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STANDING COMMITTEE OF OFFICIALS OF CONSUMER AFFAIRS
CONSUMER CREDIT CODE
STATEMENT OF ENFORCEMENT POLICY
EXEMPTION FROM REQUIREMENT FOR A COMPARISON RATE SCHEDULE
TO ACCOMPANY A CREDIT APPLICATION
The Consumer Credit (Queensland) Amendment Act 2002 inserts into the
Consumer Credit Code a new Part 9A, which provides for the mandatory disclosure
of comparison rates:
- in advertisements for fixed term credit which feature an annual percentage
rate, and
- in comparison rate schedules which are to be made available to consumers.
Comparison rate schedules:
- are to be made available at any premises of a credit provider, finance
broker or linked supplier at which copies of documents advertising consumer
credit products are displayed or made available for collection or at which
members of the public can lodge credit applications in person (under section
146K(1), (2) and (3));
- are to be made available electronically whenever a credit provider, finance
broker or linked supplier makes material advertising consumer credit products
available on an Internet site, or on any other public electronic system, under
their control (under section 146K(4)); and
- are to accompany any application for credit sent or given to a prospective
debtor by a credit provider, finance broker or linked supplier (under section
146K(5)).
Section 33G of the Consumer Credit Amendment Regulation (No. 1) 2003
provides that a credit provider is exempt from the requirement in section 146K(1)
to make comparison rate schedules available at the credit provider's premises
if the use of the premises relating to the provision of credit is limited to
one or more of the following:
- the display or provision of credit advertisements that do not, or information
that does not, contain an annual percentage rate;
- the distribution, or collection, or both, of credit applications.
This exemption is designed to ensure that distribution of general credit information
and application forms in school staff rooms, office lunch rooms and information
points, usually by volunteers, does not trigger a requirement to provide comparison
rate schedules in these locations.
Concern has now been expressed that, under section 146K(5), credit applications
which are obtained from these staff rooms, office lunch rooms and information
points will be required to be accompanied by a comparison rate schedule. This
would negate the effect of the exemption from section 146K(1), as staff rooms,
lunch rooms and information points would need to keep stocks of up-to-date schedules.
In order to address this issue, SCOCA has agreed that the Consumer Credit
Amendment Regulation (No. 1) 2003 should be amended to extend the exemption
in section 33G to a credit application which is given to a consumer at the premises
referred to in section 33G, or sent to a consumer from those premises.
Until this amendment is made SCOCA has endorsed the following agreed enforcement
approach by government consumer agencies in relation to this issue:
A credit provider is exempt from section 146K(5) in relation to any credit
application which is given to a consumer at or sent to a consumer from the premises
of the credit provider, where the use of those premises relating to the provision
of credit is limited to one or more of the following:
- the display or provision of credit advertisements that do not, or information
that does not, contain an annual percentage rate;
- the distribution, or collection, or both, of credit applications.
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