations may provide for the approach ASIC must take in the

administration of this Act or the National Credit Act during the period

starting on commencement and ending on 30 June 2011 or a later day

prescribed by the regulations.

22 Regulations about transfer of information etc. to ASIC

The regulations may provide for the transfer of information, documents,

assets or liabilities to ASIC from:

(a) a referring State or a Territory; or

(b) an authority of a referring State or a Territory.

ASIC's role in relation to appeal, review or enforcement

proceedings

(1)

ASIC has the functions and powers in relation to appeal, review or

enforcement proceedings that are expressed to be conferred on it by or

under a law of the Commonwealth or a Territory.

(2)

ASIC also has the functions and powers in relation to appeal, review or

enforcement proceedings that are expressed to be conferred on it by or

under a law of a referring State. However, ASIC:

(a) is not subject to any directions in the performance of such

functions or the exercise of such powers; and

(b) is not under a duty to perform such functions or exercise such

powers.

(3)

If a Minister of a referring State or a Territory appoints a person (other

than ASIC) to bring or continue appeal, review or enforcement

proceedings in the State or Territory, ASIC may give the person any

information and documents that ASIC has in relation to the

proceedings.

(4)

In this item:

appeal, review or enforcement proceedings means:

(a) appeal or review proceedings; or

(b) enforcement proceedings;

Registration of persons to engage in credit activities Schedule 2

Introduction Part 1

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 31

Schedule 2

Registration of persons to

engage in credit activities

Part 1

Introduction

1 Guide to this Schedule

This Schedule is about the registration of persons to engage in

credit activities. Registration is a transitional authorisation to

engage in credit activities. It applies in the period before all

persons who engage in credit activities are required to be licensed

under Chapter 2 of the National Credit Act.

Regulations made under section 6 may also deal with transitional

matters relating to the registration of persons to engage in credit

activities. Those regulations may provide for matters in addition to

those provided in this Schedule and they may modify how this

Schedule applies.

This Part deals with how certain provisions of Part 1-2 (which

deals with definitions) of the National Credit Act apply in relation

to this Schedule.

Divisions 1 and 2 of Part 2 set out requirements that apply to

persons who engage in credit activities during particular

transitional periods.

Division 3 of Part 2 deals with how the requirements in Division 3

of Part 2-1 (which deals with certain requirements in relation to

credit activities) of the National Credit Act apply in relation to

registered persons.

Part 3 deals with how a person becomes registered, the conditions

on registration, the obligations of a registered person, and the

suspension and cancellation of registration.

Part 4 deals with how other provisions of the National Credit Act

apply in relation to registered persons. These provisions include

Part 2-3 (which deals with credit representatives and other

representatives), Part 2-4 (which deals with banning and

Schedule 2 Registration of persons to engage in credit activ ities

Part 1 Introduction

32 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

disqualification) and Divisions 2 and 4 of Part 2-5 (which deal with

financial records and auditors) of the National Credit Act.

Part 5 deals with exemptions from, and modifications of, certain

provisions of this Schedule.

Part 6 allows regulations to provide for infringement notices in

relation to the civil penalty provisions and offences in this

Schedule.

2 Application of Part 1-2 of the National Credit Act

Part 1-2 (which deals with definitions) of the National Credit Act

applies as if the references in sections 10, 14, 15 and 16 to "this Act"

were references to "this Act and Schedule 2 to the Transitional Act".

Note:

Expressions that are defined in the National Credit Act (other than the new Credit Code)

have the same meanings in this Act as they have in the National Credit Act: see

subsection 4(2).

Registration of persons to engage in credit activities Schedule 2

Transitional prohibitions relating to credit activ ities Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 33

Part 2

Transitional prohibitions relating to credit

activities

Division 1

Prohibition that applies only from 1 January

2010 to 30 June 2010, or in other prescribed

period

3 Application of this Division

This Division applies during the period that:

(a) starts on 1 January 2010, or a later day prescribed by the

regulations; and

(b) ends on 30 June 2010, or a later day prescribed by the

regulations.

4 Prohibition on engaging in credit activities if not registered

or licensed during the period

Prohibition on engaging in credit activities if not registered or

licensed

(1)

A person must not engage in a credit activity unless:

(a) the person is registered to engage in the credit activity; or

(b) the person holds a licence authorising the person to engage in

the credit activity.

Civil penalty:

2,000 penalty units.

Offence

(2)

A person commits an offence if:

(a) the person is subject to a requirement under subitem (1); and

(b) the person engages in conduct; and

Criminal penalty: 200 penalty units, or 2 years imprisonment, or

both.

Defence

(3)

For the purposes of subitems (1) and (2), it is a defence if:

Schedule 2 Registration of persons to engage in credit activ ities

Part 2 Transitional prohibitions relating to credit activ ities

34 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(a) the person engages in the credit activity on behalf of another

person (the principal); and

(b) the person is:

(i) an employee or director of the principal or of a related

body corporate of the principal; or

(ii) a credit representative of the principal; and

within the authority of the principal; and

(d) the principal is registered to engage in the credit activity, or

holds a licence authorising the principal to engage in the

credit activity.

Note:

For the purposes of subitem (2), a defendant bears an evidential burden in relation to the

matter in subitem (3): see subsection 13.3(3) of the Criminal Code.

Division 2

Prohibition that applies only from 1 July

2010 to 30 June 2011, or in other prescribed

period

5 Application of this Division

This Division applies during the period that:

(a) starts on 1 July 2010, or a later day prescribed by the

regulations; and

(b) ends on 30 June 2011, or a later day prescribed by the

regulations.

6 Prohibition on engaging in credit activities in certain

circumstances during the period

Prohibition on engaging in credit activities in certain

circumstances

(1)

A person must not engage in a credit activity unless:

(a) the person:

(i) is registered to engage in the credit activity; and

(ii) has applied for a licence authorising the person to

engage in the credit activity in accordance with

section 36 of the National Credit Act; or

(b) the person holds a licence authorising the person to engage in

the credit activity.

Registration of persons to engage in credit activities Schedule 2

Transitional prohibitions relating to credit activ ities Part 2

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 35

Civil penalty:

2,000 penalty units.

Offence

(2)

A person commits an offence if:

(a) the person is subject to a requirement under subitem (1); and

(b) the person engages in conduct; and

Criminal penalty: 200 penalty units, or 2 years imprisonment, or

both.

Defence

(3)

For the purposes of subitems (1) and (2), it is a defence if:

(a) the person engages in the credit activity for or on behalf of

another person (the principal); and

(b) the person is:

(i) an employee or director of the principal or of a related

body corporate of the principal; or

(ii) a credit representative of the principal; and

within the authority of the principal; and

(d) the principal:

(i) is registered to engage in the credit activity, and has

applied for a licence authorising the principal to engage

in the credit activity in accordance with section 36 of

the National Credit Act; or

(ii) holds a licence authorising the principal to engage in the

credit activity.

Note:

For the purposes of subitem (2), a defendant bears an evidential burden in relation to the

matter in subitem (3): see subsection 13.3(3) of the Criminal Code.

Division 3

Application of Division 3 of Part 2-1 of the

National Credit Act in relation to registered

persons and this Schedule

7 Application of this Division

This Division applies during the period that:

(a) starts at commencement; and

Schedule 2 Registration of persons to engage in credit activ ities

Part 2 Transitional prohibitions relating to credit activ ities

36 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(b) ends on 30 June 2011, or a later day prescribed by the

regulations.

8 Application of section 30 of the National Credit Act

Section 30 (which deals with prohibitions on holding out and

advertising etc.) of the National Credit Act applies as if:

(a) the reference in paragraph 30(1)(a) of the National Credit Act

to a person holding a licence were a reference to a person

holding a licence or being registered; and

(b) the reference in paragraph 30(1)(b) of the National Credit Act

to a person holding a licence authorising the person to engage

in a particular credit activity were a reference to a person

holding a licence authorising the person to engage in a

particular credit activity, or being registered to engage in a

particular credit activity; and

to a requirement to hold a licence were a reference to a

requirement to hold a licence or be registered; and

(d) the reference in paragraph 30(1)(e) of the National Credit Act

to a licensee were a reference to a licensee or registered

person; and

(e) the reference in subsection 30(2) of the National Credit Act

to contravening section 29 of the National Credit Act were a

reference to contravening section 29 of the National Credit

Act or item 4 or 6 of this Schedule.

9 Application of section 31 of the National Credit Act

Section 31 (which deals with a prohibition on conducting business with

unlicensed persons) of the National Credit Act applies as if:

(a) the reference in subsection 31(1) to a licensee were a

reference to a registered person or licensee; and

(b) the reference in subsection 31(1) to contravening section 29

of the National Credit Act were a reference to contravening

section 29 of the National Credit Act or item 4 or 6 of this

Schedule.

10 Application of section 32 of the National Credit Act

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

38 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

Part 3

Registration of persons who engage in credit

activities

Division 1

How to become registered

11 Applying to be registered

(1)

A person may apply to be registered by lodging an application with

ASIC.

(2)

The application must be lodged during the period that:

(a) starts on 1 November 2009, or a later day prescribed by the

regulations; and

(b) ends on 31 December 2009, or a later day prescribed by the

regulations.

(3)

The application must be in the approved form.

12 When a person may be registered

When ASIC must register a person

(1)

ASIC must register a person (the applicant) if (and must not register the

applicant unless):

(a) the applicant has applied to be registered in accordance with

item 11; and

(b) the application makes a statement that the applicant is a

member of an approved external dispute resolution scheme;

and

relation to each of the following persons:

(i) the applicant;

(ii) if the applicant is a body corporate--each director or

secretary of the body corporate who would perform

duties in relation to the credit activities to be authorised

by the registration;

(iii) if the applicant is a partnership or the trustees of a

trust--each partner or trustee who would perform duties

in relation to the credit activities to be authorised by the

registration.

