Commonwealth Consolidated Acts

[Index] [Table] [Search] [Search this Act] [Notes] [Noteup] [Previous] [Next] [Download] [Help]

NATIONAL CONSUMER CREDIT PROTECTION ACT 2009 - SECT 47

General conduct obligations of licensees

General conduct obligations

             (1)  A licensee must:

                     (a)  do all things necessary to ensure that the credit activities authorised by the licence are engaged in efficiently, honestly and fairly; and

                     (b)  have in place adequate arrangements to ensure that clients of the licensee are not disadvantaged by any conflict of interest that may arise wholly or partly in relation to credit activities engaged in by the licensee or its representatives; and

                     (c)  comply with the conditions on the licence; and

                     (d)  comply with the credit legislation; and

                     (e)  take reasonable steps to ensure that its representatives comply with the credit legislation; and

                    (ea)  comply with the Reference Checking and Information Sharing Protocol in relation to:

                              (i)  if the licensee is an individual to whom the Protocol applies--the licensee; and

                             (ii)  if a former, current or prospective representative of the licensee is an individual to whom the Protocol applies--the representative; and

                      (f)  maintain the competence to engage in the credit activities authorised by the licence; and

                     (g)  ensure that its representatives are adequately trained, and are competent, to engage in the credit activities authorised by the licence; and

                     (h)  have an internal dispute resolution procedure that:

                              (i)  complies with standards and requirements made or approved by ASIC in accordance with the regulations; and

                             (ii)  covers disputes in relation to the credit activities engaged in by the licensee or its representatives; and

                   (ha)  give to ASIC the same information it would be required to give under subparagraph 912A(1)(g)(ii) of the Corporations Act 2001 if it were a financial services licensee (within the meaning of Chapter 7 of that Act); and

                      (i)  be a member of the AFCA scheme; and

                      (j)  have compensation arrangements in accordance with section 48; and

                     (k)  have adequate arrangements and systems to ensure compliance with its obligations under this section, and a written plan that documents those arrangements and systems; and

                      (l)  unless the licensee is a body regulated by APRA:

                              (i)  have available adequate resources (including financial, technological and human resources) to engage in the credit activities authorised by the licence and to carry out supervisory arrangements; and

                             (ii)  have adequate risk management systems; and

                    (m)  comply with any other obligations that are prescribed by the regulations.

Assessment of whether compliance is adequate

             (2)  For the purposes of paragraphs (1)(b), (g), (k) and (l), in considering whether a matter is adequate, the nature, scale and complexity of the credit activities engaged in by the licensee must be taken into account.

Regulations in relation to internal dispute resolution procedures

             (3)  Regulations made for the purposes of paragraph (1)(h) may also deal with the variation or revocation of:

                     (a)  standards or requirements made by ASIC; or

                     (b)  approvals given by ASIC.

Reference Checking and Information Sharing Protocol

          (3A)  ASIC may, by legislative instrument, determine a protocol for:

                     (a)  sharing information about any or all of the following:

                              (i)  a licensee who is an individual;

                             (ii)  individuals who are former, current or prospective representatives of a licensee;

                            by that licensee with another licensee; and

                     (b)  sharing information about any or all of the following:

                              (i)  a licensee who is an individual;

                             (ii)  individuals who are former, current or prospective representatives of a licensee;

                            by that licensee with a financial services licensee within the meaning of the Corporations Act 2001 ; and

                     (c)  keeping and retaining records of information shared, and the circumstances under which that information is shared.

          (3B)  The Reference Checking and Information Sharing Protocol must not:

                     (a)  require or permit personal information (within the meaning of the Privacy Act 1988 ) to be shared, other than with the consent of the individual to whom the information relates; or

                     (b)  require information to be shared in relation to conduct that occurred more than 5 years before the information is shared.

Application of Reference Checking and Information Sharing Protocol

          (3C)  The Reference Checking and Information Sharing Protocol applies to an individual mentioned in subparagraph (3A)(a)(i) or (ii) if there are reasonable grounds to suspect that, if the individual becomes a representative of the licensee mentioned in paragraph (3A)(a), the individual will:

                     (a)  provide credit assistance in relation to credit contracts secured by mortgages over residential property; and

                     (b)  be a mortgage broker or a director, employee or agent of a mortgage broker.

          (3D)  The Reference Checking and Information Sharing Protocol applies to an individual mentioned in subparagraph (3A)(b)(i) or (ii) if there are reasonable grounds to suspect that the individual will provide personal advice to retail clients about relevant financial products if the individual becomes a representative of the financial services licensee mentioned in paragraph (3A)(b).

          (3E)  Expressions used in subsection (3D) that are also used in the Corporations Act 2001 (other than Reference Checking and Information Sharing Protocol) have the same meaning in that subsection as they have in that Act.

Qualified privilege

           (3F)  A person has qualified privilege in relation to information shared in accordance with the Reference Checking and Information Sharing Protocol about an individual to whom the Protocol applies.

          (3G)  A person who has qualified privilege under subsection (3F) in respect of conduct is also not liable for any action based on breach of confidence in relation to that conduct.

Civil penalty for non-compliance

             (4)  The licensee must not contravene paragraph (1)(a), (b), (e), (ea), (f), (g), (h), (i), (j), (k), (l) or (m).

Civil penalty:          5,000 penalty units.

Note:          Contravening paragraphs (1)(c) (obligation to comply with conditions on the licence) and (d) (compliance with the credit legislation) has consequences under other provisions.



AustLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback