National Consumer Credit Protection Act 2009

CHAPTER 1 - INTRODUCTION  

PART 1-1 - INTRODUCTION  

SECTION 1  

1   SHORT TITLE  
This Act may be cited as the National Consumer Credit Protection Act 2009.

SECTION 2   COMMENCEMENT  

2(1)   [Commencement dates]  

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 and 2 and anything in this Act not elsewhere covered by this table	The day on which this Act receives the Royal Assent.	15 December 2009
2. Sections 3 to 337 and Schedule 1	A single day to be fixed by Proclamation. However, if any of the provision(s) do not commence within the period of 6 months beginning on the day on which this Act receives the Royal Assent, they commence on the first day after the end of that period.	1 April 2010

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(2)   [Information which may be changed]  

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.

SECTION 3  

3   THE NATIONAL CREDIT CODE  
Schedule 1 (which is the National Credit Code) has effect as a law of the Commonwealth.

PART 1-2 - DEFINITIONS  

Division 1 - Introduction  

SECTION 4  

4   GUIDE TO THIS PART  

Division 2 - The Dictionary  

SECTION 5   THE DICTIONARY  

5(1)    

In this Act (other than the National Credit Code):

acts as an intermediary
: see section 9.

ADI
has the same meaning as in subsection 5(1) of the Banking Act 1959.

adverse publicity order
: see section 182.

AFCA scheme
has the same meaning as in Chapter 7 of the Corporations Act 2001.

affairs
, in relation to a person that is a body corporate, has the same meaning as in Part 3 of the ASIC Act.

affidavit
includes affirmation.

ancillary offence
, in relation to another offence, means:

(a) an offence against section 6 of the Crimes Act 1914; or

(b) an ancillary offence within the meaning of the Criminal Code;

that relates to the other offence.

annual percentage rate
has the same meaning as in section 27 of the National Credit Code.

annual turnover
, of a body corporate during a 12-month period, means the sum of the values of all the supplies that the body corporate, and any body corporate related to the body corporate, have made, or are likely to make, during the 12-month period, other than:

(a) supplies made from any of those bodies corporate to any other of those bodies corporate; or

(b) supplies that are input taxed; or

(c) supplies that are not for consideration (and are not taxable supplies under section 72-5 of the A New Tax System (Goods and Services Tax) Act 1999); or

(d) supplies that are not made in connection with an enterprise that the body corporate carries on; or

(e) supplies that are not connected with Australia. Expressions used in this definition that are also used in the A New Tax System (Goods and Services Tax) Act 1999 have the same meaning as in that Act.

appeal
includes:

(a) an application for a new trial; and

(b) proceedings to review or call in question the proceedings, decision or jurisdiction of a court or judge.

approved code of conduct
means a code of conduct approved by ASIC by legislative instrument under section 238A, and includes a replacement code of conduct approved under that section.

approved external dispute resolution scheme
(Repealed by No 13 of 2018, s 3 and Sch 1[63], effective 6 March 2018. For application provision, see note under s 11.)

APRA
means the Australian Prudential Regulation Authority.

ASIC
means the Australian Securities and Investments Commission.

ASIC Act
means the Australian Securities and Investments Commission Act 2001, and includes instruments made under that Act.

ASIC member
means a member of ASIC within the meaning of the ASIC Act.

ASIC staff member
means a staff member within the meaning of subsection 5(1) of the ASIC Act.

associate
: see section 15A.

Australia
(Repealed by No 154 of 2020, s 3 and Sch 2[56], effective 2 August 2021.)

Australian business law
means a law of the Commonwealth, or of a State or Territory, that is a law that regulates, or relates to the regulation of, business or persons engaged in business.

Australian credit licence
: see subsection 35(1).

Australian credit licence number
means the number given to a licence under section 43.

Australian financial services licence
has the same meaning as in section 761A of the Corporations Act 2001.

authorised
, in relation to a credit activity: see subsection 35(2).

avoidance purpose
: see subsection 323A(2).

banker
has the same meaning as in section 9 of the Corporations Act 2001.

banking group
means a relevant group of bodies corporate (within the meaning of the Banking Act 1959) that includes a body corporate covered by paragraph 133CN(1)(a) (about large ADIs).

banned from engaging in a credit activity under a law of a State or Territory
: a person is banned from engaging in a credit activity under a law of a State or Territory if:

(a) the person holds a State or Territory credit licence that is suspended (otherwise than by request of the person); or

(b) the person has held a State or Territory credit licence that has been cancelled within the last 7 years (otherwise than by the person's request); or

(c) an order of a court made under a law of a State or Territory prohibits the person fromengaging in a credit activity; or

(d) the person is otherwise prohibited under a law of a State or Territory from engaging in a credit activity.

banning order
means an order made under subsection 80(1).

beneficiary of a guarantee
means a person who is a party to a guarantee and who has the benefit of the guarantee, and includes a person who is a beneficiary of a guarantee because of section 10.

benefit derived and detriment avoided
:

(a) because of an offence - has the meaning given by section 288E; and

(b) because of a contravention of a civil penalty provision - has the meaning given by section 167D.

body regulated by APRA
has the same meaning as in subsection 3(2) of the Australian Prudential Regulation Authority Act 1998.

book
includes:

(a) a register; and

(b) any other record of information; and

(c) financial reports or financial records, however compiled, recorded or stored; and

(d) a document.

business day
has the same meaning as in section 204 of the National Credit Code.

carried on in this jurisdiction
has a meaning affected by section 12.

civil penalty provision
: a subsection of this Act (or a section of this Act that is not divided into subsections) 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 subsection (or section); or

(b) another provision of this Act specifies that the subsection (or section) is a civil penalty provision.

coastal sea
:

(a) in relation to Australia - means:

(i) the territorial sea of Australia; and

(ii) the sea on the landward side of the territorial sea of Australia and not within the limits of a State or internal Territory;

and includes the airspace over, and the sea-bed and subsoil beneath, any such sea; and

(b) in relation to a State or Territory - means so much of the coastal sea of Australia as is within the area describedin Schedule 1 to the Offshore Petroleum and Greenhouse Gas Storage Act 2006 under the heading that refers to that State or Territory.

code of conduct
means a code of conduct that relates to any aspect of the activities of:

(a) licensees; or

(b) credit representatives;
being activities in relation to which ASIC has a regulatory responsibility.

commission
includes any financial or other benefit in the nature of a commission.

Note:

Commissions may be conflicted remuneration: see Division 4 of Part 3-5A.

Commonwealth body
means:

(a) an Agency (within the meaning of the Public Service Act 1999); or

(b) a body, whether incorporated or not, established for a public purpose by or under a law of the Commonwealth; or

(c) a person:

(i) holding or performing the duties of an office established by or under a law of the Commonwealth; or

(ii) holding an appointment made under a law of the Commonwealth.

Commonwealth credit legislation
means this Act and the Transitional Act.

conflicted remuneration
: see sections 158N and 158NA.

constitutional corporation
means a corporation to which paragraph 51(xx) of the Constitution applies.

constitutional trade and commerce
means trade and commerce:

(a) between Australia and places outside Australia; or

(b) between the States; or

(c) between a State and a Territory; or

(d) between 2 Territories; or

(e) within a Territory.

constrained document
: see subsection 160CA(1).

constrained information
: see subsection 160CA(1).

consumer
means a natural person or a strata corporation.

consumer lease
means a consumer lease to whichPart 11 of the National Credit Code applies.

continuing credit contract
has the same meaning as in section 204 of the National Credit Code.

contravention

(a) in relation to an offence against a law - includes an ancillary offence relating to the offence against the law; and

(b) in relation to a civil penalty provision - has a meaning affected by section 169.

control
has the meaning given by section 16A.

core obligation
has the meaning given by subsection 50A(3).

credit
has the same meaning as in subsection 3(1) of the National Credit Code.

credit activity
: see section 6.

credit assistance
: see section 8.

credit book
: see subsection 227(4).

credit card
: see subsection 133BA(2).

credit card contract
: see subsection 133BA(1).

credit card termination entitlement
: see subsection 133BT(3).

credit contract
has the same meaning as in section 4 of the National Credit Code.

credit information
has the same meaning as in the Privacy Act 1988.

credit legislation
means:

(a) this Act; and

(b) the Transitional Act; and

(c) Division 2 of Part 2 of the ASIC Act and regulations made for the purpose of that Division; and

(d) any other Commonwealth, State or Territory legislation that covers conduct relating tocredit activities (whether or not it also covers other conduct), but only in so far as it covers conduct relating to credit activities.

credit limit
of a credit contract means the maximum amount of credit that may be provided under the contract.

credit limit increase invitation
, in relation to a credit card contract: see subsection 133BE(5).

credit limit reduction entitlement
: see subsection 133BF(3).

credit provider
:

(a) when used in Part 3-2CA - has the same meaning as in the Privacy Act 1988; and

(b) otherwise - has the same meaning as in section 204 of the National Credit Code, and includes a person who is a credit provider because of section 10 of this Act.

credit registers
: see section 213.

credit reporting body
has the same meaning as in the Privacy Act 1988.

credit representative
: see subsections 64(2) and 65(2).

credit representative number
means the number given to a credit representative under section 72.

credit service
: see section 7.

criminal procedure
: see section 205.

data standards
means standards made by the Registrar under section 212H.

debtor
has the same meaning as in section 204 of the National Credit Code.

declaration of contravention
means a declaration made under section 166.

designated secrecy provision
has the meaning given by subsection 212N(3).

director
has the same meaning as in section 9 of the Corporations Act 2001.

disclosure framework
means the disclosure framework made by the Registrar under section 212L.

disqualification order
means an order of the court under section 86.

document registers
: see section 219.

eligible credit account
: see section 133CO.

eligible credit reporting body
: see subsection 133CN(2).

eligible licensee
: see subsection 133CN(1).

enforceable code provision
means a provision of an approved code of conduct identified by ASIC under subsection 238A(2).

engage in conduct
means:

(a) do an act; or

(b) omit to perform an act.

evidential burden
, in relation to a matter, means the burden of adducing or pointing to evidence that suggests a reasonable possibility that the matter exists or does not exist.

examination
, when used in Chapter 6 (which deals with compliance and enforcement), means an examination of a person pursuant to a requirement made under section 253.

expenses
, in relation to an investigation under Part 6-1, includes costs and expenses incurred by ASIC in relation to proceedings brought under section 275 as a result of the investigation.

Federal Circuit Court
(Repealed by No 13 of 2021, s 3 and Sch 2[602], effective 1 September 2021.)

Federal Court
means the Federal Court of Australia.

financial hardship information
has the same meaning as in the Privacy Act 1988.

financial records
: see subsection 88(2).

financial services licensee
has the same meaning as in Chapter 7 of the Corporations Act 2001.

financial year
: see subsection 100(6).

function
includes a duty.

give
:

(a) when used in Chapter 6 (which deals with compliance and enforcement) in relation to a document - has a meaning affected by section 314; and

(b) when used in relation to information, includes:

(i) explaining or stating a matter; and

(ii) identifying a person, matter or thing; and

(iii) disclosing information; and

(iv) answering a question.

government entity
has the meaning given by section 41 of the A New Tax System (Australian Business Number) Act 1999.

guarantee
means a guarantee to which the National Credit Code applies.

hardship notice
has the same meaning as in section 204 of the National Credit Code.

head company
, of a banking group, means the member of the group covered by paragraph 133CN(1)(a) (about large ADIs).

hearing
, when used in Chapter 6 (which deals with compliance and enforcement), means a hearing before ASIC and, in sections 278, 280, 281 and 282 (which are in that Chapter), includes part of such a hearing.

household goods
has the same meaning as in section 204 of the National Credit Code.

indirect remuneration
means a commission or conflicted remuneration.

individual fine formula
means the formula set out in subsection 288C(3).

infringement notice
means a notice given under section 288J.

initial National Credit Act
(Repealed by No 9 of 2010, s 3 and Sch 1[1].)

initial National Credit Code
: see subsection 20(2).

initial Transitional Act
(Repealed by No 9 of 2010, s 3 and Sch 1[2].)

insolvent
means:

(a) in the case of a natural person - a person who is an insolvent under administration; or

(b) in the case of a body corporate - a body corporate that is a Chapter 5 body corporate (within the meaning of the Corporations Act 2001); or

(c) in the case of a partnership - a partnership against which a creditor's petition or a debtor's petition is presented under Division 2 or 3 of Part IV of the Bankruptcy Act 1966.

investigate
, in relation to ASIC, means investigate in the course of performing any of ASIC's functions or exercising any of ASIC's powers.

involved in
: a person is involved in a contravention of a provision of legislation if, and only if, the person:

(a) has aided, abetted, counselled or procured the contravention; or

(b) has induced the contravention, whether by threats or promises or otherwise; or

(c) has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or

(d) has conspired with others to effect the contravention.

judgment
means a judgment, decree or order, whether final or interlocutory.

Key Facts Sheet
:

(a) for a credit card contract - see section 133BB; and

(b) for a standard home loan - see section 133AB.

knowledge
, in Division 5 of Part 2-2: see section 53C.

large ADI
means an ADI of a kind determined under subsection (1A).

law of a referring State or a Territory
means a law of, or in force in, a referring State or a Territory but does not include a law of the Commonwealth in force in the referring State or the Territory.

law of a State or Territory
means a law of, or in force in, a State or Territory but does not include a law of the Commonwealth in force in the State or Territory.

lawyer
means a person who is admitted to the legal profession by a federal court or a Supreme Court of a State or Territory.

lessee
means the lessee under a consumer lease.

lessor
has the same meaning as in section 204 of the National Credit Code, and includes a person who is a lessor because of section 10.

licence
means an Australian credit licence.

licensee
means a person who holds a licence.

licensing anniversary
: see subsection 53(7).

linked
: for when a credit card is linked to a credit card contract, see subsection 133BA(3).

lodge with ASIC
: see section 216.

lower court
means:

(a) the Federal Circuit and Family Court of Australia (Division 2); or

(b) a court of a State or Territory that is not a superior court.

malice
: see subsection 16(2).

mandatory code of conduct
means a code of conduct that is declared by regulations under section 238F to be mandatory.

mandatory credit information
: see section 133CP.

matter
includes an act, an omission, a body, a person or a thing.

misleading
: see section 13.

mortgage
means a mortgage to which the National Credit Code applies.

mortgage broker
: see section 15B.

mortgage intermediary
: see section 15C.

mortgagee
means the mortgagee under a mortgage, and includes a person who is a mortgagee because of section 10.

mortgagor
means the mortgagor under a mortgage.

National Credit Code
means Schedule 1 to this Act, and includes:

(a) regulations made under section 329 for the purposes of that Schedule; and

(b) instruments made under that Schedule.

officer of the Commonwealth
has the same meaning as in paragraph 75(v) of the Constitution.

official employment
means:

(a) appointment or employment by the Commonwealth, or the performance of services for the Commonwealth; or

(b) the exercise of powers or performance of functions under a delegation by the Registrar.

Part 3-2CA body
: see section 133CZF.

payment period
, in relation to an infringement notice, has the meaning given by section 288M.

pecuniary penalty order
means an order made under section 167.

penalty unit
has the same meaning as in section 4AA of the Crimes Act 1914.

person
has a meaning affected by section 14 (which deals with partnerships) and section 15 (which deals with multiple trustees).

personal information
has the same meaning as in the Privacy Act 1988.

power
includes an authority.

premises
includes:

(a) a structure, building, aircraft, vehicle or vessel; and

(b) any land or place (whether enclosed or built in or not); and

(c) a part of a structure, building, aircraft, vehicle, vessel or of such a place.

prescribed State or Territory order
means an order under a law of a State or Territory, being an order of a kind prescribed by the regulations.

proceedings
:

(a) when used in Chapter 6 (which deals with compliance and enforcement) - has the same meaning as the definition of proceeding in subsection 5(1) of the ASIC Act; and

(b) otherwise - means proceedings, whether criminal or civil, before a court.

proscribed referral
: see subsection 160G(2).

protected information
means information:

(a) obtained by a person in the course of the person's official employment; and

(b) disclosed to the person or another person, or obtained by the person or another person:

(i) under, or in relation to, this Act; or

(ii) under another law of the Commonwealth;

in connection with particular functions or powers of the Registrar.

qualified privilege
has a meaning affected by section 16.

receiving court
: see section 191.

recklessness
, in Division 5 of Part 2-2: see section 53C.

record
, when used in Chapter 6 (which deals with compliance and enforcement) in relation to an examination, means the whole or part of a record made under section 258 of statements made at the examination.

Reference Checking and Information Sharing Protocol
means the protocol determined by ASIC under subsection 47(3A).

referred credit matter
: see subsection 20(1).

referring State
: see section 19.

registered company auditor
has the same meaning as in section 9 of the Corporations Act 2001.

Registrar
has the meaning given by section 16B.

related body corporate
has the same meaning as in section 9 of the Corporations Act 2001.

related criminal justice process decision
: see section 188.

relevant criminal law
: see subsection 204(5).

relevant superior court
, in relation to a lower court, means:

(a) if the lower court is the Federal Circuit and Family Court of Australia (Division 2) - the Federal Court; or

(b) if the lower court is a court of a State or Territory - the Supreme Court of the State or Territory.

relinquishment order
means an order made under subsection 167C(1).

repayment date
: see subsection 133CD(3).

reportable situation
has the meaning given by section 50A.

representative
of a person means:

(a) if the person is a licensee:

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

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

(iii) a credit representative of the licensee; or

(iv) any other person acting on behalf of the licensee; or

(b) otherwise:

(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.

residential property
has the same meaning as in section 204 of the National Credit Code.

reverse mortgage
has the same meaning as in section 13A of the National Credit Code.

reverse mortgage information statement
means a documentrelating to reverse mortgages that complies with the regulations.

scheme
means:

(a) any agreement, arrangement, understanding, promise or undertaking, whether express or implied; or

(b) any scheme, plan, proposal, action, course of action or course of conduct, whether unilateral or otherwise; or

(c) any combination of 2 or more things that are schemes because of paragraph (a) or (b).

secrecy provision
has the meaning given by subsection 212N(2).

senior manager
has the same meaning as in section 9 of the Corporations Act 2001.

sensitive information
has the same meaning as in the Privacy Act 1988.

serious fraud
means an offence involving fraud or dishonesty, being an offence:

(a) against a law of the Commonwealth, or of a State or Territory, or any other law; and

(b) punishable by imprisonment for life or for a period, or maximum period, of at least 3 months.

short-term credit contract
: a credit contract is a short-term credit contract if:

(a) the contract is not a continuing credit contract; and

(b) the credit provider under the contract is not an ADI; and

(c) the credit limit of the contract is $2,000 (or such other amount as is prescribed by the regulations) or less; and

(d) the term of the contract is 15 days or less; and

(e) the contract meets any other requirements prescribed by the regulations.

small amount credit contract
: a credit contract is a small amount credit contract if:

(a) the contract is not a continuing credit contract; and

(b) the credit provider under the contract is not an ADI; and

(c) the credit limit of the contract is $2,000 (or such other amount as is prescribed by the regulations) or less; and

(d) the term of the contract is at least 16 days but not longer than 1 year (or such other number of years as is prescribed by the regulations); and

(e) the debtor's obligations under the contract are not, and will not be, secured; and

(f) the contract meets any other requirements prescribed by the regulations.

standard home loan
: see subsection 133AA(1).

State
, when used in a geographical sense, includes the coastal sea of the State.

statement
, when used in Chapter 6 (which deals with compliance and enforcement) in relation to an examination, includes a question asked, an answer given, and any other comment or remark made, at the examination.

state of mind
: the state of mind of a person includes:

(a) the knowledge, intention, opinion, belief or purpose of the person; and

(b) the person's reasons for the intention, opinion, belief or purpose.

State or Territory credit licence
means a licence or registration that:

(a) is granted under a law of a State or Territory; and

(b) authorises the licensee or registered person to engage in a credit activity.

strata corporation
has the same meaning as in section 204 of the National Credit Code.

subject to an infringement notice
, in relation to an offence provision or civil penalty provision, has the meaning given by section 288K.

subscriber
, in relation to an approved code of conduct:

(a) means a person or entity that agrees, in a way required by the applicant for the code's approval, to be bound by the code; and

(b) if a person or entity no longer agrees to be bound by the code - includes the person or entity during the period that the person or entity did agree to be so bound.

superior court
means any of the following courts:

(a) the Federal Court;

(b) the Supreme Court of a State or Territory.

supply requirements
: see section 133CQ.

taxation law
has the same meaning as in the Income Tax Assessment Act 1997.

Territory
:

(a) means the following:

(i) the Australian Capital Territory;

(ii) the Jervis Bay Territory;

(iii) the Northern Territory;

(iv) Norfolk Island;

(v) the Territory of Christmas Island;

(vi) the Territory of Cocos (Keeling) Islands; and

(b) when used in a geographical sense - includes the Territory's coastal sea (if any).

this Act
includes instruments made under this Act.

this jurisdiction
: see subsections 21(2) and (3).

transfer matter
: see section 191.

transferring court
: see section 191.

Transitional Act
means the National Consumer Credit Protection (Transitional and Consequential Provisions) Act 2009, and includes instruments made under that Act.

tribunal
means:

(a) a tribunal in Australia; or

(b) any other body, authority or person in Australia having power, by law or by consent of parties, to hear, receive or examine evidence.

unsolicited communication to a consumer
: see subsection 133CF(2).

use
of a credit card: see subsection 133BA(4).

value
of a credit contract, mortgage, guarantee or consumer lease: see section 199.

value of a credit contract, mortgage, guarantee or consumer lease
(Repealed by No 130 of 2012, s 3 and Sch 5[2])

virtual enquiry technology
means any technology that allows a person to appear at all or part of a hearing, examination or other enquiry without being physically present at the hearing, examination or other enquiry.

within the authority
: a representative's conduct is within the authority of a person if:

(a) for a representative who is an employee of the person or of a related body corporate of the person - the conduct is within the scope of the employee's employment; or

(b) for a representative who is a director of the person or of a related body corporate of the person - the conduct is within the scope of the director's duties as director; or

(c) for a representative who is a credit representative of the person - the conduct is within the scope of the authorisation of the credit representative under subsection 64(1) or 65(1); or

(d) otherwise - the conduct is within the scope of the authority given by the person.

witness
, in relation to a hearing before ASIC, means a person appearing at the hearing to give evidence.

written record
, when used in Chapter 6 (which deals with compliance and enforcement) in relation to an examination, means:

(a) a record of the examination:

(i) that is made in writing; or

(ii) as reduced to writing; or

(b) a part of such a record.

5(1A)    

The Minister may, by legislative instrument, determine the kinds of ADIs that are large ADIs.

5(2)    
In this Act (other than the National Credit Code), a reference to a provision is a reference to a provision of this Act, unless the contrary intention appears.

Division 3 - Definitions relating to the meaning of credit activity  

SECTION 6   MEANING OF CREDIT ACTIVITY  

6(1)   [Examples of engaging in credit activity]  

The following table sets out when a person engages in a credit activity .

Meaning of credit activity
Item	Topic	A person engages in a credit activity if:
1	credit contracts	(a) the person is a credit provider under a credit contract; or
		(b) the person carries on a business of providing credit, being credit the provision of which the National Credit Code applies to; or
		(c) the person performs the obligations, or exercises the rights, of a credit provider in relation to a credit contract or proposed credit contract (whether the person does so as the credit provider or on behalf of the credit provider); or
2	credit service	the person provides a credit service; or
3	consumer leases	(a) the person is a lessor under a consumer lease; or
		(b) the person carries on a business of providing consumer leases; or
		(c) the person performs the obligations, or exercises the rights, of a lessor in relation to a consumer lease or proposed consumer lease (whether the person does so as the lessor or on behalf of the lessor); or
4	mortgages	(a) the person is a mortgagee under a mortgage; or
		(b) the person performs the obligations, or exercises the rights, of a mortgagee in relation to a mortgage or proposed mortgage (whether the person does so as the mortgagee or on behalf of the mortgagee); or
5	guarantees	(a) the person is the beneficiary of a guarantee; or
		(b) the person performs the obligations, or exercises the rights, of another person who is a beneficiary of a guarantee or proposed guarantee, in relation to the guarantee or proposed guarantee (whether the person does so on the person's own behalf or on behalf of the other person); or
6	Prescribed activities	the person engages in an activity prescribed by the regulations in relation to credit, being credit the provision of which the National Credit Code applies to, or would apply to if the credit were provided.

6(2)   [Subclasses of conduct]  

A subclass of any of the conduct referred to in the table in subsection (1) is also a credit activity .

Note:

For example, ASIC could impose a condition on a licence under subsection 45(6) that provides that a person is authorised to be a credit provider only under particular types of credit contracts (such as credit card contracts).

SECTION 7  

7   MEANING OF CREDIT SERVICE  
A person provides a credit service if the person:

(a) provides credit assistance to a consumer; or

(b) acts as an intermediary.

SECTION 8  

8   MEANING OF CREDIT ASSISTANCE  
A person provides credit assistance to a consumer if, by dealing directly with the consumer or the consumer's agent in the course of, as part of, or incidentally to, a business carried on in this jurisdiction by the person or another person, the person:

(a) suggests that the consumer apply for a particular credit contract with a particular credit provider; or

(b) suggests that the consumer apply for an increase to the credit limit of a particular credit contract with a particular credit provider; or

(c) suggests that the consumer remain in a particular credit contract with a particular credit provider; or

(d) assists the consumer to apply for a particular credit contract with a particular credit provider; or

(e) assists the consumer to apply for an increase to the credit limit of a particular credit contract with a particular credit provider; or

(f) suggests that the consumer apply for a particular consumer lease with a particular lessor; or

(g) suggests that the consumer remain in a particular consumer lease with a particular lessor; or

(h) assists the consumer to apply for a particular consumer lease with a particular lessor.

It does not matter whether the person does so on the person's own behalf or on behalf of another person.

SECTION 9  

9   MEANING OF ACTS AS AN INTERMEDIARY  
A person acts as an intermediary if, in the course of, as part of, or incidentally to, a business carried on in this jurisdiction by the person or another person, the person:

(a) acts as an intermediary (whether directly or indirectly) between a credit provider and a consumer wholly or partly for the purposes of securing a provision of credit for the consumer under a credit contract for the consumer with the credit provider; or

(b) acts as an intermediary (whether directly or indirectly) between a lessor and a consumer wholly or partly for the purposes of securing a consumer lease for the consumer with the lessor.

It does not matter whether the person does so on the person's own behalf or on behalf of another person.

SECTION 10   ASSIGNEES OF CREDIT PROVIDERS, LESSORS, MORTGAGEES AND BENEFICIARIES OF A GUARANTEE  

10(1)   [Interpretation]  

For the purposes of this Act (other than the National Credit Code), a person is a credit provider, lessor, mortgagee or beneficiary of a guarantee whether the person is:

(a) the original credit provider, lessor, mortgagee or beneficiary of a guarantee under a credit contract, consumer lease, mortgage or guarantee; or

(b) a person to whom the rights of a credit provider, lessor, mortgagee or beneficiary of a guarantee under a credit contract, consumer lease, mortgage or guarantee have been assigned or passed by law.

Note:

For example, a person who is assigned the rights of a credit provider under a credit contract would engage in a credit activity within the meaning of paragraph (a) of item 1 of the table in subsection 6(1).

10(2)   [Assignment or passing by law of rights]  

For the purposes of paragraph (1)(b), it does not matter whether an assignment or passing by law of rights is the first or a subsequent assignment or passing by law of those rights.

Division 4 - Other definitions  

SECTION 11  

11   MEANING OF APPROVED EXTERNAL DISPUTE RESOLUTION SCHEME  
(Repealed by No 13 of 2018)

SECTION 12   WHEN A BUSINESS IS CARRIED ON IN THIS JURISDICTION  

12(1)   [Application of Div 3 of Pt 1.2 of Corporations Act 2001 ]  

Division 3 of Part 1.2 of the Corporations Act 2001 applies for the purposes of working out whether a business is carried on in this jurisdiction .

12(2)   [Interpretation of "carried on in this jurisdiction"]  

Without limiting subsection (1), a business is taken to be carried on in this jurisdiction by a person if, in the course of carrying on the business, the person engages in conduct that is:

(a) intended to induce people in this jurisdiction to use the goods or services the person provides; or

(b) is likely to have that effect;

whether or not the conduct is intended, or likely, to have that effect in other places as well.

SECTION 13   MEANING OF MISLEADING  

13(1)   [When representations are misleading]  

A representation made by a person is misleading if:

(a) the representation relates to a future matter (including the doing of, or refusing to do, any act); and

(b) the person does not have reasonable grounds for making the representation.

13(2)   [No limitation]  

Subsection (1) does not limit the circumstances in which a representation may be misleading.

SECTION 14   MEANING OF PERSON - GENERALLY INCLUDES A PARTNERSHIP  

14(1)   [Changes to Act when applied to partnerships]  

This Act (other than the National Credit Code) applies to a partnership as if the partnership were a person, but it applies with the following changes:

(a) obligations that would be imposed on the partnership are imposed instead on each partner, but may be discharged by any of the partners;

(b) any contravention of this Act (other than the National Credit Code) that would otherwise be a contravention by the partnership is taken (whether for the purposes of criminal or civil liability) to have been a contravention by each partner who:

(i) aided, abetted, counselled or procured the relevant act or omission; or

(ii) was in any way knowingly concerned in, or party to, the relevant act or omission (whether directly or indirectly and whether by any act or omission of the partner).

Note:

For the purposes of paragraph (b), to determine whether the partnership has contravened this Act, see section 325.

14(2)   [Change in partnership composition does not affect continuity]  

For the purposes of this Act (other than the National Credit Code), a change in the composition of a partnership does not affect the continuity of the partnership.

14(3)   [Subsections have effect subject to contrary intention and regulations]  

Subsections (1) and (2) have effect subject to:

(a) an express or implied contrary intention in a provision of this Act (other than the National Credit Code); and

(b) the regulations, which may exclude or modify the effect of those subsections in relation to specified provisions.

SECTION 15   MEANING OF PERSON - GENERALLY INCLUDES MULTIPLE TRUSTEES  

15(1)   [Application]  

This section applies in relation to a trust during a period while the trust continues to have:

(a) 2 or more trustees; or

(b) a single trustee who was a trustee of the trust at a time when it had 2 or more trustees.

15(2)   [Act applies as if trustee or trustees were single person]  

Subject to subsections (3) and (4), during the period this Act (other than the National Credit Code) applies to the trust as if the trustee or trustees of the trust from time to time during the period were a single person (the notional person ) that remained the same for the duration of that period.

Note:

So, for example, a licence granted under this Act during the period to the trustees of the trust will continue in force, despite a change in the persons who are the trustees.

15(3)   [Changes to Act where trust has 2 or more trustees]  

If, during the period or any part of the period, the trust has 2 or more trustees, this Act (other than the National Credit Code) applies to the trustees as referred to in subsection (2), but it applies with the following changes:

(a) obligations that would be imposed on the notional person are imposed instead on each trustee, but may be discharged by any of the trustees;

(b) any contravention of this Act (other than the National Credit Code) that would otherwise be a contravention by the notional person is taken (whether for the purposes of criminal or civil liability) to have been a contravention by each trustee who:

(i) aided, abetted, counselled or procured the relevant act or omission; or

(ii) was in any way knowingly concerned in, or party to, the relevant act or omission (whether directly or indirectly and whether by any act or omission of the trustee).

Note:

For the purposes of paragraph (b), to determine whether the notional person has contravened this Act, see section 325.

15(4)   [Changes to Act where trust has 1 trustee]  

If, during the period or any part of the period, the trust has only one trustee, this Act (other than the National Credit Code) applies to the trustee as referred to in subsection (2), but it applies with the following changes:

(a) obligations that would be imposed on the notional person are imposed instead on that single trustee;

(b) any contravention of this Act (other than the National Credit Code) that would otherwise be a contravention by the notional person is taken (whether for the purposes of criminal or civil liability) to have been a contravention by that single trustee.

15(5)   [Subsections have effect subject to contrary intention and regulations]  

Subsections (2), (3) and (4) have effect subject to:

(a) an express or implied contrary intention in a provision of this Act (other than the National Credit Code); and

(b) the regulations, which may exclude or modify the effect of those subsections in relation to specified provisions.

SECTION 15A   MEANING OF ASSOCIATE  

15A(1)    
If a person is associated with a credit provider for the purposes of the National Credit Code:

(a) the person is an associate of the credit provider; and

(b) the credit provider is an associate of the person.

15A(2)    
In any other case, a person is an associate of another person in the circumstances prescribed by the regulations.

SECTION 15B   MEANING OF MORTGAGE BROKER  

15B(1)    
A licensee is a mortgage broker if:

(a) the licensee carries on a business of providing credit assistance in relation to credit contracts secured by mortgages over residential property; and

(b) the licensee does not perform the obligations, or exercise the rights, of a credit provider in relation to the majority of those credit contracts; and

(c) in carrying on the business, the licensee provides credit assistance in relation to credit contracts offered by more than one credit provider.

15B(2)    
A credit representative of a licensee is a mortgage broker if:

(a) the credit representative carries on a business of providing credit assistance in relation to credit contracts secured by mortgages over residential property; and

(b) neither the credit representative nor the licensee performs the obligations, or exercises the rights, of a credit provider in relation to the majority of those credit contracts; and

(c) in carrying on the business, the credit representative provides credit assistance in relation to credit contracts offered by more than one credit provider.

SECTION 15C   MEANING OF MORTGAGE INTERMEDIARY  

15C(1)    
A licensee is a mortgage intermediary if:

(a) the licensee carries on a business of acting as an intermediary in relation to credit contracts securedby mortgages over residential property; and

(b) the licensee does not perform the obligations, or exercise the rights, of a credit provider in relation to the majority of those credit contracts; and

(c) in carrying on the business, the licensee acts as an intermediary in relation to credit contracts offered by more than one credit provider.

15C(2)    
A credit representative of a licensee is a mortgage intermediary if:

(a) the credit representative carries on a business of acting as an intermediary in relation to credit contracts secured by mortgages over residential property; and

(b) neither the credit representative nor the licensee performs the obligations, or exercises the rights, of a credit provider in relation to the majority of those credit contracts; and

(c) in carrying on the business, the credit representative acts as an intermediary in relation to credit contracts offered by more than one credit provider.

SECTION 16   QUALIFIED PRIVILEGE  

16(1)   [Qualified privilege for defamation]  

If this Act provides that a person has qualified privilege in relation to an act, matter or thing, then the person:

(a) has qualified privilege in proceedings for defamation; or

(b) is not, in the absence of malice on the person's part, liable to an action for defamation at the suit of a person;

in relation to that act, matter or thing.

16(2)   [Definition of "malice"]  

Malice includes ill will to the person concerned or any other improper motive.

16(3)   [No limit or affect on other right, privilege or immunity]  

Neither this section nor a provision of this Act that provides as referred to in subsection (1) limits or affects any right, privilege or immunity that a person has, apart from this section or such a provision, as defendant in proceedings, or an action, for defamation.

SECTION 16A   MEANING OF CONTROL  

16A(1)    

Control
, of a body corporate, is:

(a) having the capacity to cast, or control the casting of, more than one half of the maximum number of votes that might be cast at a general meeting of the body corporate; or

(b) directly or indirectly holding more than one half of the issued share capital of the body corporate (not including any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital, and not including MCIs); or

(c) having the capacity to control the composition of the body corporate's board or governing body; or

(d) having the capacity to determine the outcome of decisions about the body corporate's financial and operating policies, taking into account:

(i) the practical influence that can be exerted (rather than the rights that can be enforced); and

(ii) any practice or pattern of behaviour affecting the body corporate's financial or operating policies (whether or not it involves a breach of an agreement or a breach of trust).

16A(2)    

Control
, of a person other than a body corporate, is:

(a) having the capacity to control the composition of the person's board or governing body (if any); or

(b) having the capacity to determine the outcome of decisions about the person's financial and operating policies, taking into account:

(i) the practical influence that can be exerted (rather than the rights that can be enforced); and

(ii) any practice or pattern of behaviour affecting the person's financial or operating policies (whether or not it involves a breach of an agreement or a breach of trust).

16A(3)    
For the purposes of paragraph (1)(b), MCI has the same meaning as in the Corporations Act 2001, and issued has the same meaning as in Chapter 7 of that Act.

SECTION 16B  

16B   MEANING OF REGISTRAR  

A reference in this Act to the Registrar is a reference to:

(a)    if only one Commonwealth body is appointed as Registrar under section 212A - that body; or

(b)    if more than one Commonwealth body is appointed under that section:

(i) if the reference relates to one or more particular functions or powers - any Commonwealth body so appointed with any of those particular functions or powers; or

(ii) otherwise - any of the Commonwealth bodies appointed under that section.

PART 1-3 - APPLICATION OF THIS ACT AND THE TRANSITIONAL ACT  

Division 1 - Introduction  

SECTION 17  

17   GUIDE TO THIS PART  

Division 2 - Constitutional basis and application of this Act and the Transitional Act  

SECTION 18   CONSTITUTIONAL BASIS FOR THIS ACT AND THE TRANSITIONAL ACT  
Application in a referring State

18(1)    
The application of this Act and the Transitional Act in the referring States is based on:

(a) the legislative powers that the Commonwealth Parliament has under section 51 of the Constitution (other than paragraph 51(xxxvii)); and

(b) the legislative powers that the Commonwealth Parliament has because of a reference or an adoption by the Parliaments of the referringStates under paragraph 51(xxxvii) of the Constitution.

Application in a Territory

18(2)    

The application of this Act and the Transitional Act in a Territory is based on:

(a) the legislative powers that the Commonwealth Parliament has under section 122 of the Constitution to make laws for the government of a Territory; and

(b) the legislative powers that the Commonwealth Parliament has under section 51 of the Constitution.

Despite section 2H of the Acts Interpretation Act 1901, this Act and the Transitional Act as applying in the Territory are laws of the Commonwealth.

Application outside Australia

18(3)    
The operation of this Act and the Transitional Act outside Australia is based on:

(a) the legislative power the Commonwealth Parliament has under paragraph 51(xxix) of the Constitution; and

(b) the other legislative powers that the Commonwealth Parliament has under section 51 of the Constitution; and

(c) the legislative powers that the Commonwealth Parliament has under section 122 of the Constitution to make laws for the government of a Territory.

Application in a non-referring State

18(4)    
The application of this Act and the Transitional Act in a State that is not a referring State is based on:

(a) the legislative powers that the Commonwealth Parliament has under section 51 (other than paragraph 51(xxxvii)) and section 122 of the Constitution; and

(b) the legislative powers that the Commonwealth Parliament has because of a reference or an adoption by the Parliaments of the referring States under paragraph 51(xxxvii) of the Constitution.

SECTION 19   MEANING OF REFERRING STATE  
Meaning of referring State

19(1)    

A State is a referring State if, for the purposes of paragraph 51(xxxvii) of the Constitution, the Parliament of the State:

(a) has referred the matters covered by subsections (3) and (4) to the Commonwealth Parliament; or

(b) has:

(i) adopted the relevant version of this Act and the relevant version of the Transitional Act; and

(ii) referred the matter covered by subsection (4) to the Commonwealth Parliament.

19(2)   [Interpretation]  

A State is a referring State even if the State's referral law provides that:

(a) the reference to the Commonwealth Parliament of a matter covered by subsection (3) or (4) is to terminate in particular circumstances; or

(b) the adoption of the relevant version of this Act or the relevant version of the Transitional Act is to terminate in particular circumstances; or

(c) the reference to the Commonwealth Parliament of the matter covered by subsection (4) does not include:

(i) the matter of making provision with respect to the imposition or payment of State taxes, duties, charges or other imposts, however described; or

(ii) the matter of making provision with respect to the general system for the recording of estates or interests in land and related information; or

(iii) the matter of providing for the priority of interests in real property; or

(iv) the matter of making a law that excludes or limits the operation of a State law, to the extent that the State law makes provision with respect to the creation, holding, transfer, assignment, disposal or forfeiture of a State statutory right; or

(d) the reference to the Commonwealth Parliament of a matter covered by subsection (3) or (4) has effect only:

(i) if and to the extent that the matter is not included in the legislative powers of the Commonwealth Parliament (otherwise than by a reference under section 51(xxxvii) of the Constitution); or

(ii) if and to the extent that the matter is included in the legislative powers of the Parliament of the State.

Reference covering the relevant versions of this Act and the Transitional Act

19(3)    

This subsection covers the matters to which the referred provisions relate to the extent of the making of laws with respect to those matters by including the referred provisions in the relevant version of this Act and the relevant version of the Transitional Act.

Reference covering amendments of this Act or the Transitional Act

19(4)    

This subsection covers a referred credit matter (see section 20) to the extent of the making of laws with respect to that matter by making express amendments of this Act or the Transitional Act.

Effect of terminating reference or adoption of relevant versions

19(5)    

A State ceases to be a referring State if:

(a) in the case where the Parliament of the State has referred to the Commonwealth Parliament the matters covered by subsection (3) - that reference terminates; or

(b) in the case where the Parliament of the State has adopted the relevant version of this Act and the relevant version of the Transitional Act - the adoption of the relevant version of this Act or the relevant version of the Transitional Act terminates.

Effect of terminating amendment reference

19(6)    
A State ceases to be a referring State if:

(a) the State's amendment reference terminates; and

(b) subsection (7) does not apply to the termination.

19(7)   [When State does not cease to be referring State]  

A State does not cease to be a referring State because of the termination of its amendment reference if:

(a) the termination is effected by the Governor of that State fixing a day by Proclamation as the day on which the reference terminates; and

(b) the day fixed is no earlier than the first day after the end of the period of 6 months beginning on the day on which the Proclamation is published; and

(c) that State's amendment reference, and the amendment reference of every other State, terminates on the same day.

Definitions

19(8)    

In this section:

amendment reference
of a State means the reference by the Parliament of the State to the Parliament of the Commonwealth of the matter covered by subsection (4).

express amendment
of this Act or the Transitional Act means the direct amendment of the text of this Act or the Transitional Act (whether by the insertion, omission, repeal, substitution or relocation of words or matter) by another Commonwealth Act or by an instrument under a Commonwealth Act, but does not include the enactment by a Commonwealth Act of a provision that has, or will have, substantive effect otherwise than as part of the text of this Act or the Transitional Act.

forfeiture
means confiscation, seizure, extinguishment, cancellation, suspension or any other forfeiture.

initial reference
(Repealed by No 9 of 2010, s 3 and Sch 1[12], effective 3 March 2010.)

referral law
, of a State, means the Act of the State that refers the matter covered by subsection (4) to the Commonwealth Parliament.

referred provisions
means:

(a) the relevant version of this Act; and

(b) the relevant version of the Transitional Act;

to the extent to which they deal with matters that are included in the legislative powers of the Parliaments of the States.

relevant version of the Transitional Act
means the Transitional Act as originally enacted.

relevant version of this Act
means:

(a) if, at the time the State's referral law was enacted, this Act had not been enacted - this Act as originally enacted; or

(b) otherwise - this Act as originally enacted, and as later amended by the National Consumer Credit Protection Amendment Act 2010.

State law
means:

(a) any Act of the State or any instrument made under such an Act, whenever enacted or made and as in force from time to time; or

(b) the general law, being the principles and rules of common law and equity to the extent that they have effect in the State from time to time.

State statutory right
means a right, entitlement or authority that is granted by or under any Act of the State or any instrument made under such an Act, whenever enacted or made and as in force from time to time, other than a right, entitlement or authority that relates to:

(a) credit covered by paragraph (a) of the definition of referred credit matter ; or

(b) a consumer lease covered by paragraph (b) of that definition.

SECTION 20   MEANING OF REFERRED CREDIT MATTER  

20(1)   [Definition of "referred credit matter"]  

Referred credit matter means a matter relating to either of the following:

(a) credit, being credit the provision of which would be covered by the expression "provision of credit to which this Code applies" in the initial National Credit Code;

(b) consumer leases, being consumer leases each of which would be covered by the expression "consumer lease to which Part 11 applies" in the initial National Credit Code.

20(2)   [Definition of "initial national credit code"]  

Initial National Credit Code means Schedule 1 to the relevant version of this Act (within the meaning of subsection 19(8)).

SECTION 21   GENERAL APPLICATION OF THIS ACT AND THE TRANSITIONAL ACT  
Application in this jurisdiction

21(1)    
Each provision of this Act and the Transitional Act applies in this jurisdiction.

Geographical coverage of "this jurisdiction"

21(2)   [Definition of "this jurisdiction"]  

This jurisdiction means the geographical area that consists of:

(a) each referring State (including its coastal sea); and

(b) each Territory (including its coastal sea).

21(3)   [Composition of "this jurisdiction"]  

Throughout this Act and the Transitional Act, this jurisdiction therefore consists of either:

(a) if all of the States are referring States - the whole of Australia; or

(b) if one or more States are not referring States - Australia (other than any State that is not a referring State).

Application outside this jurisdiction

21(4)    
Subject to subsection (5), each provision of this Act and the Transitional Act also applies, according to its tenor, in relation to acts and omissions outside this jurisdiction.

Application in non-referring States

21(5)    
This Act does not apply to an act or omission in a State that is not a referring State to the extent to which that application would be beyond the legislative powers of the Parliament (including powers it has under paragraphs 51(xxxvii) and (xxxix) of the Constitution).

Residence, place of formation etc.

21(6)    
Each provision of this Act and the Transitional Act applies, according to its tenor, to:

(a) natural persons whether:

(i) resident in this jurisdiction or not; and

(ii) resident in Australia or not; and

(iii) Australian citizens or not; and

(b) all bodies corporate and unincorporated bodies whether:

(i) formed or carrying on a business in this jurisdiction or not; and

(ii) formed or carrying on a business in Australia or not.

SECTION 22   WHEN ACTS BIND CROWN  

22(1)   [Crown not bound by Act]  

This Act (other than the National Credit Code) and the Transitional Act do not bind the Crown in any of its capacities.

22(2)   [Regulations may bind crown]  

Despite subsection (1), the regulations may provide that this Act (other than the National Credit Code) and the Transitional Act, or specified provisions of this Act (other than the National Credit Code) or the Transitional Act, bind either or both of the following in circumstances (if any) prescribed by the regulations:

(a) the Crown in right of the Commonwealth;

(b) the Crown in all of its other capacities.

22(3)   [National Credit Code binds Crown]  

The National Credit Code binds the Crown in each of its capacities.

22(4)   [Liability of crown]  

This Act and the Transitional Act do not make the Crown liable to be prosecuted for an offence or to any pecuniary penalty.

Division 3 - Interaction between the Commonwealth credit legislation and State and Territory laws  

SECTION 23   CONCURRENT OPERATION INTENDED  

23(1)   [No exclusion of concurrent laws]  

This Act and the Transitional Act (the Commonwealth credit legislation ) are not intended to exclude or limit the concurrent operation of any law of a State or Territory.

23(2)   [Liability for convictions]  

If:

(a) an act or omission of a person is both an offence against the Commonwealth credit legislation and an offence against the law of a State or Territory; and

(b) the person is convicted of either of those offences;

the person is not liable to be convicted of the other of those offences.

23(3)   [Inconsistency]  

This section does not apply to a law of a State or Territory if there is a direct inconsistency between that law and the Commonwealth credit legislation.

Note:

Section 25 avoids direct inconsistency arising in some cases by limiting the operation of the Commonwealth credit legislation.

SECTION 24   WHEN COMMONWEALTH CREDIT LEGISLATION DOES NOT APPLY  

24(1)   [Application]  

Subsection (2) applies if a provision of a law of a referring State or a Territory declares a matter to be an excluded matter for the purposes of this section in relation to:

(a) the whole of the Commonwealth credit legislation; or

(b) a specified provision of the Commonwealth credit legislation; or

(c) the Commonwealth credit legislation other than a specified provision; or

(d) the Commonwealth credit legislation otherwise than to a specified extent.

24(2)   [Exclusions]  

By force of this subsection:

(a) none of the provisions of the Commonwealth credit legislation (other than this section) applies in or in relation to the State or Territory with respect to the matter if the declaration is one to which paragraph (1)(a) applies; and

(b) the specified provision of the Commonwealth credit legislation does not apply in or in relation to the State or Territory with respect to the matter if the declaration is one to which paragraph (1)(b) applies; and

(c) the provisions of the Commonwealth credit legislation (other than this section and the specified provisions) do not apply in or in relation to the State or Territory with respect to the matter if the declaration is one to which paragraph (1)(c) applies; and

(d) the provisions of the Commonwealth credit legislation (other than this section and otherwise than to the specified extent) do not apply in or in relation to the State or Territory with respect to the matter if the declaration is one to which paragraph (1)(d) applies.

24(3)   [Regulations may exclude application of subsection 2 to declaration]  

Subsection (2) does not apply to the declaration to the extent to which the regulations provide that that subsection does not apply to that declaration.

SECTION 25   AVOIDING DIRECT INCONSISTENCY BETWEEN COMMONWEALTH AND STATE AND TERRITORY LAWS  
This section overrides other Commonwealth credit legislation

25(1)    
This section has effect despite anything else in the Commonwealth credit legislation.

When this section does not apply to a State or Territory law

25(2)    
This section does not apply to a provision of a law of a referring State or a Territory that is capable of concurrent operation with the Commonwealth credit legislation.

Note:

This kind of provision is dealt with by section 23.

When this section applies to a State or Territory law

25(3)    
This section applies to the interaction between a provision (the displacement provision ) of a law of a referring State or a Territory and a provision (the Commonwealth provision ) of the Commonwealth credit legislation only if the displacement provision is declared by a law of the State or Territory to be a Commonwealth credit legislation displacement provision for the purposes of this section (either generally or specifically in relation to the Commonwealth provision).

Effect of displacement provision

25(4)   [Where displacement provision authorises or requires an act]  

The Commonwealth provision does not:

(a) prohibit the doing of an act; or

(b) impose a liability (whether civil or criminal) for doing an act;

if the displacement provision specifically permits, authorises or requires the doing of that act.

25(5)   [Inconsistency]  

The Commonwealth provision does not operate in or in relation to the State or Territory to the extent necessary to ensure that no inconsistency arises between:

(a) the Commonwealth provision; and

(b) the displacement provision to the extent to which the displacement provision would, apart from this subsection, be inconsistent with the Commonwealth provision.

Note 1:

The displacement provision is not covered by this subsection if subsection (4) applies to the displacement provision: if that subsection applies there would be no potential inconsistency to be dealt with by this subsection.

Note 2:

The operation of the displacement provision will be supported by section 23 to the extent to which it can operate concurrently with theCommonwealth provision.

25(6)   [Regulations may exclude application]  

Subsections (4) and (5) do not apply in relation to the displacement provision to the extent to which the regulations provide that those subsections do not apply in relation to the displacement provision.

SECTION 26   REGULATIONS TO DEAL WITH INTERACTION BETWEEN LAWS  

26(1)   [Regulations may modify Cth credit legislation]  

The regulations may modify the operation of the Commonwealth credit legislation so that:

(a) provisions of the Commonwealth credit legislation do not apply to a matter that is dealt with by a law of a referring State or a Territory specified in the regulations; or

(b) no inconsistency arises between the operation of a provision of the Commonwealth credit legislation and the operation of a provision of a law of a referring State or a Territory specified in the regulations.

26(2)   [Regulations made under subsection 1 may provide]  

Without limiting subsection (1), regulations made for the purposes of that subsection may provide that a provision of the Commonwealth credit legislation:

(a) does not apply to:

(i) a person specified in the regulations; or

(ii) a body specified in the regulations; or

(iii) circumstances specified in the regulations; or

(iv) a person or body specified in the regulations in the circumstances specified in the regulations; or

(b) does not prohibit an act to the extent to which the prohibition would otherwise give rise to an inconsistency with a law of a referring State or a Territory; or

(c) does not require a person to do an act to the extent to which the requirement would otherwise give rise to an inconsistency with a law of a referring State or a Territory; or

(d) does not authorise a person to do an act to the extent to which the conferral of that authority on the person would otherwise give rise to an inconsistency with a law of a referring State or a Territory; or

(e) does not impose an obligation on a person to the extent to which complying with that obligation would require the person not to comply with an obligation imposed on the person under a law of a referring State or a Territory; or

(f) authorises a person to do something for the purposes of the Commonwealth credit legislation that the person:

(i) is authorised to do under a law of a referring State or a Territory; and

(ii) would not otherwise be authorised to do under the Commonwealth credit legislation; or

(g) will be taken to be satisfied if a law of a referring State or a Territory is satisfied.

CHAPTER 2 - LICENSING OF PERSONS WHO ENGAGE IN CREDIT ACTIVITIES  

PART 2-1 - REQUIREMENT TO BE LICENSED TO ENGAGE IN CREDIT ACTIVITIES  

Division 1 - Introduction  

SECTION 27  

27   GUIDE TO THIS PART  

Division 2 - Engaging in credit activities without a licence  

SECTION 28  

28   APPLICATION OF THIS DIVISION  
This Division applies on or after 1 July 2011, or a later day prescribed by the regulations.

SECTION 29   PROHIBITION ON ENGAGING IN CREDIT ACTIVITIES WITHOUT A LICENCE  
Prohibition on engaging in credit activities without a licence

29(1)    

A person must not engage in a credit activity if the person does not hold a licence authorising the person to engage in the credit activity.

Civil penalty: 5,000 penalty units.

Offence

29(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

Defences

29(3)    
For the purposes of subsections (1) and (2), it is a defence if:

(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

(c) the person's conduct in engaging in the credit activity is within the authority of the principal; and

(d) the principal holds a licence authorising the principal to engage in the credit activity.

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (3) (see subsection 13.3(3) of the Criminal Code).

29(4)    
For the purposes of subsections (1) and (2), it is a defence if:

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

(b) the person is a representative of the principal; and

(c) the person's conduct in engaging in the credit activity is within the authority of the principal; and

(d) the principal is exempted from subsections (1) and (2) under paragraph 109(1)(a), 109(3)(a) or 110(1)(a).

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

Division 3 - Other prohibitions relating to the requirement to be licensed  

SECTION 30   PROHIBITIONS ON HOLDING OUT AND ADVERTISING ETC.  
Prohibitions on holding out and advertising etc.

30(1)    
A person must not hold out:

(a) that the person holds a licence; or

(b) that the person holds a licence authorising the person to engage in a particular credit activity; or

(c) that a credit activity engaged in by the person or by someone else is exempt from a requirement to hold a licence; or

(d) that, in engaging in a credit activity, the person acts on behalf of another person; or

(e) that conduct, or proposed conduct, of the person is within the authority of a licensee;

if that is not the case.

Civil penalty: 5,000 penalty units.

30(2)    

A person must not hold out or advertise that the person engages or is able to engage in a credit activity if the person would, if the person engaged in the credit activity, contravene section 29 (which deals with the requirement to be licensed).

Civil penalty: 5,000 penalty units.

Offence

30(3)    

A person commits an offence if:

(a) the person is subject to a requirement under subsection (1) or (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 1 year imprisonment.

SECTION 31   PROHIBITION ON CONDUCTING BUSINESS WITH UNLICENSED PERSONS  
Prohibition on conducting business with unlicensed persons

31(1)    
A licensee must not:

(a) engage in a credit activity; and

(b) in the course of engaging in that credit activity, conduct business with another person who is engaging in a credit activity;

if, by engaging in the credit activity, the other person contravenes section 29 (which deals with the requirement to be licensed).

Civil penalty: 5,000 penalty units.

Offence

31(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

SECTION 32   PROHIBITION ON CHARGING A FEE ETC.  
Prohibition on charging a fee etc.

32(1)    

A person must not demand, receive or accept any fee, charge or other amount from a consumer for engaging in a credit activity if, by engaging in that credit activity, the person contravenes, or would contravene, section 29 (which deals with the requirement to be licensed).

Civil penalty: 5,000 penalty units.

Offence

32(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 1 year imprisonment.

SECTION 33  

33   PROHIBITION ON GIVING MISLEADING INFORMATION ETC.  
(Repealed by No 130 of 2012)

PART 2-2 - AUSTRALIAN CREDIT LICENCES  

Division 1 - Introduction  

SECTION 34  

34   GUIDE TO THIS PART  

Division 2 - Australian credit licences  

SECTION 35   AUSTRALIAN CREDIT LICENCES  

35(1)   [Definition]  

An Australian credit licence is a licence that authorises the licensee to engage in particular credit activities.

35(2)   [Authorised activities specified in licence conditions]  

The credit activities that the licensee is authorised to engage in are those credit activities specified in a condition of the licence as the credit activities that the licensee is authorised to engage in.

Division 3 - How to get an Australian credit licence  

SECTION 36   APPLYING FOR A LICENCE  

36(1)   [Application]  

A person may apply for a licence by lodging an application with ASIC on or after 1 July 2010, or a later day prescribed by the regulations.

36(2)   [Approved form]  

The application must be in the approved form.

SECTION 37   WHEN A LICENCE MAY BE GRANTED - APPLICANTS OTHER THAN ADIs  
When ASIC must grant a licence

37(1)    
ASIC must grant a person (other than an ADI) a licence if (and must not grant the person a licence unless):

(a) the person has applied for the licence in accordance with section 36; and

(b) ASIC has no reason to believe that the person is likely to contravene the obligations that will apply under section 47 if the licence is granted; and

(c) the requirement in section 37A (fit and proper person test) is satisfied in relation to the applicant and the licence applied for; and

(d) (Repealed)

(e) the person meets any other requirements prescribed by the regulations.

Note:

ASIC must not grant a licence to a person contrary to a banning order or disqualification order, or if a prescribed State or Territory order is in force against the person or certain representatives of the person (see section 40).

False, misleading or incompleteinformation

37(2)    

ASIC must refuse to grant the licence if ASIC is satisfied that:

(a) the application for the licence, or any information, audit report or statement lodged with ASIC in accordance with subsection (4), was false in a material particular or materially misleading; or

(b) there was an omission of a material matter from the application or the information, audit report or statement.

37(3)    
(Repealed by No 3 of 2020)

ASIC may request information etc. from applicant

37(4)    

ASIC may give a written notice to a person who has applied for a licence requesting the person to lodge with ASIC, within the time specified in the notice, any of the following:

(a) information specified in the notice in relation to any matters that ASIC may have regard to in deciding whether to grant the licence;

(b) an audit report, prepared by a suitably qualified person specified in the notice, in relation to matters that ASIC may have regard to in deciding whether to grant the licence;

(c) if ASIC proposes to grant the applicant a licence - a statement that either:

(i) informs ASIC of any material changes in any information provided to ASIC in, or in connection with, the application; or

(ii) confirms that there have been no such changes.

37(5)    

To avoid doubt:

(a) a notice under subsection (4), and the information, audit report or statement requested in the notice, may relate to any person mentioned in section 37A in relation to the applicant and the licence applied for; and

(b) subsection (7) applies in relation to such a request even if the applicant is unable to comply with the request.

37(6)    

ASIC may, by written notice to the applicant before the time specified in the notice:

(a) withdraw a request under subsection (4); or

(b) extend the time specified in the notice.

37(7)    

If the applicant does not lodge with ASIC the information, audit report or statement requested by ASIC in a notice under subsection (4) within the specified time, the applicant is taken to have withdrawn the application.

37(8)    

To avoid doubt, section 41 does not apply to an application that is taken to have been withdrawn under subsection (7) of this section.

SECTION 37A   FIT AND PROPER PERSON TEST  

37A(1)    
For the purposes of paragraph 37(1)(c), subsection 46A(2) and paragraph 55(1)(c), the requirement in this section is satisfied in relation to a person (the first person ) and a licence, or a proposed licence, if ASIC is satisfied that there is no reason to believe any of the following:

(a) that the first person is not a fit and proper person to engage in the credit activities authorised by the licence;

(b) if the first person is a body corporate - that an officer (within the meaning of the Corporations Act 2001) of the first person is not a fit and proper person to perform one or more functions as an officer of a person that engages in the credit activities authorised by the licence;

(c) if the first person is a partnership or the multiple trustees of a trust:

(i) that any of the partners or trustees are not fit and proper persons to engage in the credit activities authorised by the licence; or

(ii) that any of the senior managers of the partnership or the trust are not fit and proper persons to perform one or more functions as an officer (within the meaning of the Corporations Act 2001) of a person that engages in the credit activities authorised by the licence;

(d) that any person who controls the first person is not a fit and proper person to control a person that engages in the credit activities authorised by the licence;

(e) if a controller mentioned in paragraph (d) is a body corporate - that an officer (within the meaning of the Corporations Act 2001) of the controller is not a fit and proper person to perform one or more functions as an officer of an entity (as defined by section 64A of that Act) that controls a person that engages in the credit activities authorised by the licence;

(f) if a controller mentioned in paragraph (d) is a partnership or the multiple trustees of a trust:

(i) that any of the partners or trustees are not fit and proper persons to control a person that engages in the credit activities authorised by the licence; or

(ii) that any of the senior managers of the partnership or the trust are not fit and proper persons to perform one or more functions as an officer (within the meaning of the Corporations Act 2001) of an entity (as defined by section 64A of that Act) that controls a person that engages in the credit activities authorised by the licence.

37A(2)    
In considering whether a person is fit and proper for a purpose mentioned in subsection (1), ASIC must have regard to the matters in section 37B.

SECTION 37B   FIT AND PROPER PERSON TEST - MATTERS TO WHICH ASIC MUST HAVE REGARD  

37B(1)    
ASIC must have regard to the matters set out in subsection (2) (subject to Part VIIC of the Crimes Act 1914) for the purposes of applying any of the following provisions to a person:

(a) a paragraph of subsection 37A(1);

(b) paragraph 80(1)(f).

Note:

Part VIIC of the Crimes Act 1914 includes provisions that, in certain circumstances, relieve persons from the requirement to disclose spent convictions and require persons aware of such convictions to disregard them.

37B(2)    
The matters are as follows:

(a) whether any of the following of the person has ever been suspended or cancelled:

(i) a licence, or a registration under the Transitional Act;

(ii) an Australian financial services licence;

(b) whether any of the following has ever been made against the person:

(i) a banning order, or a disqualification order under Part 2-4;

(ii) a banning order, or a disqualification order, under Division 8 of Part 7.6 of the Corporations Act 2001;

(c) if the person is an individual - whether the person has ever been disqualified under the Corporations Act 2001, or any other law of the Commonwealth or of a State or Territory, from managing corporations;

(d) whether the person has ever been banned from engaging in a credit activity under a law of a State or Territory;

(e) whether the person has ever been linked to a refusal or failure to give effect to a determination made by AFCA (as defined in section 910C of the Corporations Act 2001);

(f) if the person is not the multiple trustees of a trust - whether the person has ever been insolvent;

(g) if the person is the multiple trustees of a trust - whether a trustee of the trust has ever been insolvent;

(h) whether, in the last 10 years, the person has been convicted of an offence;

(i) any relevant information given to ASIC by a State or Territory, or an authority of a State or Territory, in relation to the person;

(j) any other matter prescribed by the regulations;

(k) any other matter ASIC considers relevant.

SECTION 38  

38   WHEN A LICENCE MAY BE GRANTED - ADIs  
If:

(a) an ADI applies under section 36 for a licence; and

(b) the application includes a statement (in accordance with the requirements of the approved form) to the effect that the ADI will, if granted the licence, comply with its obligations as a licensee;

then ASIC must grant the ADI a licence authorising the ADI to engage in credit activities that equate (as closely as possible) to the credit activities in relation to which the application was made.

Note:

ASIC must not grant a licence to a person contrary to a banning order or disqualification order, or if a prescribed State or Territory order is in force against the person or certain representatives of the person (see section 40).

SECTION 39  

39   REGULATIONS MAY PRESCRIBE STREAMLINED PROCESS FOR OTHER APPLICANTS  
Despite sections 36 and 37, the regulations may provide that:

(a) some or all of sections 36 and 37 do not apply in relation to particular classes of applicants; and

(b) alternative processes apply to applications for licences by, and the grant of licences to, those classes of applicants.

SECTION 40   LICENCES MUST NOT BE GRANTED TO CERTAIN APPLICANTS  
Banning or disqualification order in force against person

40(1)    
Despite subsection 37(1) and section 38, ASIC must not grant a licence that authorises a person to engage in a credit activity if a banning order or disqualification order under Part 2-4 is in force against the person in relation to that credit activity.

Prescribed State or Territory order in force against person etc.

40(2)    
Despite subsection 37(1) and section 38, ASIC must not grant a licence to a person if:

(a) the person is a natural person against whom a prescribed State or Territory order is in force; or

(b) the person is a body corporate, and a prescribed State or Territory order is in force against a director, secretary or senior manager of the body corporate who would perform duties in relation to the credit activities to be authorised by the licence; or

(c) the person is a partnership or the trustees of a trust, and a prescribed State or Territory order is in force against a partner or trustee who would perform duties in relation to the credit activities to be authorised by the licence.

SECTION 41  

41   APPLICANT MUST BE GIVEN HEARING BEFORE REFUSAL OF LICENCE  
ASIC may only refuse to grant a licence after giving the person who applied for the licence 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 refusal.

SECTION 42   NOTICE OF GRANT OR REFUSAL OF LICENCE AND DATE OF EFFECT  

42(1)   [Form and content of notice]  

ASIC must give a person (the applicant ) who has applied for a licence written notice of:

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

(b) if the decision is to grant the applicant a licence - the day on which the licence takes effect; and

(c) if the decision is not to grant the applicant a licence - the reasons for the decision.

42(2)   [Day on which licence comes into force]  

The licence comes into force on the day specified in the notice, which must not be before the day on which the decision to grant the licence was made.

SECTION 43   AUSTRALIAN CREDIT LICENCE NUMBERS  

43(1)   [Unique licence number must be allocated]  

ASIC must allocate each licence a unique Australian credit licence number when it is granted.

43(2)   [Credit licence number and financial services licence number to be same]  

If:

(a) a person is granted a licence; and

(b) the person holds an Australian financial services licence;

then the Australian credit licence number that ASIC gives to the licence held by that person must be the same number as the person's Australian financial services licence number.

43(3)   [Written notice of licence number must be given]  

ASIC must give the licensee written notice of the Australian credit licence number.

SECTION 44  

44   BASIS ON WHICH LICENCE IS GRANTED  
A licence granted under this Division is granted on the basis that:

(a) conditions on the licence may be imposed, varied or revoked under section 45 or 46; and

(b) the licence may be suspended under section 54, 55 or 56; and

(c) the licence may be cancelled under section 54, 55 or 56; and

(d) the licence may be varied under section 57; and

(e) the licence may be cancelled, revoked, terminated or varied by or under later legislation; and

(f) no compensation is payable if:

(i) conditions on the licence are imposed, varied or revoked as referred to in paragraph (a); or

(ii) the licence is suspended, cancelled, varied, revoked or terminated as referred to in paragraphs (b) to (e).

Division 4 - Conditions on an Australian credit licence  

SECTION 45   THE CONDITIONS ON THE LICENCE  
ASIC may impose, vary or revoke conditions on licences

45(1)    

Subject to section 46A, ASIC may, at any time:

(a) impose conditions, or additional conditions, on a licence; and

(b) vary or revoke conditions imposed on a licence.

45(2)    
ASIC may do so:

(a) on its own initiative; or

(b) if the licensee lodges an application with ASIC for the imposition, variation or revocation.

45(3)    
The application must be in the approved form.

Notice and effect of imposition, variation or revocation of conditions

45(4)    
ASIC must give the licensee 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 licensee a hearing

45(5)    

Despite subsection (1), ASIC may only impose conditions or additional conditions, or vary or revoke the conditions, on the licence after giving the licensee 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 subsection does not apply to ASIC imposing conditions when the licence is granted, or imposing or varying conditions in accordance with an application under paragraph (2)(b).

Condition in relation to credit activities authorised

45(6)    
ASIC must ensure that the licence is subject to a condition that specifies the credit activities or classes of credit activities that the licensee is authorised to engage in.

Regulations may prescribe conditions

45(7)    
The licence is subject to such other conditions as are prescribed by the regulations. However, ASIC cannot vary or revoke those conditions.

SECTION 46   LICENCE CONDITIONS - SPECIAL PROCEDURES FOR APRA-REGULATED BODIES  
Special procedures for APRA-regulated bodies (other than ADIs)

46(1)    
If the licensee, 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 licence 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 licence 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

46(2)    
If the licensee, 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 section 45:

(i) to impose, vary or revoke a condition on the licence 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, 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 45(5)(a) and receive any submissions under paragraph 45(5)(b);

(c) if ASIC imposes, varies or revokes a condition on the licence and paragraph (a) does not apply to that action, ASIC must, within one week, inform APRA of the action that has been taken.

SECTION 46A   ASIC MAY REQUEST INFORMATION ETC. IN RELATION TO AN APPLICATION FOR CONDITIONS TO BE VARIED  

46A(1)    
This section applies if a licensee applies under paragraph 45(2)(b) for ASIC to:

(a) impose conditions, or additional conditions, on the licence; or

(b) vary or revoke conditions imposed on the licence.

However, this section does not apply in relation to a power to which paragraph 46(2)(a) applies.

46A(2)    
ASIC must not grant the application unless the requirement in section 37A (fit and proper person test) is satisfied in relation to the applicant and the licence as proposed to be varied.

ASIC may request information etc. from applicant

46A(3)    
ASIC may give a written notice to the applicant requesting the applicant to lodge with ASIC, within the time specified in the notice, any of the following:

(a) information specified in the notice in relation to any matters that ASIC must have regard to for the purposes of deciding whether the requirement in section 37A is satisfied as mentioned in subsection (2) of this section;

(b) an audit report, prepared by a suitably qualified person specified in the notice, in relation to matters that ASIC must have regard to for the purposes of deciding whether the requirement in section 37A is satisfied as mentioned in subsection (2) of this section;

(c) if ASIC proposes to grant the application - a statement that either:

(i) informs ASIC of any material changes in any information provided to ASIC in, or in connection with, the application; or

(ii) confirms that there have been no such changes.

46A(4)    
To avoid doubt:

(a) a notice under subsection (3), and the information, audit report or statement requested in the notice, may relate to any person mentioned in section 37A in relation to the applicant and the licence as proposed to be varied; and

(b) subsection (6) applies in relation to such a request even if the applicant is unable to comply with the request.

46A(5)    
ASIC may, by written notice to the applicant within the time specified in the notice:

(a) withdraw the request; or

(b) extend the time specified in the notice.

46A(6)    
If the applicant does not lodge with ASIC the information, audit report or statement requested by ASIC in a notice under subsection (3) within the specified time, the applicant is taken to have withdrawn the application.

46A(7)    
To avoid doubt, subsection (8) does not apply to an application that is taken to have been withdrawn under subsection (6).

Applicant must be given hearing before refusal of application

46A(8)    
ASIC may only refuse to grant the application after giving the applicant 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 matter.

Division 5 - Obligations of licensees  

Subdivision A - General obligations  

SECTION 47  GENERAL CONDUCT OBLIGATIONS OF LICENSEES  
General conduct obligations

47(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; 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; 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

47(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

47(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

47(3A)    

ASIC may, by legislative instrument, determine a protocol for sharing and requesting information about an individual in respect of whom there are reasonable grounds to suspect that:

(a)    if the individual becomes a representative of a licensee ( recruiting credit licensee ), the individual will:

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

(ii) be a mortgage broker or a director, employee or agent of a mortgage broker; or

(b)    a mortgage intermediary ( prospective mortgage intermediary ) is acting, or will act, as an intermediary in relation to a licensee where the individual is, or is a former, current or prospective representative of, that licensee, and in that capacity the individual:

(i) provides, provided or will provide credit assistance in relation to credit contracts secured by mortgages over residential property; and

(ii) is, was or will be a mortgage broker or a director, employee or agent of a mortgage broker; or

(c)    if the individual becomes a representative of a financial services licensee ( recruiting financial services licensee ), the individual will provide personal advice to retail clients about relevant financial products.

47(3AA)    

The Reference Checking and Information Sharing Protocol may provide for any or all of the following to share information about the individual with the recruiting credit licensee, the prospective mortgage intermediary or the recruiting financial services licensee:

(a)    if the individual is a licensee - the individual;

(b)    if the individual is a former or current representative of a licensee - that licensee;

(c)    if a mortgage intermediary has previously acted or is acting as an intermediary in relation to a licensee where the individual is, or is a former or current representative of, that licensee - that mortgage intermediary;

47(3AB)    

The Reference Checking and Information Sharing Protocol may provide, in a case covered by paragraph (3A)(a) or (b), for the recruiting credit licensee or the prospective mortgage intermediary to request information about the individual from any or all of the following:

(a)    if the individual is a licensee or a financial services licensee - the individual;

(b)    if the individual is a former or current representative of a licensee - that licensee;

(c)    if the individual is a former or current representative of a financial services licensee - that financial services licensee;

(d)    if a mortgage intermediary has previously acted or is acting as an intermediary in relation to a licensee where the individual is, or is a former or current representative of, that licensee - that mortgage intermediary.

47(3AC)    

The Reference Checking and Information Sharing Protocol may provide for keeping and retaining records of information shared, and the circumstances under which that information is shared.

47(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.

47(3C)    
(Repealed by No 69 of 2023)

47(3D)    
(Repealed by No 69 of 2023)

47(3E)    

Expressions used in paragraphs (3A)(c) and (3AB)(c) 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

47(3F)    

A person has qualified privilege in relation to information shared in accordance with the Reference Checking and Information Sharing Protocol.

47(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

47(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.

SECTION 48   REQUIREMENTS FOR COMPENSATION ARRANGEMENTS  
Requirement to have adequate compensation arrangements

48(1)    
A licensee must have adequate arrangements for compensating persons for loss or damage suffered because of a contravention of this Act by the licensee or its representatives.

When arrangements are adequate

48(2)    
For the purposes of subsection (1), arrangements are adequate if, and only if, they:

(a) satisfy any requirements prescribed by the regulations; or

(b) are approved in writing by ASIC.

Approval of arrangements by ASIC

48(3)   [Matters to be consider before approval under para (2)(b)]  

Before approving arrangements under paragraph (2)(b), ASIC must have regard to:

(a) the credit activities authorised by the licence; and

(b) whether the arrangements will continue to cover persons after the licensee ceases to engage in credit activities, and the length of time for which that cover will continue; and

(c) any other matters that are prescribed by the regulations.

48(4)   [Regulations may prescribe additional details for 3(a) and (b)]  

Without limiting paragraph (3)(c), the regulations may, in particular, prescribe additional details in relation to the matters to which ASIC must have regard under paragraphs (3)(a) and (b).

Subdivision B - Providing information and assistance to ASIC  

SECTION 49   OBLIGATION TO PROVIDE A STATEMENT OR OBTAIN AN AUDIT REPORT IF DIRECTED BY ASIC  
Notice to licensee to provide a statement

49(1)    

ASIC may give a licensee a written notice directing the licensee to lodge with ASIC a written statement containing specified information about:

(a) the credit activities engaged in by the licensee or its representatives; or

(b) for the purposes of considering whether the requirement in section 37A (fit and proper person test) is satisfied in relation to the licensee and the licence - any matters mentioned in section 37B in relation to a person mentioned in a paragraph of subsection 37A(1).

49(2)    
Notices under subsection (1):

(a) may be given at any time; and

(b) may be given to one or more particular licensees, or to each licensee in one or more classes of licensee, or to all licensees; and

(c) may require all the same information, or may contain differences as to the information they require; and

(d) may require a statement containing information to be given on a periodic basis, or each time a particular event or circumstance occurs, without ASIC having to give a further written notice.

Notice to licensee to obtain an audit report

49(3)    
ASIC may also give a licensee a written notice directing the licensee to obtain an audit report, prepared by a suitably qualified person specified in the notice, on a statement, or on each statement in a class of statements, under subsection (1) before the statement is given to ASIC.

49(4)    
A notice under subsection (3) is not a legislative instrument.

Notice must specify day by which licensee must comply

49(5)    
A notice given under this section must specify the day by which the licensee 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 licensee.

Requirement to comply with notice

49(6)    

The licensee must comply with a notice given under this section within the time specified in the notice.

Civil penalty: 5,000 penalty units.

Offence

49(7)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

Strict liability offence

49(8)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 20 penalty units.

49(9)    
Subsection (8) is an offence of strict liability.

Note:

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

SECTION 50   OBLIGATION TO GIVE ASIC INFORMATION REQUIRED BY THE REGULATIONS  
Regulations may require licensee to give information

50(1)    
The regulations may require a licensee, or each licensee in a class of licensees, to give ASIC specified information about the credit activities engaged in by the licensee or its representatives.

Requirement to comply with regulations

50(2)    

If regulations under subsection (1) require a licensee to give ASIC information, the licensee must give ASIC that information.

Civil penalty: 5,000 penalty units.

Offence

50(3)    

A person commits an offence if:

(a) the person is subject to a requirement to give ASIC information under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

Strict liability offence

50(4)    

A person commits an offence if:

(a) the person is subject to a requirement to give ASIC information under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 20 penalty units.

50(5)    
Subsection (4) is an offence of strict liability.

Note:

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

SECTION 50A   WHAT ARE REPORTABLE SITUATIONS?  

50A(1)    
There is a reportable situation in relation to a licensee if one of the following paragraphs is satisfied:

(a)    the licensee or a representative of the licensee has breached a core obligation and the breach is significant;

(b)    the licensee or a representative of the licensee is no longer able to comply with a core obligation and the breach, if it occurs, will be significant;

(c)    the licensee or a representative of the licensee conducts an investigation into whether there is a reportable situation of the kind mentioned in paragraph (a) or (b) and the investigation continues for more than 30 days;

(d)    an investigation described in paragraph (c) discloses that there is no reportable situation of the kind mentioned in paragraph (a) or (b).

50A(2)    
There is also a reportable situation in relation to a licensee if:

(a)    in the course of engaging in a credit activity, the licensee or a representative of the licensee has engaged in conduct constituting gross negligence; or

(b)    the licensee or a representative of the licensee has committed serious fraud; or

(c)    any other circumstances prescribed by the regulations for the purposes of this paragraph exist.

50A(3)    
Each of the following is a core obligation :

(a)    an obligation under section 47, other than the obligation under paragraph 47(1)(d);

(b)    the obligation under paragraph 47(1)(d), so far as it relates to this Act, the Transitional Act and Division 2 of Part 2 of the ASIC Act and regulations made for the purpose of that Division;

(c)    

the obligation under paragraph 47(1)(d), so far as it relates to Commonwealth legislation that is:

(i) covered by paragraph (d) of the definition of credit legislation in subsection 5(1); and

(ii) specified in regulations made for the purposes of this subparagraph;

(d)    

an obligation of a representative of the licensee under this Act, the Transitional Act, Division 2 of Part 2 of the ASIC Act or regulations made for the purpose of that Division.

50A(4)    
For the purposes of this section, a breach of a core obligation is taken to be significant if:

(a)    the breach is constituted by the commission of an offence under any law and the commission of the offence is punishable on conviction by a penalty that may include imprisonment for a maximum period of:

(i) if the offence involves dishonesty - 3 months or more; or

(ii) in any other case - 12 months or more; or

(b)    the breach is constituted by a contravention of a civil penalty provision under any law, other than a civil penalty provision prescribed by the regulations for the purposes of this paragraph; or

(c)    the breach is constituted by a contravention of a key requirement (as defined for the purposes of the National Credit Code), other than a key requirement prescribed by the regulations for the purposes of this paragraph; or

(d)    the breach is constituted by a contravention of subsection 12DA(1) of the ASIC Act (misleading or deceptive conduct in relation to a financial service); or

(e)    the breach results, or is likely to result, in material loss or damage to a credit activity client of the licensee; or

(f)    any other circumstances prescribed by the regulations for the purposes of this paragraph exist.

50A(5)    
Otherwise, for the purposes of this section, a breach of a core obligation is significant having regard to the following:

(a)    the number or frequency of similar breaches;

(b)    the impact of the breach on the licensee's ability to engage in credit activities covered by the licence;

(c)    the extent to which the breach indicates that the licensee's arrangements to ensure compliance with those obligations are inadequate;

(d)    any other matters prescribed by regulations made for the purposes of this paragraph.

50A(5A)    
Regulations for the purposes of paragraph (4)(b) may prescribe a civil penalty provision to the extent that it relates to the following:

(a)    contraventions of specified provisions;

(b)    specified matters.

50A(6)    
For the purposes of this section, a person is a credit activity client of a licensee if the person is a consumer who:

(a)    is a party to a credit contract, or will be a party to a proposed credit contract, in relation to which the licensee, or a representative of the licensee, performs the obligations, or exercises the rights, of a credit provider; or

(b)    is a person to whom the licensee, or a representative of the licensee, provides a credit service; or

(c)    is a party to a consumer lease, or will be a party to a proposed consumer lease, in relation to which the licensee, or a representative of the licensee, performs the obligations, or exercises the rights, of a lessor; or

(d)    is a mortgagor under a mortgage, or will be the mortgagor under a proposed mortgage, in relation to which the licensee, or a representative of the licensee, performs the obligations, or exercises the rights of a mortgagee; or

(e)    is the guarantor under a guarantee, or will be the guarantor under a proposed guarantee, in relation to which the licensee, or a representative of the licensee, performs the obligations, or exercises the rights, of a beneficiary under the guarantee; or

(f)    is a person in relation to whom the licensee, or a representative of the licensee, engages in a prescribed activity mentioned in item 6 of the table in subsection 6(1).

SECTION 50B   OBLIGATION TO LODGE A REPORT - REPORTABLE SITUATIONS IN RELATION TO THE LICENSEE  

Reporting a reportable situation to ASIC

50B(1)    
If there are reasonable grounds to believe that a reportable situation has arisen in relation to a licensee:

(a)    the licensee must lodge a report in relation to the reportable situation with ASIC; and

(b)    the report must be lodged in accordance with this section.

Civil penalty: 5,000 penalty units.

Offence

50B(2)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

Report must be in the approved form

50B(3)    
The report must be lodged with ASIC in writing in the approved form.

Period within which report must be lodged

50B(4)    
The report must be lodged with ASIC within 30 days after the licensee first knows that, or is reckless with respect to whether, there are reasonable grounds to believe that the reportable situation has arisen.

Strict liability applies in relation to paragraphs (1)(a) and (b)

50B(5)    
Strict liability applies in relation to paragraphs (1)(a) and (b).

If report is received by APRA

50B(6)    
A report that a licensee is required to lodge with ASIC under this section in relation to a reportable situation is taken to have been lodged with ASIC if:

(a)    the licensee is a body regulated by APRA; and

(b)    the licensee has given a report to APRA that contains all of the information that is required in a report under this section in relation to the reportable situation.

50B(7)    
Subsection (1) does not apply to a licensee in relation to a reportable situation if:

(a)    the licensee is a body regulated by APRA; and

(b)    the auditor oractuary of the licensee gives APRA a written report about a matter to which the reportable situation relates; and

(c)    the report is given before, or within 10 business days after, the licensee first knows that, or is reckless with respect to whether, there are reasonable grounds to believe that the reportable situation has arisen.

SECTION 50C   OBLIGATION TO LODGE A REPORT - REPORTABLE SITUATIONS IN RELATION TO OTHER LICENSEES  

Reporting a reportable situation to ASIC

50C(1)    
A licensee (the reporting licensee ) must lodge a report with ASIC in accordance with this section if there are reasonable grounds to believe that:

(a)    a reportable situation has arisen in relation to another licensee of the kind mentioned in:

(i) paragraph 50A(1)(a) or (b) (significant breach or likely breach of a core obligation); or

(ii) subsection 50A(2) (gross negligence or serious fraud); and

(b)    one of the following is an individual who has engaged in conduct that forms part of the reportable situation:

(i) the other licensee;

(ii) an employee of the other licensee or of a related body corporate of the other licensee, acting within the scope of the employee's employment;

(iii) a director of the other licensee or of a related body corporate of the other licensee, acting within the scope of the director's duties as director;

(iv) another representative of the other licensee acting within the scope of the representative's authority given by the licensee; and

(c)    the individual is a mortgage broker.

Civil penalty: 5,000 penalty units.

Report must be in the approved form

50C(2)    
The report must be lodged with ASIC in writing in the approved form.

Period within which report must be lodged

50C(3)    
The report must be lodged with ASIC within 30 days after the reporting licensee first knows of, or is reckless with respect to, the circumstances mentioned in paragraphs (1)(a), (b) and (c).

If the reportable situation already reported to ASIC

50C(4)    
Subsection (1) does not apply in relation to a reportable situation if there are reasonable grounds to believe that ASIC is aware of:

(a)    the existence of the reportable situation; and

(b)    all of the information that is required in a report under this section in relation to the reportable situation.

A copy of the report must be given to the other licensee

50C(5)    
The reporting licensee must give a copy of any report that the reporting licensee is required to lodge with ASIC under subsection (1) to the other licensee within 30 days after the reporting licensee first knows of, or is reckless with respect to, the circumstances mentioned in paragraphs (1)(a), (b) and (c).

Civil penalty: 5,000 penalty units.

50C(6)    
A licensee has qualified privilege in relation to a copy of a report given under subsection (5).

50C(7)    
A licensee who has qualified privilege under subsection (6) in respect of conduct is also not liable for any action based on breach of confidence in relation to that conduct.

SECTION 50D   ASIC MUST PUBLISH DETAILS OF CERTAIN REPORTS  

50D(1)    
ASIC must, for each financial year, publish information about:

(a)    reports lodged with ASIC during the financial year under section 50B in relation to reportable situations of the kind mentioned in paragraphs 50A(1)(a) and (b) (breaches and likely breaches of core obligations); and

(b)    reports lodged with APRA during the financial year, as described in subsections 50B(6) and (7), in relation to reportable situations of the kind mentioned in paragraphs 50A(1)(a) and (b) (breaches and likely breaches of core obligations); and

(c)    the entities in relation to which those reports are lodged with ASIC or APRA.

50D(2)    
The information must:

(a)    be published within 4 months after the end of the financial year; and

(b)    be published on ASIC's website; and

(c)    include the information (if any) prescribed by the regulations, which may include personal information (within the meaning of the Privacy Act 1988) in relation to a licensee who is an individual; and

(d)    if the regulations prescribe how the information is to be organised - be organised in accordance with the regulations.

50D(3)    
The regulations may prescribe circumstances in which information need not be included in the information published by ASIC under this section.

50D(4)    
ASIC may correct any error in, or omission from, information published under this section.

SECTION 51   OBLIGATION TO PROVIDE ASIC WITH ASSISTANCE IF REASONABLY REQUESTED  
Requirement to provide assistance

51(1)    

If ASIC, or a person authorised by ASIC, reasonably requests assistance from a licensee in relation to whether the licensee and its representatives are complying with the credit legislation, the licensee must give ASIC or the authorised person the requested assistance.

Civil penalty: 5,000 penalty units.

51(2)    
If the request is in writing, it is not a legislative instrument.

Offence

51(3)    

A person commits an offence if:

(a) the person is subject to a requirement to give ASIC or an authorised person assistance under subsection (1); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

Assistance may include showing ASIC credit books etc.

51(4)    
The assistance referred to in subsection (1) may include showing ASIC the person's credit books or giving ASIC other information.

Subdivision C - Notifying and remediating consumers affected by reportable situations  

SECTION 51A   REPORTING TO CONSUMERS AFFECTED BY A REPORTABLE SITUATION  

Notifying an affected consumer of a reportable situation

51A(1)    
A licensee must take reasonable steps to notify a consumer (the affected consumer ) of a reportable situation in accordance with this section if:

(a)    the licensee, or a representative of the licensee, provides or has provided credit assistance to the affected consumer in relation to a credit contract secured by a mortgage over residential property; and

(b)    the licensee, or the representative of the licensee, is a mortgage broker; and

(c)    there are reasonable grounds to believe that a reportable situation has arisen in relation to the licensee as mentioned in:

(i) paragraph 50A(1)(a) (significant breach of a core obligation); or

(ii) subsection 50A(2) (gross negligence or serious fraud); and

(d)    there are reasonable grounds to suspect that:

(i) the affected consumer has suffered or will suffer loss or damage as a result of the reportable situation; and

(ii) the affected consumer has a legally enforceable right to recover the loss or damage from the licensee.

Civil penalty: 5,000 penalty units.

Form and period for giving notice

51A(2)    
A notice under this section must:

(a)    be given in writing within 30 days after the licensee first knows of, or is reckless with respect to, the circumstances mentioned in paragraphs (1)(a), (b), (c) and (d); and

(b)    if ASIC has approved the form in which the notice must be given:

(i) be in the approved form; and

(ii) include the information, statements, explanations or other matters required by the form; and

(iii) be accompanied by any other material required by the form.

Qualified privilege

51A(3)    
A licensee has qualified privilege in relation to a notice given under this section.

51A(4)    
A licensee who has qualified privilege under subsection (3) in respect of conduct is also not liable for any action based on breach of confidence in relation to that conduct.

SECTION 51B   OBLIGATION TO INVESTIGATE REPORTABLE SITUATIONS THAT MAY AFFECT CONSUMERS  

Obligation to investigate

51B(1)    
A licensee must conduct an investigation into a reportable situation in accordance with this section if:

(a)    the licensee, or a representative of the licensee, has provided credit assistance to a consumer (the affected consumer ) in relation to a credit contract secured by a mortgage over residential property; and

(b)    the licensee, or the representative of the licensee, is a mortgage broker; and

(c)    there are reasonable grounds to believe that a reportable situation has arisen in relation to the licensee as mentioned in:

(i) paragraph 50A(1)(a) (significant breach of a core obligation); or

(ii) subsection 50A(2) (gross negligence or serious fraud); and

(d)    there are reasonable grounds to suspect that:

(i) the affected consumer has suffered or will suffer loss or damage as a result of the reportable situation; and

(ii) the affected consumer has a legally enforceable right to recover the loss or damage from the licensee.

Civil penalty: 5,000 penalty units.

Period within which investigation must be commenced

51B(2)    
The investigation must be commenced within 30 days after the licensee first knows of, or is reckless with respect to, the circumstances mentioned in paragraphs (1)(a), (b), (c) and (d).

Matters to be considered in the investigation

51B(3)    
In conducting the investigation, the licensee must:

(a)    identify the conduct that gave rise to the reportable situation; and

(b)    quantify the loss or damage that there are reasonable grounds to believe:

(i) the affected consumer has suffered or will suffer as a result of the reportable situation; and

(ii) the affected consumer has a legally enforceable right to recover from the licensee; and

(c)    do anything else prescribed by the regulations for the purposes of this paragraph.

Completing the investigation

51B(4)    
The investigation must be completed as soon as is reasonably practicable after it is commenced.

Notifying affected consumer

51B(5)    
The licensee must take reasonable steps to give the affected consumer a notice of the outcome of the investigation:

(a)    in writing within 10 days after the investigation is completed; and

(b)    if ASIC has approved the form in which the notice must be given:

(i) in the approved form; and

(ii) that includes the information, statements, explanations or other matters required by the form; and

(iii) that is accompanied by any other material required by the form.

Civil penalty: 5,000 penalty units.

51B(6)    
A licensee has qualified privilege in relation to a notice given under subsection (5).

51B(7)    
A licensee who has qualified privilege under subsection (6) in respect of conduct is also not liable for any action based on breach of confidence in relation to that conduct.

Compensating the affected consumer for loss or damage

51B(8)    
If, after the investigation is completed, there are reasonable grounds to believe that:

(a)    the affected consumer has suffered or will suffer loss or damage as a result of the reportable situation; and

(b)    the affected consumer has a legally enforceable right to recover the loss or damage from the licensee;

the licensee must take reasonable steps to pay the affected consumer an amount equal to the loss or damage within 30 days after the investigation is completed.

Civil penalty: 5,000 penalty units.

Nothing affects right of affected consumer to pursue legally enforceable rights

51B(9)    
Nothing in this section affects any legally enforceable right of the affected consumer to recover loss or damage that the affected consumer suffers, or will suffer, as a result of a reportable situation.

51B(10)    
However, a court may take into account the amount paid by the licensee under this section when quantifying the amount of compensation (if any) to be paid by the licensee in relation to that loss or damage.

SECTION 51C   OBLIGATION TO KEEP RECORDS OF COMPLIANCE  

Obligation to keep records of compliance

51C(1)    
A licensee must keep records sufficient to enable the licensee's compliance with this Subdivision to be readily ascertained.

51C(2)    
The regulations may specify records that the licensee must keep as part of the obligation in subsection (1).

Offence

51C(3)    
A person commits an offence if:

(a)    the person is subject to a requirement in relation to records under subsection (1); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes subsection (1).

Criminal penalty: 5 years imprisonment.

Subdivision D - Miscellaneous  

SECTION 52   OBLIGATION TO CITE AUSTRALIAN CREDIT LICENCE NUMBER  
When this section applies

52(1)    
This section applies on or after the day that is 2 years after the day section 3 commences.

Requirement to include licence number in documents

52(2)    
Whenever a licensee identifies itself in a document of a kind prescribed by the regulations, the licensee must:

(a) include in the document thelicensee's Australian credit licence number; and

(b) identify in the document that the number is the licensee's Australian credit licence number.

Civil penalty: 5,000 penalty units.

Strict liability offence

52(3)    

A person commits an offence if:

(a) the person is subject to a requirement under subsection (2) to include and identify its Australian credit licence number in a document; and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 20 penalty units.

52(4)    
Subsection (3) is an offence of strict liability.

Note:

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

SECTION 53   OBLIGATION TO LODGE ANNUAL COMPLIANCE CERTIFICATE  
Requirement to lodge annual compliance certificate

53(1)    

A licensee must, no later than 45 days after the licensee's licensing anniversary in each year, lodge a compliance certificate with ASIC in accordance with this section. ASIC may extend the day by giving a written notice to the licensee.

Civil penalty: 5,000 penalty units.

Compliance certificate must be in approved form

53(2)    
The compliance certificate must be in the approved form.

Who must sign compliance certificate

53(3)    
The compliance certificate must be signed by:

(a) if the licensee is a single natural person - the licensee; or

(b) if the licensee is a body corporate - a person of a kind prescribed by the regulations; or

(c) if the licensee is a partnership or the trustees of a trust - a partner or trustee who performs duties in relation to credit activities.

Requirement to ensure compliance certificate is lodged

53(4)    

Each person by whom the compliance certificate may be signed under subsection (3) must ensure that the licensee lodges the compliance certificate with ASIC in accordance with this section.

Civil penalty: 5,000 penalty units.

Strict liability offence

53(5)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1) or (4); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 60 penalty units.

53(6)    
Subsection (5) is an offence of strict liability.

Meaning of licensing anniversary

53(7)    
Licensing anniversary of a licensee means the anniversary of the day on which the licensee's licence came into force under section 42.

SECTION 53A   OBLIGATION TO NOTIFY ASIC OF CHANGE IN CONTROL  

Requirement to notify ASIC of change in control

53A(1)    
If an entity (as defined by section 64A of the Corporations Act 2001) starts to control, or stops controlling, a licensee, the licensee must lodge a notification with ASIC:

(a) in the approved form; and

(b) before the end of 30 business days after the day the entity starts to control, or stops controlling, the licensee.

Strict liability offence

53A(2)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1) to lodge a notification with ASIC; and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 30 penalty units.

53A(3)    
Subsection (2) is an offence of strict liability.

Note:

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

SECTION 53B   OBLIGATION TO NOTIFY ASIC IF LICENSEE DOES NOT ENGAGE IN CREDIT ACTIVITIES  

Requirement to notify ASIC if licensee does not engage in credit activities

53B(1)    
If a licensee does not engage in the credit activities authorised by the licence before the end of 6 months after the licence is granted, the licensee must lodge a notification with ASIC:

(a) in the approved form; and

(b) before the end of 15 business days after the end of the 6 months.

Strict liability offence

53B(2)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1) to lodge a notification with ASIC; and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 30 penalty units.

53B(3)    
Subsection (2) is an offence of strict liability.

Note:

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

SECTION 53C  

53C   KNOWLEDGE AND RECKLESSNESS  

In this Division:

knowledge
has the meaning given by section 5.3 of the Criminal Code.

recklessness
has the meaning given by section 5.4 of the Criminal Code.

Division 6 - When a licence can be suspended, cancelled or varied  

Subdivision A - Suspensions and cancellations  

SECTION 54   SUSPENSION OR CANCELLATION WITHOUT HEARING  

54(1)    
ASIC may suspend or cancel a licensees licence if:

(a)    the licensee lodges with ASIC an application for the suspension or cancellation; or

(b)    

the licensee ceases to engage in credit activities; or

(c)    

any of the matters set out in subsection (2) applies to any of the following persons:

(i) the licensee;

(ii) if the licensee is a body corporate - a director, secretary or senior manager of the body corporate;

(iii) if the licensee is a partnership or the trustees of a trust - a partner or trustee; or

(d)    

in the case of a licensee that is a leviable entity (within the meaning of the ASIC Supervisory Cost Recovery Levy Act 2017) - the following have not been paid in full at least 12 months after the due date for payment:

(i) an amount of levy (if any) payable in respect of the licensee;

(ii) an amount of late payment penalty payable (if any) in relation to the levy;

(iii) an amount of shortfall penalty payable (if any) in relation to the levy; or

(e)    

in the case of a licensee that is liable to pay an instalment of levy (within the meaning of the Financial Services Compensation Scheme of Last Resort Levy (Collection) Act 2023) - the following have not been paid in full at least 12 months after the due date for payment:

(i) the amount of the instalment of levy;

(ii) the amount of any late payment penalty in relation to the instalment of levy;

(iii) the amount of any shortfall penalty payable in relation to the instalment of levy.

54(1A)    

ASIC may cancel a licensee's licence if the licensee does not engage in the credit activities authorised by the licence before the end of 6 months after the licence is granted.

54(1B)    

ASIC must cancel a licensee's licence if:

(a)    the licensee is required to pay an amount to a person in accordance with a relevant AFCA determination (within the meaning of the Corporations Act 2001); and

(b)    the CSLR operator (within the meaning of that Act) has paid, under section 1063 of that Act, an amount of compensation to the person for the relevant AFCA determination.

54(2)    
For the purposes of paragraph (1)(c), the matters are as follows:

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

(b)    if the person is a natural person:

(i) the person is convicted of serious fraud; or

(ii) the person is incapable of managing his or her affairs because of physical or mental incapacity; or

(iii) a prescribed State or Territory order is in force against the person.

54(3)    
An application for suspension or cancellation of a licence must be in the approved form.

SECTION 55   SUSPENSION OR CANCELLATION AFTER OFFERING A HEARING  

55(1)    
ASIC may suspend or cancel a licensee's licence (subject to complying with subsection (4)) if:

(a) the licensee has contravened an obligation under section 47 (which deals with general conduct obligations of licensees); or

(b) ASIC has reason to believe that the licensee is likely to contravene an obligation under that section; or

(c) the requirement in section 37A (fit and proper person test) is not satisfied in relation to the licensee and the licence; or

(d) the application for the licence:

(i) was false in a material particular or materially misleading; or

(ii) omitted a material matter; or

(e) any information, audit report or statement lodged with ASIC in accordance with a request under subsection 37(4) in relation to the application for the licence:

(i) was false in a material particular or materially misleading; or

(ii) omitted a material matter; or

(f) an application made by the licensee under paragraph 45(2)(b) in relation to the licence:

(i) was false in a material particular or materially misleading; or

(ii) omitted a material matter; or

(g) any information, audit report or statement lodged with ASIC in accordance with a request under subsection 46A(3) in relation to an applicationmade by the licensee under paragraph 45(2)(b) in relation to the licence:

(i) was false in a material particular or materially misleading; or

(ii) omitted a material matter.

55(2)-(3)    
(Repealed by No 3 of 2020)

55(4)    
ASIC may only suspend or cancel a licensee's licence under this section after giving the licensee 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.

SECTION 56   SUSPENSION AND CANCELLATION - SPECIAL PROCEDURES FOR APRA-REGULATED BODIES  
Special procedures for APRA-regulated bodies (other than ADIs)

56(1)    
If a licensee, 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 licensee's licence 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 licensee's licence 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

56(2)    
If:

(a) a licensee is an ADI; or

(b) a related body corporate of a licensee is an ADI, and cancellation or suspension of the licensee's licence 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:

(c) subject to paragraph (d), the powers that ASIC would otherwise have under this Division to cancel or suspend the licensee's licence, or to revoke a suspension to which this subsection 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;

(e) ASIC (rather than the Minister) must still conduct any hearing required under paragraph 55(4)(a) and receive any submissions under paragraph 55(4)(b).

Subdivision B - Variations  

SECTION 57  

57   VARYING LICENCES  
ASIC may vary a person's licence to take account of a change in the person's name.

Note:

The conditions on the licence can be varied under section 45.

Subdivision C - Miscellaneous rules about suspensions, cancellations and variations  

SECTION 58   EFFECT OF SUSPENSION  

58(1)   [No effect while suspended]  

A suspended licence has no effect while it remains suspended.

58(2)   [Interpretation]  

Subsection (1) has effect subject to section 62 (which deals with the continued effect of some suspended or cancelled licences).

SECTION 59  

59   REVOCATION OF SUSPENSION  
ASIC may at any time revoke the suspension of a licence.

SECTION 60   DATE OF EFFECT, NOTICE AND PUBLICATION OF VARIATION, CANCELLATION OR SUSPENSION ETC.  

60(1)   [Written notice must be given]  

ASIC must give a licensee written notice of a variation, suspension, revocation of a suspension, or cancellation of the licensee's licence.

60(2)   [In force when written notice given to licensee]  

A variation, suspension, revocation of a suspension, or cancellation of a licence comes into force when the written notice of that action is given to the licensee.

60(3)   [Publication]  

As soon as practicable after the notice is given to the licensee, ASIC must publish a notice of the action on ASIC's website. The notice must state when the action took effect.

SECTION 61  

61   STATEMENT OF REASONS  
A notice of suspension or cancellation given to a licensee must be accompanied by a statement of reasons for the action taken.

SECTION 62   ASIC MAY ALLOW LICENCE TO CONTINUE IN FORCE  

62(1)   [ASIC may include terms in suspension or cancellation of licence]  

If ASIC gives a written notice of suspension or cancellation to a licensee, ASIC may include terms in the notice specifying that the licence continues in force as though the suspension or cancellation had not happened for the purposes of specified provisions of this Act in relation to specified matters, a specified period, or both.

62(2)   [Licence continues in force in accordance with terms]  

If ASIC includes terms in a notice under subsection (1), the licence continues in force in accordance with the terms of the notice.

PART 2-3 - CREDIT REPRESENTATIVES AND OTHER REPRESENTATIVES OF LICENSEES  

Division 1 - Introduction  

SECTION 63   GUIDE TO THIS PART  

Division 2 - Authorisation of credit representatives  

SECTION 64   LICENSEE MAY AUTHORISE CREDIT REPRESENTATIVES  
Authorisation of credit representative by licensee

64(1)    
A licensee may give a person a written notice authorising the person to engage in specified credit activities on behalf of the licensee.

64(2)    
A person who is authorised under subsection (1) is a credit representative of the relevant licensee.

64(3)    
The credit activities specified may be some or all of the credit activities authorised by the licensee's licence.

When authorisation is of no effect

64(4)    
The authorisation:

(a) is of no effect if subsection (5) applies to it when it is given; and

(b) ceases to have effect if and when subsection (5) starts to apply to it after it is given;

to the extent that subsection (5) applies.

64(5)    
This section applies to the authorisation to the extent that it purports to authorise:

(a) a person to engage in a credit activity that is not authorised by the licensee's licence; or

(b) a person to engage in a credit activity, and a banning order or disqualification order under Part 2-4 is in force against the person in relation to the credit activity; or

(c) a person who is not a member of the AFCA scheme; or

(d) a person who is banned from engaging in a credit activity under a law of a State or Territory; or

(e) a natural person who has been convicted, within the last 10 years, of serious fraud; or

(f) a natural person against whom a prescribed State or Territory order is in force; or

(g) a person that is a body corporate, if a prescribed State or Territory order is in force against a director, secretary or senior manager of the body corporate who would perform duties in relation to the credit activities specified in the authorisation; or

(h) a person that is a partnership or the trustees of a trust, if a prescribed State or Territory order is in force against a partner or trustee who would perform duties in relation to the credit activities specified in the authorisation.

SECTION 65   CREDIT REPRESENTATIVE THAT IS A BODY CORPORATE MAY SUB-AUTHORISE NATURAL PERSONS AS CREDIT REPRESENTATIVES  
Authorisation of natural person as credit representative by credit representative that is a body corporate

65(1)    
A body corporate that is a credit representative of a licensee may, in that capacity, give a natural person a written notice authorising that natural person to engage in specified credit activities on behalf of the licensee.

65(2)    
A natural person who is authorised under subsection (1) is a credit representative of the relevant licensee.

65(3)    
The credit activities specified may be some or all of the credit activities authorised by the licensee's licence.

Licensee must give consent to authorisation

65(4)    
The authorisation can only be given if the licensee gives the body corporate its written consent to the authorisation. The licensee may give consent in relation to either a specified natural person or aspecified class of natural persons (the membership of which might change from time to time).

When authorisation is of no effect

65(5)    
The authorisation:

(a) is of no effect if subsection (6) applies to it when it is given; and

(b) ceases to have effect if and when subsection (6) starts to apply to it after it is given;

to the extent that subsection (6) applies.

65(6)    
This subsection applies to the authorisation to the extent that it purports to authorise:

(a) a natural person to engage in a credit activity that is not authorised by the licensee's licence; or

(b) a natural person to engage in a credit activity, and a banning order or disqualification order under Part 2-4 is in force against the natural person in relation to the credit activity; or

(c) a natural person who is not a member of the AFCA scheme; or

(d) a natural person who is banned from engaging in a credit activity under a law of a State or Territory; or

(e) a natural person who has been convicted, within the last 10 years, of serious fraud; or

(f) a natural person against whom a prescribed State or Territory order is in force; or

(g) a natural person in relation to the authorisation of whom the licensee has not given its written consent in accordance with subsection (4).

65(7)    
To avoid doubt, an authorisation under subsection (1) is taken, for the purposes of sections 66 to 72, to be given by the body corporate, not the licensee.

SECTION 66   CREDIT REPRESENTATIVE OF 2 OR MORE LICENSEES  

66(1)   [May be credit representative if consent or licensees related body corporate of each other licensee]  

One person can be the credit representative of 2 or more licensees, but only if:

(a) each of those licensees has consented to the person also being the credit representative of each of the other licensees; or

(b) each of the licensees is a related body corporate of each of the other licensees.

66(2)   [When authorisation has no effect]  

An authorisation:

(a) is of no effect if it contravenes subsection (1) when it is given; and

(b) ceases to have effect if and when it starts to contravene subsection (1) after it is given.

SECTION 67   A PERSON CANNOT BE A CREDIT REPRESENTATIVE IN RELATION TO CREDIT ACTIVITIES AUTHORISED BY A PERSON'S LICENCE  

67(1)   [Authorisation under subsection 64(1) or 65(1)]  

A person must not authorise another person to engage in a credit activity as a credit representative under subsection 64(1) or 65(1) if the other person holds a licence authorising the person to engage in the credit activity.

67(2)   [When authorisation has no effect]  

An authorisation:

(a) is of no effect if it contravenes subsection (1) when it is given; and

(b) ceases to have effect if and when it starts to contravene subsection (1) after it is given.

SECTION 68   VARIATION AND REVOCATION OF AUTHORISATIONS AND SUB-AUTHORISATIONS  
Variation and revocation of authorisations

68(1)    
An authorisation under subsection 64(1) may be varied or revoked at any time by the licensee giving written notice to the credit representative.

Variation and revocation of sub-authorisations

68(2)   [Varied or revoked by written notice from licensee or by body corporate]  

An authorisation under subsection 65(1) may be varied or revoked at any time by:

(a) the licensee in relation to whom the authorisation was given; or

(b) the body corporate that gave the authorisation;

giving written notice to the credit representative.

68(3)   [Written notice under subsection 2 to be given to all parties with power to vary or revoke authorisation]  

If a person varies or revokes an authorisation under subsection (2), that person must give the other person who could have varied or revoked the authorisation written notice of the variation or revocation.

SECTION 69   OBLIGATION NOT TO GIVE AUTHORISATION THAT HAS NO EFFECT  
Requirement not to give authorisation

69(1)    

A person must not purport to authorise a credit representative under subsection 64(1) or 65(1) if, at the time the person first purports to give the authorisation, it is of no effect, to any extent, under this Division.

Civil penalty: 5,000 penalty units.

Offence

69(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

SECTION 70   OBLIGATION TO VARY OR REVOKE AUTHORISATION THAT CEASES TO HAVE EFFECT  
Requirement to vary or revoke authorisation

70(1)    
If a person:

(a) has authorised a credit representative under subsection 64(1) or 65(1); and

(b) becomes aware of a matter because of which the authorisation of the credit representative has ceased to have effect under this Division;

the person must, as soon as practicable:

(c) revoke the authorisation; or

(d) vary the authorisation so that it is no longer, to any extent, of no effect under this Division.

Civil penalty: 5,000 penalty units.

Offence

70(2)    

A person commits an offence if:

(a) the person is required to vary or revoke an authorisation under subsection (1); and

(b) the person engages in conduct; and

(c) the conduct contravenes subsection (1).

Criminal penalty: 2 years imprisonment.

SECTION 71   OBLIGATION TO NOTIFY ASIC ETC. ABOUT CREDIT REPRESENTATIVES  
Requirement to notify ASIC when credit representative authorised

71(1)    

If a person authorises a credit representative under subsection 64(1) or 65(1), the person must, within 15 business days of the authorisation, lodge with ASIC a written notice in accordance with subsection (3).

Civil penalty: 5,000 penalty units.

Requirement to notify licensee of sub-authorisation

71(2)    
If:

(a)    a person authorises a natural person as a credit representative of a licensee under subsection 65(1) (which deals with sub-authorisations); and

(b)    

the consent of the licensee to the authorisation was given in relation to a specified class of natural persons;

then the person must, within 15 business days of the authorisation, give the licensee written notice of the authorisation in accordance with subsection (3).

Civil penalty: 5,000 penalty units.

Details to be included in notice

71(3)    
The notice must include the following details:

(a)    the name and business address of the credit representative;

(b)    details of the authorisation, including the date on which it was made and what the credit representative is authorised to do on behalf of the licensee;

(c)    details of the external dispute resolution scheme of which the credit representative is a member;

(d)    details of each other licensee on behalf of whom the credit representative is a credit representative.

Requirement to notify ASIC of change in details etc.

71(4)    
If:

(a)    a person authorises a credit representative under subsection 64(1) or 65(1); and

(b)    

either:

(i) any of the details that are referred to in subsection (3) in relation to the credit representative changes; or

(ii) the person revokes the authorisation;

then the person must, within 10 business days of the change or revocation, lodge with ASIC a written notice of the change or revocation.

Civil penalty: 5,000 penalty units.

71(5)    
A notice given under subsection (1), (2) or (4) must be in the approved form.

Strict liability offence

71(6)    

A person commits an offence if:

(a)    the person is subject to a requirement to give a notice under subsection (1), (2) or (4); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 60 penalty units.

71(7)    
Subsection (6) is an offence of strict liability.

Note:

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

SECTION 72   CREDIT REPRESENTATIVE NUMBERS  

72(1)    
Within a reasonable period after receiving a notice under subsection 71(1) of the authorisation of a credit representative, ASIC must allocate the credit representative a unique credit representative number.

72(2)    
ASIC must give written notice of the credit representative number to:

(a)    the credit representative; and

(b)    the person who authorised the credit representative.

72(3)    
This section does not apply in relation to a credit representative that has already been allocated a credit representative number.

Division 3 - Information about representatives  

SECTION 73   ASIC MAY GIVE LICENSEE INFORMATION ABOUT REPRESENTATIVES  
ASIC may give licensee information about representatives

73(1)    
If ASIC considers it appropriate to do so, it may give information to a licensee about a person whom ASIC believes is, or will be, a representative of the licensee. However, ASIC may only do so if it believes, on reasonable grounds, that the information is true.

Requirements about use of information

73(2)    
A licensee to whom information is given under subsection (1) may make use of, make a record of, or give to another person, the information for a purpose connected with:

(a)    the licensee making a decision about what action (if any) to take in relation to the representative, as a consequence of receiving the information; or

(b)    the licensee taking action pursuant to such a decision.

73(3)    

A licensee to whom information is given under subsection (1) must not make use of, make a record of, or give to another person, the information other than as permitted by subsection (2).

Civil penalty: 5,000 penalty units.

73(4)    
A person to whom information has been given for a purpose or purposes under subsection (2) or this subsection may make use of, make a record of, or give to another person, that information for that purpose or any of those purposes.

73(5)    

A person to whom information has been given for a purpose or purposes under subsection (2) or (4) must not make use of, make a record of, or give to another person, the information other than as permitted by subsection (4).

Civil penalty: 5,000 penalty units.

Offence

73(6)    

A person commits an offence if:

(a)    the person is subject to a requirement under subsection (3) or (5); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 1 year imprisonment.

Qualified privilege

73(7)    
A person has qualified privilege in relation to an act done by the person under subsection (2) or (4).

Use of information obtained under this section in court

73(8)    
A person to whom information is given in accordance with this section must not give any of the information to a court, or produce in a court a document that sets out some or all of the information, except:

(a)    for a purpose connected with:

(i) a licensee making a decision about what action (if any) to take in relation to the representative, as a consequence of receiving some or all of the information; or

(ii) a licensee taking action pursuant to that decision; or

(iii) proving in proceedings in that court that particular action taken by a licensee in relation to the representative was taken pursuant to that decision; or

(b)    in proceedings in that court, in so far as the proceedings relate to an alleged contravention of this section; or

(c) in proceedings about giving to a court false information some, at least, of which was the information given under this section.

73(9)    
For the purposes of subsection (8), a licensee takes action in relation to a representative if the licensee:

(a)    takes action by way of making, terminating or varying the terms and conditions of an agreement; or

(b)    otherwise takes action in relation to an agreement;

to the extent that the agreement relates to the representative acting on behalf of the licensee.

73(10)    
Subsection (8) also has the effect it would have if:

(a)    

a reference in it to a court were a reference to a court of a country outside Australia; and

(b)    paragraph (8)(b) were omitted.

Division 4 - Liability of licensees for representatives  

SECTION 74  

74   APPLICATION OF THIS DIVISION  
This Division applies to any conduct of a representative of a licensee:

(a) that relates to a credit activity; and

(b) on which a third person (the client ) could reasonably be expected to rely; and

(c) on which the client in fact relied in good faith.

SECTION 75  

75   RESPONSIBILITY IF REPRESENTATIVE OF ONLY ONE LICENSEE  
If the representative is the representative of only one licensee, the licensee is responsible, as between the licensee and the client, for the conduct of the representative, whether or not the representative's conduct is within the authority of the licensee.

SECTION 76   REPRESENTATIVES OF MULTIPLE LICENSEES  
When this section applies

76(1)    
This section applies if the representative is the representative of more than one licensee.

Conduct covered by only one authority

76(2)    
If:

(a) the representative is the representative of one of the licensees only in relation to a particular class of credit activity; and

(b) the conduct relates to that class of credit activity;

that licensee is responsible for the conduct, as between that licensee and the client, whether or not the conduct is within the authority of the licensee.

Conduct covered by multiple authorities

76(3)    
If:

(a) the representative is the representative of more than one of the licensees in relation to a particular class of credit activity; and

(b) the conduct relates to that class of credit activity; and

(c) the conduct is within the authority of:

(i) only one of those licensees (the authorising licensee ); or

(ii) 2 or more of those licensees (the authorising licensees );

then:

(d) if subparagraph (c)(i) applies - the authorising licensee is responsible for the conduct, as between that licensee and the client; or

(e) if subparagraph (c)(ii) applies - the authorising licensees are jointly and severally responsible for the conduct, as between themselves and the client.

All other cases

76(4)    
In any other case, all of the licensees are jointly and severally responsible for the conduct, as between themselves and the client, whether or not the representative's conduct is within the authority of any of them.

SECTION 77  

77   RESPONSIBILITY EXTENDS TO LOSS OR DAMAGE SUFFERED BY CLIENT  
The responsibility of a licensee under this Division extends so as to make the licensee liable to the client in relation to any loss or damage suffered by the client as a result of the representative's conduct.

SECTION 78   EFFECT OF THIS DIVISION  

78(1)   [Remedies against licensee and representative]  

If a licensee is responsible for the conduct of its representative under this Division, the client has the same remedies against the licensee that the client has against the representative.

78(2)   [Joint and several liability]  

The licensee and the representative (along with any other licensees that are also responsible) are all jointly and severally liable to the client in relation to those remedies.

78(3)   [Criminal responsibility or civil liability]  

However, nothing in this Division imposes:

(a) any criminal responsibility; or

(b) any civil liability under a provision of this Act apart from this Division;

on a licensee that would not otherwise be imposed on the licensee.

78(4)   [No relief from liability given to representatives]  

This Division does not relieve a representative of a licensee of any liability that the representative has to the client or the licensee.

78(5)   [Cannot contract out of sections 75, 76 or 77]  

An agreement has no effect in so far as it purports to alter or restrict the operation of section 75, 76 or 77.

78(6)   [Exceptions to subsection 5]  

However, subsection (5) does not apply to the extent that the agreement:

(a) provides for a representative of a licensee to indemnify the licensee for a liability of the licensee in relation to the representative; or

(b) provides for a licensee, for whom a representative acts, to indemnify another licensee for a liability in relation to the representative.

78(7)   [Licensee must not make agreement]  

A licensee must not make, or offer to make, an agreement that has, or would have, no effect under subsection (5).

PART 2-4 - BANNING OR DISQUALIFICATION OF PERSONS FROM ENGAGING IN CREDIT ACTIVITIES  

Division 1 - Introduction  

SECTION 79   GUIDE TO THIS PART  

Division 2 - Banning orders  

SECTION 80   ASIC'S POWER TO MAKE A BANNING ORDER  
Making a banning order

80(1)    

ASIC may, in writing, make one or more orders ( banning orders ) against a person:

(a)    if ASIC suspends or cancels a licence of the person; or

(b)    

if the person becomes insolvent; or

(c)    for a natural person - if the person is convicted of fraud; or

(d)    if the person has:

(i) contravened any credit legislation; or

(ii) been involved in a contravention of a provision of any credit legislation by another person; or

(e)    if ASIC has reason to believe that the person is likely to:

(i) contravene any credit legislation; or

(ii) be involved in a contravention of a provision of any credit legislation by another person; or

(f)    

if ASIC has reason to believe that the person is not a fit and proper person to:

(i) engage in one or more credit activities; or

(ii) perform one or more functions as an officer (within the meaning of the Corporations Act 2001) of another person who engages in credit activities; or

(iii) control another person who engages in credit activities; or

(fa)    

if ASIC has reason to believe that the person is not adequately trained, or is not competent, to:

(i) engage in one or more credit activities; or

(ii) perform one or more functions as an officer (within the meaning of the Corporations Act 2001) of another person who engages in credit activities; or

(iii) control another person who engages in credit activities; or

(fb)    

if the person has, at least twice, been linked to a refusal or failure to give effect to a determination made by AFCA (as defined in section 910C of the Corporations Act 2001) relating to a complaint that relates to:

(i) credit activities; or

(ii) a financial services business (within the meaning of the Corporations Act 2001); or

(fba)    

if all of the following apply:

(i) an individual who holds a licence, a partner in a partnership, a body corporate or a trustee of a trust is required to pay an amount in accordance with a relevant AFCA determination (within the meaning of the Corporations Act 2001);

(ii) the CSLR operator (within the meaning of that Act) has paid, under section 1063 of that Act, an amount of compensation for the relevant AFCA determination;

(iii) at the time the payment is made by the CSLR operator, the person is the individual licensee, a partner in the partnership, an officer (within the meaning of that Act) of the body corporate or the trustee of the trust; or

(fc)    

if subsection (3) applies to the person in relation to 2 or more corporations; or

(g)    if a prescribed State or Territory order is in force against the person; or

(h)    in any other circumstances prescribed by the regulations.

80(1A)    

Subsection (1) has effect subject to subsection (4).

When a person is not a fit and proper person

80(2)    

For the purposes of paragraph (1)(f), ASIC must have regard to the matters in section 37B.

When a person has been an officer of a corporation unable to pay its debts

80(3)    

This subsection applies to a person in relation to a corporation if, within the last 7 years:

(a)    the person was an officer (within the meaning of the Corporations Act 2001) of the corporation when the corporation was:

(i) engaging in credit activities; or

(ii) carrying on a financial services business (within the meaning of the Corporations Act 2001); and

(b)    the corporation was wound up either:

(i) while the person was such an officer of the corporation; or

(ii) within the 12 months after the person ceased to be such an officer of the corporation; and

(c)    a liquidator lodged a report under subsection 533(1) of the Corporations Act 2001 (including that subsection as applied by section 526-35 of the Corporations (Aboriginal and Torres Strait Islander) Act 2006) about the corporation's inability to pay its debts.

Person to be given an opportunity to be heard

80(4)    

Subject to subsection (5), if ASIC has not delegated its power to make a banning order against a person to a Financial Services and Credit Panel, ASIC may make the order only 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.

Note:

If ASIC delegates its power to make a banning order against a person to a Financial Services and Credit Panel, the panel may make the order only after holding a hearing in relation to the proposed order (see section 157 of the ASIC Act).

80(5)    

ASIC may make a banning order against a person without giving the person the opportunities mentioned in subsection (4) if:

(a)    

either:

(i) ASIC has not delegated its power to make the banning order to a Financial Services and Credit Panel; or

(ii) ASIC exercises its power to make the banning order despite such a delegation; and

(b)    subsection (6) or (6A) applies.

Note:

See section 34AB of the Acts Interpretation Act 1901 (effect of delegation).

80(6)    

This subsection applies if:

(a)    

ASIC's grounds for making a banning order against a person include that ASIC has suspended or cancelled a licence of the person (see paragraph (1)(a)); and

(b)    the suspension or cancellation took place without a hearing under section 54.

80(6A)    

This subsection applies if:

(a)    ASIC's grounds for making a banning order against a person include that the person has been convicted of fraud (see paragraph (1)(c)); and

(b)    the person has been convicted of serious fraud.

Copy of banning order to be given to the person

80(7)    

ASIC must give a copy of a banning order to the person against whom it was made.

SECTION 81   WHAT A BANNING ORDER PROHIBITS  

81(1)    

A banning order made against a person may specify that the person is prohibited from doing one or more of the following:

(a) engaging in any credit activities;

(b) engaging in specified credit activities in specified circumstances or capacities;

(c) controlling, whether alone or in concert with one or more other entities (as defined by section 64A of the Corporations Act 2001), another person who engages in credit activities;

(d) performing any function involved in the engaging in of credit activities (including as an officer (within the meaning of the Corporations Act 2001), manager, employee, contractor or in some other capacity);

(e) performing specified functions involved in the engaging in of credit activities.

81(2)    

The banning order may specify that a particular prohibition specified in the order applies against the person:

(a) if the sole ground for the banning order is because paragraph 80(1)(fc) applies - for a specified period of up to 5 years; or

(b) otherwise - either permanently or for a specified period.

Note:

This subsection applies separately to each prohibition specified in the order.

81(3)    
A banning order may include a provision allowing the person against whom it was made, subject to any specified conditions:

(a) to do specified acts; or

(b) to do specified acts in specified circumstances;

that the order would otherwise prohibit them from doing.

81(4)    
A banning order is not a legislative instrument.

SECTION 82   EFFECT OF BANNING ORDERS  
Requirement not to engage in conduct contrary to banning order

82(1)    

A person must not engage in conduct that is contrary to a banning order that is in force against the person.

Civil penalty: 5,000 penalty units.

Offence

82(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 5 years imprisonment.

Note:

A person against whom a banning order is in force cannot be granted a licence authorising the person to engage in a credit activity to which the banning order applies (see subsection 40(1)).

SECTION 83   VARIATION OR CANCELLATION OF BANNING ORDERS  

83(1)   [ASIC may vary or cancel]  

ASIC may vary or cancel a banning order if ASIC is satisfied that it is appropriate to do so because of a change in any of the circumstances based on which ASIC made the order.

83(2)   [ASIC may act on own initiative or on application]  

ASIC may do so:

(a) on its own initiative; or

(b) if the person against whom the order was made lodges with ASIC an application for the variation or cancellation.

83(3)   [Approved form]  

The application must be in the approved form.

83(4)   [When ASIC proposes not to vary or cancel under para (2)(b)]  

If ASIC proposes not to vary or cancel a banning order in accordance with an application given by a person under paragraph (2)(b), ASIC must give 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.

83(5)   [Written notice must be given]  

ASIC must give written notice of the variation or cancellation of a banning order to the person against whom the order was made.

SECTION 84   DATE OF EFFECT, NOTICE AND PUBLICATION OF BANNING ORDER, VARIATION OR CANCELLATION  

84(1)   [When "in force"]  

A banning order comes into force when it is given to the person against whom it is made.

84(2)   [Variation or cancellation in force when written notice given to person]  

A variation or cancellation of a banning order comes into force when written notice of the variation or cancellation is given to the person against whom the order was made.

84(3)   [Publication]  

ASIC must publish a notice on ASIC's website as soon as practicable after making, varying or cancelling a banning order. The notice must state when the banning order, or variation or cancellation of the banning order, came into force and:

(a) in the case of the making of a banning order - set out a copy of the banning order; or

(b) in the case of the variation of a banning order - set out a copy of the banning order as varied.

84(4)   [Summary publication]  

However, if the banning order contains a provision of the kind referred to in subsection 81(3) and ASIC considers that the notice on its website would be unreasonably long if that provision were included, the notice may instead set out a summary of the provision's effect.

SECTION 85   STATEMENT OF REASONS  

85(1)   [Must include statement of reasons]  

A copy of a banning order given to a person must be accompanied by a statement of reasons for the order.

85(2)   [Statement of reasons for variation]  

If ASIC varies a banning order made against a person, ASIC must, on request by the person, give the person a statement of reasons for the variation.

Division 3 - Disqualification by the court  

SECTION 86   DISQUALIFICATION BY THE COURT  

86(1)    

ASIC may apply to the court for one or more orders under subsection (2) in relation to a person if ASIC:

(a) cancels a licence of the person; or

(b) makes a banning order against the person that is to operate permanently.

86(2)    
The court may make:

(a) one or more orders disqualifying the person, permanently or for a specified period, from doing one or more of the following:

(i) engaging in any credit activities;

(ii) engaging in specified credit activities in specified circumstances or capacities;

(iii) controlling, whether alone or in concert with one or more other entities (as defined by section 64A of the Corporations Act 2001), another person who engages in credit activities;

(iv) performing any function involved in the engaging in of credit activities (including as an officer (within the meaning of the Corporations Act 2001), manager, employee, contractor or in some other capacity);

(v) performing specified functions involved in the engaging in of credit activities; or

(b) any other order the court considers appropriate.

Note:

A person against whom a disqualification order is in force cannot be granted a licence authorising the person to engage in a credit activity to which the disqualification order applies (see subsection 40(1))

PART 2-5 - FINANCIAL RECORDS, TRUST ACCOUNTS AND AUDIT REPORTS  

Division 1 - Introduction  

SECTION 87  

87   GUIDE TO THIS PART  

Division 2 - Financial records of licensees  

SECTION 88   OBLIGATION TO KEEP FINANCIAL RECORDS  
Requirement to keep financial records

88(1)    

A licensee must:

(a) keep financial records that correctly record and explain the transactions and financial position of any business of engaging in credit activities carried on by the licensee; and

(b) keep those records in accordance with this Division; and

(c) comply with subsection 90(2) in relation to the conversion of records into the English language; and

(d) comply with section 91 in relation to the location and production of records and particulars.

Civil penalty: 5,000 penalty units.

Meaning of financial records

88(2)    
Financial records includes:

(a) invoices, receipts, orders for the payment of money, bills of exchange, cheques, promissory notes and vouchers; and

(b) documents of prime entry; and

(c) any trust account statement or trust account report required under section 100.

Offence

88(3)    

A person commits an offence if:

(a) the person is subject to a requirement in relation to financial records under subsection (1); and

(b) the person engages in conduct; and

(c) the conduct contravenes subsection (1).

Criminal penalty: 5 years imprisonment.

Financial records may be kept with other records

88(4)    
A licensee does not contravene this Division merely because some or all of the financial records are prepared as a part of, or in conjunction with, the records relating to any other business that is carried on by the licensee.

Note:

For the purposes of subsection (3), a defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

SECTION 89  

89   HOW FINANCIAL RECORDS ARE TO BE KEPT  
The financial records must be kept in a way that:

(a) enables true and fair profit and loss statements, and balance sheets, of the business referred to in paragraph 88(1)(a) to be prepared from time to time; and

(b) allows those statements and balance sheets to be conveniently and properly audited in accordance with the auditing standards (if any) prescribed by regulations made under section 106.

SECTION 90   LANGUAGE OF FINANCIAL RECORDS  

90(1)   [How records are to be kept]  

The financial records must be kept in writing in the English language, or in a manner that enables them to be readily accessible and readily converted into writing in the English language.

90(2)   [If records are not kept in writing in the English language]  

If any of the financial records are not kept in writing in the English language, the licensee must, if required to convert the financial records concerned into writing in the English language by a person who is entitled to examine the financial records concerned, comply with the requirement within a reasonable time.

SECTION 91  

91   LOCATION OF FINANCIAL RECORDS  
If any of the financial records are kept outside this jurisdiction, the licensee must:

(a) cause to be sent to and retained at a place in this jurisdiction such particulars in relation to the business dealt with in those financial records as will enable true and fair profit and loss statements and balance sheets to be prepared; and

(b) if required by ASIC to produce those financial records at a place in this jurisdiction, comply with the requirement not later than 28 days after the requirement is made.

SECTION 92  

92   INFORMATION TO BE SHOWN IN FINANCIAL RECORDS  
The financial records must be kept in sufficient detail to show particulars of:

(a) all money received or paid by the licensee; and

(b) for each credit contract under which the licensee is the credit provider:

(i) the amount and day of all payments made by or on behalf of the debtor under the credit contract; and

(ii) all amounts (including principal, interest, fees and charges) owed by the debtor under the credit contract; and

(c) for each consumer lease under which the licensee is the lessor - the amount and day of all payments made by or on behalf of the lessee under the consumer lease; and

(d) for each guarantee under which the licensee is the beneficiary of the guarantee - the amount and day of all payments made by or on behalf of the guarantor under the guarantee; and

(e) all income received by the licensee from indirect remuneration, interest, and other sources, and all expenses, indirect remuneration, and interest paid by the licensee; and

(f) all the assets and liabilities (including contingent liabilities) of the licensee; and

(g) any other matters prescribed by the regulations.

SECTION 93  

93   REGULATIONS MAY IMPOSE ADDITIONAL REQUIREMENTS  
The regulations may impose additional requirements to be complied with in relation to the financial records including, for example:

(a) requirements for things to be contained in the records; and

(b) requirements relating to the level of detail to be shown in the records.

SECTION 94  

94   FINANCIAL RECORDS TAKEN TO BE MADE WITH LICENSEE'S AUTHORITY  
An entry in the records is, unless the contrary is proved, to be taken to have been made by, or with the authority of, the licensee.

SECTION 95   OBLIGATION TO RETAIN FINANCIAL RECORDS FOR 7 YEARS  
Requirement to retain financial records

95(1)    

A licensee that is required by this Division to make a financial record must retain it for 7 years after the transactions covered by the record are completed.

Civil penalty: 5,000 penalty units.

Regulations

95(2)    
The regulations may prescribe financial records to which subsection (1) does not apply.

Records to be kept even if person stops carrying on business

95(3)    
Financial records must be retained in accordance with this section, even if the person stops carrying on any business to which they relate.

Offence

95(4)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

SECTION 96   FINANCIAL RECORDS ARE PRIMA FACIE EVIDENCE OF MATTERS  

96(1)   [Financial records prima facie evidence]  

In proceedings in a court, a financial record kept under this Division is admissible as prima facie evidence of any matter in the financial record.

96(2)   [Presumed financial record unless contrary is proved]  

A document purporting to be a financial record kept by a licensee under this Division is, unless the contrary is proved, presumed to be a financial record kept by the licensee under this Division.

96(3)   [Electronic records]  

If:

(a) because of subsection (1) a financial record is prima facie evidence of a matter; and

(b) the financial record, or a part of the financial, is kept or prepared by recording or storing matters (including that matter) by means of a mechanical, electronic or other device;

a written reproduction of that matter as so recorded or stored is admissible as prima facie evidence of that matter in a proceeding in a court.

96(4)   [Written reproduction of electronic records]  

A written document that purports to reproduce a matter recorded or stored by means of a mechanical, electronic or other device is, unless the contrary is proved, presumed to be a reproduction of that matter.

Division 3 - Trust accounts of credit service licensees  

SECTION 97  

97   APPLICATION OF THIS DIVISION  
This Division applies to a licensee (the credit service licensee ) that:

(a) holds a licence that authorises the licensee to provide a credit service; and

(b) in the course of providing the credit service, receives money on behalf of another person.

SECTION 98   OBLIGATION FOR CREDIT SERVICE LICENSEES TO MAINTAIN TRUST ACCOUNT  
Requirement to maintain trust account

98(1)    

The credit service licensee must maintain one more trust accounts (the trust account ) in accordance with this section.

Civil penalty: 5,000 penalty units.

Requirements for trust accounts

98(2)    
The trust account must be maintained with an Australian ADI (within the meaning of section 9 of the Corporations Act 2001).

98(3)    
The trust account must be designated as the credit service licensee's trust account.

Offence

98(4)    

The credit service licensee commits an offence if:

(a) the credit service licensee is subject to a requirement under subsection (1); and

(b) the credit service licensee engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

SECTION 99   OBLIGATIONS IN RELATION TO TRUST ACCOUNT MONEY  
Requirement to pay money to credit of trust account

99(1)    

The credit service licensee must pay to the credit of the trust account any money received by the credit service licensee on behalf of another person in relation to the credit service provided by the licensee.

Civil penalty: 5,000 penalty units.

Requirement in relation to withdrawal of money from trust account

99(2)    

The credit service licensee must not withdraw any money paid into the trust account, other than for the purpose of paying the money in accordance with subsection (3).

Civil penalty: 5,000 penalty units.

Requirement in relation to payment of money from trust account

99(3)    

The credit service licensee must pay any money withdrawn from the trust account to the person or persons lawfully entitled to receive that money.

Civil penalty: 5,000 penalty units.

Offence

99(4)    

The credit service licensee commits an offence if:

(a) the credit service licensee is subject to a requirement under subsection (1), (2) or (3); and

(b) the credit service licensee engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

Trust account money not available for payment of debts etc.

99(5)    
Money paid into a trust account by the credit service licensee under this section:

(a) is not available for the payment of a debt of any other creditor of the credit service licensee; and

(b) is not liable to be attached or taken in execution under the order or process of a court at the instance of any such creditors.

SECTION 100   OBLIGATION TO LODGE TRUST ACCOUNT STATEMENT AND TRUST ACCOUNT AUDIT REPORT  
Requirement to prepare and lodge trust account statement

100(1)    
The credit service licensee must, for each financial year of the credit service licensee:

(a) prepare a written statement in relation to the trust account (the trust account statement ) in accordance with this section; and

(b) lodge the trust account statement with ASIC in accordance with this section.

Civil penalty: 5,000 penalty units.

Requirement to prepare and lodge trust account audit report

100(2)    

The credit service licensee must, with the trust account statement, lodge with ASIC an auditor's report (the trust account audit report ) in accordance with this section.

Civil penalty: 5,000 penalty units.

Requirements for statement and audit report

100(3)    
Each of the trust account statement and trust account audit report must:

(a) be in the approved form; and

(b) contain the information and matters prescribed by the regulations; and

(c) be lodged with ASIC in accordance with section 101.

100(4)    
The trust account audit report must be prepared by a person who complies with any eligibility requirements prescribed by the regulations.

Offence

100(5)    

The credit service licensee commits an offence if:

(a) the credit service licensee is subject to a requirement under subsection (1) or (2); and

(b) the credit service licensee engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 5 years imprisonment.

Meaning of financial year

100(6)    
A financial year of the credit service licensee means:

(a) if the credit service licensee is a body corporate to which section 323D of the Corporations Act 2001 applies - a financial year of the body corporate (within the meaning of that section); and

(b) in any other case - a year ending on 30 June.

SECTION 101   TIME OF LODGMENT OF TRUST ACCOUNT STATEMENT AND TRUST ACCOUNT AUDIT REPORT  

101(1)   [Time for lodgment]  

Unless an extension is granted under subsection (3), the trust account statement and trust account audit report must be lodged with ASIC before the day that is 3 months after the end of the financial year of the credit service licensee to which they relate.

101(2)   [Time for lodgment where extension granted]  

If an extension is granted under subsection (3), the trust account statement and trust account audit report must be lodged with ASIC before the end of the extended period.

101(3)   [Application for approval of an extension]  

ASIC may, on application made:

(a) by the credit service licensee and the auditor that is to prepare the trust account audit report; and

(b) before the end of the period that would otherwise apply;

approve an extension of the period for lodging the trust account statement and trust account audit report. The extension may be of the period originally applicable or the period applicable under a previous extension.

101(4)   [Approval subject to conditions]  

An approval may be given subject to any conditions imposed by ASIC.

101(5)   [Must comply with conditions]  

If an approval is given subject to conditions, the licensee must comply with those conditions.

Division 4 - Matters relating to audit reports  

SECTION 102   AUDITOR'S RIGHT OF ACCESS TO RECORDS, INFORMATION ETC.  
Auditor is entitled to access and assistance etc. from licensee

102(1)    
An auditor (the auditor ) who prepares one of the following audit reports (the audit report ):

(a) an audit report required under subsection 49(3) in relation to a licensee;

(b) a trust account audit report required under subsection 100(2) in relation to a licensee;

has a right of access at all reasonable times to the financial records or other credit books of the licensee for purposes relating to the audit report.

102(2)    
The auditor is entitled to require:

(a) from the licensee; or

(b) if the licensee is a body corporate - from any director, secretary or senior manager of the licensee;

any assistance and explanations that the auditor desires for purposes relating to the audit report.

Requirement to give auditor access and assistance etc

102(3)    
The licensee, or a director, secretary or senior manager of the licensee if it is a body corporate, must not:

(a) refuse or fail to allow the auditor access, in accordance with subsection (1), to financial records or other credit books of the licensee; or

(b) refuse or fail to give assistance, or an explanation, to the auditor as and when required under subsection (2); or

(c) otherwise hinder, obstruct or delay the auditor in the performance or exercise of the auditor's duties or powers.

Civil penalty: 5,000 penalty units.

Offence

102(4)    

A person commits an offence if:

(a) the person is subject to a requirement under subsection (3); and

(b) the person engages in conduct; and

(c) the person's conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

SECTION 103   AUDITOR'S FEES AND EXPENSES  

103(1)   [Fees payable by licensee]  

The reasonable fees and expenses of the auditor for preparing the audit report are payable by the licensee.

103(2)   [Fees recoverable by action]  

The auditor may recover those fees by action against the licensee.

SECTION 104   AUDITOR TO REPORT ON CERTAIN MATTERS  
Requirement for auditor to disclose matters

104(1)    
If the auditor, in the performance of duties relating to the audit report, becomes aware of a matter referred to in subsection (2), the auditor must, within 7 days after becoming aware of the matter:

(a) lodge a written report on the matter with ASIC; and

(b) give a copy of the report to the licensee.

Civil penalty: 5,000 penalty units.

Matters that must be disclosed

104(2)    
A report must be given in relation to any matter that, in the opinion of the auditor:

(a) has adversely affected, is adversely affecting or may adversely affect the ability of the licensee to meet the licensee's obligations as a licensee; or

(b) constitutes or may constitute a contravention of:

(i) Division 2 or 3 (or regulations made under those Divisions); or

(ii) a condition of the licensee's licence; or

(c) constitutes an attempt to unduly influence, coerce, manipulate or mislead the auditor in the preparation of the audit report.

Offence

104(3)    

The auditor commits an offence if:

(a) the auditor is subject to a requirement under subsection (1); and

(b) the auditor engages in conduct; and

(c) the auditor's conduct contravenes the requirement.

Criminal penalty: 1 year imprisonment.

SECTION 105   QUALIFIED PRIVILEGE FOR AUDITOR ETC.  
Qualified privilege for auditor

105(1)    
The auditor has qualified privilege in relation to:

(a) a statement that the auditor makes, orally or in writing, in the course of its duties relating to the audit report; or

(b) the lodging of a report with ASIC under subsection 104(1); or

(c) the giving of a report to the licensee under subsection 104(1).

Note:

If the auditor is a company, the company has qualified privilege under this subsection in relation to statements made, and reports lodged or sent, by natural persons on behalf of the company if those statements and notices can be properly attributed to the company.

Qualified privilege for registered company auditor acting on behalf of company

105(2)    
If the auditor is a company registered under the Corporations Act 2001, a registered company auditor acting on behalf of the company has qualified privilege in relation to:

(a) a statement that the registered company auditor makes (orally or in writing) in the course of the performance, on behalf of the company, of the company's duties relating to the audit report; or

(b) the lodging by the registered company auditor, on behalf of the company, of a report with ASIC under subsection 104(1); or

(c) the giving by the registered company auditor, on behalf of the company, of a report to the licensee under subsection 104(1).

Qualified privilege for subsequent publication

105(3)   [Documents published by auditor]  

A person has qualified privilege in relation to the publishing of a document prepared by the auditor in the course of the auditor's duties relating to the audit report.

105(4)   [Published statements]  

A person has qualified privilege in relation to the publishing of a statement:

(a) made by the auditor as referred to in subsection (1); or

(b) made by a registered company auditor as referred to in subsection (2).

SECTION 106  

106   REGULATIONS IN RELATION TO AUDIT REPORTS ETC.  
The regulations may make provision in relation to:

(a) the audit reports referred to in subsection 102(1); and

(b) audit reports that persons who have applied for a licence may be requested to lodge under subsection 37(4) or 46A(3); and

(c) the auditors that prepare those reports; and

(d) auditing standards that must be complied with in relation to those reports.

PART 2-6 - EXEMPTIONS AND MODIFICATIONS RELATING TO THIS CHAPTER  

Division 1 - Introduction  

SECTION 107  

107   GUIDE TO THIS PART  

Division 2 - Exemptions and modifications relating to this Chapter  

SECTION 108  

108   PROVISIONS TO WHICH THIS PART APPLIES  
The provisions to which this Part applies are:

(a) this Chapter; and

(b) definitions in this Act, as they apply to references in this Chapter; and

(c) instruments made for the purposes of this Chapter.

SECTION 109   EXEMPTIONS AND MODIFICATIONS BY ASIC  
Exemptions and modifications

109(1)    
ASIC may:

(a) exempt:

(i) a person; or

(ii) a person and all of the person's credit representatives;

from all or specified provisions to which this Part applies; or

(b) exempt a credit activity that is engaged in in relation to a specified credit contract, mortgage, guarantee or consumer lease from all or specified provisions to which this Part applies; or

(c) declare that provisions to which this Part applies apply in 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.

109(2)    
An exemption or declaration under subsection (1) is not a legislative instrument.

109(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

(c) exempt a class of credit activities from all or specified 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

109(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

109(5)    
An exemption or declaration under subsection (1) must be in writing and ASIC must publish notice of it on its website.

Special rules in relation to offences

109(6)    

If conduct (including an omission) 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 Legislation Act 2003 if the declaration is made under subsection (3)).

109(7)    
In a prosecution for an offence to which subsection (6) applies, the prosecution must prove that paragraph (6)(a) or (b) was complied with before the conduct occurred.

SECTION 110   EXEMPTIONS AND MODIFICATIONS BY THE REGULATIONS  

110(1)    
The regulations may:

(a) exempt a person or class of persons from all or specified provisions to which this Part applies; or

(b) exempt a credit activity or a class of credit activities from all or specified provisions to which this Part applies; or

(c) provide that the provisions to which this Part applies apply as if specified provisions were omitted, modified or varied as specified in the regulations.

110(2)    

An exemption that:

(a) is made for the purposes of paragraph (1)(a); and

(b) exempts a person or class of persons from subsection 29(1) to enable testing of particular credit activities;

may apply unconditionally or subject to specified conditions.

110(3)    

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.

110(4)    

An exemption described in subsection (2) may empower ASIC to make decisions relating to how the exemption starts or ceases to apply to a person or class of persons.

CHAPTER 3 - RESPONSIBLE LENDING CONDUCT  

PART 3-1 - LICENSEES THAT PROVIDE CREDIT ASSISTANCE IN RELATION TO CREDIT CONTRACTS  

Division 1 - Introduction  

SECTION 111   GUIDE TO THIS PART  

SECTION 112  

112   APPLICATION OF THIS PART  
This Part does not apply in relation to credit assistance provided by a licensee in relation to a credit contract if the licensee is or will be the credit provider under the contract.

Division 2 - Credit guide of credit assistance providers  

SECTION 113   CREDIT GUIDE OF CREDIT ASSISTANCE PROVIDERS  
Requirement to give credit guide

113(1)    

A licensee must, as soon as practicable after it becomes apparent to the licensee that it is likely to provide credit assistance to a consumer in relation to a credit contract, give the consumer the licensee's credit guide in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

113(2)    
The licensee's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the licensee's name and contact details; and

(d) specify the licensee's Australian credit licence number; and

(e) give information about:

(i) any fees that are payable by a consumer to the licensee for the licensee's credit assistance; and

(ii) any charges that are payable by a consumer to the licensee for matters associated with providing the credit assistance; and

(iii) the method for working out the amount of the fees and charges; and

(f) give information about:

(i) if there are 6 or fewer credit providers that the licensee conducts business with when providing credit assistance in relation to credit contracts - the names of those credit providers; and

(ii) if there are more than 6 credit providers that the licensee conducts business with when providing credit assistance in relation to credit contracts - the names of the 6 credit providers with whom the licensee reasonably believes it conducts the most business; and

(g) give information about:

(i) any indirect remuneration that the licensee, or an employee, director or credit representative of the licensee, is likely to receive, directly or indirectly, from credit providers in relation to credit contracts for which the licensee has provided credit assistance; and

(ii) a reasonable estimate of the amounts of that indirect remuneration or the range of those amounts; and

(iii) the method for working out those amounts; and

(h) give information about the licensee's procedure for resolving disputes with a consumer, including contact details for a consumer to access:

(i) the licensee's internal dispute resolution procedure; and

(ii) the AFCA scheme; and

(i) give information about the licensee's obligations under sections 120 and 123; and

(j) comply with any other requirements prescribed by the regulations.

113(3)    
The regulations may prescribe:

(a) information that need not be included in the credit guide, despite subsection (2); and

(b) for the purposes of paragraph (2)(g):

(i) the method for working out amounts of indirect remuneration; and

(ii) how indirect remuneration or amounts of indirect remuneration must be described.

Manner of giving credit guide

113(4)    
The licensee must give the consumer the licensee's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

113(5)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

113(6)    
Subsection (5) is an offence of strict liability.

Note:

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

Division 3 - Quote for providing credit assistance etc. in relation to credit contracts  

SECTION 114   QUOTE FOR PROVIDING CREDIT ASSISTANCE ETC.  
Requirement to give quote

114(1)    
A licensee must not provide credit assistance to a consumer by:

(a) suggesting that the consumer apply, or assisting the consumer to apply, for a particular credit contract with a particular credit provider; or

(b) suggesting that the consumer apply, or assisting the consumer to apply, for an increase to the credit limit of a particular credit contract with a particular credit provider; or

(c) suggesting that the consumer remain in a particular credit contract with a particular credit provider;

unless:

(d) the licensee has given the consumer a quote in accordance with subsection (2); and

(e) the consumer has signed and dated that quote or otherwise indicated the consumer's acceptance of it (and the day that happens) in the manner (if any) prescribed by the regulations; and

(f) the licensee has given the consumer a copy of the accepted quote.

Civil penalty: 5,000 penalty units.

114(2)    
The quote must:

(a) be in writing; and

(b) give information about the credit assistance and other services that the quote covers; and

(c) specify the maximum amount that will be payable by the consumer to the licensee in relation to the licensee's credit assistance and other services; and

(d) give information about what that amount relates to, including:

(i) the maximum amount of the licensee's fee for providing the credit assistance and other services; and

(ii) the maximum amount of charges that will be incurred by the licensee for matters associated with providing the credit assistance and other services; and

(iii) the maximum amount of fees or charges that will be payable by the licensee to another person on the consumer's behalf; and

(e) state whether the maximum amount or any other amount will be payable by the consumer to the licensee if a credit contract is not entered or a credit limit is not increased; and

(f) comply with any other requirements prescribed by the regulations.

Manner of giving quote

114(3)    
The licensee must give the quote to the consumer in the manner (if any) prescribed by the regulations.

No demanding payment of amount exceeding quoted amount

114(4)    

The licensee must not request or demand payment of an amount that exceeds the maximum amount set out in the quote.

Civil penalty: 5,000 penalty units.

No demanding payment before credit assistance provided

114(5)    

The licensee must not request or demand payment of an amount for the licensee's credit assistance before the licensee provides the assistance.

Civil penalty: 5,000 penalty units.

Caveats

114(6)    

The licensee must not lodge, or threaten to lodge, a caveat in relation to land to induce the consumer to pay an amount to the licensee for the licensee's credit assistance or other services.

Civil penalty: 5,000 penalty units.

Division 4 - Obligations of credit assistance providers before providing credit assistance for credit contracts  

SECTION 115   OBLIGATIONS OF CREDIT ASSISTANCE PROVIDERS BEFORE PROVIDING CREDIT ASSISTANCE FOR CREDIT CONTRACTS  

115(1)    
A licensee must not provide credit assistance to a consumer on a day (the assistance day ) by:

(a) suggesting that the consumer apply, or assisting the consumer to apply, for a particular credit contract with a particular credit provider; or

(b) suggesting that the consumer apply, or assisting the consumer to apply, for an increase to the credit limit of a particular credit contract with a particular credit provider;

unless the licensee has, within 90 days (or other period prescribed by the regulations) before the assistance day:

(c) made a preliminary assessment that:

(i) is in accordance with subsection 116(1); and

(ii) covers the period proposed forthe entering of the contract or the increase of the credit limit; and

(d) made the inquiries and verification in accordance with section 117.

Civil penalty: 5,000 penalty units.

115(2)    
A licensee must not provide credit assistance to a consumer on a day (the assistance day ) by suggesting that the consumer remain in a particular credit contract with a particular credit provider unless the licensee has, within 90 days (or other period prescribed by the regulations) before the assistance day:

(a) made a preliminary assessment that:

(i) is in accordance with subsection 116(2); and

(ii) covers a period in which the assistance day occurs; and

(b) made the inquiries and verification in accordance with section 117.

Civil penalty: 5,000 penalty units.

SECTION 116   PRELIMINARY ASSESSMENT OF UNSUITABILITY OF THE CREDIT CONTRACT  

116(1)   [Preliminary assessment for para 115(1)(c)]  

For the purposes of paragraph 115(1)(c), the licensee must make a preliminary assessment that:

(a) specifies the period the assessment covers; and

(b) assesses whether the credit contract will be unsuitable for the consumer if the contract is entered or the credit limit is increased in that period.

116(2)   [Preliminary assessment for para 115(2)(a)]  

For the purposes of paragraph 115(2)(a), the licensee must make a preliminary assessment that:

(a) specifies the period the assessment covers; and

(b) assesses whether the credit contract will be unsuitable for the consumer if the consumer remains in the contract in that period.

Note:

The licensee is not required to make a preliminary assessment under this section if the credit assistance is not provided.

SECTION 117   REASONABLE INQUIRIES ETC. ABOUT THE CONSUMER  

117(1)    
For the purposes of paragraph 115(1)(d) or 115(2)(b), the licensee must, before making the preliminary assessment:

(a)    make reasonable inquiries about the consumer's requirements and objectives in relation to the credit contract; and

(b)    make reasonable inquiries about the consumer's financial situation; and

(c)    take reasonable steps to verify the consumer's financial situation; and

(d)    make any inquiries prescribed by the regulations about any matter prescribed by the regulations; and

(e)    

take any steps prescribed by the regulations to verify any matter prescribed by the regulations.

Civil penalty: 5,000 penalty units.

117(1A)    

If:

(a)    the credit contract is a small amount credit contract; and

(b)    the consumer holds (whether alone or jointly with another person) an account with an ADI into which income payable to the consumer is credited;

the licensee must, in verifying the consumer's financial situation for the purposes of paragraph 115(1)(d), obtain and consider information about each transaction on the account, and the balances of the account, during at least the immediately preceding period of 90 days.

117(1B)    
Subsection (1A) does not limit paragraph (1)(c) of this section.

117(2)    
The regulations may prescribe particular inquiries or steps that must be made or taken, or do not need to be made or taken, for the purposes of paragraph (1)(a), (b) or (c).

SECTION 118   WHEN THE CREDIT CONTRACT MUST BE ASSESSED AS UNSUITABLE - ENTERING CONTRACT OR INCREASING THE CREDIT LIMIT  
Requirement to assess the contract as unsuitable

118(1)    

For a preliminary assessment under subsection 116(1) about entering a credit contract or increasing a credit limit of a credit contract, the licensee must assess that the contract will be unsuitable for the consumer if the contract will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

Note:

Even if the contract will not be unsuitable for the consumer under subsection (2), the licensee may still assess that the contract will be unsuitable for other reasons.

Particular circumstances when the contract will be unsuitable

118(2)    
The contract will be unsuitable for the consumer if, at the time of the preliminary assessment, it is likely that:

(a)    the consumer will be unable to comply with the consumer's financial obligations under the contract, or could only comply with substantial hardship, or

(b)    the contract will not meet the consumer's requirements or objectives; or

(c)    if the regulations prescribe circumstances in which a credit contract is unsuitable - those circumstances will apply to the contract;

if the contract is entered in the period proposed for it to be entered or the credit limit is increased in the period proposed for it to be increased.

118(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the contract by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

118(3AA)    

For the purposes of paragraph (2)(a), a consumer is taken to be able to comply with the consumer's financial obligations under a contract only with substantial hardship if:

(a)    the contract is a credit card contract; and

(b)    the consumer could not comply with an obligation to repay an amount equal to the credit limit of the contract within the period determined by ASIC under section 160F.

118(3A)    
(Repealed by No 87 of 2022)

Information to be used to determine if contract will be unsuitable

118(4)    
For the purposes of determining under subsection (2) whether the contract will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a)    the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 117(1)(d) or (e);

(b)    at the time of the preliminary assessment:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 117.

SECTION 119   WHEN THE CREDIT CONTRACT MUST BE ASSESSED AS UNSUITABLE - REMAINING IN CREDIT CONTRACT  
Requirement to assess the contract as unsuitable

119(1)    

For a preliminary assessment under subsection 116(2) about remaining in a credit contract, the licensee must assess that the contract will be unsuitable for the consumer if the contract will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

Note:

Even if the contract will not be unsuitable for the consumer under subsection (2), the licensee may still assess that the contract will be unsuitable for other reasons.

Particular circumstances when the contract will be unsuitable

119(2)    
The contract will be unsuitable for the consumer if, at the time of the preliminary assessment, it is likely that:

(a) the consumer will be unable to comply with the consumer's financial obligations under the contract, or could only comply with substantial hardship, if the consumer remains in the contract in the period covered by the preliminary assessment; or

(b) the contract will not meet the consumer's requirements or objectives if the consumer remains in the contract in the period covered by the preliminary assessment; or

(c) if the regulations prescribe circumstances in which a credit contract is unsuitable - those circumstances will apply to the contract if the consumer remains in the contract in the period covered by the preliminary assessment.

119(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the contract by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

119(3A)    

For the purposes of paragraph (2)(a), a consumer is taken to be able to comply with the consumer's financial obligations under a contract only with substantial hardship if:

(a) the contract is a credit card contract; and

(b) the consumer could not comply with an obligation to repay an amount equal to the credit limit of the contract within the period determined by ASIC under section 160F.

Information to be used to determine if contract will be unsuitable

119(4)    
For the purposes of determining under subsection (2) whether the contract will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 117(1)(d) or (e);

(b) at the time of the preliminary assessment:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 117.

SECTION 120   PROVIDING THE CONSUMER WITH THE PRELIMINARY ASSESSMENT  
Requirement to give assessment if requested

120(1)    
If the consumer requests the licensee for a copy of the preliminary assessment within 7 years of the date of the credit assistance quote under section 114, the licensee must give the consumer a written copy of the assessment:

(a) if the request is made within 2 years of the quote - before the end of 7 business days after the day the licensee receives the request; and

(b) otherwise - before the end of 21 business days after the day the licensee receives the request.

Note:

The licensee is not required to give the consumer a copy of the preliminary assessment if the licensee does not provide credit assistance to the consumer.

Civil penalty: 5,000 penalty units.

Manner of giving assessment

120(2)    
The licensee must give the consumer the copy of the assessment in the manner (if any) prescribed by the regulations.

No payment for assessment

120(3)    

The licensee must not request or demand payment of an amount for giving the consumer a copy of the preliminary assessment.

Civil penalty: 5,000 penalty units.

Strict liability offence

120(4)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1) or (3); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

120(5)    
Subsection (4) is an offence of strict liability.

Note:

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

Division 5 - Fees, indirect remuneration etc. relating to credit contracts  

SECTION 121   FEES, INDIRECT REMUNERATION ETC. RELATING TO CREDIT CONTRACTS  
Requirement for disclosure

121(1)    
A licensee must, at the same time as providing credit assistance to a consumer by:

(a) suggesting that the consumer apply, or assisting the consumer to apply, for a particular credit contract with a particular credit provider; or

(b) suggesting that the consumer apply, or assisting the consumer to apply, for an increase to the credit limit of a particular credit contract with a particular credit provider; or

(c) suggesting that the consumer remain in a particular credit contract with a particular credit provider;

give the consumer a credit proposal disclosure document in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

121(2)    
The credit proposal disclosure document must contain the following:

(a) the total amount of any fees or charges that the consumer is liable to pay to the licensee in relation to the credit contract and the method used for working out that amount;

(b) a reasonable estimate of the total amount of any indirect remuneration that the licensee, or an employee, director or credit representative of the licensee, is likely to receive in relation to the credit contract and the method used for working out that amount;

(c) a reasonable estimate of the total amount of any fees or charges that the consumer is likely to be liable to pay to the credit provider in relation to applying for the credit contract;

(d) a reasonable estimate of the total amount of any fees or charges that the consumer is likely to be liable to pay to any other person in relation to applying for the credit contract;

(e) if the credit is to be applied to pay any of the amounts in the above paragraphs - a reasonable estimate of the likely amount of credit that will be available to the consumer after payments under paragraphs (a), (c) and (d) are made.

121(3)    
For the purposes of paragraph (2)(b), the regulations may prescribe:

(a) the method for working out amounts of indirect remuneration; and

(b) how amounts of indirect remuneration must be described.

Manner of giving credit proposal disclosure document

121(4)    
The licensee must give the credit proposal disclosure document to the consumer in the manner (if any) prescribed by the regulations.

SECTION 122   NO PROFITING FROM FEES ETC. PAID TO THIRD PARTIES  
Requirement not to profit

122(1)    

If, in the course of providing credit assistance to a consumer in relation to a credit contract, a licensee pays an amount (the third party amount ) to another person on behalf of the consumer, the licensee must not request or demand payment of an amount, as reimbursement for the third party amount, that exceeds the third party amount.

Civil penalty: 5,000 penalty units.

Offence

122(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

Division 6 - Prohibition on suggesting, or assisting with, unsuitable credit contracts  

SECTION 123   PROHIBITION ON SUGGESTING OR ASSISTING CONSUMERS TO ENTER, OR INCREASE THE CREDIT LIMIT UNDER, UNSUITABLE CREDIT CONTRACTS  
Prohibition on suggesting, or assisting with, unsuitable contracts

123(1)    
A licensee must not provide credit assistance to a consumer by:

(a)    suggesting that the consumer apply, or assisting the consumer to apply, for a particular credit contract with a particular credit provider; or

(b)    

suggesting that the consumer apply, or assisting the consumer to apply, for an increase to the credit limit of a particular credit contract with a particular credit provider;

if the contract will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the contract will be unsuitable

123(2)    
The contract will be unsuitable for the consumer if, at the time the licensee provides the credit assistance, it is likely that:

(a)    the consumer will be unable to comply with the consumer's financial obligations under the contract, or could only comply with substantial hardship; or

(b)    the contract will not meet the consumer's requirements or objectives; or

(c)    if the regulations prescribe circumstances in which a credit contract is unsuitable - those circumstances will apply to the contract;

if the contract is entered in the period proposed for it to be entered or the credit limit is increased in the period proposed for it to be increased.

123(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the contract by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

123(3AA)    

For the purposes of paragraph (2)(a), a consumer is taken to be able to comply with the consumer's financial obligations under a contract only with substantial hardship if:

(a)    the contract is a credit card contract; and

(b)    the consumer could not comply with an obligation to repay an amount equal to the credit limit of the contract within the period determined by ASIC under section 160F.

123(3A)    
(Repealed by No 87 of 2022)

Information to be used to determine if contract will be unsuitable

123(4)    
For the purposes of determining under subsection (2) whether the contract will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a)    the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 117(1)(d) or (e);

(b)    at the time the licensee provides the credit assistance:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 117.

Credit contract not unsuitable under regulations

123(5)    
The regulations may prescribe particular situations in which a credit contract is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

123(6)    

A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

SECTION 124   PROHIBITION ON SUGGESTING TO CONSUMERS TO REMAIN IN UNSUITABLE CREDIT CONTRACTS  
Prohibition on suggesting to remain in unsuitable contracts

124(1)    

A licensee must not provide credit assistance to a consumer by suggesting that the consumer remain in a particular credit contract with a particular credit provider if the contract is unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the contract is unsuitable

124(2)    
The credit contract is unsuitable for the consumer if, at that time the licensee provides the credit assistance:

(a) the consumer is, or is likely to be, unable to comply with the consumer's financial obligations under the contract, or only able to comply with substantial hardship; or

(b) the contract does not meet the consumer's requirements or objectives; or

(c) if the regulations prescribe circumstances in which a credit contract is unsuitable - those circumstances apply to the contract.

124(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the contract by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

124(3A)    

For the purposes of paragraph (2)(a), a consumer is taken to be able to comply with the consumer's financial obligations under a contract only with substantial hardship if:

(a) the contract is a credit card contract; and

(b) the consumer could not comply with an obligation to repay an amount equal to the credit limit of the contract within the period determined by ASIC under section 160F.

Information to be used to determine if contract is unsuitable

124(4)    
For the purposes of determining under subsection (2) whether the contract is unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 117(1)(d) or (e);

(b) at the time the licensee provides the credit assistance:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 117.

Credit contract not unsuitable under regulations

124(5)    
The regulations may prescribe particular situations in which a credit contract is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

124(6)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

Defence

124(7)    
For the purposes of subsections (1) and (6), it is a defence if:

(a) the licensee suggested that the consumer remain in the credit contract because, after making reasonable inquiries, the licensee reasonably believed that there was no other credit contract that was not unsuitable for the consumer; and

(b) the licensee informed the consumer that there is a procedure under sections 72 and 94 of the National Credit Code for consumers in hardship.

Note: For the purposes of subsection (6), a defendant bears an evidential burden in relation to the matter in subsection (7) (see subsection 13.3(3) of the Criminal Code).

124(8)    
The regulations may prescribe particular inquiries that must be made, or do not need to be made, for the purposes of paragraph (7)(a).

Division 7 - Special rules for short-term and small amount credit contracts  

SECTION 124A   PROHIBITION ON PROVIDING CREDIT ASSISTANCE IN RELATION TO SHORT-TERM CREDIT CONTRACTS  

Prohibition

124A(1)    
A licensee must not provide credit assistance to a consumer by:

(a) suggesting that the consumer apply, or assisting the consumer to apply, for a short-term credit contract; or

(b) suggesting that the consumer apply, or assisting the consumer to apply, for an increase to the credit limit of a particular short-term credit contract with a particular credit provider.

Civil penalty: 5,000 penalty units.

Offence

124A(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 124B   LICENSEE WHO MAKES REPRESENTATIONS ABOUT CREDIT ASSISTANCE IN RELATION TO SMALL AMOUNT CREDIT CONTRACTS MUST DISPLAY AND GIVE INFORMATION  

Requirement

124B(1)    
If a licensee represents that the licensee provides, or is able to provide, credit assistance to consumers in relation to small amount credit contracts, the licensee must:

(a)    display information; and

(a)    

give information to consumers;

in accordance with any determination made by ASIC under subsection (2).

Civil penalty: 5,000 penalty units.

124B(2)    
ASIC may, by legislative instrument, determine one or more of the following matters relating to licensees that make representations described in subsection (1):

(a)    the information that the licensees must display;

(b)    how the licensees must display the information;

(c)    when the licensees must display the information;

(d)    the information that the licensees must give to consumers;

(e)    how the licensees must give the information to consumers;

(f)    when the licensees must give the information to consumers.

124B(3)    
In making the determination under subsection (2), ASIC must take into account the risks associated with small amount credit contracts and the alternatives that may be available to consumers.

Offence

124B(4)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 124C   WRITTEN DOCUMENTATION REQUIRED IN RELATION TO THE PRELIMINARY ASSESSMENT FOR A SMALL AMOUNT CREDIT CONTRACT  

124C(1)    
If, in a preliminary assessment made for the purposes of paragraph 115(1)(c) or (2)(a), the licensee assesses that a small amount credit contract is not unsuitable for a consumer, before providing credit assistance to the consumer by:

(a)    suggesting that the consumer apply, or assisting the consumer to apply, for the small amount credit contract; or

(b)    suggesting that the consumer apply, or assisting the consumer to apply, for the increase to the credit limit of the small amount credit contract which is the subject of that preliminary assessment; or

(c)    suggesting that the consumer remain in the small amount credit contract;

the licensee must document in writing and in accordance with any requirements determined by ASIC under subsection (2):

(d)    the preliminary assessment; and

(e)    the inquiries and verification made for the purposes of paragraph 115(1)(d) or (2)(b) in relation to that preliminary assessment.

Civil penalty: 5,000 penalty units.

124C(2)    
ASIC may, by legislative instrument, determine the form in which the matters in paragraphs (1)(d) and (e) are to be documented in writing.

124C(3)    
Before making a determination under subsection (2), ASIC must:

(a)    consult the Information Commissioner in relation to matters that relate to the privacy functions (within the meaning of the Australian Information Commissioner Act 2010); and

(b)    have regard to any submissions made by the Information Commissioner because of that consultation.

PART 3-2 - LICENSEES THAT ARE CREDIT PROVIDERS UNDER CREDIT CONTRACTS: GENERAL RULES  

Division 1 - Introduction  

SECTION 125  

125   GUIDE TO THIS PART  

Division 2 - Credit guide of credit providers  

SECTION 126   CREDIT GUIDE OF CREDIT PROVIDERS  
Requirement to give credit guide

126(1)    

A licensee must, as soon as practicable after it becomes apparent to the licensee that it is likely to enter a credit contract with a consumer who will be the debtor under the contract, give the consumer the licensee's credit guide in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

126(2)    
The licensee's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the licensee's name and contact details; and

(d) specify the licensee's Australian credit licence number; and

(e) give information about the licensee's procedure for resolving disputes with a consumer, including contact details for a consumer to access:

(i) the licensee's internal dispute resolution procedure; and

(ii) the AFCA scheme; and

(f) give information about the licensee's obligations under sections 132 and 133; and

(g) comply with any other requirements prescribed by the regulations.

126(3)    
The regulations may prescribe information that need not be included in the credit guide, despite subsection (2).

Manner of giving credit guide

126(4)    
The licensee must give the consumer the licensee's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

126(5)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

126(6)    
Subsection (5) is an offence of strict liability.

Note:

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

SECTION 127   CREDIT GUIDE OF CREDIT PROVIDERS WHO ARE ASSIGNEES  
Requirement to give credit guide

127(1)    

A licensee must, as soon as practicable after it has been assigned any rights or obligations of a credit provider under a credit contract, give the debtor under the contract the licensee's credit guide in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

127(2)    
The licensee's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the licensee's name and contact details; and

(d) specify the licensee's Australian credit licence number; and

(e) give information about the licensee's procedure for resolving disputes with a consumer, including contact details for a consumer to access:

(i) the licensee's internal dispute resolution procedure; and

(ii) the AFCA scheme; and

(f) comply with any other requirements prescribed by the regulations.

127(3)    
The regulations may prescribe information that need not be included in the credit guide, despite subsection (2).

Manner of giving credit guide

127(4)    
The licensee must give the consumer the licensee's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

127(5)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

127(6)    
Subsection (5) is an offence of strict liability.

Note:

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

Division 3 - Obligation to assess unsuitability  

SECTION 128  

128   OBLIGATION TO ASSESS UNSUITABILITY  
A licensee must not:

(a) enter a credit contract with a consumer who will be the debtor under the contract; or

(aa) make an unconditional representation to a consumer that the licensee considers that the consumer is eligible to enter a credit contract with the licensee; or

(b) increase the credit limit of a credit contract with a consumer who is the debtor under the contract; or

(ba) make an unconditional representation to a consumer that the licensee considers that the credit limit of credit contract between the consumer and the licensee will be able to be increased;

on a day (the credit day ) unless the licensee has, within 90 days (or other period prescribed by the regulations) before the credit day:

(c) made an assessment that:

(i) is in accordance with section 129; and

(ii) covers the period in which the credit day occurs; and

(d) made the inquiries and verification in accordance with section 130.

Civil penalty: 5,000 penalty units.

SECTION 129  

129   ASSESSMENT OF UNSUITABILITY OF THE CREDIT CONTRACT  

For the purposes of paragraph 128(c), the licensee must make an assessment that:

(a) specifies the period the assessment covers; and

(b) assesses whether the credit contract will be unsuitable for the consumer if the contract is entered or the credit limit is increased in that period.

Note:

The licensee is not required to make the assessment under this section if the contract is not entered or the credit limit is not increased.

SECTION 130   REASONABLE INQUIRIES ETC. ABOUT THE CONSUMER  
Requirement to make inquiries and take steps to verify

130(1)    

For the purposes of paragraph 128(d), the licensee must, before making the assessment:

(a)    make reasonable inquiries about the consumer's requirements and objectives in relation to the credit contract; and

(b)    make reasonable inquiries about the consumer's financial situation; and

(c)    take reasonable steps to verify the consumer's financial situation; and

(d)    make any inquiries prescribed by the regulations about any matter prescribed by the regulations; and

(e)    

take any steps prescribed by the regulations to verify any matter prescribed by the regulations.

Civil penalty: 5,000 penalty units.

130(1A)    

If:

(a)    the credit contract is a small amount credit contract; and

(b)    the consumer holds (whether alone or jointly with another person) an account with an ADI into which income payable to the consumer is credited;

the licensee must, in verifying the consumer's financial situation for the purposes of paragraph 128(d), obtain and consider information about each transaction on the account, and the balances of the account, during at least the immediately preceding period of 90 days.

130(1B)    

Subsection (1A) does not limit paragraph (1)(c) of this section.

130(2)    
The regulations may prescribe particular inquiries or steps that must be made or taken, or do not need to be made or taken, for the purposes of paragraph (1)(a), (b) or (c).

SECTION 131   WHEN CREDIT CONTRACT MUST BE ASSESSED AS UNSUITABLE  
Requirement to assess the contract as unsuitable

131(1)    

The licensee must assess that the credit contract will be unsuitable for the consumer if the contract will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

Note:

Even if the contract will not be unsuitable for the consumer under subsection (2), the licensee may still assess that the contract will be unsuitable for other reasons.

Particular circumstances when the contract will be unsuitable

131(2)    
The contract will be unsuitable for the consumer if, at the time of the assessment, it is likely that:

(a)    the consumer will be unable to comply with the consumer's financial obligations under the contract, or could only comply with substantial hardship, if the contract is entered or the credit limit is increased in the period covered by the assessment; or

(b)    the contract will not meet the consumer's requirements or objectives if the contract is entered or the credit limit is increased in the period covered by the assessment; or

(c)    if the regulations prescribe circumstances in which a credit contract is unsuitable - those circumstances will apply to the contract if the contract is entered or the credit limit is increased in the period covered by the assessment.

131(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the contract by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

131(3AA)    

For the purposes of paragraph (2)(a), a consumer is taken to be able to comply with the consumer's financial obligations under a contract only with substantial hardship if:

(a)    the contract is a credit card contract; and

(b)    the consumer could not comply with an obligation to repay an amount equal to the credit limit of the contract within the period determined by ASIC under section 160F.

131(3A)    
(Repealed by No 87 of 2022)

Information to be used to determine if contract will be unsuitable

131(4)    
For the purposes of determining under subsection (2) whether the contract will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 130(1)(d) or (e);

(b) at the time of the assessment:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 130.

SECTION 132   GIVING THE CONSUMER THE ASSESSMENT  
Requirement to give assessment if requested

132(1)    

If, before entering the credit contract or increasing the credit limit, the consumer requests the licensee for a copy of the assessment, the licensee must give the consumer a written copy of the assessment before entering the contract or increasing the credit limit.

Note:

The licensee is not required to give the consumer a copy of the assessment if the contract is not entered or the credit limit is not increased.

Civil penalty: 5,000 penalty units.

132(2)    
If, during the period that:

(a) starts on the day (the credit day ) the credit contract is entered or the credit limit is increased; and

(b) ends 7 years after that day;

the consumer requests the licensee for a copy of the assessment, the licensee must give the consumer a written copy of the assessment:

(c) if the request is made within 2 years of the credit day - before the end of 7 business days after the day the licensee receives the request; and

(d) otherwise - before the end of 21 business days after the day the licensee receives the request.

Civil penalty: 5,000 penalty units.

Manner of giving assessment

132(3)    
The licensee must give the consumer the copy of the assessment in the manner (if any) prescribed by the regulations.

No payment for assessment

132(4)    

The licensee must not request or demand payment of an amount for giving the consumer a copy of the assessment.

Civil penalty: 5,000 penalty units.

Strict liability offence

132(5)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1), (2) or (4); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

132(6)    
Subsection (5) is an offence of strict liability.

Note:

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

Division 4 - Prohibition on entering, or increasing the credit limit of, unsuitable credit contracts  

SECTION 133   PROHIBITION ON ENTERING, OR INCREASING THE CREDIT LIMIT OF, UNSUITABLE CREDIT CONTRACTS  
Prohibition on entering etc. unsuitable contracts

133(1)    
A licensee must not:

(a)    enter a credit contract with a consumer who will be the debtor under the contract; or

(b)    increase the credit limit of a credit contract with a consumer who is the debtor under the contract;

if the contract is unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the contract is unsuitable

133(2)    
The contract is unsuitable for the consumer if, at the time it is entered or the credit limit is increased:

(a)    it is likely that the consumer will be unable to comply with the consumer's financial obligations under the contract, or could only comply with substantial hardship; or

(b)    the contract does not meet the consumer's requirements or objectives; or

(c)    if the regulations prescribe circumstances in which a credit contract is unsuitable - those circumstances apply to the contract.

133(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the contract by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

133(3AA)    

For the purposes of paragraph (2)(a), a consumer is taken to be able to comply with the consumer's financial obligations under a contract only with substantial hardship if:

(a)    the contract is a credit card contract; and

(b)    the consumer could not comply with an obligation to repay an amount equal to the credit limit of the contract within the period determined by ASIC under section 160F.

133(3A)    
(Repealed by No 87 of 2022)

Information to be used to determine if contract will be unsuitable

133(4)    
For the purposes of determining under subsection (2) whether the contract will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a)    the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 130(1)(d) or (e);

(b)    at the time of the contract is entered or the credit limit is increased, the information:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 130.

Credit contract not unsuitable under regulations

133(5)    
The regulations may prescribe particular situations in which a credit contract is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

133(6)    

A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

Note:

Sections 178 and 179 provide for remedies for anyone who suffers, or is likely to suffer, loss or damage because of a breach of this section. For example, if a consumer makes an unsuitable credit contract with a licensee, rather than making a not unsuitable credit contract for a reverse mortgage, a person who suffered, or is likely to suffer, loss as a result may be able to get court orders under section 178 or 179 to put the person in a position like the one they would have been in had the consumer entered into the contract for the reverse mortgage.

PART 3-2A - LICENSEES THAT ARE CREDIT PROVIDERS UNDER CREDIT CONTRACTS: ADDITIONAL RULES RELATING TO STANDARD HOME LOANS  

Division 1 - Introduction  

SECTION 133A  

133A   GUIDE TO THIS PART  

Division 2 - Key Facts Sheets for standard home loans  

SECTION 133AA   WHAT IS A STANDARD HOME LOAN ?  

133AA(1)    
A standard home loan of a licensee is a standard form of credit contract under which the licensee provides credit:

(a) to purchase residential property; or

(b) to refinance credit that has been provided wholly or predominantly to purchase residential property.

133AA(2)    
The regulations may make provisions that apply to determining, for the purpose of subsection (1), whether a credit contract is a standard form of credit contract.

SECTION 133AB   WHAT IS A KEY FACTS SHEET FOR A STANDARD HOME LOAN?  

133AB(1)    
A Key Facts Sheet for a standard home loan is a document:

(a) that contains the information relating to the standard home loan that is required by the regulations; and

(b) that complies with any other requirements prescribed by the regulations.

133AB(2)    
Without limiting paragraph (1)(a), regulations made for the purpose of that paragraph:

(a) may require a Key Facts Sheet for a standard home loan to contain information:

(i) that is specific to the consumer by whom the Key Facts Sheet is to be generated under section 133AC or to whom it is to be provided under section 133AD; and

(ii) that relates to the cost or implications of the loan for the consumer; and

(b) may require information contained in a Key Facts Sheet for a standard home loan to be based on either or both of the following:

(i) information provided by the consumer;

(ii) particular assumptions.

SECTION 133AC   CREDIT PROVIDER'S WEBSITE TO PROVIDE CAPACITY TO GENERATE KEY FACTS SHEET  

When this section applies

133AC(1)    
This section applies if a licensee has a website that can be used by a consumer to apply for, or make an inquiry about, one or more standard home loans of the licensee.

Requirement

133AC(2)    
The licensee must ensure that the website satisfies all of the following paragraphs:

(a) the website tells the consumer that the consumer may use the website to generate a Key Facts Sheet for the standard home loan, or for each of the standard home loans;

(b) the website:

(i) tells the consumer what information the consumer will need to enter in order to generate the Key Facts Sheet or Sheets; and

(ii) provides the consumer with instructions on how to generate the Key Facts Sheet or Sheets;

(c) if the consumer enters the information and follows those instructions, the consumer can use the website to generate the Key Facts Sheet or Sheets, containing up-to-date information, in a form that can be printed;

(d) the website complies with any other requirements prescribed by the regulations.

Civil penalty: 5,000 penalty units.

Offence

133AC(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 133AD   CREDIT PROVIDER TO PROVIDE KEY FACTS SHEET IN OTHER SITUATIONS  

When this section applies

133AD(1)    
This section applies if:

(a) either:

(i) a consumer makes a request to a licensee (otherwise than by using a website of the licensee) to be provided with a Key Facts Sheet for one or more standard home loans of the licensee that are specified in the request; or

(ii) the regulations require a consumer, in circumstances prescribed by the regulations, to be provided with a Key Facts Sheet for one or more standard home loans of a licensee; and

(b) the consumer has given the licensee the consumer's name, and the contact details required by the regulations.

Requirement

133AD(2)    
The licensee must, in accordance with any requirements prescribed by the regulations:

(a) provide the consumer with a Key Facts Sheet containing up-to-date information for the standard home loan, or for each of the standard home loans; and

(b) provide the consumer with any other information relating to other standard home loans of the licensee that is required by the regulations.

Note:

Subsection 133AE(4) and section 133AF provide defences to liability under this subsection.

Civil penalty: 5,000 penalty units.

Offence

133AD(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Note:

Subsection 133AE(4) and section 133AF provide defences to liability under this subsection.

SECTION 133AE   WHAT IF MORE INFORMATION IS NEEDED FROM THE CONSUMER?  

When this section applies

133AE(1)    
This section applies if:

(a) a licensee is required by section 133AD to provide a consumer with a Key Facts Sheet for a standard home loan; but

(b) the licensee does not have all the information from the consumer that the licensee needs in order to be able to prepare the Key Facts Sheet.

Requirement

133AE(2)    

The licensee must, in accordance with any requirements prescribed by the regulations, tell the consumer what information the licensee needs in order to be able to prepare the Key Facts Sheet.

Civil penalty: 5,000 penalty units.

Offence

133AE(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Defence for subsections 133AD(2) and (3)

133AE(4)    
For the purposes of applying subsections 133AD(2) and (3) to a failure by a licensee to provide a Key Facts Sheet to a consumer, it is a defence if:

(a) the licensee has, in accordance with subsection (2) of this section, told the consumer what information the licensee needs in order to be able to prepare the Key Facts Sheet; and

(b) the consumer has not provided that information to the licensee.

Note:

For the purpose of subsection 133AD(3), a defendant bears an evidential burden in relation to the matter in this subsection (see subsection 13.3(3) of the Criminal Code).

SECTION 133AF   DEFENCES TO OBLIGATION TO PROVIDE A KEY FACTS SHEET  

133AF(1)    
For the purpose of applying subsection 133AD(2) or (3) to a failure by a licensee to provide a consumer with a Key Facts Sheet (the new Key Facts Sheet ) for a standard home loan, it is a defence if:

(a) the following conditions are satisfied:

(i) the licensee has previously provided the consumer with a Key Facts Sheet (the previous Key Facts Sheet ) for the standard home loan;

(ii) the new Key Facts Sheet would be the same (except for its date) as the previous Key Facts Sheet; or

(b) the licensee reasonably believes that:

(i) another person has previously provided the consumer with a Key Facts Sheet (the previous Key Facts Sheet ) for the standard home loan; and

(ii) the new Key Facts Sheet would be the same (except for its date) as the previous Key Facts Sheet; or

(c) the licensee reasonably believes that the consumer would not be eligible for the standard home loan; or

(d) under regulations made for the purpose of subsection (2), the licensee is not required to provide the consumer with the new Key Facts Sheet.

Note:

For the purpose of subsection 133AD(3), a defendant bears an evidential burden in relation to the matters in this subsection (see subsection 13.3(3) of the Criminal Code).

133AF(2)    
The regulations may prescribe circumstances in which a licensee is not required to provide a consumer with a Key Facts Sheet for a standard home loan.

PART 3-2B - LICENSEES THAT ARE CREDIT PROVIDERS UNDER CREDIT CONTRACTS: ADDITIONAL RULES RELATING TO CREDIT CARD CONTRACTS  

Division 1 - Introduction  

SECTION 133B  

133B   GUIDE TO THIS PART  

Division 2 - Credit card contracts and related concepts  

SECTION 133BA   MEANING OF CREDIT CARD CONTRACT ETC.  

Meaning of credit card contract

133BA(1)    
A credit card contract is a continuing credit contract under which credit is ordinarily obtained only by the use of a credit card.

Meaning of credit card

133BA(2)    
A credit card is:

(a) a card of a kind commonly known as a credit card; or

(b) a card of a kind that persons carrying on business commonly issue to their customers, or prospective customers, for use in obtaining goods or services from those persons on credit; or

(c) anything else that may be used as a card referred to in paragraph (a) or (b).

Meaning of linked to a credit card contract

133BA(3)    
A credit card is linked to a credit card contract if:

(a) the credit card is issued under or in relation to the contract; and

(b) the credit card can be used to obtain credit under the contract as referred to in subsection (1).

Meaning of use of a credit card

133BA(4)    
A reference to the use of a credit card to obtain cash, goods or services includes a reference to the use or provision of the number of the credit card to obtain cash, goods or services.

Articles that can be used as credit cards and in other ways

133BA(5)    
If a credit card can also be used in other ways (for example, as a debit card, or to access other accounts):

(a) the article is a credit card (despite the fact that it can also be used in those other ways); but

(b) the provisions of this Act that are expressed to apply in relation to credit cards do not apply to the article inso far as it can be used in those other ways.

Division 3 - Key Facts Sheets for credit card contract  

SECTION 133BB  

133BB   WHAT IS A KEY FACTS SHEET FOR A CREDIT CARD CONTRACT?  

A Key Facts Sheet for a credit card contract is a document:

(a) that contains the information relating to the contract that is required by the regulations; and

(b) that complies with any other requirements prescribed by the regulations.

SECTION 133BC   APPLICATION FORM FOR CREDIT CARD CONTRACT TO INCLUDE UP-TO-DATE KEY FACTS SHEET  

Requirement

133BC(1)    

If a licensee makes available to consumers an application form that can be used to apply for a credit card contract under which the licensee would be the credit provider, the licensee must ensure that the application form includes a Key Facts Sheet for the contract that contains up-to-date information.

Civil penalty: 5,000 penalty units.

Offence

133BC(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Circumstances in which application form may, for limited period, include out-of-date Key Facts Sheet

133BC(3)    
The regulations may prescribe circumstances in which a licensee may, for a period prescribed by the regulations, make available an application form that includes a Key Facts Sheet containing information that has ceased to be up-to-date.

Note:

If a consumer applies using such an application form, the consumer must be given the up-to-date information: see paragraph 133BD(1)(b).

133BC(4)    
If a licensee makes available an application form that includes a Key Facts Sheet containing information that has ceased to be up-to-date, it is a defence for the purposes of subsections (1) and (2) if the application form was made available as permitted by regulations made for the purpose of subsection (3).

Note:

For the purpose of subsection (2), a defendant bears an evidential burden in relation to the matter in this subsection (see subsection 13.3(3) of the Criminal Code).

SECTION 133BD   CREDIT PROVIDER NOT TO ENTER INTO CREDIT CARD CONTRACT UNLESS KEY FACTS SHEET HAS BEEN PROVIDED ETC.  

Requirement

133BD(1)    
If a consumer applies to a licensee for a credit card contract under which the licensee would be the credit provider, the licensee must not enter into, or offer to enter into, the contract unless:

(a) the application is made using an application form that includes a Key Facts Sheet for the contract that contains up-to-date information; or

(b) the following conditions are satisfied:

(i) the application is made using an application form that includes a Key Facts Sheet for the contract that contains information that has ceased to be up-to-date;

(ii) the consumer has been provided with the up-to-date information in accordance with any requirements prescribed by the regulations; or

(c) the consumer has otherwise been provided with a Key Facts Sheet for the contract that contains up-to-date information in accordance with any requirements prescribed by the regulations.

Civil penalty: 5,000 penalty units.

Offence

133BD(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Division 4 - Offers etc. to increase, and entitlement to reduce, credit limit of credit card contract  

SECTION 133BE   CREDIT PROVIDER NOT TO OFFER ETC. TO INCREASE CREDIT LIMIT OF CREDIT CARD CONTRACT  

Requirement

133BE(1)    

A licensee who is the credit provider under a credit card contract must not make a credit limit increase invitation in relation to the contract.

Civil penalty: 5,000 penalty units.

Note:

For other provisions that must be complied with in relation to increasing credit limits, see:

(a) Divisions 3 and 4 of Part 3-2; and

(b) subsection 67(4) of the National Credit Code.

Offence

133BE(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Strict liability offence

133BE(3)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 20 penalty units.

133BE(4)    
Subsection (3) is an offence of strict liability.

Note:

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

Meaning of credit limit increase invitation

133BE(5)    
A licensee makes a credit limit increase invitation , in relation to a credit card contract, if:

(a) the licensee gives any form of communication that relates to the contract to the consumer who is the debtor under the contract; and

(b) one or more of the following conditions is satisfied in relation to the communication:

(i) the communication offers to increase the credit limit of the contract;

(ii) the communication invites the consumer to apply for an increase of the credit limit of the contract;

(iii) the licensee gave the communication to the consumer for the purpose (or for purposes including the purpose) of encouraging the consumer to consider applying for an increase of the credit limit of the contract.

133BE(6)    

The regulations may make provisions that apply to determining whether a communication is covered by the definition in subsection (5).

SECTION 133BF   CREDIT PROVIDER NOT TO ENTER INTO CREDIT CARD CONTRACT UNLESS IT ALLOWS CREDIT LIMIT TO BE REDUCED  

Requirement

133BF(1)    

A licensee must not enter into, or offer to enter into, a credit card contract under which the licensee would be the credit provider, if the consumer who would be the debtor under the contract would not have a credit limit reduction entitlement under the contract.

Civil penalty: 5,000 penalty units.

Offence

133BF(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Meaning of credit limit reduction entitlement

133BF(3)    
A consumer who is the debtor under a credit card contract has a credit limit reduction entitlement under the contract if:

(a) for a contract that does not provide for a minimum credit limit - the consumer is entitled under the contract to reduce the credit limit of the contract to any amount (including nil); or

(b) for a contract that provides for a minimum credit limit - the consumer is entitled under the contract to reduce the credit limit of the contract to any amount that equals, or exceeds, the minimum credit limit.

SECTION 133BFA   CREDIT PROVIDER TO PROVIDE ONLINE CAPACITY TO REQUEST REDUCTION OF CREDIT LIMIT  

When this section applies

133BFA(1)    
This section applies if a consumer who is the debtor under a credit card contract has a credit limit reduction entitlement under the contract on a day (the online reduction day ).

Requirement

133BFA(2)    

The licensee who is the credit provider under the credit card contract must establish and maintain a website that satisfies all of the following paragraphs:

(a) the website tells the consumer that the consumer may use the website to request a reduction in the consumer's credit limit;

(b) the website:

(i) tells the consumer what information the consumer will need to enter in order to request a reduction in the consumer's credit limit; and

(ii) provides the consumer with instructions on how to request a reduction in the consumer's credit limit;

(c) if the consumer enters the information and follows those instructions, the consumer can use the website to request a reduction in the consumer's credit limit;

(d) the website is available on the online reduction day.

Civil penalty: 5,000 penalty units.

Defence

133BFA(3)    
For the purposes of subsection (2), it is a defence if the website is reasonably unavailable on the online reduction day.

SECTION 133BFB   CREDIT PROVIDER NOT TO SUGGEST THE CONSUMER NOT REDUCE THE CREDIT LIMIT  

When this section applies

133BFB(1)    
This section applies if:

(a) a consumer who is the debtor under a credit card contract has a credit limit reduction entitlement under the contract; and

(b) the consumer has requested to exercise the entitlement by reducing the credit limit of the contract.

Requirement

133BFB(2)    

The licensee who is the credit provider under the credit card contract must not do any of the following:

(a) suggest that the consumer apply for an increase to the credit limit of the contract;

(b) suggest that the consumer not reduce the credit limit of the contract;

(c) if the consumer's request is to reduce the credit limit of the contract by a specified amount - suggest that the consumer instead reduce the credit limit by a smaller amount.

Civil penalty: 5,000 penalty units.

Offence

133BFB(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 133BFC   CREDIT PROVIDER TO GIVE EFFECT TO REQUEST TO REDUCE CREDIT LIMIT  

When this section applies

133BFC(1)    
This section applies if:

(a) a consumer who is the debtor under a credit card contract has a credit limit reduction entitlement under the contract; and

(b)the consumer has requested to exercise the entitlement by reducing the credit limit of the contract.

Requirement

133BFC(2)    

The licensee who is the credit provider under the credit card contract must take reasonable steps to ensure that the request is given effect to as soon as practicable.

Civil penalty: 5,000 penalty units.

Offence

133BFC(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 133BG  

133BG   RECORDS OF CONSENTS AND WITHDRAWALS TO BE KEPT  
(Repealed by No 9 of 2018)

Division 5 - Use of credit card in excess of credit limit  

SECTION 133BH   CREDIT PROVIDER TO NOTIFY CONSUMER OF USE OF CREDIT CARD IN EXCESS OF CREDIT LIMIT  

Regulations may require licensee to notify consumer of use of credit card in excess of credit limit

133BH(1)    
The regulations may require a licensee who is the credit provider under a credit card contract to notify the consumer who is the debtor under the contract if the licensee becomes aware that the debtor has used a credit card that is linked to the contract to obtain cash, goods or services in excess of the credit limit for the contract.

133BH(2)    
Without limiting subsection (1), regulations made for the purpose of that subsection may deal with:

(a) how and when the licensee must notify the consumer; and

(b) the matters that must be included in the notification.

Requirement to comply with the regulations

133BH(3)    

A licensee must comply with regulations made for the purpose of subsection (1).

Civil penalty: 5,000 penalty units.

Offence

133BH(4)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (3); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 133BI   CREDIT PROVIDER NOT TO IMPOSE FEES ETC. BECAUSE CREDIT CARD USED IN EXCESS OF CREDIT LIMIT  

133BI(1)    
If a credit card is used to obtain cash, goods or services in excess of the credit limit for the credit card contract, the licensee who is the credit provider under the contract must not, because the credit limit was exceeded, impose any liability to pay fees or charges, or a higher rate of interest, on the consumer who is the debtor under the contract unless:

(a) the licensee has, in accordance with this section, obtained express consent from the consumer covering the imposition of the fees or charges, or the higher rate of interest; and

(b) the consent has not been withdrawn; and

(c) any other requirements prescribed by the regulations are complied with.

Note 1:

The consent must be express, and cannot be implied from the actions of the consumer or from other circumstances.

Note 2:

The licensee must keep records of consents and withdrawals: see section 133BJ.

133BI(2)    
The consumer may consent to the licensee imposing a liability to pay fees or charges, or a higher rate of interest, if the credit card is used to obtain cash, goods or services in excess of the credit limit.

133BI(3)    
Before obtaining the consumer's consent, the licensee must, in accordance with the regulations, inform the consumer of any matters prescribed by the regulations.

133BI(4)    
The consent may be obtained before or after the credit card contract is entered into, but it does not cover any fees, charges or interest imposed before the consent is obtained.

133BI(5)    
The consumer may withdraw the consent at any time.

133BI(6)    
The regulations may prescribe requirements to be complied with in relation to giving consent under subsection (2), or withdrawing consent under subsection (5).

133BI(7)    
For the purpose of subsection 23(1) of the National Credit Code (and the other provisions of the Code that refer to, or apply in relation to, that subsection):

(a) a liability to pay a fee or charge that is imposed contrary to subsection (1) of this section is taken to be a credit fee or charge that is prohibited by the Code; and

(b) a liability to pay interest that is imposed contrary to subsection (1) of this section is taken to be an interest charge under the credit card contract exceeding the amount that may be charged consistently with the Code.

Note:

For the civil and criminal consequences of contravening subsection 23(1) of the National Credit Code, see subsections 23(2) to (4), section 24, and Part 6, of the Code.

SECTION 133BJ   RECORDS OF CONSENTS AND WITHDRAWALS TO BE KEPT  

Requirement

133BJ(1)    
A licensee must, in accordance with the requirements prescribed by the regulations, keep a record of:

(a) consents the licensee obtains under section 133BI; and

(b) withdrawals of such consents.

Civil penalty: 5,000 penalty units.

Offence

133BJ(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Division 6 - Order of application of payments made under credit card contracts  

SECTION 133BO   CREDIT PROVIDER TO APPLY PAYMENTS IN ACCORDANCE WITH THIS DIVISION  

Requirement

133BO(1)    
If a payment (the relevant payment ) is made under a credit card contract:

(a) by or on behalf of the consumer who is the debtor under the contract; and

(b) to the licensee who is the credit provider under the contract;

the licensee must apply the payment in accordance with this Division (despite any provision to the contrary in the contract, any other contract or instrument or any other law).

Civil penalty: 5,000 penalty units.

133BO(2)    
To avoid doubt, an amount:

(a) that is credited to the consumer's account by the licensee; and

(b) that is, or is in the nature of:

(i) a total or partial refund in relation to a transaction entered into using the credit card; or

(ii) a total or partial reversal of such a transaction;

is not a payment to which subsection (1) applies.

Offence

133BO(3)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Strict liability offence

133BO(4)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 20 penalty units.

133BO(5)    
Subsection (4) is an offence of strict liability.

Note:

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

SECTION 133BP   AGREEMENT TO APPLY PAYMENT AGAINST PARTICULAR AMOUNT OWED  

133BP(1)    
This section applies if, at the time when the licensee applies the relevant payment, the following conditions are satisfied:

(a) the consumer has requested the licensee to apply certain payments made under the credit card contract against a particular amount:

(i) owed by the consumer to the licensee under the contract; and

(ii) in relation to which any other requirements prescribed by the regulations are satisfied;

(b) the licensee has agreed to the request;

(c) the relevant payment is a payment to which the request relates;

(d) neither the request, nor the agreement to the request, has been withdrawn in accordance with this section.

133BP(2)    
The licensee must apply the relevant payment against the amount referred to in paragraph (1)(a) in accordance with the request.

133BP(3)    
The consumer may withdraw the request at any time.

133BP(4)    
The licensee may withdraw the agreement to the request, but only if the consumer has consented to the withdrawal.

133BP(5)    
The regulations may prescribe requirements to be complied with in relation to any of the following:

(a) making a request under paragraph (1)(a);

(b) agreeing to a request under paragraph (1)(b);

(c) withdrawing a request under subsection (3);

(d) withdrawing agreement to a request under subsection (4);

(e) consenting under subsection (4) to the withdrawal of agreement to a request.

SECTION 133BQ   APPLICATION OF PAYMENT AGAINST LAST STATEMENT BALANCE, WITH HIGHER INTEREST DEBTS TO BE DISCHARGED FIRST  

133BQ(1)    
Subject to subsection (2), the licensee must apply the relevant payment (or any part of the relevant payment remaining after complying with section 133BP) against so much as remains owing of the closing balance shown in the last statement of account for the credit card contract that the licensee gave the consumer before the relevant payment was made.

133BQ(2)    
If different annual percentage rates apply to different parts of that closing balance, the licensee must apply the relevant payment (or any remaining part of the payment) first to the part of that balance to which the highest rate applies, next to the part of that balance to which the next highest rate applies, and so on.

SECTION 133BR  

133BR   APPLICATION OF ANY REMAINING PART OF THE RELEVANT PAYMENT  

The licensee must apply any part of the relevant payment remaining after complying with sections 133BP and 133BQ in accordance with the terms of the credit card contract.

Division 7 - Calculation of interest under credit card contracts  

SECTION 133BS   CREDIT PROVIDER NOT TO IMPOSE RETROSPECTIVE INTEREST CHARGES  

Requirement

133BS(1)    

A licensee who is the credit card provider under a credit card contract must not, in relation to a statement period covered by a statement of account, impose on the consumer who is the debtor under the contract a liability to pay a rate of interest if the rate of interest would:

(a) be applied to the balance, or a part of the balance, of the credit card contract on a day in the statement period; and

(b) be applied because of facts or circumstances coming into existence after that day; and

(c) be higher than the rate of interest (including nil) that would have been applied to that balance, or that part of the balance, on that day if those facts and circumstances had not come into existence.

Civil penalty: 5,000 penalty units.

Offence

133BS(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Division 8 - Ending credit card contracts  

SECTION 133BT   CREDIT PROVIDER NOT TO ENTER INTO CREDIT CARD CONTRACT UNLESS IT ALLOWS FOR TERMINATION OF CONTRACTS  

Requirement

133BT(1)    

A licensee must not enter into, or offer to enter into, a credit card contract under which the licensee would be the credit provider, if the consumer who would be the debtor under the contract would not have a credit card termination entitlement under the contract.

Civil penalty: 5,000 penalty units.

Offence

133BT(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Meaning of credit card termination entitlement

133BT(3)    
A consumer who is the debtor under a credit card contract has a credit card termination entitlement under the contract if the consumer is entitled, under the contract, to terminate the credit card contract.

SECTION 133BU   CREDIT PROVIDER TO PROVIDE ONLINE CAPACITY TO REQUEST TERMINATION OF CREDIT CARD CONTRACT  

When this section applies

133BU(1)    
This section applies if a consumer who is the debtor under a credit card contract has a credit card termination entitlement under the contract on a day (the online termination day ).

Requirement

133BU(2)    

The licensee who is the credit provider under the credit card contract must establish and maintain a website that satisfies all of the following paragraphs:

(a) the website tells the consumer that the consumer may use the website to request to terminate the credit card contract;

(b) the website:

(i) tells the consumer what information the consumer will need to enter in order to request to terminate the credit card contract; and

(ii) provides the consumer with instructions on how to request to terminate the credit card contract;

(c) if the consumer enters the information and follows those instructions, the consumer can use the website to request to terminate the credit card contract;

(d) the website is available on the online termination day.

Civil penalty: 5,000 penalty units.

Defence

133BU(3)    
For the purposes of subsection (2), it is a defence if the website is reasonably unavailable on the online termination day.

SECTION 133BV   CREDIT PROVIDER NOT TO SUGGEST THE CONSUMER NOT TERMINATE THE CREDIT CARD CONTRACT  

When this section applies

133BV(1)    
This section applies if:

(a) a consumer who is the debtor under a credit card contract has a credit card termination entitlement under the contract; and

(b) the consumer has requested to terminate the credit card contract.

Requirement

133BV(2)    

The licensee who is the credit provider under the credit card contract must not suggest that the consumer remain in the credit card contract.

Civil penalty: 5,000 penalty units.

Offence

133BV(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 133BW   CREDIT PROVIDER TO GIVE EFFECT TO REQUEST TO TERMINATE CREDIT CARD CONTRACT  

When this section applies

133BW(1)    
This section applies if:

(a) a consumer who is the debtor under a credit card contract has a credit card termination entitlement under the contract; and

(b) the consumer has requested to terminate the consumer's credit card contract.

Requirement

133BW(2)    

The licensee who is the credit provider under the credit card contract must take reasonable steps to ensure that the request is given effect to as soon as practicable.

Civil penalty: 5,000 penalty units.

Offence

133BW(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

PART 3-2C - LICENSEES THAT ARE CREDIT PROVIDERS UNDER CREDIT CONTRACTS: ADDITIONAL RULES RELATING TO SHORT-TERM AND SMALL AMOUNT CREDIT CONTRACTS  

Division 1 - Introduction  

SECTION 133C  

133C   GUIDE TO THIS PART  

Division 2 - Short-termand small amount credit contracts  

SECTION 133CA   PROHIBITION ON ENTERING, OR INCREASING THE CREDIT LIMIT OF, SHORT-TERM CREDIT CONTRACTS  

Prohibition

133CA(1)    
A licensee must not:

(a) enter a short-term credit contract with a consumer who will be the debtor under the contract; or

(b) increase the credit limit of a short-term credit contract with a consumer who is the debtor under the contract.

Civil penalty: 5,000 penalty units.

Offence

133CA(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 133CB   LICENSEE WHO MAKES REPRESENTATIONS IN RELATION TO SMALL AMOUNT CREDIT CONTRACTS MUST DISPLAY AND GIVE INFORMATION  

Requirement

133CB(1)    
If a licensee represents that the licensee enters into, or is able to enter into, small amount credit contracts with consumers under which the licensee would be the credit provider, the licensee must:

(a)    display information; and

(b)    

give information to consumers;

in accordance with any determination made by ASIC under subsection (2).

Civil penalty: 5,000 penalty units.

133CB(2)    
ASIC may, by legislative instrument, determine one or more of the following matters relating to licensees that make representations described in subsection (1):

(a)    the information that the licensees must display;

(b)    how the licensees must display the information;

(c)    when the licensees must display the information;

(d)    the information that the licensees must give to consumers;

(e)    how the licensees must give the information to consumers;

(f)    when the licensees must give the information to consumers.

133CB(3)    
In making a determination under subsection (2), ASIC must take into account the risks associated with small amount credit contracts and the alternatives that may be available to consumers.

Offence

133CB(4)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 133CC   LICENSEE MUST NOT ENTER INTO A SMALL AMOUNT CREDIT CONTRACT IF THE REPAYMENTS DO NOT MEET THE PRESCRIBED REQUIREMENTS  

Requirement

133CC(1)    

A licensee must not enter into, or offer to enter into, a small amount credit contract with a consumer who will be the debtor under the contract if the repayments that would be required under the contract would not meet the requirements prescribed by the regulations.

Civil penalty: 5,000 penalty units.

Note:

For example, the regulations may provide that the amount of a repayment must not exceed a specified percentage of the consumer's income.

Offence

133CC(2)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Loss of certain fees and charges

133CC(3)    

If a licensee enters into a small amount credit contract in contravention of subsection (1), then:

(a)    the consumer is not liable (and is taken never to have been liable) to pay a fee or charge of a kind mentioned in paragraph 31A(1)(a), (b), (c) or (d) of the National Credit Code under that small amount credit contract (whether or not the liability is imposed consistently with the National Credit Code); and

(b)    the consumer may recover as a debt due to the consumer any amounts paid by the consumer that, in accordance with paragraph (a) of this subsection, the consumer is not liable to pay (or is taken never to have been liable to pay).

Criminal penalty: 50 penalty units.

SECTION 133CD   LICENSEE MUST NOT ENTER INTO A SMALL AMOUNT CREDIT CONTRACT IF REPAYMENT AMOUNTS AND INTERVALS ARE NOT EQUAL  

Requirement

133CD(1)    
A licensee must not enter into, or offer to enter into, a small amount credit contract with a consumer who will be the debtor under the contract if any of the following applies:

(a)    repayments that would be required under the contract are not equal;

(b)    the intervals between repayment dates would not be equal;

(c)    the interval between the date on which credit would be first provided under the contract and the first repayment date would be longer than twice the interval between the first repayment date and the second repayment date.

Civil penalty: 5,000 penalty units.

133CD(2)    
For the purposes of paragraph (1)(a), repayments that would be required under a small amount credit contract are taken to be equal if:

(a)    each repayment is of the same amount; or

(b)    both of the following apply:

(i) each repayment (other than the last repayment) is the same amount;

(ii) the last repayment is up to 5% less than each other repayment; or

(c)    the repayments meet the conditions determined by ASIC under subsection (5).

133CD(3)    
A repayment date in relation to a small amount credit contract is the date on or by which a repayment is required to be made under the contract.

133CD(4)    
For the purposes of paragraph (1)(b), if a small amount credit contract provides that:

(a)    repayments that would be required under the contract are to be made on or by a fixed day of each week, fortnight or month; and

(b)    if that fixed day falls on a day that is not a business day - the repayment would be required to be made on or by the immediately preceding or succeeding business day;

the intervals between repayment dates are taken to be equal.

133CD(5)    
ASIC may, by legislative instrument, determine conditions for the purposes of paragraph (2)(c).

133CD(6)    
Nothing in this section is intended to limit the regulations which may be made for the purposes of section 133CC.

Offence

133CD(7)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Strict liability offence

133CD(8)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 10 penalty units.

133CD(9)    
Subsection (8) is an offence of strict liability.

SECTION 133CE   WRITTEN DOCUMENTATION REQUIRED IN RELATION TO THE ASSESSMENT FOR A SMALL AMOUNT CREDIT CONTRACT  

133CE(1)    
If, in an assessment made for the purposes of paragraph 128(c), the licensee assesses that a small amount credit contract is not unsuitable for a consumer, before:

(a)    entering into the small amount credit contract with the consumer; or

(b)    making an unconditional representation to the consumer that the licensee considers that the consumer is eligible to enter into the small amount credit contract with the licensee; or

(c)    increasing the credit limit of the small amount credit contract which is the subject of that assessment; or

(d)    making an unconditional representation to the consumer that the licensee considers that the credit limit of the small amount credit contract between the consumer and the licensee will be able to be increased;

the licensee must document in writing and in accordance with any requirements determined by ASIC under subsection (2):

(e)    the assessment; and

(f)    the inquiries and verification made for the purposes of paragraph 128(d) in relation to that assessment.

Civil penalty: 5,000 penalty units.

133CE(2)    
ASIC may, by legislative instrument, determine the form in which the matters in paragraphs (1)(e) and (f) are to be documented in writing.

133CE(3)    
Before making a determination under subsection (2), ASIC must:

(a)    consult the Information Commissioner in relation to matters that relate to the privacy functions (within the meaning of the Australian Information Commissioner Act 2010); and

(b)    have regard to any submissions made by the Information Commissioner because of that consultation.

SECTION 133CF   LICENSEE NOT TO MAKE CERTAIN UNSOLICITED COMMUNICATIONS IN RELATION TO A SMALL AMOUNT CREDIT CONTRACT  

Prohibition on certain unsolicited communications

133CF(1)    
A licensee must not make, or arrange for the making of, an unsolicited communication to a consumer (whether orally, in writing or by electronic means) that contains:

(a)    an offer to the consumer to enter into a small amount credit contract; or

(b)    an invitation to the consumer to apply for a small amount credit contract;

if any of the following apply:

(c)    the consumer is, or has at any time been, a debtor under a small amount credit contract with the licensee;

(d)    the consumer has at any time applied for a small amount credit contract with the licensee;

(e)    the consumer:

(i) is, or has at any time been, a debtor under a small amount credit contract with another credit provider; or

(ii) has at any time applied for a small amount credit contract with another credit provider;

and a reasonable person in the licensee's position would, if the person undertook such inquiries as are reasonable in the circumstances, be aware of the matter in subparagraph (i) or (ii) (whichever applies).

Civil penalty: 5,000 penalty units.

Meaning of unsolicited communication to a consumer

133CF(2)    
An unsolicited communication to a consumer is a communication to a consumer or a consumer's agent that is made by a person by dealing directly with the consumer or the consumer's agent in any of the following circumstances:

(a)    no prior request has been made by the consumer to the licensee for that communication;

(b)    the consumer has made a prior request to the licensee for that communication and that request was solicited by or on behalf of the licensee;

(c)    circumstances of a kind prescribed by the regulations.

However, the regulations may prescribe that specified kinds of communications are not unsolicited communications to which this section applies.

Offence

133CF(3)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Loss of certain fees and charges

133CF(4)    
If:

(a)    a licensee makes an unsolicited communication to a consumer in contravention of subsection (1); and

(b)    the licensee enters into a small amount credit contract with that consumer within 30 days after that unsolicited communication is made;

then:

(c)    the consumer is not liable (and is taken never to have been liable) to pay a fee or charge of a kind mentioned in paragraph 31A(1)(a), (b), (c) or (d) of the National Credit Code under that small amount credit contract (whether or not the liability is imposed consistently with the National Credit Code); and

(d)    the consumer may recover as a debt due to the consumer any amounts paid by the consumer that, in accordance with paragraph (c) of this subsection, the consumer is not liable to pay (or is taken never to have been liable to pay).

PART 3-2CA - LICENSEES SUPPLYING CREDIT INFORMATION TO CREDIT REPORTING BODIES ETC.  

Division 1 - Introduction  

SECTION 133CM   GUIDE TO THIS PART  

SECTION 133CN   MEANINGS OF ELIGIBLE LICENSEE AND ELIGIBLE CREDIT REPORTING BODY  

133CN(1)    
A licensee is an eligible licensee , on 1 July 2021 or a later day, if on that day the licensee:

(a)    is a large ADI, or is a body corporate of a kind prescribed by the regulations; and

(b)    is a credit provider.

133CN(2)    
A credit reporting body is an eligible credit reporting body for a licensee if:

(a)    the following conditions are met:

(i) ) an agreement of the kind referred to in paragraph 20Q(2)(a) of the Privacy Act 1988 between the body and the licensee was in force on 2 November 2017;

(ii) the licensee is an eligible licensee on 1 July 2021; or

(b)    the conditions (if any) prescribed by the regulations are met.

SECTION 133CO   MEANING OF ELIGIBLE CREDIT ACCOUNT  

133CO(1)    
An eligible credit account is an account that:

(a)    relates to the provision, or possible provision, of consumer credit (within the meaning of the Privacy Act 1988); and

(b)    is held by one or more natural persons with a credit provider; and

(c)    is not of a kind determined under subsection (2).

133CO(2)    
ASIC may, by legislative instrument, determine one or more kinds of account for the purposes of paragraph (1)(c).

SECTION 133CP   MEANING OF MANDATORY CREDIT INFORMATION  

133CP(1)    
Mandatory credit information , for eligible credit accounts held by natural persons with a credit provider, is personal information (other than sensitive information) for those accounts that is:

(a)    identification information (within the meaning of the Privacy Act 1988) about the natural persons; or

(b)    consumer credit liability information (within the meaning of the Privacy Act 1988) about the natural persons; or

(c)    repayment history information (within the meaning of the Privacy Act 1988) about the natural persons; or

(d)    

financial hardship information about the natural persons; or

(e)    default information (within the meaning of the Privacy Act 1988) about the natural persons; or

(f)    payment information (within the meaning of the Privacy Act 1988) about the natural persons; or

(g)    new arrangement information (within the meaning of the Privacy Act 1988) about the natural persons.

133CP(2)    
Despite paragraph (1)(c), mandatory credit information does not include repayment history information (within the meaning of the Privacy Act 1988) that comes into existence more than 3 months before the first 1 July on which:

(a)    if the credit provider is a member of a banking group - the head company of the group is an eligible licensee; or

(b)    otherwise - the credit provider is an eligible licensee.

133CP(3)    

Despite paragraph (1)(d), mandatory credit information does not include financial hardship information that comes into existence:

(a)    before 1 July 2022; or

(b)    more than 3 months before the first 1 July on which:

(i) if the credit provider is a member of a banking group - the head company of the group is an eligible licensee; or

(ii) otherwise - the credit provider is an eligible licensee.

Note:

Paragraph (b) is included to deal with the case where the first 1 July is in 2023 or a later year.

133CP(4)    
Despite paragraph (1)(e), mandatory credit information does not include default information (within the meaning of the Privacy Act 1988) that comes into existence before the first 1 July on which:

(a)    if the credit provider is a member of a banking group - the head company of the group is an eligible licensee; or

(b)    otherwise - the credit provider is an eligible licensee.

SECTION 133CQ   MEANING OF SUPPLY REQUIREMENTS  

133CQ(1)    
Information is supplied in accordance with the supply requirements if the supply is in accordance with:

(a)    the registered CR code (within the meaning of the Privacy Act 1988); and

(b)    any determination under subsection (2); and

(c)    any technical standards approved under subsection (4).

133CQ(2)    
For one or more kinds of information to be supplied under this Part, ASIC may, by legislative instrument, determine particulars of the information that must be included in the supply.

133CQ(3)    
Despite subsection 14(2) of the Legislation Act 2003, a determination under subsection (2) may make provision in relation to a matter by applying, adopting or incorporating, with or without modification, any matter contained in any other instrument or writing as in force or existing from time to time.

133CQ(4)    
ASIC may, in writing, approve technical standards for supplying one or more kinds of information under this Part.

133CQ(5)    
If there is an inconsistency between:

(a)    the registered CR code (within the meaning of the Privacy Act 1988); and

(b)    a determination under subsection (2) or a technical standard approved under subsection (4);

the registered CR code prevails to the extent of the inconsistency.

Division 2 - Supplying credit information to credit reporting bodies etc.  

Subdivision A - Initial bulk supplies of credit information  

SECTION 133CR   REQUIREMENT TO SUPPLY  

First bulk supply for at least 50% of total eligible credit accounts

133CR(1)    
An eligible licensee must supply mandatory credit information for the accounts referred to in subsection (2) to each eligible credit reporting body ( CRB ) for the licensee:

(a)    before the end of the later of the following periods:

(i) the 90-day period starting on the first 1 July on which the licensee is an eligible licensee;

(ii) if subsection (5) applies - the 14-day period starting on the cessation day referred to in that subsection; and

(b)    in accordance with the supply requirements; and

(c)    to the extent that the licensee is not prevented by the Privacy Act 1988 from doing so.

Civil penalty: 5,000 penalty units.

133CR(2)    
For the purposes of subsection (1), the accounts are at least 50% of all of the eligible credit accounts held:

(a)    on the first 1 July on which the licensee is an eligible licensee; and

(b)    with the licensee, or with a member of a banking group of which the licensee is the head company.

The licensee may choose which eligible credit accounts make up this 50%.

Bulk supply for remaining eligible credit accounts

133CR(3)    
An eligible licensee must supply mandatory credit information for the accounts referred to in subsection (4) to each eligible credit reporting body ( CRB ) for the licensee:

(a)    before the end of the latest of the following periods:

(i) the 90-day period starting on the second 1 July on which the licensee is an eligible licensee;

(ii) if subsection (5) applies - the 14-day period starting on the cessation day referred to in that subsection;

(iii) if, because paragraph 133CS(1)(b) is no longer satisfied, subsection 133CS(1) ceases to provide the licensee with an exception to this subsection for the CRB - the 14-day period starting on the day that exception ceases to apply; and

(b)    in accordance with the supply requirements; and

(c)    to the extent that the licensee is not prevented by the Privacy Act 1988 from doing so.

Civil penalty: 5,000 penalty units.

133CR(4)    
For the purposes of subsection (3), the accounts are all of the eligible credit accounts held:

(a)    on the second 1 July on which the licensee is an eligible licensee; and

(b)   with the licensee, or with a member of a banking group of which the licensee is the head company;

for which mandatory credit information was not supplied under subsection (1) to the CRB.

Possible extension of time if credit reporting body later complies with information security requirements before end of 90-day period

133CR(5)    
For the purposes of subsection (1) or (3), this subsection applies if:

(a)    the licensee reasonably believes that the CRB is not complying with section 20Q of the Privacy Act 1988 on the 1 July referred to in that subsection; and

(b)    the licensee complies with paragraphs 133CS(2)(a) and (b) in relation to that belief; and

(c)    the licensee ceases to hold that belief on a day (the cessation day ) before the end of the 90-day period starting on that 1 July.

Requirements apply whether the information is kept in or outside this jurisdiction

133CR(6)    
Subsection (1) or (3) applies whether the mandatory credit information is kept in or outside this jurisdiction.

SECTION 133CS   EXCEPTION IF CREDIT REPORTING BODY NOT COMPLYING WITH INFORMATION SECURITY REQUIREMENTS  

133CS(1)    
Subsection 133CR(1) or (3) does not apply, and is taken never to have applied, to a licensee for a credit reporting body if:

(a)    the licensee reasonably believes that the body is not complying with section 20Q of the Privacy Act 1988:

(i) on the 1 July referred to in that subsection; and

(ii) on the last day of the 90-day period starting on that 1 July; and

(b)    in the case of subsection 133CR(3) - the licensee continues to hold that belief after that 90-day period; and

(c)    the licensee satisfies subsection (2) of this section.

Note 1:

Paragraph (b) means that, if the licensee ceases to hold that belief after the 90-day period starting on the 1 July in subsection 133CR(3), this exception will cease to apply and the supply requirement in subsection 133CR(3) will apply.

Note 2:

A person who wishes to rely on this subsection bears an evidential burden in relation to the matters in this subsection (see subsection (3) of this section and subsection 13.3(3) of the Criminal Code).

133CS(2)    
The licensee satisfies this subsection if:

(a)    the licensee prepares a written notice:

(i) stating that the licensee reasonably believes that the credit reporting body is not complying with section 20Q of the Privacy Act 1988 on that 1 July; and

(ii) setting out the licensee's reasons for that belief; and

(iii) stating that the body may try to convince the licensee otherwise, but that in the case of subsection 133CR(1)the body will need to do so before the end of the 90-day period starting on that 1 July; and

(b)    the licensee gives that notice to the body, and a copy to the Information Commissioner and ASIC, within 7 days after that 1 July; and

(c)    the licensee prepares a written notice (the final notice ):

(i) stating that the licensee reasonably believes that the body is not complying with section 20Q of the Privacy Act 1988 on the last day of that 90-day period; and

(ii) setting out the licensee's reasons for that belief; and

(d)    the licensee gives the final notice to the body, and a copy to the Information Commissioner and ASIC, within 7 days after the last day of that 90-day period.

133CS(3)    
A licensee who wishes to rely on subsection (1) in proceedings for a declaration of contravention or a pecuniary penalty order bears an evidential burden in relation to the matters in that subsection.

SECTION 133CT  

133CT   LICENSEE MUST GIVE NOTICE IF CREDIT REPORTING BODY LATER COMPLIES WITH INFORMATION SECURITY REQUIREMENTS  

If:

(a)    an eligible licensee reasonably believes that an eligible credit reporting body for the licensee is not complying with section 20Q of the Privacy Act 1988 on the first or second 1 July on which the licensee is an eligible licensee; and

(b)    the licensee complies with paragraphs 133CS(2)(a) and (b) in relation to that belief; and

(c)    the licensee ceases to hold that belief:

(i) in the case of subsection 133CR(1) - on a day during the 90-day period starting on that first 1 July; or

(ii) in the case of subsection 133CR(3) - on any day after that second 1 July;

the licensee must:

(d)    prepare a written notice:

(i) stating that the licensee has ceased to hold that belief; and

(ii) setting out the licensee's reasons for ceasing to hold that belief; and

(e)    give that notice to the body, and a copy to the Information Commissioner and ASIC, within 7 days after the day the licensee ceases to hold that belief.

Civil penalty: 5,000 penalty units.

Subdivision B - Ongoing supplies of credit information  

SECTION 133CU   REQUIREMENT TO SUPPLY  

133CU(1)    

If:

(a)    a licensee has supplied a credit reporting body (the CRB ) with mandatory credit information under this Division; and

(b)    on a later day (the trigger day ):

(i) the conditions (if any) prescribed by the regulations are not met for the licensee and the CRB; and

(ii) the licensee, or a member of a banking group of which the licensee is the head company, would reasonably be expected to have become aware that an event in an item of the following table has happened; and

(iii) the licensee is still an eligible licensee; and

(iv) an agreement of the kind referred to in paragraph 20Q(2)(a) of the Privacy Act 1988 is in force between the CRB and a body referred to in subparagraph (ii) of this paragraph;

the licensee must supply to the CRB the information referred to in that table item:

(c)    before the end of the latest of the following periods:

(i) the 45-day period starting on the trigger day;

(ii) if subsection (2) applies - the 14-day period starting on the cessation day referred to in that subsection;

(iii) if, because paragraph 133CV(1)(b) is no longer satisfied, subsection 133CV(1) ceases to provide the licensee with an exception to this subsection for the CRB - the 14-day period starting on the day that exception ceases to apply;

(iv) if the trigger day happens because of table item 3 and is before the licensee supplies the CRB with mandatory credit information under subsection 133CR(3) - the 90-day period starting on the trigger day; and

(d)    in accordance with the supply requirements; and

(e)    to the extent that the licensee is not prevented by the Privacy Act 1988 from doing so.

Ongoing supplies of mandatory credit information
Item	If this event happens:	This information must be supplied:
1	the need to correct any mandatory credit information the licensee has supplied under this Division to ensure that, having regard to a purpose for which the information is held by:	details of the corrected information
	(a)	the licensee; or
	(b)	a member of a banking group of which the licensee is the head company;
	the information is accurate, up-to-date, complete, relevant and not misleading
2	the payment of an overdue payment about which default information (within the meaning of the Privacy Act 1988) has been supplied under this Division	payment information (within the meaning of the Privacy Act 1988) relating to the payment
3	the opening of an eligible credit account with:	mandatory credit information for that account
	(a)	the licensee; or
	(b)	a member of a banking group of which the licensee is the head company;
	provided this happens after the second 1 July on which the licensee is an eligible licensee
4	financial hardship information comes into existence for an eligible credit account on or after the later of:	the financial hardship information
	(a)	1 July 2022; and
	(b)	the day after the first day mandatory credit information for the account is supplied by the licensee to the CRB under this Division
5	default information (within the meaning of the Privacy Act 1988) comes into existence for an eligible credit account for which mandatory credit information has previously been supplied by the licensee to the CRB under this Division	the default information
6	an event:	information that:
	(a)	of a kind prescribed by the regulations; and	(a)	is, or relates to, mandatory credit information; and
	(b)	that relates to eligible credit accounts or to the natural persons who hold those accounts	(b)	is of a kind prescribed by the regulations for that kind of event

Civil penalty: 5,000 penalty units.

133CU(2)    
For the purposes of subparagraph (1)(c)(ii), this subsection applies if:

(a)    the licensee reasonably believes that the CRB is not complying with section 20Q of the Privacy Act 1988 on the trigger day; and

(b)    the licensee complies with paragraphs 133CV(2)(a) and (b) in relation to that belief; and

(c)    the licensee ceases to hold that belief on a day (the cessation day ) before the end of the 45-day period starting on the trigger day.

133CU(3)    
Supplies under subsection (1) of information relating to multiple events, or multiple trigger days, may be made together.

133CU(4)    
Subsection (1) applies whether the information referred to in the table is kept in or outside this jurisdiction.

133CU(5)    
Regulations made for the purposes of subparagraph (1)(b)(i) may make provision in relation to a matter by applying, adopting or incorporating, with or without modification, any matter contained in any other instrument or writing as in force or existing from time to time.

133CU(6)    
Subsection (5) has effect despite subsection 14(2) of the Legislation Act 2003.

SECTION 133CV   EXCEPTION IF CREDIT REPORTING BODY NOT COMPLYING WITH INFORMATION SECURITY REQUIREMENTS  

133CV(1)    
Subsection 133CU(1) does not apply, and is taken never to have applied, to a licensee for a credit reporting body if:

(a)    the licensee reasonably believes that the body is not complying with section 20Q of the Privacy Act 1988:

(i) on the trigger day referred to in that subsection; and

(ii) on the last day of the 45-day period starting on the trigger day; and

(b)    the licensee continues to hold that belief after that 45-day period; and

(c)    the licensee satisfies subsection (2) of this section.

Note 1:

Paragraph (b) means that, if the licensee ceases to hold that belief after that 45-day period, this exception will cease to apply and the supply requirement in subsection 133CU(1) will apply.

Note 2:

A person who wishes to rely on this subsection bears an evidential burden in relation to the matters in this subsection (see subsection (3) of this section and subsection 13.3(3) of the Criminal Code).

133CV(2)    
The licensee satisfies this subsection if:

(a)    the licensee prepares a written notice:

(i) stating that the licensee reasonably believes that the body is not complying with section 20Q of the Privacy Act 1988 on the trigger day; and

(ii) setting out the licensee's reasons for that belief; and

(iii) stating that the body may try to convince the licensee otherwise; and

(b)    the licensee gives that notice to the body, and a copy to the Information Commissioner and ASIC, within 7 days after the trigger day; and

(c)    the licensee prepares a written notice (the final notice ):

(i) stating that the licensee reasonably believes that the body is not complying with section 20Q of the Privacy Act 1988 on the last day of that 45-day period; and

(ii) setting out the licensee's reasons for that belief; and

(d)    the licensee gives the final notice to the body, and a copy to the Information Commissioner and ASIC, within 7 days after the last day of that 45-day period.

133CV(3)    
A licensee who wishes to rely on subsection (1) in proceedings for a declaration of contravention or a pecuniary penalty order bears an evidential burden in relation to the matters in that subsection.

133CV(4)    
Subsection 21U(2) of the Privacy Act 1988 does not require a licensee to give a credit reporting body notice of a correction of certain information if:

(a)    subsection (1) of this section is providing the licensee with an exception from a requirement under subsection 133CU(1) of this Act; and

(b)    that requirement is to supply the corrected information to the body;

unless the reason under subsection 21U(1) of the Privacy Act 1988 for the correction is that the information is inaccurate, and it was inaccurate when earlier supplied to the body under this Division.

SECTION 133CW  

133CW   LICENSEE MUST GIVE NOTICE IF CREDIT REPORTING BODY LATER COMPLIES WITH INFORMATION SECURITY REQUIREMENTS  

If:

(a)    an eligible licensee reasonably believes that an eligible credit reporting body for the licensee is not complying with section 20Q of the Privacy Act 1988 on the trigger day referred to in subsection 133CU(1); and

(b)    the licensee complies with paragraphs 133CV(2)(a) and (b) in relation to that belief; and

(c)    the licensee ceases to hold that belief on any day after the trigger day;

the licensee must:

(d)    prepare a written notice:

(i) stating that the licensee has ceased to hold that belief; and

(ii) setting out the licensee's reasons for ceasing to hold that belief; and

(e)    give that notice to the body, and a copy to the Information Commissioner and ASIC, within 7 days after the day the licensee ceased to hold that belief.

Civil penalty: 5,000 penalty units.

Subdivision C - Offences  

SECTION 133CX   OFFENCE RELATING TO INITIAL BULK SUPPLIES  

133CX(1)    
A person commits an offence if:

(a)    the person is subject to a requirement under subsection 133CR(1) or (3); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

133CX(2)    
Section 14.1 of the Criminal Code does not apply to an offence against subsection (1).

Note:

For an exception to an offence against subsection (1), see subsection 133CS(1). A defendant bears an evidential burden in relation to the matters in subsection 133CS(1) (see subsection 13.3(3) of the Criminal Code).

SECTION 133CY   OFFENCE RELATING TO ONGOING SUPPLIES  

133CY(1)    
A person commits an offence if:

(a)    the person is subject to a requirement under subsection 133CU(1); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

133CY(2)    
Section 14.1 of the Criminal Code does not apply to an offence against subsection (1).

Note:

For an exception to an offence against subsection (1), see subsection 133CV(1). A defendant bears an evidential burden in relation to the matters in subsection 133CV(1) (see subsection 13.3(3) of the Criminal Code).

SECTION 133CZ  

133CZ   OFFENCE RELATING TO GIVING NOTICE IF CREDIT REPORTING BODY LATER COMPLIES WITH INFORMATION SECURITY REQUIREMENTS  

A person commits an offence if:

(a)    the person is subject to a requirement under section 133CT or 133CW; and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Division 3 - Conditions on credit reporting bodies on-disclosing credit information  

SECTION 133CZA   ON-DISCLOSING INFORMATION SUPPLIED UNDER DIVISION 2 ETC.  

133CZA(1)    
This section applies to a credit reporting body in relation to the following information (the protected information ):

(a)    any information that the credit reporting body is supplied under Division 2;

(b)    any CRB derived information (within the meaning of the Privacy Act 1988) that is derived from information that the credit reporting body is supplied under Division 2.

When protected information must not be disclosed

133CZA(2)    
If the conditions prescribed by the regulations are met for the credit reporting body and a credit provider, the credit reporting body must not disclose to the credit provider so much of the protected information as:

(a)    is prescribed by the regulations; or

(b)    is of a kind or kinds prescribed by the regulations.

Civil penalty: 5,000 penalty units.

When protected information must be disclosed

133CZA(3)    
If the conditionsprescribed by the regulations are met for the credit reporting body and a credit provider, the credit reporting body must disclose to the credit provider so much of the protected information as:

(a)    the regulations require to be disclosed; or

(b)    is of a kind or kinds prescribed by the regulations;

and which the Privacy Act 1988 does not prevent the credit reporting body from disclosing.

Civil penalty: 5,000 penalty units.

133CZA(4)    
If the credit reporting body is required under subsection (3) to disclose information, the credit reporting body must make the disclosure by the time, and in accordance with the requirements, prescribed by the regulations.

Civil penalty: 5,000 penalty units.

Incorporation of other instruments

133CZA(5)    
Regulations made for the purposes of subsection (2), (3) or (4) may make provision in relation to a matter by applying, adopting or incorporating, with or without modification, any matter contained in any other instrument or writing as in force or existing from time to time.

133CZA(6)    
Subsection (5) has effect despite subsection 14(2) of the Legislation Act 2003.

Matters regulations may deal with

133CZA(7)    
Without limiting subsection (2), (3) or (4), a matter prescribed for the purposes of that subsection may depend on a person or body being satisfied of one or more specified matters.

SECTION 133CZB  

133CZB   OFFENCE  

A person commits an offence if:

(a)    the person is subject to a requirement under subsection 133CZA(2), (3) or (4); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Division 4 - Reporting to the Minister  

SECTION 133CZC   REPORTS ABOUT INITIAL BULK SUPPLIES OF CREDIT INFORMATION  

133CZC(1)    
A licensee who is required under subsection 133CR(1) or (3) to supply mandatory credit information must arrange:

(a)    for the preparation of a written statement containing information of the kinds prescribed by the regulations relating to:

(i) the mandatory credit information; or

(ii) the eligible credit accounts to which the mandatory credit information relates; and

(b)    for a person appointed under section 133CZD to audit that statement and prepare a written report of the audit; and

(c)    for that statement and audit report to be given to the Minister within 6 months after the 1 July referred to in that subsection.

Civil penalty: 5,000 penalty units.

133CZC(2)    
A credit reporting body to whom mandatory credit information is required under subsection 133CR(1) or (3) to be supplied must arrange:

(a)    for the preparation of a written statement containing information of the kinds prescribed by the regulations relating to:

(i) the mandatory credit information; or

(ii) the eligible credit accounts to which the mandatory credit information relates; and

(b)    for a person appointed under section 133CZD to audit that statement and prepare a written report of the audit; and

(c)    for that statement and audit report to be given to the Minister within 6 months after the 1 July referred to in that subsection.

Civil penalty: 5,000 penalty units.

133CZC(3)    
For the purposes of subsection (1) or (2), disregard section 133CS when working out whether a person is required under subsection 133CR(1) or (3) to supply mandatory credit information to another person.

SECTION 133CZD   AUDITORS  

133CZD(1)    
ASIC may, in writing, appoint as auditors for the purposes of this Division:

(a)    one or more suitably qualified persons; or

(b)    the members of one or more classes of suitably qualified persons.

133CZD(2)    
The reasonable fees and expenses of an auditor for preparing an audit report under this Division are payable by the person required to arrange for the preparation of the statement to which the audit report relates.

133CZD(3)    
The auditor may recover those fees by action against that person.

SECTION 133CZE  

133CZE   OFFENCE  

A person commits an offence if:

(a)    the person is subject to a requirement under subsection 133CZC(1) or (2); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

Division 5 - Assisting ASIC  

SECTION 133CZF  

133CZF   MEANING OF PART 3-2CA BODY  

A Part 3-2CA body is a person that is or has been:

(a)    an eligible licensee; or

(b)    an eligible credit reporting body for a licensee.

SECTION 133CZG   OBLIGATION TO PROVIDE A STATEMENT OR OBTAIN AN AUDIT REPORT IF DIRECTED BY ASIC  

Notice to Part 3-2CA body to provide a statement

133CZG(1)    
ASIC may give a Part 3-2CA body a written notice directing the body to lodge with ASIC a written statement containing specified information about whether the body, or another Part 3-2CA body, is complying with this Part (other than Division 4).

133CZG(2)    
Notices under subsection (1):

(a)    may be given at any time; and

(b)    may be given to one or more particular Part 3-2CA bodies, or to each Part 3-2CA body in one or more classes of Part 3-2CA bodies, or to all Part 3-2CA bodies; and

(c)    may require all the same information, or may contain differences as to the information they require; and

(d)    may require a statement containing information to be given on a periodic basis, or each time a particular event or circumstance occurs, without ASIC having to give a further written notice.

Notice to Part 3-2CA body to obtain an audit report

133CZG(3)    
ASIC may also give a Part 3-2CA body a written notice directing the body to obtain an audit report prepared:

(a)    by a suitably qualified person specified in the notice; and

(b)    on a statement, or on each statement in a class of statements, under subsection (1); and

(c)    before the statement is given to ASIC.

133CZG(4)    
A notice under subsection (3) is not a legislative instrument.

Notice must specify day by which Part 3-2CA body must comply

133CZG(5)    
A notice given under this section must specify the day by which the Part 3-2CA body 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 Part 3-2CA body.

Requirement to comply with notice

133CZG(6)    
The Part 3-2CA body must comply with a notice given under this section within the time specified in the notice.

Civil penalty: 5,000 penalty units.

Offence

133CZG(7)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

SECTION 133CZH   OBLIGATION TO GIVE ASIC INFORMATION REQUIRED BY THE REGULATIONS  

Regulations may require Part 3-2CA body to give information

133CZH(1)    
The regulations may require:

(a)    a Part 3-2CA body; or

(b)    each Part 3-2CA body in a class of Part 3-2CA bodies;

to give ASIC specified information about whether the body, or another Part 3-2CA body, is complying with this Part (other than Division 4).

Requirement to comply with regulations

133CZH(2)    
If regulations under subsection (1) require a Part 3-2CA body to give ASIC information, the body must give ASIC that information.

Civil penalty: 5,000 penalty units.

Offence

133CZH(3)    
A person commits an offence if:

(a)    the person is subject to a requirement to give ASIC information under subsection (2); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

SECTION 133CZI   OBLIGATION TO PROVIDE ASIC WITH ASSISTANCE IF REASONABLY REQUESTED  

Requirement to provide assistance

133CZI(1)    
If ASIC, or a person authorised by ASIC, reasonably requests assistance from a Part 3-2CA body (the assisting body ) about whether:

(a)    the assisting body; or

(b)    another Part 3-2CA body;

is complying with this Part (other than Division 4), the assisting body must give ASIC or the authorised person the requested assistance.

Civil penalty: 5,000 penalty units.

133CZI(2)    
If the request is in writing, it is not a legislative instrument.

Offence

133CZI(3)    
A person commits an offence if:

(a)    the person is subject to a requirement to give ASIC or an authorised person assistance under subsection (1); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

SECTION 133CZJ   EXTENDED APPLICATION OF DIVISION 4 OF PART 2-5  

133CZJ(1)    
Division 4 of Part 2-5 also applies in relation to an audit report required under subsection 133CZG(3) as if the substitutions in the following table, and the modification in subsection (2) of this section, were made.

Substitutions to be made
Item	For a reference in Division 4 of Part 2-5 to:	substitute a reference to:
1	licensee	Part 3-2CA body
2	subsection 49(3)	subsection 133CZG(3)
3	financial records or other credit books	records

133CZJ(2)    
For the purposes of subsection (1), assume that paragraphs 104(2)(a) and (b) were replaced with the following:

"(a) constitutes or may constitute a contravention of Part 3-2CA (other than Division 4); or".

Division 6 - Miscellaneous  

SECTION 133CZK  

133CZK   THIS PART DOES NOT LIMIT THE PRIVACY ACT 1988  

Subject to subsection 133CV(4), this Part does not limit the operation of the Privacy Act 1988.

SECTION 133CZL   REVIEW OF THE OPERATION OF THIS PART  

133CZL(1)    
The Minister must cause an independent review to be conducted of the operation of this Part.

133CZL(2)    
The persons who conduct the review must complete it, and give the Minister a written report of the review, before 1 October 2024.

133CZL(3)    
The Minister must cause copies of the report to be tabled in each House of the Parliament within 15 sitting days of that House after the report is given to the Minister.

SECTION 133CZM  

133CZM   MAIN CONSTITUTIONAL BASIS  

The main constitutional basis for this Part is set out in Part 1-3.

SECTION 133CZN   OTHER CONSTITUTIONAL BASES  

133CZN(1)    
Independently of section 133CZM, this Part also has effect as provided by subsections (2), (3), (4) and (5).

Other constitutional bases - eligible licensees

133CZN(2)    
This Part also has the effect it would have if a reference in it to an eligible licensee were expressly confined to an eligible licensee that is a corporation to which paragraph 51(xx) of the Constitution applies.

133CZN(3)    
This Part also has the effect it would have if a reference in it to an eligible licensee were expressly confined to an eligible licensee acting:

(a)    in the course of; or

(b)    in relation to;

the carrying on of the business of banking, other than State banking (within the meaning of paragraph 51(xiii) of the Constitution) not extending beyond the limits of the State concerned.

Other constitutional bases - credit reporting bodies

133CZN(4)    
Division 3, subsection 133CZC(2) and Division 5 also have the effect they would have if a reference in them to a credit reporting body were expressly confined to a credit reporting body that is a corporation to which paragraph 51(xx) of the Constitution applies.

133CZN(5)    
Division 3, subsection 133CZC(2) and Division 5 also have the effect they would have if a reference in them to a credit reporting body were expressly confined to a credit reporting body acting:

(a)    in the course of; or

(b)    in relation to;

the carrying on of the business of banking, other than State banking (within the meaning of paragraph 51(xiii) of the Constitution) not extending beyond the limits of the State concerned.

PART 3-2D - LICENSEES AND REVERSE MORTGAGES  

SECTION 133DA  

133DA   GUIDE TO THIS PART  

SECTION 133DB   GIVING PROJECTIONS OF EQUITY BEFORE PROVIDING CREDIT ASSISTANCE OR ENTERING CREDIT CONTRACT  

Requirement to give projections

133DB(1)    
Before a licensee makes a preliminary assessment for the purposes of paragraph 115(1)(c) or (2)(a), or an assessment for the purposes of paragraph 128(c), in connection with a credit contract with a consumer for a reverse mortgage, the licensee must:

(a) show the consumer in person, or give the consumer in a way prescribed by the regulations, projections that:

(i) relate to the value of the dwelling or land that may become reverse mortgaged property, and the consumer's indebtedness, over time if the consumer were to enter into a contract for a reverse mortgage; and

(ii) are made in accordance with the regulations by using a website approved by ASIC; and

(b) give the consumer a printed copy of the projections; and

(c) tell the consumer in person the things (if any) that relate to reverse mortgages and are prescribed by the regulations; and

(d) give the consumer a reverse mortgage information statement.

Civil penalty: 5,000 penalty units.

Offence

133DB(2)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the person's conduct breaches the requirement.

Criminal penalty: 50 penalty units.

Defences for not giving projections

133DB(3)    
For the purposes of paragraphs (1)(a) and (b), and of subsection (2) so far as it relates to either of those paragraphs, it is a defence if the licensee reasonably believes that:

(a) another person has:

(i) shown the consumer in person projections described in paragraph (1)(a); and

(ii) given the consumer a printed copy of the projections; and

(b) the projections are the same, or substantially the same, as those paragraph (1)(a) requires the licensee to show the consumer.

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (3) (see subsection 13.3(3) of the Criminal Code).

133DB(4)    
For the purposes of paragraphs (1)(a) and (b), and of subsection (2) so far as it relates to either of those paragraphs, it is a defence if the circumstances prescribed by the regulations exist.

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

Defence for not giving reverse mortgage information statement

133DB(5)    
For the purposes of paragraph (1)(d), and of subsection (2) so far as it relates to that paragraph, it is a defence if the licensee reasonably believes that another person has given the consumer a reverse mortgage information statement in the last 90 days.

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (5) (see subsection 13.3(3) of the Criminal Code).

SECTION 133DC   MAKING REVERSE MORTGAGE INFORMATION STATEMENT AVAILABLE ON WEBSITE OF CREDIT PROVIDER OR CREDIT ASSISTANCE PROVIDER  

When this section applies

133DC(1)    
This section applies if a licensee:

(a) is:

(i) a person who provides, or holds himself or herself out as able to provide, credit assistance relating to credit contracts for reverse mortgages; or

(ii) a credit provider under one or more credit contracts for a reverse mortgages; and

(b) has a website that provides information about such contracts.

Requirement

133DC(2)    

The licensee must make available through the website a reverse mortgage information statement.

Civil penalty: 5,000 penalty units.

Offence

133DC(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the person's conduct breaches the requirement.

Criminal penalty: 50 penalty units.

SECTION 133DD   MAKING REVERSE MORTGAGE INFORMATION STATEMENT AVAILABLE IN OTHER SITUATIONS  

When this section applies

133DD(1)    
This section applies if:

(a) a licensee is:

(i) a person who provides, or holds himself or herself out as able to provide, credit assistance relating to credit contracts for reverse mortgages; or

(ii) a credit provider under one or more credit contracts for reverse mortgages; and

(b) either:

(i) a consumer asks the licensee (otherwise than by using a website of the licensee) for a reverse mortgage information statement; or

(ii) the regulations require a consumer, in circumstances prescribed by the regulations, to be given a reverse mortgage information statement; and

(c) the consumer gives the licensee the consumer's name, and the contact details required by the regulations.

Requirement

133DD(2)    

The licensee must, in accordance with any requirements prescribed by the regulations, give the consumer a reverse mortgage information statement.

Civil penalty: 5,000 penalty units.

Offence

133DD(3)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (2); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Defences

133DD(4)    
For the purposes of subsections (2) and (3), it is a defence if:

(a) the licensee has given the consumer, or reasonably believes that someone else has given the consumer, a reverse mortgage information statement; or

(b) the licensee:

(i) is a credit provider under one or more credit contracts for reverse mortgages; and

(ii) reasonably believes that the consumer would not be eligible to makea credit contract with the licensee for a reverse mortgage; or

(c) there exist circumstances prescribed by regulations as circumstances in which the licensee is not required to give the consumer a reverse mortgage information statement.

Note:

For the purposes of subsection (3), a defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

SECTION 133DE   REPRESENTATIONS THAT USE THE TERM "REVERSE MORTGAGE" ETC.  

Credit service providers

133DE(1)    
A licensee must not, in providing or offering to provide a credit service to a consumer, use either of the following terms (either alone or in combination with other words or letters) in a representation to the consumer about an actual or proposed credit contract or mortgage:

(a) the phrase "reverse mortgage";

(b) another term (whether or not in English) of similar import to the phrase "reverse mortgage".

Civil penalty: 5,000 penalty units.

Credit providers

133DE(2)    
A licensee that is a credit provider must not use either of the following terms (either alone or in combination with other words or letters) in a representation to a consumer about an actual or proposed credit contract or mortgage:

(a) the phrase "reverse mortgage";

(b) another term (whether or not in English) of similar import to the phrase "reverse mortgage".

Civil penalty: 5,000 penalty units.

Defence

133DE(3)    
For the purposes of subsections (1) and (2), it is a defence if:

(a) the representation truly represents that a credit contract:

(i) is or will be a credit contract for a reverse mortgage; or

(ii) is not or will not be a credit contract for a reverse mortgage; or

(b) the representation truly represents that a mortgage:

(i) is or will be part of a reverse mortgage; or

(ii) is not or will not be part of a reverse mortgage.

PART 3-3 - LICENSEES THAT PROVIDE CREDIT ASSISTANCE IN RELATION TO CONSUMER LEASES  

Division 1 - Introduction  

SECTION 134   GUIDE TO THIS PART  

SECTION 135  

135   APPLICATION OF THIS PART  
This Part does not apply in relation to credit assistance provided by a licensee in relation to a consumer lease if the licensee is or will be the lessor under the consumer lease.

Division 2 - Credit guide of credit assistance providers  

SECTION 136   CREDIT GUIDE OF CREDIT ASSISTANCE PROVIDERS  
Requirement to give credit guide

136(1)    

A licenseemust, as soon as practicable after it becomes apparent to the licensee that it is likely to provide credit assistance to a consumer in relation to a consumer lease, give the consumer the licensee's credit guide in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

136(2)    
The licensee's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the licensee's name and contact details; and

(d) specify the licensee's Australian credit licence number; and

(e) give information about:

(i) any fees that are payable by a consumer to the licensee for the licensee's credit assistance; and

(ii) any charges that are payable by a consumer to the licensee for matters associated with providing the credit assistance; and

(iii) the method for working out the amount of the fees and charges; and

(f) give information about:

(i) if there are 6 or fewer lessors that the licensee conducts business with when providing credit assistance in relation to consumer leases - the names of those lessors; and

(ii) if there are more than 6 lessors that the licensee conducts business with when providing credit assistance in relation to consumer leases - the names of the 6 lessors with whom the licensee reasonably believes it conducts the most business; and

(g) give information about:

(i) any indirect remuneration that the licensee, or an employee, director or credit representative of the licensee, is likely to receive, directly or indirectly, from lessors in relation to consumer leases for which the licensee has provided credit assistance; and

(ii) a reasonable estimate of the amounts of that indirect remuneration or the range of those amounts; and

(iii) the method for working out those amounts; and

(h) give information about the licensee's procedure for resolving disputes with a consumer, including contact details for a consumer to access:

(i) the licensee's internal dispute resolution procedure; and

(ii) the AFCA scheme; and

(i) give information about the licensee's obligations under sections 143 and 146; and

(j) comply with any other requirements prescribed by the regulations.

136(3)    
The regulations may prescribe:

(a) information that need not be included in the credit guide, despite subsection (2); and

(b) for the purposes of paragraph (2)(g):

(i) the method for working out amounts of indirect remuneration; and

(ii) how commissions or amounts of indirect remuneration must be described.

Manner of giving credit guide

136(4)    
The licensee must give the consumer the licensee's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

136(5)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

136(6)    
Subsection (5) is an offence of strict liability.

Note:

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

Division 3 - Quote for providing credit assistance etc. in relation to consumer leases  

SECTION 137   QUOTE FOR PROVIDING CREDIT ASSISTANCE ETC.  
Requirement to give quote

137(1)    
A licensee must not provide credit assistance to a consumer by:

(a) suggesting that the consumer apply, or assisting the consumer to apply, for a particular consumer lease with a particular lessor; or

(b) suggesting that the consumer remain in a particular consumer lease with a particular lessor;

unless:

(c) the licensee has given the consumer a quote in accordance with subsection (2); and

(d) the consumer has signed and dated that quote or otherwise indicated the consumer's acceptance of it (and the day that happens) in the manner (if any) prescribed by the regulations; and

(e) the licensee has given the consumer a copy of the accepted quote.

Civil penalty: 5,000 penalty units.

137(2)    
The quote must:

(a) be in writing; and

(b) give information about the credit assistance and other services that the quote covers; and

(c) specify the maximum amount that will be payable by the consumer to the licensee in relation to the licensee's credit assistance and other services; and

(d) give information about what that amount relates to, including:

(i) the maximum amount of the licensee's fee for providing the credit assistance and other services; and

(ii) the maximum amount of charges that will be incurred by the licensee for matters associated with providing the credit assistance and other services; and

(iii) the maximum amount of fees or charges that will be payable by the licensee to another person on the consumer's behalf; and

(e) state whether the maximum amount or any other amount will be payable by the consumer to the licensee if a consumer lease is not entered; and

(f) comply with any other requirements prescribed by the regulations.

Manner of giving quote

137(3)    
The licensee must give the quote to the consumer in the manner (if any) prescribed by the regulations.

No demanding payment of amount exceeding quoted amount

137(4)    

The licensee must not request or demand payment of an amount that exceeds the maximum amount set out in the quote.

Civil penalty: 5,000 penalty units.

No demanding payment before credit assistance provided

137(5)    

The licensee must not request or demand payment of an amount for the licensee's credit assistance before the licensee provides the assistance.

Civil penalty: 5,000 penalty units.

Caveats

137(6)    

The licensee must not lodge, or threaten to lodge, a caveat in relation to land to induce the consumer to pay an amount to the licensee for the licensee's credit assistance or other services.

Civil penalty: 5,000 penalty units.

Division 4 - Obligations of credit assistance providers before providing credit assistance for consumer leases  

SECTION 138   OBLIGATIONS OF CREDIT ASSISTANCE PROVIDERS BEFORE PROVIDING CREDIT ASSISTANCE FOR CONSUMER LEASES  

138(1)    
A licensee must not provide credit assistance to a consumer on a day (the assistance day ) by:

(a) suggesting that the consumer apply for a particular consumer lease with a particular lessor; or

(b) assisting the consumer to apply for a particular consumer lease with a particular lessor;

unless the licensee has, within 90 days (or other period prescribed by the regulations) before the assistance day:

(c) made a preliminary assessment that:

(i) is in accordance with subsection 139(1); and

(ii) covers the period proposed for the entering of the lease; and

(d) made the inquiries and verification in accordance with section 140.

Civil penalty: 5,000 penalty units.

138(2)    
A licensee must not provide credit assistance to a consumer on a day (the assistance day ) by suggesting that the consumer remain in a particular consumer lease with a particular lessor unless the licensee has, within 90 days (or other period prescribed by the regulations) before the assistance day:

(a) made a preliminary assessment that:

(i) is in accordance with subsection 139(2); and

(ii) covers a period in which the assistance day occurs; and

(b) made the inquiries and verification in accordance with section 140.

Civil penalty: 5,000 penalty units.

SECTION 139   PRELIMINARY ASSESSMENT OF UNSUITABILITY OF THE CONSUMER LEASE  

139(1)   [Preliminary assessment for para 138(1)(c)]  

For the purposes of paragraph 138(1)(c), the licensee must make a preliminary assessment that:

(a) specifies the period the assessment covers; and

(b) assesses whether the consumer lease will be unsuitable for the consumer if the lease is entered in that period.

139(2)   [Preliminary assessment for para 138(2)(a)]  

For the purposes of paragraph 138(2)(a), the licensee must make a preliminary assessment that:

(a) specifies the period the assessment covers; and

(b) assesses whether the consumer lease will be unsuitable for the consumer if the consumer remains in the lease in that period.

Note:

The licensee is not required to make a preliminary assessment under this section if the credit assistance is not provided.

SECTION 140   REASONABLE INQUIRIES ETC. ABOUT THE CONSUMER  

140(1)    
For the purposes of paragraph 138(1)(d) or 138(2)(b), the licensee must, before making the preliminary assessment:

(a)    make reasonable inquiries about the consumer's requirements and objectives in relation to the consumer lease; and

(b)    make reasonable inquiries about the consumer's financial situation; and

(c)    take reasonable steps to verify the consumer's financial situation; and

(d)    make any inquiries prescribed by the regulations about any matter prescribed by the regulations; and

(e)    

take any steps prescribed by the regulations to verify any matter prescribed by the regulations.

Civil penalty: 5,000 penalty units.

140(1A)    

If:

(a)    the consumer lease is a consumer lease for household goods; and

(b)    the consumer holds (whether alone or jointly with another person) an account with an ADI into which income payable to the consumer is credited;

the licensee must, in verifying the consumer's financial situation for the purposes of paragraph 138(1)(d), obtain and consider information about each transaction on the account, and the balances of the account, during at least the immediately preceding period of 90 days.

140(1B)    

Subsection (1A) does not limit paragraph (1)(c).

140(2)    
The regulations may prescribe particular inquiries or steps that must be made or taken, or do not need to be made or taken, for the purposes of paragraph (1)(a), (b) or (c).

SECTION 141   WHEN THE CONSUMER LEASE MUST BE ASSESSED AS UNSUITABLE - ENTERING LEASE  
Requirement to assess the lease as unsuitable

141(1)    

For a preliminary assessment under subsection 139(1) about entering a consumer lease, the licensee must assess that the lease will be unsuitable for the consumer if the lease will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

Note:

Even if the lease will not be unsuitable for the consumer under subsection (2), the licensee may still assess that the lease will be unsuitable for other reasons.

Particular circumstances when the lease will be unsuitable

141(2)    
The lease will be unsuitable for the consumer if, at the time of the preliminary assessment, it is likely that:

(a) the consumer will be unable to comply with the consumer's financial obligations under the lease, or could only comply with substantial hardship, if the lease is entered in the period proposed for it to be entered; or

(b) the lease will not meet the consumer's requirements or objectives if the lease is entered in the period proposed for it to be entered; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances will apply to the lease if the lease is entered in the period proposed for it to be entered.

141(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the lease by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease will be unsuitable

141(4)    
For the purposes of determining under subsection (2) whether the lease will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 140(1)(d) or (e);

(b) at the time of the preliminary assessment:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 140.

SECTION 142   WHEN THE CONSUMER LEASE MUST BE ASSESSED AS UNSUITABLE - REMAINING IN LEASE  
Requirement to assess the lease as unsuitable

142(1)    

For a preliminary assessment under subsection 139(2) about remaining in a consumer lease, the licensee must assess that the lease will be unsuitable for the consumer if the lease will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

Note:

Even if the lease will not be unsuitable for the consumer under subsection (2), the licensee may still assess that the lease will be unsuitable for other reasons.

Particular circumstances when the lease will be unsuitable

142(2)    
The lease will be unsuitable for the consumer if, at the time of the preliminary assessment, it is likely that:

(a) the consumer will be unable to comply with the consumer's financial obligations under the lease, or could only comply with substantial hardship if the consumer remains in the lease in the period covered by the preliminary assessment; or

(b) the lease will not meet the consumer's requirements or objectives if the consumer remains in the lease in the period covered by the preliminary assessment; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances will apply to the lease if the consumer remains in the lease in the period covered by the preliminary assessment.

142(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the lease by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease will be unsuitable

142(4)    
For the purposes of determining under subsection (2) whether the lease will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 140(1)(d) or (e);

(b) at the time of the preliminary assessment:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 140.

SECTION 143   PROVIDING THE CONSUMER WITH THE PRELIMINARY ASSESSMENT  
Requirement to give assessment if requested

143(1)    
If the consumer requests the licensee for a copy of the preliminary assessment within 7 years of the date of the credit assistance quote under section 137, the licensee must give the consumer a written copy of the assessment:

(a) if the request is made within 2 years of the quote - before the end of 7 business days after the day the licensee receives the request; and

(b) otherwise - before the end of 21 business days after the day the licensee receives the request.

Note:

The licensee is not required to give the consumer a copy of the preliminary assessment if the licensee does not provide credit assistance to the consumer.

Civil penalty: 5,000 penalty units.

Manner of giving assessment

143(2)    
The licensee must give the consumer the copy of the assessment in the manner (if any) prescribed by the regulations.

No payment for assessment

143(3)    

The licensee must not request or demand payment of an amount for giving the consumer a copy of the preliminary assessment.