(2)

For the purposes of paragraph (1)(c), the statement is that:

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 39

(a) a banning order or disqualification order under Part 2-4 of the

National Credit Act is not in force against the person; and

(b) a banning order or disqualification order under Division 8 of

Part 7.6 of the Corporations Act 2001 is not in force against

the person; and

under a law of a State or Territory; and

(d) if the person is or has been registered--the person's

registration is neither suspended nor cancelled; and

(e) an Australian financial services licence of the person is

neither suspended, nor has been cancelled within the last 7

years, under:

(i) paragraph 915B(1)(d) or subparagraph 915B(4)(b)(iii)

of the Corporations Act 2001 (which deals with

suspension or cancellation because of mental or

physical incapacity); or

(ii) section 915C of the Corporations Act 2001 (which deals

with suspension or cancellation after offering a hearing);

and

(f) if the person is not the trustees of a trust--the person is not

insolvent; and

(g) if the person is a natural person:

(i) the person is not disqualified from managing

corporations under Part 2D.6 of the Corporations Act

2001; and

(ii) the person has not been convicted, within 10 years

before the application is made, of serious fraud; and

(iii) a prescribed State or Territory order is not in force

against the person.

ASIC may refuse to register a person in certain circumstances

(3)

Despite subitem (1), ASIC may refuse to register a person if ASIC has

reason to believe that:

(a) the application is false in a material particular or materially

misleading; or

(b) there is an omission of a material matter from the application.

Notice of decision on application

(4)

ASIC must give the applicant written notice of:

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

40 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(a) ASIC's decision on the application; and

(b) if the decision is to register the applicant--the day on which

the applicant becomes registered; and

the decision.

When applicant becomes registered

(5)

The applicant becomes registered when ASIC enters the applicant's

name on a credit register as a registered person.

13 Basis on which a person is registered

A person who is registered under this Division is registered on the basis

that:

(a) conditions on the registration may be imposed, varied or

revoked under item 14 or 15; and

(b) the registration may be suspended under item 22, 23, 24 or

25; and

24 or 25; and

(d) the registration may be varied under item 26; and

(e) the registration may be cancelled, revoked, terminated or

varied by or under later legislation; and

(f) no compensation is payable if:

(i) conditions on the registration are imposed, varied or

revoked as referred to in paragraph (a); or

(ii) the registration is suspended, cancelled, varied, revoked

or terminated as referred to in paragraphs (b) to (e).

Division 2

The conditions on the registration

14 The conditions on the registration

ASIC may impose, vary or revoke conditions on registrations

(1)

ASIC may, at any time:

(a) impose conditions, or additional conditions, on a person's

registration; and

(b) vary or revoke conditions imposed on a person's registration.

(2)

ASIC may do so:

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 41

(a) on its own initiative; or

(b) if the registered person lodges an application with ASIC for

the imposition, variation or revocation.

(3)

The application must be in the approved form.

Notice and effect of imposition, variation or revocation of

conditions

(4)

ASIC must give the registered person written notice of the imposition,

variation or revocation of the conditions. The imposition, variation or

revocation of the conditions comes into force on the day specified in the

notice, which must not be before the day on which the decision to

impose, vary or revoke the conditions was made.

ASIC must give the registered person a hearing

(5)

Despite subitem (1), ASIC may only impose conditions or additional

conditions, or vary or revoke the conditions, on the registration after

giving the registered person an opportunity:

(a) to appear, or be represented, at a hearing before ASIC that

takes place in private; and

(b) to make submissions to ASIC in relation to the conditions.

This subitem does not apply to ASIC imposing conditions when a

person becomes registered.

Condition in relation to credit activities authorised

(6)

ASIC must ensure that the registration is subject to a condition that

specifies the credit activities or classes of credit activities that the

registered person is authorised to engage in.

Regulations may prescribe conditions

(7)

The registration is subject to such other conditions as are prescribed by

the regulations. However, ASIC cannot vary or revoke those conditions.

15 Registration conditions

special procedures for

APRA-regulated bodies

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

42 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

Special procedures for APRA-regulated bodies (other than ADIs)

(1)

If the registered person, or a related body corporate, is a body (the

APRA body) regulated by APRA (other than an ADI), then the

following provisions apply:

(a) ASIC cannot:

(i) impose, vary or revoke a condition on the registration

that, in ASIC's opinion, has or would have the result of

preventing the APRA body from being able to carry on

all or any of its usual activities (being activities in

relation to which APRA has regulatory or supervisory

responsibilities); or

(ii) vary a condition so that it would, in ASIC's opinion,

become a condition that would have a result as

described in subparagraph (i);

unless ASIC has first consulted APRA about the proposed

action;

(b) if ASIC imposes, varies or revokes a condition on the

registration and paragraph (a) does not apply to that action,

ASIC must, within one week, inform APRA of the action that

has been taken.

Special procedures for ADIs

(2)

If the registered person, or a related body corporate, is an ADI, then the

following provisions apply:

(a) subject to paragraphs (b) and (c), the powers that ASIC

would otherwise have under item 14:

(i) to impose, vary or revoke a condition on the registration

that, in ASIC's opinion, has or would have the result of

preventing the ADI from being able to carry on all or

any of its banking business (within the meaning of the

Banking Act 1959); or

(ii) to vary a condition so that it would, in ASIC's opinion,

become a condition that would have a result as

described in subparagraph (i);

are instead powers of the Minister;

(b) the following provisions apply in relation to a power to

which paragraph (a) applies:

(i) the procedures for the exercise of the power are the

same as would apply if ASIC could exercise the power,

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 43

except that the Minister must not exercise the power

unless he or she has first considered advice from ASIC

on the proposed action, being advice given after ASIC

has consulted APRA about the proposed action;

(ii) ASIC (rather than the Minister) must still conduct any

hearing required under paragraph 14(5)(a) and receive

any submissions under paragraph 14(5)(b);

registration and paragraph (a) does not apply to that action,

ASIC must, within one week, inform APRA of the action that

has been taken.

Division 3

Obligations of registered persons

16 General conduct obligations of registered persons

Obligation to be a member of an approved external dispute

resolution scheme

(1)

During the period that:

(a) starts on 1 November 2009, or a later day prescribed by the

regulations; and

(b) ends on 30 June 2011, or a later day prescribed by the

regulations;

a registered person must be a member of an approved external dispute

resolution scheme.

Other general conduct obligations of registered persons

(2)

Subitem (3) applies during the period that:

(a) starts on 1 January 2010, or a later day prescribed by the

regulations; and

(b) ends on 30 June 2011, or a later day prescribed by the

regulations.

(3)

A registered person must:

(a) do all things necessary to ensure that the credit activities

authorised by the registration are engaged in efficiently,

honestly and fairly; and

(b) comply with the conditions on the registration; and

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

44 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(d) take reasonable steps to ensure that its representatives

comply with the credit legislation; and

(e) take reasonable steps to ensure that clients of the registered

person are not disadvantaged by any conflict of interest that

arises wholly or partly in relation to credit activities engaged

in by the registered person or its representatives; and

(f) comply with any other obligations that are prescribed by the

regulations.

17 Obligation to provide a statement or obtain an audit report

if directed by ASIC

Notice to registered person to provide a statement

(1)

ASIC may give a registered person a written notice directing the

registered person to lodge with ASIC a written statement containing

specified information about the credit activities engaged in by the

registered person or its representatives.

(2)

Notices under subitem (1):

(a) may be given at any time; and

(b) may be given to one or more particular registered persons, or

to each registered person in one or more classes of registered

persons, or to all registered persons; and

differences as to the information they require; and

(d) may require a statement containing information to be

provided on a periodic basis, or each time a particular event

or circumstance occurs, without ASIC having to give a

further written notice.

Notice to registered person to obtain an audit report

(3)

ASIC may also give a registered person a written notice directing the

registered person to obtain an audit report, prepared by a suitably

qualified person specified in the notice, on a statement, or each

statement in a class of statements, under subitem (1) before the

statement is given to ASIC.

(4)

A notice under subitem (3) is not a legislative instrument.

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 45

Notice must specify day by which registered person must comply

(5)

A notice given under this item must specify the day by which the

registered person must comply with the notice (which must be a

reasonable period after the notice is given). ASIC may extend the day

by giving a written notice to the registered person.

Requirement to comply with notice

(6)

The registered person must comply with a notice given under this item

within the time specified in the notice.

Civil penalty:

2,000 penalty units.

Offence

(7)

A person commits an offence if:

(a) the person is subject to a requirement under subitem (6); and

(b) the person engages in conduct; and

Criminal penalty: 25 penalty units, or 6 months imprisonment,

or both.

Strict liability offence

(8)

A person commits an offence if:

(a) the person is subject to a requirement under subitem (6); and

(b) the person engages in conduct; and

Criminal penalty: 10 penalty units.

(9)

Subitem (8) is an offence of strict liability.

Note:

For strict liability, see section 6.1 of the Criminal Code.

18 Obligation to give ASIC information required by the

regulations

Regulations may require registered person to give information

(1)

The regulations may require a registered person, or each registered

person in a class of registered persons, to give ASIC specified

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

46 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

information about the credit activities engaged in by the registered

person or its representatives.

Requirement to comply with regulations

(2)

If regulations under subitem (1) require a registered person to give

ASIC information, the registered person must give ASIC that

information.

Civil penalty:

2,000 penalty units.

Offence

(3)

A person commits an offence if:

(a) the person is subject to a requirement to give ASIC

information under subitem (2); and

(b) the person engages in conduct; and

Criminal penalty: 25 penalty units, or 6 months imprisonment,

or both.

Strict liability offence

(4)

A person commits an offence if:

(a) the person is subject to a requirement to give ASIC

information under subitem (2); and

(b) the person engages in conduct; and

Criminal penalty: 10 penalty units.

(5)

Subitem (4) is an offence of strict liability.

Note:

For strict liability, see section 6.1 of the Criminal Code.

