The National Consumer Credit Protection legislative package, which will effect the transfer of responsibility for regulation of consumer credit to the Commonwealth, was introduced into Parliament today.
The timing for implementation of the national Australian credit licence regime remains the same. All persons currently engaging in credit activities will need to apply for registration between 1 November 2009 and 31 December 2009 and will subsequently need to apply for a licence by 30 June 2010. From 1 January 2010, any person engaging in credit activities for the first time must apply for a licence.
One significant change is that the responsible lending conduct obligations will commence on 1 January 2011, to allow industry time to implement systems and procedures required to comply with those obligations. Previously the government had been indicating it would commence on 1 January 2010.
At a first glance, there appears to have been some changes made in response to submissions on the exposure drafts of the legislative package. This includes that credit providers who deal only with their own proprietary credit contracts or consumer leases have been granted relief from the credit assistance responsible lending provisions. They remain subject to the responsible lending obligations imposed on credit providers.
Point-of-sale retailers such as car dealerships or retail outlets will be exempt from the requirements that facilitate credit assistance to consumers. The Government will examine the issue of regulatory oversight within the next 12 months.
We will be updating our detailed paper on this proposed legislation shortly.