Civil penalty: 5,000 penalty units.

Strict liability offence

143(4)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1) or (3); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

143(5)    
Subsection (4) is an offence of strict liability.

Note:

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

Division 5 - Fees, indirect remuneration etc. relating to consumer leases  

SECTION 144   FEES, INDIRECT REMUNERATION ETC. RELATING TO CONSUMER LEASES  
Requirement for disclosure

144(1)    
A licensee must, at the same time as providing credit assistance to a consumer by:

(a) suggesting that the consumer apply, or assisting the consumer to apply, for a particular consumer lease with a particular lessor; or

(b) suggesting that the consumer remain in a particular consumer lease with a particular lessor;

give the consumer a lease proposal disclosure document in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

144(2)    
The lease proposal disclosure document must contain the following:

(a) the total amount of any fees or charges that the consumer is liable to pay to the licensee in relation to the consumer lease and the method used for working out that amount;

(b) a reasonable estimate of the total amount of any indirect remuneration that the licensee, or an employee, director or credit representative of the licensee, is likely to receive in relation to the consumer lease and the method used for working out that amount;

(c) a reasonable estimate of the total amount of any fees or charges that the consumer is likely to be liable to pay to the lessor in relation to applying for the consumer lease;

(d) a reasonable estimate of the total amount of any fees or charges that the consumer is likely to be liable to pay to another person in relation to applying for the consumer lease.

144(3)    
For the purposes of paragraph (2)(b), the regulations may prescribe:

(a) the method for working out amounts of indirect remuneration; and

(b) how amounts of indirect remuneration must be described.

Manner of giving lease proposal disclosure document

144(4)    
The licensee must give the lease proposal disclosure document to the consumer in the manner (if any) prescribed by the regulations.

SECTION 145   NO PROFITING FROM FEES ETC. PAID TO THIRD PARTIES  
Requirement not to profit

145(1)    

If, in the course of providing credit assistance to a consumer in relation to a consumer lease, a licensee pays an amount (the third party amount ) to another person on behalf of the consumer, the licensee must not request or demand payment of an amount, as reimbursement for the third party amount, that exceeds the third party amount.

Civil penalty: 5,000 penalty units.

Offence

145(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

Division 6 - Prohibition on suggesting, or assisting with, unsuitable consumer leases  

SECTION 146   PROHIBITION ON SUGGESTING, OR ASSISTING WITH, UNSUITABLE CONSUMER LEASES  
Prohibition on suggesting, or assisting with, unsuitable leases

146(1)    
A licensee must not provide credit assistance to a consumer by:

(a) suggesting that the consumer apply for a particular consumer lease with a particular lessor; or

(b) assisting the consumer to apply for a particular consumer lease with a particular lessor;

if the lease will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the lease will be unsuitable

146(2)    
The lease will be unsuitable for the consumer if, at the time the licensee provides the credit assistance, it is likely that:

(a) the consumer will be unable to comply with the consumer's financial obligations under the lease, or could only comply with substantial hardship, if the lease is entered in the period proposed for it to be entered; or

(b) the lease will not meet the consumer's requirements or objectives if the lease is entered in the period proposed for it to be entered; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances will apply to the lease if the lease is entered in the period proposed for it to be entered.

146(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the lease by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease will be unsuitable

146(4)    
For the purposes of determining under subsection (2) whether the lease will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 140(1)(d) or (e);

(b) at the time the licensee provides the credit assistance:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 140.

Consumer lease not unsuitable under regulations

146(5)    
The regulations may prescribe particular situations in which a consumer lease is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

146(6)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

SECTION 147   PROHIBITION ON SUGGESTING TO CONSUMERS TO REMAIN IN UNSUITABLE CONSUMER LEASES  
Prohibition on suggesting to remain in unsuitable lease

147(1)    

A licensee must not provide credit assistance to a consumer by suggesting that the consumer remain in a particular consumer lease with a particular lessor if the lease is unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the lease is unsuitable

147(2)    
The lease is unsuitable for the consumer if, at that time the licensee provides the credit assistance:

(a) the consumer is, or is likely to be, unable to comply with the consumer's financial obligations under the lease, or only able to comply with substantial hardship; or

(b) the lease does not meet the consumer's requirements or objectives; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances apply to the lease.

147(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the lease by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease is unsuitable

147(4)    
For the purposes of determining under subsection (2) whether the lease is unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 140(1)(d) or (e);

(b) at the time the licensee provides the credit assistance:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 140.

Consumer lease not unsuitable under regulations

147(5)    
The regulations may prescribe particular situations in which a consumer lease is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

147(6)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

Defence

147(7)    
For the purposes of subsections (1) and (6), it is a defence if:

(a) the licensee suggested that the consumer remain in the consumer lease because the licensee reasonably believed that there was no other consumer lease that was not unsuitable for the consumer; and

(b) the licensee informed the consumer that there is a procedure under sections 177B and 179H of the National Credit Code for consumers in hardship.

Note:

For the purposes of subsection (6), a defendant bears an evidential burden in relation to the matter in subsection (7) (see subsection 13.3(3) of the Criminal Code).

147(8)    
The regulations may prescribe particular inquiries that must be made, or do not need to be made, for the purposes of paragraph (7)(a).

Division 7 - Special rules for consumer leases for household goods  

SECTION 147A   LICENSEE WHO MAKES REPRESENTATIONS ABOUT CREDIT ASSISTANCE IN RELATION TO CONSUMER LEASES FOR HOUSEHOLD GOODS MUST DISPLAY AND GIVE INFORMATION  

Requirement

147A(1)    
If a licensee represents that the licensee provides, or is able to provide, credit assistance to consumers in relation to consumer leases for household goods, the licensee must:

(a)    display information; and

(b)    give information to consumers;

in accordance with any determination made by ASIC under subsection (2).

Civil penalty: 5,000 penalty units.

147A(2)    
ASIC may, by legislative instrument, determine one or more of the following matters relating to licensees that make representations described in subsection (1):

(a)    the information that the licensees must display;

(b)    how the licensees must display the information;

(c)    when the licensees must display the information;

(d)    the information that the licensees must give to consumers;

(e)    how the licensees must give the information to consumers;

(f)    when the licensees must give the information to consumers.

147A(3)    
In making a determination under subsection (2), ASIC must take into account the risks associated with consumer leases for household goods and the alternatives that may be available to consumers.

Offence

147A(4)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

SECTION 147B   WRITTEN DOCUMENTATION REQUIRED IN RELATION TO THE PRELIMINARY ASSESSMENT FOR A CONSUMER LEASE FOR HOUSEHOLD GOODS  

147B(1)    
If, in a preliminary assessment made for the purposes of paragraph 138(1)(c) or (2)(a), the licensee assesses that a consumer lease for household goods is not unsuitable for a consumer, before providing credit assistance to the consumer by:

(a)    suggesting that the consumer apply for a particular consumer lease with a particular lessor; or

(b)    assisting the consumer to apply for a particular consumer lease with a particular lessor; or

(c)    suggesting that the consumer remain in a particular consumer lease with a particular lessor;

the licensee must document in writing and in accordance with any requirements determined by ASIC under subsection (2):

(d)    the preliminary assessment; and

(e)    the inquiries and verification made for the purposes of paragraph 138(1)(d) or (2)(b) in relation to that preliminary assessment.

Civil penalty: 5,000 penalty units.

147B(2)    
ASIC may, by legislative instrument, determine the form in which the matters in paragraphs (1)(d) and (e) are to be documented in writing.

147B(3)    
Before making a determination under subsection (2), ASIC must:

(a)    consult the Information Commissioner in relation to matters that relate to the privacy functions (within the meaning of the Australian Information Commissioner Act 2010); and

(b)    have regard to any submissions made by the Information Commissioner because of that consultation.

PART 3-4 - LICENSEES THAT ARE LESSORS UNDER CONSUMER LEASES  

Division 1 - Introduction  

SECTION 148  

148   GUIDE TO THIS PART  

Division 2 - Credit guide of lessors  

SECTION 149   CREDIT GUIDE OF LESSORS  
Requirement to give credit guide

149(1)    

A licensee must, as soon as practicable after it becomes apparent to the licensee that it is likely to enter a consumer lease with a consumer who will be the lessee under the lease, give the consumer the licensee's credit guide in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

149(2)    
The licensee's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the licensee's name and contact details; and

(d) specify the licensee's Australian credit licence number; and

(e) give information about the licensee's procedure for resolving disputes with a consumer, including contact details for a consumer to access:

(i) the licensee's internal dispute resolution procedure; and

(ii) the AFCA scheme; and

(f) give information about the licensee's obligations under sections 155 and 156; and

(g) comply with any other requirements prescribed by the regulations.

149(3)    
The regulations may prescribe information that need not be included in the credit guide, despite subsection (2).

Manner of giving credit guide

149(4)    
The licensee must give the consumer the licensee's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

149(5)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

149(6)    
Subsection (5) is an offence of strict liability.

Note:

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

SECTION 150   CREDIT GUIDE OF LESSORS WHO ARE ASSIGNEES  
Requirement to give credit guide

150(1)    

A licensee must, as soon as practicable after it has been assigned any rights or obligations of a lessor under a consumer lease, give the lessee under the lease the licensee's credit guide in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

150(2)   
The licensee's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the licensee's name and contact details; and

(d) specify the licensee's Australian credit licence number; and

(e) give information about the licensee's procedure for resolving disputes with a consumer, including contact details for a consumer to access:

(i) the licensee's internal dispute resolution procedure; and

(ii) the AFCA scheme; and

(f) comply with any other requirements prescribed by the regulations.

150(3)    
The regulations may prescribe information that need not be included in the credit guide, despite subsection (2).

Manner of giving credit guide

150(4)    
The licensee must give the consumer the licensee's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

150(5)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

150(6)    
Subsection (5) is an offence of strict liability.

Note:

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

Division 3 - Obligation to assess unsuitability  

SECTION 151  

151   OBLIGATION TO ASSESS UNSUITABILITY  

A licensee must not:

(a) enter a consumer lease with a consumer who will be the lessee under the lease; or

(b) make an unconditional representation to a consumer that the licensee considers that the consumer is eligible to enter a consumer lease with the licensee;

on a day (the lease day ) unless the licensee has, within 90 days (or other period prescribed by the regulations) before the lease day:

(c) made an assessment that:

(i) is in accordance with section 152; and

(ii) covers a period in which the lease day occurs; and

(d) made the inquiries and verification in accordance with section 153.

Civil penalty: 5,000 penalty units.

SECTION 152  

152   ASSESSMENT OF UNSUITABILITY OF THE CONSUMER LEASE  

For the purposes of paragraph 151(c), the licensee must make an assessment that:

(a) specifies the period the assessment covers; and

(b) assesses whether the consumer lease will be unsuitable for the consumer if the lease is entered in that period.

Note:

The licensee is not required to make the assessment under this section if the lease is not entered.

SECTION 153   REASONABLE INQUIRIES ETC. ABOUT THE CONSUMER  
Requirement to make inquiries and take steps to verify

153(1)    

For the purposes of paragraph 151(d), the licensee must, before making the assessment:

(a)    make reasonable inquiries about the consumer's requirements and objectives in relation to the consumer lease; and

(b)    make reasonable inquiries about the consumer's financial situation; and

(c)    take reasonable steps to verify the consumer's financial situation; and

(d)    make any inquiries prescribed by the regulations about any matter prescribed by the regulations; and

(e)    

take any steps prescribed by the regulations to verify any matter prescribed by the regulations.

Civil penalty: 5,000 penalty units.

153(1A)    

If:

(a)    the consumer lease is a consumer lease for household goods; and

(b)    the consumer holds (whether alone or jointly with another person) an account with an ADI into which income payable to the consumer is credited;

the licensee must, in verifying the consumer's financial situation for the purposes of paragraph 151(d), obtain and consider information about each transaction on the account, and the balances of the account, during at least the immediately preceding period of 90 days.

153(1B)    
Subsection (1A) does not limit paragraph (1)(c).

153(2)    
The regulations may prescribe particular inquiries or steps that must be made or taken, or do not need to be made or taken, for the purposes of paragraph (1)(a), (b) or (c).

SECTION 154   WHEN CONSUMER LEASE MUST BE ASSESSED AS UNSUITABLE  
Requirement to assess the lease as unsuitable

154(1)    
The licensee must assess that the consumer lease will be unsuitable for the consumer if the lease will be unsuitable for the consumer under subsection (2).

Note:

Even if the lease will not be unsuitable for the consumer under subsection (2), the licensee may still assess that the lease will be unsuitable for other reasons.

Particular circumstances when the lease will be unsuitable

154(2)    
The lease will be unsuitable for the consumer if, at the time of the assessment, it is likely that:

(a) the consumer will be unable to comply with the consumer's financial obligations under the lease, or could only comply with substantial hardship, if the lease is entered in the period covered by the assessment; or

(b) the lease will not meet the consumer's requirements or objectives if the lease is entered in the period covered by the assessment; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances will apply to the lease if the lease is entered in the period covered by the assessment.

Civil penalty: 5,000 penalty units.

154(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the lease by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease will be unsuitable

154(4)    
For the purposes of determining under subsection (2) whether the lease will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 153(1)(d) or (e);

(b) at the time of the preliminary assessment:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 153.

SECTION 155   GIVING THE CONSUMER THE ASSESSMENT  
Requirement to give assessment if requested

155(1)    

If, before entering the consumer lease, the consumer requests the licensee for a copy of the assessment, the licensee must give the consumer a written copy of the assessment before entering the lease.

Note:

The licensee is not required to give the consumer a copy of the assessment if the lease is not entered.

Civil penalty: 5,000 penalty units.

155(2)    
If, during the period that:

(a) starts on the day (the lease day ) the consumer lease is entered; and

(b) ends 7 years after that day;

the consumer requests the licensee for a copy of the assessment, the licensee must give the consumer a written copy of the assessment:

(c) if the request is made within 2 years of the lease day - before the end of 7 business days after the day the licensee receives the request; and

(d) otherwise - before the end of 21 business days after the day the licensee receives the request.

Civil penalty: 5,000 penalty units.

Manner of giving assessment

155(3)    
The licensee must give the consumer the copy of the assessment in the manner (if any) prescribed by the regulations.

No payment for assessment

155(4)    

The licensee must not request or demand payment of an amount for giving the consumer a copy of the assessment.

Civil penalty: 5,000 penalty units.

Strict liability offence

155(5)    
A person commits an offence if:

(a) the person is subject to a requirement under subsection (1), (2) or (4); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

155(6)    
Subsection (5) is an offence of strict liability.

Note:

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

Division 4 - Prohibition on entering unsuitable consumer leases  

SECTION 156   PROHIBITION ON ENTERING UNSUITABLE CONSUMER LEASES  
Prohibition on entering unsuitable lease

156(1)    

A licensee must not enter a consumer lease with a consumer who will be the lessee under the lease if the lease is unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the lease is unsuitable

156(2)    
The lease is unsuitable for the consumer if, at the time it is entered:

(a) it is likely that the consumer will be unable to comply with the consumer's financial obligations under the lease, or could only comply with substantial hardship; or

(b) the lease does not meet the consumer's requirements or objectives; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances apply to the lease.

156(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer's financial obligations under the lease by selling the consumer's principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease is unsuitable

156(4)    
For the purposes of determining under subsection (2) whether the lease is unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer's financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 153(1)(d) or (e);

(b) at the time the lease is entered:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 153.

Consumer lease not unsuitable under regulations

156(5)    
The regulations may prescribe particular situations in which a consumer lease is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

156(6)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.

Division 5 - Special rules for consumer leases for household goods  

SECTION 156A   LICENSEE WHO MAKES REPRESENTATIONS ABOUT CONSUMER LEASES FOR HOUSEHOLD GOODS MUST DISPLAY AND GIVE INFORMATION  

Requirement

156A(1)    
If a licensee represents that the licensee enters into, or is able to enter into, consumer leases for household goods with consumers under which the licensee would be the lessor, the licensee must:

(a)    display information; and

(b)    give information to consumers;

in accordance with any determination made be ASIC under subsection (2).

Civil penalty: 5,000 penalty units.

156A(2)    
ASIC may, by legislative instrument, determine one or more of the following matters relating to licensees that make representations described in subsection (1):

(a)    the information that the licensees must display;

(b)    how the licensees must display the information;

(c)    when the licensees must display the information;

(d)    the information that the licensees must give to consumers;

(e)    how the licensees must give the information to consumers;

(f)    when the licensees must give the information to consumers.

Offence

156A(3)    
A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement

Criminal penalty: 50 penalty units.

SECTION 156B   LICENSEE MUST NOT ENTER INTO A CONSUMER LEASE FOR HOUSEHOLD GOODS IF THE PAYMENTS DO NOT MEET THE PRESCRIBED REQUIREMENTS  

Requirement

156B(1)    
A licensee must not enter into, or offer to enter into, a consumer lease for household goods with a consumer who will be the lessee under the lease if the amount that would be required to be paid under the lease by the lessee would not meet the requirements prescribed by the regulations.

Civil penalty: 5,000 penalty units.

Note:

For example, the regulations may provide that the amount of a payment must not exceed a specified percentage of the lessee's income.

Offence

156B(2)    
A person commits an offence if:

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

(b)    theperson engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

Loss of certain amounts

156B(3)    
If the licensee enters into a consumer lease for household goods in contravention of subsection (1), then:

(a)    the lessee is not liable (and is taken never to have been liable) to pay any amount under that consumer lease that exceeds the base price of the goods hired under that consumer lease (whether or not the liability is imposed consistently with the National Credit Code); and

(b)    the lessee may recover as a debt due to the lessee any amounts paid by the lessee that, in accordance with paragraph (a) of this subsection, the lessee is not liable to pay (or is taken never to have been liable to pay).

SECTION 156C   WRITTEN DOCUMENTATION REQUIRED IN RELATION TO THE ASSESSMENT FOR A CONSUMER LEASE FOR HOUSEHOLD GOODS  

156C(1)    
If, in an assessment made for the purposes of paragraph 151(c), the licensee assesses that a consumer lease for household goods is not unsuitable for a consumer, before:

(a)    entering into the consumer lease with the consumer; or

(b)    making an unconditional representation to the consumer that the licensee considers that the consumer is eligible to enter a consumer lease with the licensee;

the licensee must document in writing and in accordance with any requirements determined by ASIC under subsection (2):

(c)    the assessment; and

(d)    the inquiries and verification made for the purposes of paragraph 151(d) in relation to that assessment.

Civil penalty: 5,000 penalty units.

156C(2)    
ASIC may, by legislative instrument, determine the form in which the matters in paragraphs (1)(c) and (d) are to be documented in writing.

156C(3)    
Before making a determination under subsection (2), ASIC must:

(a)    consult the Information Commissioner in relation to matters that relate to the privacy functions (within the meaning of the Australian Information Commissioner Act 2010); and

(b)    have regard to any submissions made by the Information Commissioner because of that consultation.

PART 3-5 - CREDIT REPRESENTATIVES  

Division 1 - Introduction  

SECTION 157  

157   GUIDE TO THIS PART  

Division 2 - Credit guide of credit representatives  

SECTION 158   CREDIT GUIDE OF CREDIT REPRESENTATIVES  
Requirement to give credit guide

158(1)    

If a credit representative of a licensee gives a consumer the licensee's credit guide when acting on behalf of the licensee under Part 3-1, 3-2, 3-3 or 3-4, the credit representative must at the same time give the consumer the credit representative's credit guide in accordance with subsection (2).

Civil penalty: 5,000 penalty units.

158(2)    
The credit representative's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the credit representative's name and contact details; and

(d) specify the credit representative's credit representative number; and

(e) give information about:

(i) any fees that are payable by a consumer to the credit representative for acting as a credit representative; and

(ii) any charges that are payable by a consumer to the credit representative for matters associated with acting as a credit representative; and

(iii) the method for working out the amount of the fees and charges; and

(f) give information about:

(i) if there are 6 or fewer licensees for whom the credit representative is a credit representative - the names of those licensees; and

(ii) if there are more than 6 licensees for whom the credit representative is a credit representative - the names of the 6 licensees for whom the credit representative reasonably believes it conducts the most business; and

(iii) the credit activities the credit representative is authorised to engage in on behalf of the licensees referred to in subparagraph (i) or (ii); and

(g) give information about:

(i) any indirect remuneration the credit representative is likely to receive, directly or indirectly, from those licensees; and

(ii) a reasonable estimate of the amounts of that indirect remuneration or the range of those amounts; and

(iii) the method for working out those amounts; and

(h) give information about the credit representative's procedure for resolving disputes with a consumer, including contact details for a consumer to access the AFCA scheme; and

(i) comply with any other requirements prescribed by the regulations.

158(3)    
The regulations may prescribe:

(a) information that need not be included in the credit guide, despite subsection (2); and

(b) for the purposes of paragraph (2)(g):

(i) the method for working out amounts of indirect remuneration; and

(ii) how indirect remuneration or amounts of indirect remuneration must be described.

Manner of giving credit guide

158(4)    
The credit representative must give the consumer the credit representative's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

158(5)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

158(6)    
Subsection (5) is an offence of strict liability.

Note:

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

PART 3-5A - MORTGAGE BROKERS AND MORTGAGE INTERMEDIARIES  

Division 1 - Introduction  

Subdivision A - Guide to this Part  

SECTION 158K   GUIDE TO THIS PART  

Subdivision B - Interpretation  

SECTION 158KA  

158KA   DOING ACTS  

A reference in this Part to doing an act or thing includes a reference to causing or authorising the act or thing to be done.

SECTION 158KB   CIRCUMSTANCES IN WHICH A SECONDARY REPRESENTATIVE IS TAKEN TO BE ACTING WITHIN ACTUAL OR APPARENT AUTHORITY  

158KB(1)    
This section applies if a person (the secondary representative ) is authorised as a credit representative of a licensee by a credit representative that is a body corporate (the primary representative ).

158KB(2)    
For the purposes of this Part, the secondary representative is taken to be acting within the scope of the secondary representative's actual or apparent authority from the licensee if the secondary representative is acting within the actual or apparent scope of the authority given by the primary representative to engage in specified credit activities on behalf of the licensee.

SECTION 158KC  

158KC   OBLIGATIONS UNDER THIS PART IN ADDITION TO OTHER OBLIGATIONS  

The obligations imposed on a person under this Part are in addition to any other obligations to which the person is subject under this Act or any other law.

Division 2 - Best interests obligations  

Subdivision A - Licensees that provide credit assistance in relation to credit contracts  

SECTION 158L   APPLICATION OF THIS SUBDIVISION  

158L(1)    
This Subdivision applies in relation to credit assistance provided by a licensee to a consumer in relation to a credit contract if the licensee is a mortgage broker.

158L(2)    
However, this Subdivision does not apply in relation to credit assistance provided to a consumer in relation to a credit contract by a credit representative acting within the scope of the credit representative's actual or apparent authority from the licensee.

Note 1:

A credit representative in these circumstances is covered by Subdivision B of this Division.

Note 2:

The conduct of any other representative, acting within the scope of actual or apparent authority from the licensee, is taken to have been engaged in also by the licensee: see sections 324 and 325.

SECTION 158LA  

158LA   LICENSEE MUST ACT IN THE BEST INTERESTS OF THE CONSUMER  

The licensee must act in the best interests of the consumer in relation to the credit assistance.

Civil penalty: 5,000 penalty units.

SECTION 158LB  

158LB   CONFLICT BETWEEN CONSUMER'S INTERESTS AND THOSE OF THE LICENSEE ETC.  

If the licensee knows, or reasonably ought to know, that there is a conflict between the interests of the consumer and the interests of:

(a) the licensee; or

(b) an associate of the licensee; or

(c) a representative of the licensee; or

(d) an associate of a representative of the licensee;

the licensee must give priority to the consumer's interests when providing the credit assistance.

Civil penalty: 5,000 penalty units.

Subdivision B - Credit representatives that provide credit assistance in relation to credit contracts  

SECTION 158LD  

158LD   APPLICATION OF THIS SUBDIVISION  

This Subdivision applies in relation to credit assistance provided to a consumer in relation to a credit contract by a credit representative acting within the scope of the credit representative's actual or apparent authority from a licensee, if either the credit representative or the licensee is a mortgage broker.

SECTION 158LE   CREDIT REPRESENTATIVE MUST ACT IN THE BEST INTERESTS OF THE CONSUMER  

158LE(1)    
The credit representative must act in the best interests of the consumer in relation to the credit assistance.

Civil penalty: 5,000 penalty units.

158LE(2)    
The licensee must take reasonable steps to ensure that the credit representative complies with subsection (1).

Civil penalty: 5,000 penalty units.

SECTION 158LF   CONFLICT BETWEEN CONSUMER'S INTERESTS AND THOSE OF THE CREDIT REPRESENTATIVE ETC.  

158LF(1)    
If the credit representative knows, or reasonably ought to know, that there is a conflict between the interests of the consumer and the interests of:

(a) the licensee; or

(b) an associate of the licensee; or

(c) the credit representative; or

(d) an associate of the credit representative; or

(e) another representative of the licensee; or

(f) an associate of another representative of the licensee;

the credit representative must give priority to the consumer's interests when providing the credit assistance.

Civil penalty: 5,000 penalty units.

158LF(2)    
The licensee must take reasonable steps to ensure that the credit representative complies with subsection (1).

Civil penalty: 5,000 penalty units.

Division 4 - Conflicted remuneration  

Subdivision A - What is conflicted remuneration?  

SECTION 158N  

158N   CONFLICTED REMUNERATION  

Conflicted remuneration
means:

(a) any benefit, whether monetary or non-monetary, that:

(i) is given to a licensee, or a representative of a licensee, who provides credit assistance to consumers; and

(ii) because of the nature of the benefit or the circumstances in which it is given, could reasonably be expected to influence the credit assistance provided to consumers; or

(b) any benefit, whether monetary or non-monetary, that:

(i) is given to a licensee, or a representative of a licensee, who acts as an intermediary; and

(ii) because of the nature of the benefit or the circumstances in which it is given, could reasonably be expected to influence whether the licensee or representative acts as an intermediary, or how the licensee or representative acts as an intermediary.

SECTION 158NA  

158NA   REGULATIONS MAY FURTHER DEFINE CONFLICTED REMUNERATION  

The regulations may prescribe:

(a) circumstances, in addition to those set out in section 158N, in which a benefit given to a licensee or a representative of a licensee is conflicted remuneration ; and

(b) circumstances in which a benefit given to a licensee or a representative of a licensee is not conflicted remuneration .

Subdivision B - Ban on accepting conflicted remuneration  

SECTION 158NB  

158NB   LICENSEE MUST NOT ACCEPT CONFLICTED REMUNERATION  

A licensee must not accept conflicted remuneration in circumstances prescribed by the regulations if:

(a) the licensee is a mortgage broker; or

(b) the licensee is a mortgage intermediary.

Civil penalty: 5,000 penalty units.

SECTION 158NC   CREDIT REPRESENTATIVE MUST NOT ACCEPT CONFLICTED REMUNERATION  

158NC(1)    
A credit representative of a licensee must not accept conflicted remuneration in circumstances prescribed by the regulations if the credit representative or the licensee is:

(a) a mortgage broker; or

(b) a mortgage intermediary.

Civil penalty: 5,000 penalty units.

158NC(2)    
The licensee must take reasonable steps to ensure that the credit representative complies with subsection (1).

Civil penalty: 5,000 penalty units.

Subdivision C - Ban on giving conflicted remuneration  

SECTION 158ND   EMPLOYER MUST NOT GIVE EMPLOYEES CONFLICTED REMUNERATION  

158ND(1)    
An employer of a licensee must not give the licensee conflicted remuneration in circumstances prescribed by the regulations if the licensee is:

(a) a mortgage broker; or

(b) a mortgage intermediary.

Civil penalty: 5,000 penalty units.

158ND(2)    
An employer of a representative of a licensee must not give the representative conflicted remuneration in circumstances prescribed by the regulations if the licensee or the representative is:

(a) a mortgage broker; or

(b) a mortgage intermediary.

Civil penalty: 5,000 penalty units.

SECTION 158NE   CREDIT PROVIDER MUST NOT GIVE CONFLICTED REMUNERATION  

158NE(1)    
A credit provider must not give a licensee conflicted remuneration in circumstances prescribed by the regulations if the licensee is:

(a) a mortgage broker; or

(b) a mortgage intermediary.

Civil penalty: 5,000 penalty units.

158NE(2)    
A credit provider must not give a representative of a licensee conflicted remuneration in circumstances prescribed by the regulations if the licensee or the representative is:

(a) a mortgage broker; or

(b) a mortgage intermediary.

Civil penalty: 5,000 penalty units.

SECTION 158NF   MORTGAGE INTERMEDIARY MUST NOT GIVE CONFLICTED REMUNERATION  

158NF(1)    
A mortgage intermediary must not give a licensee conflicted remuneration in circumstances prescribed by the regulations if the licensee is:

(a) a mortgage broker; or

(b) a mortgage intermediary.

Civil penalty: 5,000 penalty units.

158NF(2)    
A mortgage intermediary must not give a representative of a licensee conflicted remuneration in circumstances prescribed by the regulations if the licensee or the representative is:

(a) a mortgage broker; or

(b) a mortgage intermediary.

Civil penalty: 5,000 penalty units.

Division 6 - Miscellaneous  

SECTION 158T  

158T   ANTI-AVOIDANCE  

A person must not, either alone or together with one or more other persons, enter into, begin to carry out or carry out a scheme if:

(a) it would be concluded that the person, or any of the persons, who entered into, began to carry out or carried out the scheme or any part of the scheme did so for the sole purpose or for a purpose (that is not incidental) of avoiding the application of any provision of this Part in relation to any person or persons (whether or not a person or persons who entered into, began to carry out or carried out the scheme or any part of the scheme); and

(b) the scheme or the part of the scheme has achieved, or apart from this section, would achieve, that purpose.

Civil penalty: 5,000 penalty units.

PART 3-6 - DEBT COLLECTORS  

Division 1 - Introduction  

SECTION 159  

159   GUIDE TO THIS PART  

Division 2 - Credit guide of debt collectors  

SECTION 160   CREDIT GUIDE OF DEBT COLLECTORS  
Requirement to give credit guide

160(1)    

A person who is a licensee or credit representative must, as soon as practicable after it becomes authorised by a credit provider to collect, on the credit provider's behalf, repayments made by a debtor under a credit contract, give the debtor the person's credit guide in accordance with subsection (3).

Civil penalty: 5,000 penalty units.

160(2)    

A person who is a licensee or credit representative must, as soon as practicable after it becomes authorised by a lessor to collect, on the lessor's behalf, payments made by a lessee under a consumer lease, give the lessee the person's credit guide in accordance with subsection (3).

Civil penalty: 5,000 penalty units.

160(3)    
The person's credit guide must:

(a) be in writing; and

(b) be in the form (if any) prescribed by the regulations; and

(c) specify the person's name and contact details; and

(d) if the person is a licensee - specify the person's Australian credit licence number; and

(e) if the person is a credit representative - specify the person's credit representative number; and

(f) give information about the person's procedure for resolving disputes with a consumer, including contact details for a consumer to access:

(i) if the person is a licensee - the person's internal dispute resolution procedure; and

(ii) in all cases - the AFCA scheme; and

(g) comply with any other requirements prescribed by the regulations.

160(4)    
The regulations may prescribe information that need not be included in the credit guide, despite subsection (3).

Manner of giving credit guide

160(5)    
The person must give the consumer the person's credit guide in the manner (if any) prescribed by the regulations.

Strict liability offence

160(6)    
A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 50 penalty units.

160(7)    
Subsection (6) is an offence of strict liability.

Note:

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

PART 3-6A - MISCELLANEOUS RULES  

Division 1 - Introduction  

SECTION 160A   GUIDE TO THIS PART  

Division 2 - Representations  

SECTION 160B   "INDEPENDENT", "IMPARTIAL" OR "UNBIASED" ETC.  

160B(1)    
A licensee must not, in providing or offering to provide a credit service to a consumer, use any of the following terms (either alone or in combination with other words or letters) in a representation to the consumer about the licensee, the service or the licensee's actions in providing the service:

(a) the word "independent";

(b) the word "impartial";

(c) the word "unbiased";

(d) another term (whether or not in English) that is of similar import to a word mentioned in paragraph (a), (b) or (c).

Civil penalty: 5,000 penalty units.

Defences

160B(2)    
For the purposes of subsection (1), it is a defence if:

(a) the licensee does not receive any of the following:

(i) indirect remuneration (apart from indirect remuneration that is rebated in full to the licensee's clients);

(ii) other gifts or benefits from a credit provider or a lessor that may reasonably be expected to influence the licensee; and

(b) in providing a credit service, the licensee operates free from direct or indirect restrictions relating to the credit contracts and consumer leases to which the service relates (except restrictions imposed on the licensee by this Act or by an Australian credit licence); and

(c) in providing a credit service, the licensee operates without any conflicts of interest that might:

(i) arise from the licensee's associations or relationships with credit providers and lessors; and

(ii) reasonably be expected to influence the licensee in providing the service; and

(d) neither of the following persons receives any indirect remuneration, gift, or benefit, covered by paragraph (a):

(i) the licensee's employer (if any);

(ii) any other person prescribed (whether by reference to a class of person or otherwise) by the regulations.

S 160B(2) amended by No 2 of 2020, s 3 and Sch 3[28] and [29], effective 18 February 2020.

160B(3)    
For the purposes of subsection (1), it is a defence if the representation uses any of the terms in the negative (for example, a representation that the licensee is not independent).

SECTION 160C   "FINANCIAL COUNSELLOR" ETC.  

160C(1)    
A licensee must not, in providing or offering to provide a credit service to a consumer, use any of the following terms (either alone or in combination with other words or letters) in a representation to the consumer about the licensee, the service or the licensee's actions in providing the service:

(a) the phrase "financial counsellor";

(b) the phrase "financial counselling";

(c) another term (whether or not in English) that:

(i) is of similar import to a phrase mentioned in paragraph (a) or (b); and

(ii) is prescribed by the regulations.

Civil penalty: 5,000 penalty units.

Defences

160C(2)    

For the purposes of subsection (1), it is a defence if regulations made for the purposes of paragraph 110(1)(a) exempt the licensee from section 29 in relation to a credit activity because the licensee engages in the activity as part of a financial counselling service.

160C(3)    
For the purposes of subsection (1), it is a defence if:

(a) the licensee is providing, or offering to provide, the credit service on behalf of another person (the principal ); and

(b) the licensee is a representative of the principal; and

(c) regulations made for the purposes of paragraph 110(1)(a) exempt the principal from section 29 in relation to a credit activity because the principal engages in the activity as part of a financial counselling service; and

(d) the licensee's actions in providing or offering to provide the credit service are within the authority of the principal.

160C(4)    
For the purposes of subsection (1), it is a defence if the representation uses any of the terms in the negative (for example, a representation that the licensee is not a financial counsellor).

Division 2A - Use or disclosure of certain documents and information  

SECTION 160CA   APPLICATION OF THIS DIVISION  

160CA(1)    
This Division applies to a person who:

(a)    is or was a licensee who has received or obtained a document (a constrained document ) prescribed by the regulations, or information ( constrained information ) prescribed by the regulations, in connection with:

(i) a proposed small amount credit contract; or

(ii) a small amount credit contract; or

(iii) a proposed consumer lease for household goods; or

(iv) a consumer lease for household goods; or

(b)    is or was a licensee who has obtained information (also constrained information ) as required under subsection 117(1A), 130(1A), 140(1A) or 153(1A) for the purposes of verifying a consumer's financial situation; or

(c)    has received or obtained a constrained document, or constrained information, from a person described in paragraph (a) or (b) of this subsection.

160CA(2)    
However, this Division does not apply to a person in relation to:

(a)    a constrained document; or

(b)    information contained in a constrained document; or

(c)    constrained information;

that is about the financial affairs of the person (either alone or with others).

SECTION 160CB   PROHIBITION ON USE OR DISCLOSURE OF CERTAIN DOCUMENTS AND INFORMATION  

Requirement

160CB(1)    
A person must not use or disclose:

(a)    a constrained document; or

(b)    information contained in a constrained document; or

(c)    constrained information.

Civil penalty: 5,000 penalty units.

Offence

160CB(2)    
A person commits an offence if:

(a)    the person uses or discloses a document or information; and

(b)    any of the following apply:

(i) the document is a constrained document;

(ii) the information is contained in a constrained document;

(iii) the information is constrained information.

Criminal penalty: 100 penalty units.

Strict liability offence

160CB(3)    
A person commits an offence if the person uses or discloses:

(a)    a constrained document; or

(b)    information contained in a constrained document; or

(c)    constrained information.

Criminal penalty: 10 penalty units.

160CB(4)    
Subsection (3) is an offence of strict liability.

Defence

160CB(5)    
For the purposes of subsection (1), (2) or (3) it is a defence if the use or disclosure by the person is:

(a)    a disclosure to another person (the recipient ) of:

(i) a constrained document; or

(ii) information contained in a constrained document; or

(iii) constrained information;

that is about the financial affairs of the recipient (either alone or with others); or

(b)    necessary for the person to comply with the person's obligations under this Act; or

(c)    required or authorised by or under a law of the Commonwealth, or of a State or Territory, or a court or tribunal order; or

(d)    for the purposes of considering a hardship notice; or

(e)    for the purposes of assisting ASIC to perform its functions or exercise its powers; or

(f)    for the purposes of allowing the operator of the AFCA scheme to perform its functions or exercise its powers.

Note:

For the purposes of subsection (2) or (3), a defendant bears an evidential burden in relation to the matter in subsection (5) (see subsection 13.3(3) of the Criminal Code).

Division 3 - Giving misleading information  

SECTION 160D   PROHIBITION ON GIVING MISLEADING INFORMATION ETC.  

Prohibition on giving misleading information etc.

160D(1)    
A person (the giver ) must not, in the course of engaging in a credit activity, give information or a document to another person if the giver knows, or is reckless as to whether, the information or document is:

(a) false in a material particular; or

(b) materially misleading.

Civil penalty: 5,000 penalty units.

Offence

160D(2)    

A person commits an offence if:

(a) the person gives information or a document to another person; and

(b) the person does so in the course of engaging in a credit activity; and

(c) the information or document is false in a material particular or materially misleading.

Criminal penalty: 5 years imprisonment.

Division 4 - Giving authorisation for deductions by employer of debtor or lessee  

SECTION 160E   REQUIREMENTS FOR GIVING AUTHORISATION TO EMPLOYER  

160E(1)    
This section applies to a credit provider or lessor giving, or intending to give, an employer of a debtor or lessee who is party to a credit contract or consumer lease with the credit provider or lessor an instrument that:

(a) was made by the debtor or lessee; and

(b) authorises the employer to:

(i) make one or more deductions from one or more amounts payable by the employer in relation to the performance of work by the debtor or lessee; and

(ii) pay the deductions to the credit provider or lessor.

Credit provider or lessor must give statement to employer

160E(2)    

If the credit contract or consumer lease is of a kind prescribed by the regulations, the credit provider or lessor must give the employer a statement, in the form prescribed by the regulations for that kind of contract or lease, with the instrument.

Civil penalty: 5,000 penalty units.

Credit provider or lessor must give 7 days' notice to defaulting debtor or lessee

160E(3)    

If the debtor or lessee is in default under the credit contract or consumer lease, the credit provider or lessor must give the debtor or lessee at least 7 days' notice, in a form prescribed by the regulations, of the intention of the credit provider or lessor to give the instrument to the employer.

Civil penalty: 5,000 penalty units.

160E(4)    
To avoid doubt, subsection (3) does not apply if there are not regulations in force prescribing a form for the purposes of that subsection.

Subsections (2) and (3) do not apply to some credit contracts

160E(5)    
Subsections (2) and (3) do not apply in relation to a credit contract for the provision of credit relating to the provision of goods or services to the debtor in connection with the debtor's remuneration, or other benefits, for the debtor's employment.

Division 5 - Periods for determining unsuitability in respect of credit card contracts  

SECTION 160F   PERIODS FOR DETERMINING UNSUITABILITY IN RESPECT OF CREDIT CARD CONTRACTS  

160F(1)    
ASIC may, by legislative instrument, determine a period for the purposes of the following provisions:

(a) paragraph 118(3AA)(b);

(b) paragraph 119(3A)(b);

(c) paragraph 123(3AA)(b);

(d) paragraph 124(3A)(b);

(e) paragraph 131(3AA)(b);

(f) paragraph 133(3AA)(b).

160F(2)    
Without limiting subsection (1), a legislative instrument referred to in that subsection may determine different periods in relation to the following:

(a) different classes of credit card contracts;

(b) different credit limits;

(c) different rates of interest.

Division 6 - Proscribed referrals  

SECTION 160G   PROHIBITION ON PROSCRIBED REFERRALS  

Prohibition

160G(1)    
A licensee that carries on a business of providing credit under small amount credit contracts must not make a proscribed referral if:

(a)    the licensee is a constitutional corporation; or

(b)    the referral is made in the course of carrying on thatbusiness; or

(c)    the referral is made in the course of carrying on the business of banking, other than State banking (within the meaning of paragraph 51(xiii) of the Constitution) not extending beyond the limits of the State concerned; or

(d)    the referral is made using a service to which paragraph 51(v) of the Constitution applies.

Civil penalty: 5,000 penalty units.

What is a proscribed referral?

160G(2)    
A referral of one or more persons (the referred persons ) to another person or persons (the recipients of the referral) is a proscribed referral if, at the time when the referral is made, it is reasonable to believe that one or more of the referred persons would or might, as a direct or indirect result of the referral (including as a result of conduct that any of the recipients of the referral engages in as a result of the referral), enter into a contract or arrangement that satisfies the following conditions:

(a)    under the contract or arrangement, credit is to be, or may be, provided to the referred person;

(b)    the provision of that credit under the contract or arrangement would not be a provision of credit to which the National Credit Code applies.

Note:

For the kinds of provision of credit to which the National Credit Code does or does not apply, see sections 5 and 6 of that Code.

160G(3)    
For the purposes of subsection (2), a recipient of a proscribed referral need not be a person who would or might be a provider of credit under a contract or arrangement of the kind mentioned in that subsection.

160G(4)    
For the purposes of subsection (2), a referral of one or more persons to another person or persons includes (but is not limited to) the provision of information about the first-mentioned person or persons to the second-mentioned person or persons, whether or not the first-mentioned person or persons are aware of the provision of that information.

160G(5)    
To avoid doubt, it does not matter for the purposes of subsection (2) whether any person actually has, or had, the belief mentioned in that subsection.

PART 3-7 - EXEMPTIONS AND MODIFICATIONS RELATING TO THIS CHAPTER  

Division 1 - Introduction  

SECTION 161  

161   GUIDE TO THIS PART  

Division 2 - Exemptions and modifications relating to this Chapter  

SECTION 162  

162   PROVISIONS TO WHICH THIS PART APPLIES  
The provisions to which this Part applies are:

(a) this Chapter; and

(b) definitions in this Act, as they apply to references in this Chapter; and

(c) instruments made for the purposes of this Chapter.