19 Obligation to provide ASIC with assistance if reasonably

requested

Requirement to provide assistance

(1)

If ASIC, or a person authorised by ASIC, reasonably requests assistance

from a registered person in relation to whether the registered person and

its representatives are complying with the credit legislation, the

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 47

registered person must give ASIC or the authorised person the requested

assistance.

Civil penalty:

2,000 penalty units.

(2)

If the request is in writing, it is not a legislative instrument.

Offence

(3)

A person commits an offence if:

(a) the person is subject to a requirement to give ASIC or an

authorised person assistance under subitem (1); and

(b) the person engages in conduct; and

Criminal penalty: 25 penalty units, or 6 months imprisonment,

or both.

Assistance may include showing ASIC credit books etc.

(4)

The assistance referred to in subitem (1) may include showing ASIC the

person's credit books or giving ASIC other information.

Division 4

When registrations can be suspended,

cancelled or varied

20 Cancellation because of grant or refusal of licence

If:

(a) a person is registered; and

(b) the person applies for a licence under section 36 of the

National Credit Act; and

then the person's registration is cancelled.

Note:

See subitem 29(2) for when the cancellation comes into force.

21 Cancellation of all registrations on 30 June 2011 or other

prescribed day

The registration of every registered person is cancelled at the end of

30 June 2011, or a later day prescribed by the regulations.

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

48 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

22 Suspension or cancellation for failure to apply for a

licence when directed by ASIC

(1)

ASIC may give a written notice to a registered person, directing the

person to apply for a licence by a day specified in the notice (which

must be at least 28 days after the day the notice is given). ASIC may

extend the day by giving a written notice to the person.

(2)

If the person does not apply for the licence in accordance with

section 36 of the National Credit Act by the day specified in the notice,

ASIC may suspend or cancel the person's registration.

(3)

A notice given under subitem (1) is not a legislative instrument.

23 Suspension or cancellation without hearing

(1)

ASIC may suspend or cancel a registered person's registration if:

(a) the registered person lodges with ASIC an application for the

suspension or cancellation; or

(b) the registered person ceases to engage in credit activities; or

National Credit Act is in force against the registered person;

(d) a banning order or disqualification order under Division 8 of

Part 7.6 of the Corporations Act 2001 is in force against the

registered person; or

(e) the registered person is banned from engaging in a credit

activity under a law of a State or Territory; or

(f) an Australian financial services licence of the registered

person is suspended, or has been cancelled within the last 7

years, under:

(i) paragraph 915B(1)(d) or subparagraph 915B(4)(b)(iii)

of the Corporations Act 2001 (which deals with

suspension or cancellation because of mental or

physical incapacity); or

(ii) section 915C of the Corporations Act 2001 (which deals

with suspension or cancellation after offering a hearing);

(g) if the registered person is not the trustees of a trust--the

registered person is insolvent; or

(h) the registered person is a single natural person and:

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 49

(i) is disqualified from managing corporations under

Part 2D.6 of the Corporations Act 2001; or

(ii) is convicted of serious fraud; or

(iii) is incapable of managing his or her affairs because of

physical or mental incapacity; or

(iv) a prescribed State or Territory order is in force against

the registered person; or

(i) the registered person is not a single natural person and a

prescribed State or Territory order is in force against any of

the following persons:

(i) if the registered person is a body corporate--a director

or secretary of the body corporate who performs duties

in relation to credit activities;

(ii) if the registered person is a partnership or the trustees of

a trust--a partner or trustee who performs duties in

relation to credit activities.

(2)

An application for suspension or cancellation of a registration must be

in the approved form.

24 Suspension or cancellation after offering a hearing

(1)

ASIC may suspend or cancel a registered person's registration (subject

to complying with subitem (3)) if:

(a) the registered person has contravened an obligation under

item 16 (which deals with general conduct obligations of

registered persons); or

(b) ASIC has reason to believe that the registered person is likely

to contravene an obligation under that item; or

(i) was false in a material particular or materially

misleading; or

(ii) omitted a material matter; or

(d) if the registered person is not a single natural person--any of

the matters set out in subitem (2) applies to any of the

following persons:

(i) if the registered person is a body corporate--a director

or secretary of the body corporate who performs duties

in relation to credit activities;

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

50 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(ii) if the registered person is a partnership or the trustees of

a trust--a partner or trustee who performs duties in

relation to credit activities.

(2)

For the purposes of paragraph (1)(d), the matters are the following:

(a) a banning order or disqualification order under Part 2-4 of the

National Credit Act is in force against the person;

(b) a banning order or disqualification order under Division 8 of

Part 7.6 of the Corporations Act 2001 is in force against the

person;

a law of a State or Territory;

(d) an Australian financial services licence of the person is

suspended, or has been cancelled within the last 7 years,

under:

(i) paragraph 915B(1)(d) or subparagraph 915B(4)(b)(iii)

of the Corporations Act 2001 (which deals with

suspension or cancellation because of mental or

physical incapacity); or

(ii) section 915C of the Corporations Act 2001 (which deals

with suspension or cancellation after offering a hearing);

(e) the person is insolvent;

(f) the person is disqualified from managing corporations under

Part 2D.6 of the Corporations Act 2001;

(g) the person is convicted of serious fraud;

(h) the person is incapable of managing his or her affairs because

of physical or mental incapacity.

(3)

ASIC may only suspend or cancel a person's registration under this

item after giving the person an opportunity:

(a) to appear, or be represented, at a hearing before ASIC that

takes place in private; and

(b) to make submissions to ASIC on the matter.

25 Suspension and cancellation

special procedures for

APRA-regulated bodies

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 51

Special procedures for APRA-regulated bodies (other than ADIs)

(1)

If a registered person, or a related body corporate, is a body (the APRA

body) regulated by APRA (other than an ADI), then the following

provisions apply:

(a) ASIC cannot suspend or cancel the registered person's

registration if doing so would, in ASIC's opinion, have the

result of preventing the APRA body from being able to carry

on all or any of its usual activities (being activities in relation

to which APRA has regulatory or supervisory

responsibilities), unless ASIC has first consulted APRA

about the proposed action;

(b) if ASIC suspends or cancels the registered person's

registration and paragraph (a) does not apply to that action,

ASIC must, within one week, inform APRA of the action that

has been taken.

Special procedures for ADIs

(2)

If:

(a) a registered person is an ADI; or

(b) a related body corporate of a registered person is an ADI, and

cancellation or suspension of the registered person's

registration would, in ASIC's opinion, have the result of

preventing the ADI from being able to carry on all or any of

its banking business (within the meaning of the Banking Act

1959);

then the following provisions have effect:

otherwise have under this Division to cancel or suspend the

registered person's registration, or to revoke a suspension to

which this subitem applied, are instead powers of the

Minister;

(d) the procedures for the exercise of a power to which

paragraph (c) applies are the same as would apply if ASIC

could exercise the power, except that the Minister must not

exercise the power unless he or she has first considered

advice from ASIC on the proposed action, being advice given

after ASIC has consulted APRA about the proposed action;

Schedule 2 Registration of persons to engage in credit activ ities

Part 3 Registration of persons who engage in credit activities

52 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(e) ASIC (rather than the Minister) must still conduct any

hearing required under paragraph 24(3)(a) and receive any

submissions under paragraph 24(3)(b).

26 Varying registrations

ASIC may vary a person's registration to take account of a change in

the person's name.

Note:

The conditions on the registration can be varied under item 14.

27 Effect of suspension

(1)

A suspended registration has no effect while it remains suspended.

(2)

Subitem (1) has effect subject to item 31 (which deals with the

continued effect of some suspended or cancelled registrations).

28 Revocation of suspension

ASIC may at any time revoke the suspension of a person's registration.

29 Date of effect, notice and publication of variation,

cancellation or suspension etc.

(1)

ASIC must give a registered person written notice of a variation,

suspension, revocation of a suspension, or cancellation of the person's

registration.

(2)

A variation, suspension, revocation of a suspension, or cancellation of a

person's registration (other than a cancellation under item 21) comes

into force when the notice is given to the person.

(3)

As soon as practicable after the notice is given to the person, ASIC must

publish a notice of the action on ASIC's website. The notice must state

when the variation, suspension, revocation of a suspension, or

cancellation of the person's registration came into force.

30 Statement of reasons

A notice of suspension or cancellation given to a registered person must

be accompanied by a statement of reasons for the action taken.

31 ASIC may allow registration to continue in force

(1)

If ASIC gives a written notice of suspension or cancellation to a

registered person, ASIC may include in the notice terms specifying that

Registration of persons to engage in credit activities Schedule 2

Registration of persons who engage in credit activ ities Part 3

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 53

the registration continues in force as though the suspension or

cancellation had not happened for the purposes of specified provisions

of this Schedule in relation to specified matters, a specified period, or

both.

(2)

If ASIC includes terms in a notice under subitem (1), the registration

continues in force in accordance with the terms of the notice.

Schedule 2 Registration of persons to engage in credit activ ities

Part 4 Application of other provisions of the National Credit Act in relation to

registered persons and this Schedule

54 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

Part 4

Application of other provisions of the

National Credit Act in relation to registered

persons and this Schedule

32 Application of this Part

This Part (other than item 36) applies during the period that:

(a) starts at commencement; and

(b) ends on 30 June 2011, or a later day prescribed by the

regulations.

33 Application of Part 2-3 of the National Credit Act

Application of Part 2-3 of National Credit Act

(1)

Part 2-3 (which deals with credit representatives and other

representatives of licensees) of the National Credit Act applies as if:

(a) all references to a licensee were references to a registered

person or licensee; and

(b) all references to licensees were references to registered

persons or licensees; and

registered person's registration or licensee's licence; and

(d) the reference in subsection 67(1) of the National Credit Act

to a person holding a licence authorising the person to engage

in the credit activity were a reference to a person holding a

licence authorising the person to engage in the credit activity,

or being registered to engage in the credit activity.

Credit representatives of registered person taken to be credit

representatives of licensee

(2)

If:

(a) a credit representative of a registered person has been

authorised under subsection 64(1) or 65(1) of the National

Credit Act (as those subsections apply because of

subitem (1)); and

(b) the registered person is granted a licence under the National

Credit Act; and

credit representative is in force;

Registration of persons to engage in credit activities Schedule 2

Application of other provisions of the National Credit Act in relation to registered

persons and this Schedule Part 4

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 55

then the authorisation of the credit representative under subsection

64(1) or 65(1) of the National Credit Act (as those subsections apply

because of subitem (1)) is taken to have been an authorisation of the

credit representative as a credit representative of the licensee under

subsection 64(1) or 65(1) of the National Credit Act (as those

subsections apply otherwise than because of subitem (1)).

34 Application of Part 2-4 of the National Credit Act

Part 2-4 (which deals with banning and disqualification of persons from

engaging in credit activities) of the National Credit Act applies as if:

(a) the references in paragraph 80(1)(a) and (5)(a) of the

National Credit Act to a licence were references to a

registration or licence; and

(b) the reference in paragraph 80(5)(b) of the National Credit Act

to section 54 of the National Credit Act were a reference to

section 54 of the National Credit Act or item 23 of this

Schedule; and

to a licence were a reference to a registration or licence.

35 Application of Divisions 2 and 4 of Part 2-5 of the National

Credit Act

(1)

Division 2 of Part 2-5 (which deals with financial records of licensees)

of the National Credit Act applies as if all references to a licensee were

references to a registered person or licensee.

(2)

Division 4 of Part 2-5 (which deals with matters relating to audit

reports) of the National Credit Act applies as if:

(a) all references to a licensee were references to a registered

person or a licensee; and

(b) the reference in paragraph 102(1)(a) of the National Credit

Act to an audit report required under subsection 49(3) of the

National Credit Act in relation to a licensee were a reference

to an audit report required under subsection 49(3) of that Act

in relation to a licensee, or an audit report required under

subitem 17(3) of this Schedule in relation to a registered

person; and

to audit reports referred to in subsection 102(1) of the

Schedule 2 Registration of persons to engage in credit activ ities

Part 4 Application of other provisions of the National Credit Act in relation to

registered persons and this Schedule

56 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

National Credit Act included a reference to the audit reports

required under subitem 17(3) of this Schedule.

36 Application of Chapter 3 of the National Credit Act

(1)

Chapter 3 (which deals with responsible lending conduct) of the

National Credit Act applies, during the period that:

(a) starts on 1 January 2011; and

(b) ends on 30 June 2011, or a later day prescribed by the

regulations;

as if:

person or licensee; and

(d) all references to licensees were references to registered

persons or licensees.

(2)

Despite subitem (1), the following provisions of Chapter 3 of the

National Credit Act do not apply in relation to registered persons:

(a) paragraphs 113(2)(d), 126(2)(d), 127(2)(d), 136(2)(d),

149(2)(d), 150(2)(d) and 160(3)(d) (which deal with

including Australian credit licence numbers in credit guides);

(b) subparagraphs 113(2)(h)(i), 126(2)(e)(i), 127(2)(e)(i),

136(2)(h)(i), 149(2)(e)(i), 150(2)(e)(i) and 160(3)(f)(i)

(which deal with including information about internal dis pute

resolution procedures in credit guides).

37 Application of Chapter 4 of the National Credit Act

(1)

Chapter 4 (which deals with remedies) of the National Credit Act

applies as if:

(a) all references to "this Act" were references to "this Act and

Schedule 2 to the Transitional Act"; and

(b) all references to civil penalty provisions included references

to civil penalty provisions within the meaning of this Act.

(2)

Section 180 (which deals with orders in relation to unlawful credit

activities) of the National Credit Act applies as if the reference in

paragraph 180(1)(b) to contravening section 29 of that Act were a

reference to contravening section 29 of that Act or item 4 or 6 of this

Schedule.

38 Application of Chapter 5 of the National Credit Act

Registration of persons to engage in credit activities Schedule 2

Application of other provisions of the National Credit Act in relation to registered

persons and this Schedule Part 4

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 57

(1)

Chapter 5 (which deals with administration) of the National Credit Act

applies as if all references to "this Act" were references to "this Act and

Schedule 2 to the Transitional Act".

(2)

Section 243 (which deals with qualified privilege for information given

to ASIC) of the National Credit Act applies as if:

(a) the reference in subparagraph 243(1)(c)(i) to section 37 of the

National Credit Act were a reference to section 37 of that Act

or item 12 of this Schedule; and

(b) the reference in subparagraph 243(1)(c)(ii) to section 54 or

55 of the National Credit Act were a reference to section 54

or 55 of that Act, or item 23 or 24 of this Schedule.

39 Application of Chapter 7 of the National Credit Act

Chapter 7 (which deals with miscellaneous matters) of the National

Credit Act, other than sections 329, 331 and 338, applies as if all

references to "this Act" were references to "this Act and Schedule 2 to

the Transitional Act".

Schedule 2 Registration of persons to engage in credit activ ities

Part 5 Exemptions and modifications relating to this Schedule

58 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

Part 5

Exemptions and modifications relating to

this Schedule

40 Provisions to which this Part applies

The provisions to which this Part applies are:

(a) Divisions 1 and 2 of Part 2 (which deal with requirements to

be registered etc. to engage in credit activities); and

(b) Part 3 (which deals with the registration of persons to engage

in credit activities); and

apply to references in the provisions referred to in

paragraphs (a) and (b); and

(d) instruments made for the purposes of any of the provisions

referred to in paragraphs (a) to (c).

41 Exemptions and modifications by ASIC

Exemptions and modifications

(1)

ASIC may:

(a) exempt a person from all or specified provisions to which

this Part applies; or

(b) exempt a credit activity that is engaged in relation to a

specified credit contract, mortgage, guarantee or consumer

lease from all or specified provisions to which this Part

applies; or

relation to a person, or a credit activity referred to in

paragraph (1)(b), as if specified provisions were omitted,

modified or varied as specified in the declaration.

(2)

An exemption or declaration under subitem (1) is not a legislative

instrument.

(3)

ASIC may, by legislative instrument:

(a) exempt a class of persons from all or specified provisions to

which this Part applies; or

(b) exempt a credit activity (other than a credit activity referred

to in paragraph (1)(b)) from all or specified provisions to

which this Part applies; or

Registration of persons to engage in credit activities Schedule 2

Exemptions and modifications relating to this Schedule Part 5

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 59

provisions to which this Part applies; or

(d) declare that provisions to which this Part applies apply in

relation to a credit activity (other than a credit activity

referred to in paragraph (1)(b)), or a class of persons or credit

activities, as if specified provisions were omitted, modified

or varied as specified in the declaration.

Conditions on exemptions

(4)

An exemption may apply unconditionally or subject to specified

conditions. A person to whom a condition specified in an exemption

applies must comply with the condition. The court may order the person

to comply with the condition in a specified way. Only ASIC may apply

to the court for the order.

Publication of exemptions and declarations

(5)

An exemption or declaration under subitem (1) must be in writing and

ASIC must publish notice of it on its website.

Special rules in relation to offences

(6)

If conduct of a person would not have constituted an offence if a

particular declaration under paragraph (1)(c) or (3)(d) had not been

made, that conduct does not constitute an offence unless, before the

conduct occurred:

(a) the text of the declaration was published by ASIC on its

website; or

(b) ASIC gave written notice setting out the text of the

declaration to the person;

(in addition to complying with the requirements of the Legislative

Instruments Act 2003 if the declaration is made under subitem (3)).

(7)

In a prosecution for an offence to which subitem (6) applies, the

prosecution must prove that paragraph (6)(a) or (b) was complied with

before the conduct occurred.

42 Exemptions and modifications by the regulations

The regulations may:

(a) exempt a person or class of persons from all or specified

provisions to which this Part applies; or

Schedule 2 Registration of persons to engage in credit activ ities

Part 5 Exemptions and modifications relating to this Schedule

60 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

(b) exempt a credit activity or a class of credit activities from all

or specified provisions to which this Part applies; or

if specified provisions were omitted, modified or varied as

specified in the regulations.

Registration of persons to engage in credit activities Schedule 2

Regulations relating to infringement notices Part 6

National Consumer Credit Protection (Transitional and Consequential Provisions) Bill 2009

No. , 2009 61

Part 6

Regulations relating to infringement notices

43 Regulations

infringement notices

Infringement notices for civil penalties

(1)

The regulations may provide for a person who is alleged to have

contravened a civil penalty provision in this Schedule to pay a penalty

to the Commonwealth as an alternative to civil proceedings.

(2)

The penalty must not exceed one-fourtieth of the maximum penalty that

a court could impose on the person for contravention of that provision.

Infringement notices for offences

(3)

The regulations may provide for a person who is alleged to have

committed an offence against this Schedule that is stated to be an

offence of strict liability to pay a penalty to the Commonwealth as an

alternative to prosecution.

(4)

The penalty must not exceed one-fifth of the maximum penalty that a

court could impose on the person for that offence.

Schedule 3 Consequential amendments

62 National Consumer Credit Protection (Transitional and Consequential Provisions) Bill

2009 No. , 2009

Schedule 3

Consequential amendments

Australian Securities and Investments Commission Act 2001

1 At the end of subsection 12A(1)

Add:

; (i) the National Consumer Credit Protection Act 2009;

(j) the National Consumer Credit Protection (Transitional and

Consequential Provisions) Act 2009.

Corporations Act 2001

2 Section 913C

Before "ASIC", insert "(1)".

3 At the end of section 913C

Add:

(2) If:

(a) a person is granted an Australian financial services licence;

and

(b) the person holds an Australian credit licence (within the

meaning of the National Consumer Credit Protection Act

2009);

the licence number that ASIC gives to the Australian financial

services licence held by that person must be the same number as

the person's Australian credit licence number (within the meaning

of that Act).

Commonwealth of Australia Bills

NATIONAL CONSUMER CREDIT PROTECTION (TRANSITIONAL AND CONSEQUENTIAL PROVISIONS) BILL 2009