SECTION 163   EXEMPTIONS AND MODIFICATIONS BY ASIC  

163(1)    
ASIC may:

(a) exempt:

(i) a person; or

(ii) a person and all of the person's credit representatives;

from all or specified provisions to which this Part applies; or

(b) exempt a credit contract from all or specified provisions to which this Part applies; or

(c) exempt a consumer lease from all or specified provisions to which this Part applies; or

(d) declare that provisions to which this Part applies apply in relation to a person, credit contract or consumer lease as if specified provisions were omitted, modified or varied as specified in the declaration.

163(2)    
An exemption or declaration under subsection (1) is not a legislative instrument.

163(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 class of credit contracts from all or specified provisions to which this Part applies; or

(c) exempt a class of consumer leases from all or specified provisions to which this Part applies; or

(d) declare that provisions to which this Part applies apply in relation to a class of persons, credit contracts or consumer leases, as if specified provisions were omitted, modified or varied as specified in the declaration.

163(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.

163(5)    
An exemption or declaration under subsection (1) must be in writing and ASIC must publish notice of it on its website.

163(6)    

If conduct (including an omission) of a person would not have constituted an offence if a particular declaration under paragraph (1)(d) 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 Legislation Act 2003 if the declaration is made under subsection (3)).

163(7)    
In a prosecution for an offence to which subsection (6) applies, the prosecution must prove that paragraph (6)(a) or (b) was complied with before the conduct occurred.

SECTION 164  

164   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

(b) exempt a credit contract or class of credit contracts from all or specified provisions to which this Part applies; or

(c) exempt a consumer lease or a class of consumer leases from all or specified provisions to which this Part applies;or

(d) provide that the provisions to which this Part applies apply as if specified provisions were omitted, modified or varied as specified in the regulations.

CHAPTER 4 - REMEDIES  

PART 4-1 - CIVIL PENALTY PROVISIONS  

Division 1 - Introduction  

SECTION 165  

165   GUIDE TO THIS PART  

Division 2 - Declarations and pecuniary penalty orders for contraventions of civil penalty provisions  

SECTION 166   DECLARATION OF CONTRAVENTION OF CIVIL PENALTY PROVISION  
Application for declaration of contravention

166(1)    
Within 6 years of a person contravening a civil penalty provision, ASIC may apply to the court for a declaration that the person contravened the provision.

Declaration of contravention

166(2)   [Must make declaration if contravention]  

The court must make the declaration if it is satisfied that the person has contravened the provision.

166(3)   [Content of declaration]  

The declaration must specify the following:

(a) the court that made the declaration;

(b) the civil penalty provision that was contravened;

(c) the person who contravened the provision;

(d) the conduct that constituted the contravention.

Declaration of contravention conclusive evidence

166(4)    
The declaration is conclusive evidence of the matters referred to in subsection (3).

SECTION 167   COURT MAY ORDER PERSON TO PAY PECUNIARY PENALTY FOR CONTRAVENING CIVIL PENALTY PROVISION  
Application for order

167(1)    
Within 6 years of a person contravening a civil penalty provision, ASIC may apply to the court for an order that the person pay the Commonwealth a pecuniary penalty.

Court may order person to pay pecuniary penalty

167(2)    

If a declaration has been made under section 166 that the person has contravened the provision, the court may order the person to pay to the Commonwealth a pecuniary penalty that the court considers is appropriate (but not more than the amount specified in section 167A).

Determining pecuniary penalty

167(3)    

In determining the pecuniary penalty, the court must take into account all relevant matters, including:

(a)    the nature and extent of the contravention; and

(b)    the nature and extent of any loss or damage suffered because of the contravention; and

(c)    the circumstances in which the contravention took place; and

(d)    

whether the person has previously been found by a court (including a court in a foreign country) to have engaged in similar conduct.

Civil enforcement of penalty

167(4)    

A pecuniary penalty is a debt payable to the Commonwealth.

167(5)    

The Commonwealth may enforce a pecuniary penalty order as if it were an order made in civil proceedings against the person to recover a debt due by the person. The debt arising from the order is taken to be a judgement debt.

SECTION 167A  

167A   MAXIMUM PECUNIARY PENALTY  

The pecuniary penalty must not be more than the pecuniary penalty applicable to the contravention of the civil penalty provision.

SECTION 167B   PECUNIARY PENALTY APPLICABLE  

Pecuniary penalty applicable to the contravention of a civil penalty provision - by an individual

167B(1)    
The pecuniary penalty applicable to the contravention of a civil penalty provision by an individual is the greater of:

(a) the penalty specified for the civil penalty provision; and

(b) if the court can determine the benefit derived and detriment avoided because of the contravention - that amount multiplied by 3.

Note:

See section 14 in relation to contraventions by partners in a partnership and section 15 in relation to contraventions by multiple trustees.

Pecuniary penalty applicable to the contravention of a civil penalty provision - by a body corporate

167B(2)    
The pecuniary penalty applicable to the contravention of a civil penalty provision by a body corporate is the greatest of:

(a) the penalty specified for the civil penalty provision, multiplied by 10; and

(b) if the court can determine the benefit derived and detriment avoided because of the contravention - that amount multiplied by 3; and

(c) either:

(i) 10% of the annual turnover of the body corporate for the 12-month period ending at the end of the month in which the body corporate contravened, or began to contravene, the civil penalty provision; or

(ii) if the amount worked out under subparagraph (i) is greater than an amount equal to 2.5 million penalty units - 2.5 million penalty units.

Contrary intention

167B(3)    
This section applies in relation to a contravention of a civil penalty provision by an individual or a body corporate unless there is a contrary intention under this Act in relation to the pecuniary penalty applicable to the contravention. In that case, the pecuniary penalty applicable is the penalty specified for the civil penalty provision.

SECTION 167C   RELINQUISHING THE BENEFIT DERIVED FROM CONTRAVENING A CIVIL PENALTY PROVISION  

Relinquishment order

167C(1)    
A court may order a person to pay the Commonwealth an amount equal to the benefit derived and detriment avoided because of a contravention of a civil penalty provision if a declaration of contravention by the person has been made under section 166. The order is a relinquishment order .

167C(2)    
The court may make a relinquishment order:

(a) on its own initiative during proceedings before the court; or

(b) on application by ASIC, made within 6 years after the alleged contravention.

Relationship between relinquishment orders and pecuniary penalty orders

167C(3)    
To avoid doubt, the court may make a relinquishment order in relation to the contravention of a civil penalty provision even if a pecuniary penalty order could be, or has been, made in relation to the contravention of the civil penalty provision.

Note:

The relationship between relinquishment orders and proceedings for an offence are dealt with in sections 171, 172, 173 and 174.

Civil enforcement of relinquishment order

167C(4)    
The amount payable under a relinquishment order is a debt payable to ASIC on behalf of the Commonwealth.

167C(5)    
ASIC or the Commonwealth may enforce a relinquishment order as if it were an order made in civil proceedings against the person to recover a debt due by the person. The debt arising from the order is taken to be a judgment debt.

SECTION 167D  

167D   MEANING OF BENEFIT DERIVED AND DETRIMENT AVOIDED BECAUSE OF A CONTRAVENTION OF A CIVIL PENALTY PROVISION  

The benefit derived and detriment avoided because of a contravention of a civil penalty provision is the sum of:

(a) the total value of all benefits that one or more persons obtained that are reasonably attributable to the contravention; and

(b) the total value of all detriments that one or more persons avoided that are reasonably attributable to the contravention.

Division 3 - General provisions relating to civil penalty provisions  

SECTION 168  

168   CONTRAVENING A CIVIL PENALTY PROVISION IS NOT AN OFFENCE  
A contravention of a civil penalty provision is not an offence.

SECTION 169  

169   ATTEMPT AND INVOLVEMENT IN CONTRAVENTION TREATED IN SAME WAY AS ACTUAL CONTRAVENTION  

A person who:

(a) attempts to contravene a civil penalty provision; or

(b) is involved in a contravention of a civil penalty provision;

is taken to have contravened the provision.

SECTION 170  

170   CIVIL EVIDENCE AND PROCEDURE RULES FOR PROCEEDINGS RELATING TO CIVIL PENALTY PROVISIONS  
The court must apply the rules of evidence and procedure for civil matters when hearing proceedings relating to a contravention, or proposed contravention, of a civil penalty provision.

SECTION 171  

171   CRIMINAL PROCEEDINGS BEFORE CIVIL PROCEEDINGS  

The court must not make a declaration of contravention, a pecuniary penalty order or a relinquishment order against a person for a contravention of a civil penalty provision if the person has been convicted of an offence constituted by conduct that is substantially the same as the conduct constituting the contravention.

SECTION 172   CRIMINAL PROCEEDINGS DURING CIVIL PROCEEDINGS  

172(1)    

Proceedings for a declaration of contravention, a pecuniary penalty order or a relinquishment order against a person for a contravention of a civil penalty provision are stayed if:

(a) criminal proceedings are brought or have already been brought against the person for an offence; and

(b) the offence is constituted by conduct that is substantially the same as the conduct in relation to which the declaration or order would be made.

172(2)    

The proceedings for the declaration or order (the civil proceedings ) may be resumed if the person is not convicted of the offence. Otherwise:

(a) the civil proceedings are dismissed; and

(b) costs must not be awarded in relation to the civil proceedings.

SECTION 173  

173   CRIMINAL PROCEEDINGS AFTER CIVIL PROCEEDINGS  

Criminal proceedings may be brought against a person for conduct that is substantially the same as conduct constituting a contravention of a civil penalty provision regardless of whether a declaration of contravention, a pecuniary penalty order or a relinquishment order has been made against the person under this Division.

SECTION 174   EVIDENCE GIVEN IN PROCEEDINGS FOR PECUNIARY PENALTY NOT ADMISSIBLE IN CRIMINAL PROCEEDINGS  

174(1)    
Evidence of information given, or evidence of production of documents, by a natural person is not admissible in criminal proceedings against the natural person if:

(a) the natural person previously gave the information or produced the documents in proceedings for a declaration of contravention, a pecuniary penalty order or a relinquishment order against the natural person for a contravention of a civil penalty provision (whether or not the declaration or order was made); and

(b) the conduct alleged to constitute the offence is substantially the same as the conduct in relation to which the declaration or order was sought.

174(2)    
However, this does not apply to criminal proceedings in relation to the falsity of the evidence given by the natural person in the proceedings for the declaration or order.

SECTION 175   CIVIL DOUBLE JEOPARDY  

175(1)    
If a person is ordered to pay a pecuniary penalty under a civil penalty provision in relation to particular conduct, the person is not liable to be ordered to pay a pecuniary penalty under some other provision of a law of the Commonwealth in relation to that conduct.

Note:

A court may make other orders, such as an order for compensation, in relation to particular conduct even if the court has made a pecuniary penalty order in relation to that conduct (see section 184).

175(2)    

If a relinquishment order is made against a person under section 167C in relation to particular conduct, the person is not liable to a relinquishment order under the Corporations Act 2001 or the Australian Securities and Investments Commission Act 2001 in relation to that conduct.

SECTION 175A   CONTINUING CONTRAVENTIONS OF CIVIL PENALTY PROVISIONS  

175A(1)    
If an act or thing is required under a civil penalty provision to be done:

(a) within a particular period; or

(b) before a particular time;

then the obligation to do that act or thing continues until the act or thing is done (even if the period has expired or the time has passed).

175A(2)    
A person who contravenes a civil penalty provision that requires an act or thing to be done:

(a) within a particular period; or

(b) before a particular time;

commits a separate contravention of that provision in respect of each day during which the contravention occurs (including the day the relevant pecuniary penalty order is made or any later day).

SECTION 175B   STATE OF MIND  

175B(1)    
In proceedings for a declaration of contravention, a pecuniary penalty order, a relinquishment order or any other order against a person for a contravention of a civil penalty provision, it is not necessary to prove:

(a) the person's intention; or

(b) the person's knowledge; or

(c) the person's recklessness; or

(d) the person's negligence; or

(e) any other state of mind of the person.

175B(2)    
Subsection (1) does not apply to the extent that the proceedings relate to attempting to contravene a civil penalty provision, or being involved in a contravention of a civil penalty provision.

175B(3)    
Subsection (1) does not affect the operation of section 175C (which is about mistake of fact).

175B(4)    
Subsection (1) does not apply to the extent that the civil penalty provision, or a provision that relates to the civil penalty provision, expressly provides otherwise.

SECTION 175C   MISTAKE OF FACT  

175C(1)    
A person is not liable to have a declaration of contravention, a pecuniary penalty order, a relinquishment order or any other order made against the person for a contravention of a civil penalty provision if:

(a) at or before the time of the conduct constituting the contravention, the person:

(i) considered whether or not facts existed; and

(ii) was under a mistaken but reasonable belief about those facts; and

(b) had those facts existed, the conduct would not have constituted a contravention of the civil penalty provision.

175C(2)    
For the purposes of subsection (1), a person may be regarded as having considered whether or not facts existed if:

(a) the person had considered, on a previous occasion, whether those facts existed in the circumstances surrounding that occasion; and

(b) the person honestly and reasonably believed that the circumstances surrounding the present occasion were the same, or substantially the same, as those surrounding the previous occasion.

175C(3)    
A person who wishes to rely on subsection (1) or (2) in proceedings bears an evidential burden in relation to that matter.

175C(4)    
In subsection (3), evidential burden , in relation to a matter, means the burden of adducing or pointing to evidence that suggests a reasonable possibility that the matter exists or does not exist.

SECTION 175D   EXCEPTIONS ETC. TO CIVIL PENALTY PROVISIONS - BURDEN OF PROOF  

175D(1)    
If, in proceedings for a declaration of contravention, a pecuniary penalty order, a relinquishment order or any other order against a person for a contravention of a civil penalty provision, the person wishes to rely on any exception, exemption, excuse, qualification or justification provided by the law creating the civil penalty provision, then the person bears an evidential burden in relation to that matter.

175D(2)    
In subsection (1), evidential burden , in relation to a matter, means the burden of adducing or pointing to evidence that suggests areasonable possibility that the matter exists or does not exist.

SECTION 175E  

175E   CIVIL PENALTY PROVISIONS CONTRAVENED BY EMPLOYEES, AGENTS OR OFFICERS  

If an element of a civil penalty provision is done by an employee, agent or officer of a body corporate acting:

(a) within the actual or apparent scope of the employee's, agent's, or officer's employment; or

(b) within the employee's, agent's, or officer's actual or apparent authority;

the element must also be attributed to the body corporate.

PART 4-2 - POWER OF THE COURT TO GRANT REMEDIES  

Division 1 - Introduction  

SECTION 176  

176   GUIDE TO THIS PART  

Division 2 - Power of the court to grant remedies  

SECTION 177   INJUNCTIONS  

177(1)   [Circumstances in which court may grant injunction]  

If, on the application of ASIC or any other person, the court is satisfied that a person has engaged or is proposing to engage in conduct that constitutes or would constitute:

(a) a contravention of this Act; or

(b) attempting to contravene this Act; or

(c) aiding, abetting, counselling or procuring a person to contravene this Act; or

(d) inducing or attempting to induce, whether by threats, promises or otherwise, a person to contravene this Act; or

(e) being in any way, directly or indirectly, knowingly concerned in, or party to, the contravention by a person of this Act; or

(f) conspiring with others to contravene this Act;

the court may grant an injunction on such terms as the court considers appropriate.

177(2)   [Injunction by consent]  

If an application for an injunction under subsection (1) has been made, the court may, if the court considers it appropriate, grant an injunction by consent of all the parties to the proceedings, whether or not the court is satisfied that the person has engaged, or is proposing to engage, in conduct of a kind referred to in subsection (1).

177(3)   [Interim injunction]  

The court may, if the court considers it appropriate, grant an interim injunction pending determination of an application under subsection (1).

177(4)   [Court may revoke or vary]  

The court may revoke or vary an injunction granted under subsection (1) or (3).

177(5)   [Exercise of power restraining conduct]  

The power of the court to grant an injunction restraining a person from engaging in conduct may be exercised:

(a) whether or not it appears to the court that the person intends to engage again, or to continue to engage, in conduct of that kind; and

(b) whether or not the person has previously engaged in conduct of that kind; and

(c) whether or not there is an imminent danger of substantial damage to another person if the person engages in conduct of that kind.

177(6)   [Exercise of power to require an act or thing done]  

The power of the court to grant an injunction requiring a person to do an act or thing may be exercised:

(a) whether or not it appears to the court that the person intends to refuse or fail again, or to continue to refuse or fail, to do that act or thing; and

(b) whether or not the person has previously refused or failed to do that act or thing; and

(c) whether or not there is an imminent danger of substantial damage to another person if the person refuses or fails to do that act or thing.

177(7)   [ASIC not required to give undertaking as to damages]  

If ASIC applies to the court for the grant of an injunction under this section, the court must not require ASIC or another person, as a condition of granting an interim injunction, to give an undertaking as to damages.

177(8)   [Damages]  

If the court has power under this section to grant an injunction against a person, the court may, either in addition to or in substitution for the grant of the injunction, order the person to pay damages to another person.

SECTION 178   COMPENSATION ORDERS  
Court may order person to pay compensation

178(1)    
The court may order a person (the defendant ) to compensate another person (the plaintiff ) for loss or damage suffered by the plaintiff if:

(a) the defendant has contravened a civil penalty provision or has committed an offence against this Act (other than the National Credit Code); and

(b) the loss or damage resulted from the contravention or commission of the offence.

The order must specify the amount of compensation.

Note:

An order may be made under this subsection whether or not a declaration of contravention has been made under section 166.

When order may be made

178(2)    
The court may make the order only if:

(a) the plaintiff or ASIC (on behalf of the plaintiff) applies for an order under this section; and

(b) the application is made within 6 years of the day the cause of action that relates to the contravention or commission of the offence accrued.

Applications for order

178(3)    
For the purposes of paragraph (2)(a), ASIC may make an application on behalf of the plaintiff, but only if the plaintiff has given consent in writing before the application is made.

Recovery of compensation as a debt

178(4)    
If the court makes the order, the amount of compensation specified in the order that is to be paid to the plaintiff may be recovered as a debt due to the plaintiff.

SECTION 179   OTHER ORDERS TO COMPENSATE LOSS OR DAMAGE  
Court may make other orders to compensate loss or damage

179(1)   [Powers]  

If:

(a) a person (the defendant) has contravened a civil penalty provision or has committed an offence against this Act (other than the National Credit Code); and

(b) another person (the plaintiff ) has suffered, or is likely to suffer, loss or damage as a result of the contravention or commission of the offence;

the court may make such order as the court considers appropriate against the defendant to:

(c) compensate the plaintiff, in whole or in part, for the loss or damage; or

(d) prevent or reduce the loss or damage suffered, or likely to be suffered, by the plaintiff.

Note:

An order may be made under this subsection whether or not a declaration of contravention has been made under section 166.

179(2)   [Example of orders court may make]  

Without limiting subsection (1), examples of orders the court may make include:

(a) an order declaring the whole or any part of a contract, deed or arrangement made between the defendant and the plaintiff to be void and, if the court considers it appropriate, to have been void from the time it was entered or at all times on and after a specified day before the order is made; and

(b) an order varying such a contract, deed or arrangement in such manner as is specified in the order and, if the court considers it appropriate, declaring the contract, deed or arrangement to have had effect as so varied on and after a specified day before the order is made; and

(c) an order refusing to enforce any or all of the terms of such a contract, deed or arrangement; and

(d) an order directing the defendant to refund money or return property to the plaintiff; and

(e) an order directing the defendant to pay to the plaintiff the amount of loss or damage the plaintiff suffered; and

(f) an order directing the defendant, at the defendant's own expense, to supply specified services to the plaintiff.

When order may be made

179(3)    
The court may make the order only if:

(a) the plaintiff or ASIC (on behalf of the plaintiff) applies for an order under this section; and

(b) the application is made within 6 years of the day the cause of action that relates to the contravention or commission of the offence accrued.

Applications for order

179(4)    
For the purposes of paragraph (3)(a), ASIC may make an application on behalf of the plaintiff, but only if the plaintiff has given consent in writing before the application is made.

Recovery of amount as a debt

179(5)    
If the court makes an order that the defendant pay an amount specified in the order to the plaintiff, the plaintiff may recover the amount as a debt due to the plaintiff.

Presumption in favour of certain orders

179(6)    

Subsection (7) applies if:

(a) the defendant is a credit provider who has contravened section 133 by entering into, or increasing the credit limit of, a credit contract (the illegal contract ) that is not a credit contract for a reverse mortgage; and

(b) the debtor's obligations under the illegal contract are secured by a mortgage over the debtor's principal place of residence; and

(c) the court is satisfied that, at any time in the period in which an assessment needed to be made to comply with section 128 in relation to the illegal contract:

(i) there was a credit provider (whether the defendant or not) offering credit through a reverse mortgage (whether or not the credit provider actually made such an offer to the debtor); and

(ii) the debtor would have been eligible to enter into a credit contract for the reverse mortgage; and

(iii) the credit contract for the reverse mortgage would not have been unsuitable for the debtor under section 133; and

(d) the plaintiff, or ASIC on behalf of the plaintiff, applies for an order under this section to let the plaintiff reside in the place to prevent or reduce loss or damage suffered or likely to be suffered by the plaintiff vacating the place.

179(7)    

The court must consider the order appropriate to prevent or reduce the loss or damage and make the order unless the court is satisfied that the order would adversely affect a person other than the debtor and the defendant.

SECTION 180   ORDERS IN RELATION TO UNLAWFUL CREDIT ACTIVITIES  
Court may make orders in relation to unlawful credit activities

180(1)   [Powers]  

If:

(a) a person (the defendant ) engages in a credit activity in relation to another person (the plaintiff ); and

(b) the engaging in the activity contravenes any of the following:

(i) section 29 (which requires the holding of a licence);

(ii) section 124A (which prohibits the provision of credit assistance in relation to short-term credit contracts);

(iii) section 133CA (which prohibits credit providers from entering into short-term credit contracts etc.);

the court may make such order as the court considers appropriate against the defendant:

(c) to prevent the defendant from profiting from the plaintiff by engaging in that activity; or

(d) to compensate the plaintiff, in whole or in part, for any loss or damage suffered as a result of the defendant engaging in that activity; or

(e) to prevent or reduce the loss or damage suffered, or likely to be suffered, by the plaintiff as a result of the defendant engaging in that activity.

Note:

An order may be made under this subsection whether or not a declaration of contravention has been made under section 166.

180(2)   [Examples of orders court may make]  

Without limiting subsection (1), examples of orders the court may make include:

(a) an order declaring the whole or any part of a contract, deed or arrangement made between the defendant and the plaintiff to be void and, if the court considers it appropriate, to have been void from the time it was entered or at all times on and after a specified day before the order is made; and

(b) an order varying such a contract, deed or arrangement in such manner as is specified in the order and, if the court considers it appropriate, declaring the contract, deed or arrangement to have had effect as so varied on and after a specified day before the order is made; and

(c) an order refusing to enforce any or all of the terms of such a contract, deed or arrangement; and

(d) an order directing the defendant to refund money or return property to the plaintiff; and

(e) an order directing the defendant to pay to the plaintiff the amount of loss or damage the plaintiff suffered; and

(f) an order directing the defendant, at the defendant's own expense, to supply specified services to the plaintiff.

When order may be made

180(3)    
The court may make the order only if:

(a) the plaintiff or ASIC (on behalf of the plaintiff) applies for an order under this section; and

(b) the application is made within 6 years of the day the cause of action that relates to the contravention or commission of the offence accrued.

Applications for order

180(4)    
For the purposes of paragraph (3)(a), ASIC may make an application on behalf of the plaintiff, but only if the plaintiff has given consent in writing before the application is made.

Recovery of amount as a debt

180(5)    
If the court makes an order that the defendant pay an amount specified in the order to the plaintiff, the plaintiff may recover the amount as a debt due to the plaintiff.

SECTION 180A   ORDERS TO REMEDY UNFAIR OR DISHONEST CONDUCT BY CREDIT SERVICE PROVIDERS  

180A(1)    
The court may make one or more of the orders described in subsection (2) if the court is satisfied that:

(a) a person (the defendant ) provided a credit service to a consumer (the plaintiff ); and

(b) the defendant engaged in conduct that:

(i) was connected with the provision of the service; and

(ii) was unfair or dishonest; and

(c) the conduct had one or more of the following results:

(i) the plaintiff entered a credit contract, consumer lease, mortgage or guarantee that the plaintiff would not have entered apart from the conduct;

(ii) the plaintiff entered a credit contract, consumer lease, mortgage or guarantee whose terms were different from a credit contract, consumer lease, mortgage or guarantee the plaintiff would have entered apart from the conduct;

(iii) the plaintiff became liable to pay fees, costs or charges to the defendant or someone else.

180A(2)    
The orders are as follows:

(a) an order that the defendant take, or refrain from taking, specified action;

(b) an order that the defendant pay the plaintiff a specified amount;

(c) an order that a specified amount is not due or owing by the plaintiff to the defendant;

(d) any other order the court considers appropriate to:

(i) redress the unfairness or dishonesty; or

(ii) prevent the defendant from profiting from the plaintiff by engaging in the conduct;

except an order that affects a credit contract, consumer lease, mortgage or guarantee to which the conduct related.

Determining whether conduct was unfair or dishonest

180A(3)    
In determining whether conduct was unfair or dishonest, the court:

(a) must have regard to the extent (if any) to which one or more of the circumstances described in subsection (4) existed; and

(b) must consider it more likely that the conduct was unfair or dishonest the more any of those circumstances existed and the more any of them affected the plaintiff's interests.

This does not limit the matters to which the court may have regard.

180A(4)    
The circumstances are as follows:

(a) the plaintiff was at a special disadvantage in dealing with the defendant in relation to the transaction involving:

(i) the conduct; and

(ii) a credit contract, consumer lease, mortgage or guarantee to which the conduct related; and

(iii) any other contract requiring the plaintiff to make payments for the purposes of which it is reasonable to expect the plaintiff would or did enter such a credit contract, consumer lease, mortgage or guarantee;

(b) the plaintiff was a member of a class whose members were more likely than people who were not members of the class to be at such a disadvantage;

(c) if the plaintiff was a member of a class referred to in paragraph (b) - a reasonable person would consider that the conduct was directed at that class;

(d) the plaintiff was unable, or considered himself or herself unable, to make:

(i) a credit contract with a credit provider other than the credit provider to which the conduct related; or

(ii) a consumer lease with a lessor other than the lessor to which the conduct related; or

(iii) a mortgage with a mortgagee other than the mortgagee to which the conduct related; or

(iv) a guarantee with a beneficiary other than the beneficiary to which the conduct related;

(e) the conduct involved a technique that:

(i) should not in good conscience have been used; or

(ii) manipulated the plaintiff;

(f) the defendant could determine or significantly influence the terms of a contract covered by subparagraph (a)(ii) or (iii);

(g) the terms of the transaction described in paragraph (a) were less favourable to the plaintiff than the terms of a comparable transaction.

When order may be made

180A(5)    
The court may make the order only if:

(a) the plaintiff or ASIC (on behalf of the plaintiff) applies for an order under this section; and

(b) the application is made within 6 years of the day the defendant first started engaging in the conduct.

Applications for order

180A(6)    
For the purposes of paragraph (5)(a), ASIC may make an application on behalf of the plaintiff, but only if the plaintiff has given consent in writing before the application is made.

Recovery of amount as a debt

180A(7)    
If the court makes an order that the defendant pay an amount specified in the order to the plaintiff, the plaintiff may recover the amount as a debt due to the plaintiff.

When this section does not apply

180A(8)    
This section does not apply to the provision of credit assistance by a person who is (or after the provision of the assistance becomes):

(a) a credit provider under the credit contract to which the assistance relates; or

(b) a lessor under the consumer lease to which the assistance relates; or

(c) a mortgagee under a mortgage in relation to the credit contract to which the assistance relates; or

(d) a beneficiary of a guarantee in relation to the credit contract to which the assistance relates.

SECTION 181   PREFERENCE MUST BE GIVEN TO COMPENSATE CONSUMERS  

181(1)    
This section applies if a court considers that it is appropriate to:

(a) make a pecuniary penalty order against a person in relation to a contravention of a civil penalty provision; or

(b) make a relinquishment order against a person in relation to a contravention of a civil penalty provision; or

(c) impose a fine against a person in relation to a commission of an offence constituted by the same conduct as the conduct constituting the contravention of the pecuniary penalty order.

181(2)    
In making the pecuniary penalty order or relinquishment order or imposing the fine, the court:

(a) must consider the effect that making the order or imposing the fine would have on the amount available to pay compensation to which persons might reasonably be expected to be entitled under section 178, 179 or 180; and

(b) give preference to making an appropriate amount available for compensation under those sections.

181(3)    
If the court gives preference to making an appropriate amount available for compensation under paragraph (2)(b), the court may also make such orders as the court thinks fit for the purpose of ensuring that the amount remains available for the payment of compensation under section 178, 179 or 180.

SECTION 182   ADVERSE PUBLICITY ORDERS  

182(1)   [When order may be made]  

The court may, on application by ASIC, make an adverse publicity order against a person who has:

(a) contravened a civil penalty provision; or

(b) committed an offence against this Act.

182(2)   [Definition]  

An adverse publicity order is an order that:

(a) requires a person to disclose, in the way and to the persons specified in the order, such information as is so specified, being information that the person has possession of or access to; or

(b) requires a person to publish, at the person's expense and in the way specified in the order, an advertisement in the terms specified in, or determined in accordance with, the order.

182(3)   [Conditions]  

The court may make the order only if:

(a) ASIC applies for an order under this section; and

(b) the application is made within 6 years of the contravention or the commission of the offence.

SECTION 183   RELIEF FROM LIABILITY FOR CONTRAVENTION OF CIVIL PENALTY PROVISION  

183(1)   [Powers]  

If:

(a) proceedings for a contravention of a civil penalty provision are brought against a person; and

(b) in the proceedings it appears to the court that the person has, or may have, contravened a civil penalty provision but that:

(i) the person has acted honestly; and

(ii) having regard to all the circumstances of the case, the person ought fairly to be excused for the contravention;

the court may relieve the person either wholly or partly from a liability to which the person would otherwise be subject, or that might otherwise be imposed on the person, because of the contravention.

183(2)   [When a person may apply to court for relief]  

If a person considers that proceedings for a contravention of a civil penalty provision will or may be brought against the person, the person may apply to the court for relief.

183(3)   [Relief following application in subsection (2)]  

On an application under subsection (2), the court may grant relief under subsection (1) as if the proceedings had been begun in the court.

SECTION 184  

184   MULTIPLE REMEDIES MAY BE GRANTED  

To avoid doubt, the court may make an order under a provision of this Act in addition to one or more orders under another provision of this Act or another Act.

PART 4-3 - JURISDICTION AND PROCEDURE OF COURTS  

Division 1 - Introduction  

SECTION 185   GUIDE TO THIS PART  

Division 2 - Civil proceedings  

Subdivision A - Application of this Division  

SECTION 186   APPLICATION OF THIS DIVISION  

186(1)   [Application]  

This Division applies to the exclusion of:

(a) the Jurisdiction of Courts (Cross-vesting) Act 1987; and

(b) section 39B of the Judiciary Act 1903.

186(2)   [No limitation]  

This Division does not limit the application of the provisions of the Judiciary Act 1903 (other than section 39B). In particular, it does not limit the application of subsection 39(2) of that Act in relation to matters arising under this Act.

186(3)   [Other court jurisdictions not affected]  

Nothing in this Division affects any other jurisdiction of any court.

186(4)   [Jurisdiction]  

Despite anything else in this Division, jurisdiction is conferred on the courts of a Territory only to the extent that the Constitution permits.

Subdivision B - Conferral of civil jurisdiction  

SECTION 187   CIVIL JURISDICTION OF COURTS  

187(1)    

Jurisdiction is conferred on a court referred to in an item in the following table in relation to civil matters arising under this Act, subject to the limits on the court's jurisdiction (if any) specified in the item:

Civil jurisdiction of courts
Item	Court on which civil jurisdiction is conferred	Limits of jurisdiction
1	The Federal Court	No specified limits.
2	The Federal Circuit and Family Court of Australia (Division 2)	The court does not have jurisdiction to award an amount for loss or damage that exceeds:
		(a) $750,000; or
		(b) if another amount is prescribed by the regulations - that other amount.
3	A superior court of a State or Territory	The court's general jurisdictional limits, including limits as to locality and subject matter.
4	A lower court of a State, or of a Territory other than Norfolk Island	The court's general jurisdictional limits, including limits as to locality and subject matter.

187(2)    
This section has effect subject to section 188.

SECTION 188   JURISDICTION - DECISIONS TO PROSECUTE AND RELATED CRIMINAL JUSTICE PROCESS DECISIONS MADE BY COMMONWEALTH OFFICERS  

188(1)   [Where proposed prosecution in court of State or Territory]  

If a decision to prosecute a person for an offence against this Act has been made by an officer of the Commonwealth, and the prosecution is proposed to be brought in a court of a State or Territory:

(a) the Federal Court does not have jurisdiction in relation to any matter in which a person seeks a writ of mandamus or prohibition, or an injunction, against the officer in relation to that decision; and

(b) jurisdiction in relation to any such matter is conferred on the Supreme Court of the State or Territory in which the prosecution is proposed to be brought.

188(2)   [Where prosecution is in progress or appeal proceedings arise]  

Subject to subsection (4), at any time when:

(a) a prosecution for an offence against this Act is before a court of a State or Territory; or

(b) an appeal arising out of such a prosecution is before a court of a State or Territory;

the following apply:

(c) the Federal Court does not have jurisdiction in relation to any matter in which the person who is or was the defendant in the prosecution seeks a writ of mandamus or prohibition, or an injunction, against an officer of the Commonwealth in relation to a related criminal justice process decision;

(d) jurisdiction in relation to any such matter is conferred on the Supreme Court of the State or Territory in which the prosecution or appeal is before a court.

188(3)   [Definition]  

A related criminal justice process decision , in relation to an offence, means a decision (other than a decision to prosecute) made in the criminal justice process in relation to the offence, including:

(a) a decision in connection with the investigation, committal for trial or prosecution of the defendant; and

(b) a decision in connection with the appointment of investigators or inspectors for the purposes of such an investigation; and

(c) a decision in connection with the issue of a warrant, including a search warrant or a seizure warrant; and

(d) a decision requiring the production of documents, the giving of information or the summoning of persons as witnesses; and

(e) a decision in connection with an appeal arising out of the prosecution.

188(4)   [Exception to subsection (2)]  

Subsection (2) does not apply if a person has applied for a writ of mandamus or prohibition, or an injunction, against an officer of the Commonwealth in relation to a related criminal justice process decision before the commencement of a prosecution for an offence against a law of the Commonwealth, or of a State or a Territory.

188(5)   [Application for permanent stay of proceedings where subsection (4) applies]  

If subsection (4) applies, the prosecutor may apply to the court for a permanent stay of the proceedings referred to in that subsection and the court may grant such a stay if the court determines that:

(a) the matters that are the subject of the proceedings are more appropriately dealt with in the criminal justice process; and

(b) a stay of proceedings will not substantially prejudice the person.

188(6)   [Effect of subsection (1), (2), (4) and (5)]  

Subsections (1), (2), (4) and (5) have effect despite anything in this Act or in any other law. In particular:

(a) neither this Act, nor any other law, has the effect of giving the Federal Court jurisdiction contrary to subsection (1) or (2); and

(b) neither section 9 of the Administrative Decisions (Judicial Review) Act 1977, nor any other law, has the effect of removing from the Supreme Court of a State or Territory the jurisdiction given to that court by subsection (1) or (2).

SECTION 189  

189   CROSS-JURISDICTIONAL APPEALS  

The following table has effect:

Cross-jurisdictional appeals
Item	Despite any other law of the Commonwealth, an appeal in relation to a matter arising under this Act does not lie from a decision of ...	to any of the following courts:
1	the Federal Court	(a) a court of a State;
		(b) a court of a Territory;
		(c) the Federal Circuit and Family Court of Australia (Division 2).
2	the Federal Circuit and Family Court of Australia (Division 2)	(a) a court of a State;
		(b) a court of a Territory.
3	a court of a State	(a) the Federal Court;
		(b) the Federal Circuit and Family Court of Australia (Division 2);
		(c) a court of another State;
		(d) a court of a Territory.
4	a court of the Australian Capital Territory	(a) the Federal Court;
		(b) the Federal Circuit and Family Court of Australia (Division 2);
		(c) a court of a State;
		(d) a court of another Territory.
5	a court of the Northern Territory	(a) the Federal Court;
		(b) the Federal Circuit and Family Court of Australia (Division 2);
		(c) a court of a State;
		(d) a court of another Territory.
6	The Supreme Court of Norfolk Island	(a) the Federal Circuit and Family Court of Australia (Division 2);
		(b) a court of a State;
		(c) a court of another Territory.

SECTION 190  

190   COURTS TO ACT IN AID OF EACH OTHER  
All of the following must severally act in aid of, and be auxiliary to, each other in civil matters arising under this Act:

(a) courts on which jurisdiction is conferred under this Division;

(b) officers of, or under the control of, those courts.

Subdivision C - Transfers between courts  

SECTION 191   TRANSFERS - APPLICATION OF SUBDIVISION  
Scope of Subdivision

191(1)    
This Subdivision applies if all the following conditions are satisfied:

(a)    proceedings in relation to a civil matter arising under this Act are pending, or have come, before a court (the transferring court ) on which jurisdiction is conferred under this Division in relation to the matter;

(b)    jurisdiction is also conferred on another court (the receiving court ) under this Division in relation to either of the following (the transfer matter ):

(i) the entire proceedings;

(ii) an application in the proceedings;

(c)    the receiving court has the power to grant the remedies sought before the transferring court in relation to the transfer matter.

Transfers to which other legislation applies

191(2)    

This Subdivision does not apply to a transfer between the Federal Court and the Federal Circuit and Family Court of Australia (Division 2), except as provided by paragraph 192(2)(b).

Note 1:

Paragraph 192(2)(b) gives the Federal Circuit and Family Court of Australia (Division 2) the power to transfer a matter to the Federal Court with a recommendation that the Federal Court transfer the matter to another superior court.

Note 2:

For transfers from the Federal Court to the Federal Circuit and Family Court of Australia (Division 2): see section 32AB of the Federal Court of Australia Act 1976.

Note 3:

For transfers from the Federal Circuit and Family Court of Australia (Division 2) to the Federal Court: see section 153 of the Federal Circuit and Family Court of Australia Act 2021 and section 32AC of the Federal Court of Australia Act 1976.

SECTION 192   TRANSFERS - EXERCISE OF TRANSFER POWER  
General rule

192(1)    
If section 193 (which deals with the criteria for transfers) is satisfied, the transferring court may transfer to the receiving court:

(a) the transfer matter; and

(b) if the transferring court considers it necessary or convenient - any related application (or all related applications) in the proceedings.

Cross-jurisdictional transfers between lower courts and superior courts

192(2)    
However, if the transferring court is a lower court, and the transferring court considers that section 193 is satisfied in relation to the transfer of a matter referred to in subsection (1) of this section to a receiving court that is a superior court other than the relevant superior court:

(a) the transferring court does not have the power to transfer the matter to that receiving court; but

(b) the transferring court may:

(i) transfer the matter to the relevant superior court; and

(ii) give the relevant superior court a recommendation that the matter be transferred to that receiving court by the relevant superior court.

SECTION 193   TRANSFERS - CRITERIA FOR TRANSFER  
General

193(1)    
The transferring court may make a transfer under section 192 only if it appears to the transferring court, taking into account the considerations covered by subsection (2) of this section, that:

(a) the transfer matter arises out of, or is related to, other proceedings pending, or that have come, before the receiving court; or

(b) it is otherwise in the interests of justice that the transfer matter be determined by the receiving court.

Relevant considerations

193(2)    
The considerations covered by this subsection include the following:

(a) the principal location, or place of business, of the parties in relation to the transfer matter;

(b) where the event (or events) that are the subject of the transfer matter took place;

(c) if the transfer matter involves secured real property - the jurisdiction in which the real property is located;

(d) the desirability of related proceedings being heard in the same State or Territory;

(e) any relevant recommendation received under subsection 192(2);

(f) the suitability (taking into account the considerations referred to in paragraphs (a) to (e) and any other consideration) of having the transfer matter determined by the receiving court.

SECTION 194  

194   TRANSFERS - HOW INITIATED  
A court may make a transfer under section 192:

(a) on the application of a party made at any stage; or

(b) at the court's own initiative.

SECTION 195  

195   TRANSFERS - DOCUMENTS AND PROCEDURE  
If the transferring court transfers proceedings or an application to the receiving court under section 192:

(a) the Registrar (or other proper officer) of the transferring court must give the Registrar (or other proper officer) of the receiving court all documents filed in the transferring court in relation to the proceedings or application; and

(b) the receiving court must proceed as if:

(i) the proceedings or application had been originally brought or made in the receiving court; and

(ii) the same proceedings had been taken in the receiving court as were taken in the transferring court.

SECTION 196   TRANSFERS - CONDUCT OF PROCEEDINGS  

196(1)   [Rules of evidence and procedure]  

Subject to any applicable rules of court, in dealing with the transfer matter transferred to the court under section 192, the receiving court must apply rules of evidence and procedure that:

(a) are applied in any superior court; and

(b) the court considers appropriate to be applied in the circumstances.

196(2)   [Where proceedings transferred under s 192]  

If proceedings are transferred under section 192 from the transferring court to the receiving court, the receiving court must deal with the proceedings as if, subject to any order of the transferring court, the steps that had been taken for the purposes of the proceedings in the transferring court (including the making of an order), or similar steps, had been taken in the receiving court.

SECTION 197   TRANSFERS - ENTITLEMENT TO PRACTISE AS A LAWYER  

197(1)   [Transfer of entitlement to practice]  

If proceedings (the transferred proceedings ) in the transferring court are transferred to the receiving court under section 192, a person who is entitled to practise as a lawyer (however described) in the transferring court has the same entitlements to practise in relation to the matters covered by subsection (2) in the receiving court that the person would have if the receiving court were a federal court exercising federal jurisdiction.

197(2)   [Application of subsection]  

This subsection covers the following matters:

(a) the transferred proceedings;

(b) any other proceedings out of which the transferred proceedings arise or to which the transferred proceedings are related, if the other proceedings are to be determined together with the transferred proceedings.

SECTION 198  

198   TRANSFERS - LIMITATION ON APPEALS  
An appeal does not lie from a decision of a court:

(a) in relation to the transfer of proceedings under section 192; or

(b) as to which rules of evidence and procedure are to be applied under subsection 196(1).

Subdivision D - Other matters  

SECTION 199   PLAINTIFFS MAY CHOOSE SMALL CLAIMS PROCEDURE  
Application for small claims procedure

199(1)    

Proceedings are to be dealt with as small claims proceedings under this section if:

(a)    

a person applies to a magistrates court, local court or the Federal Circuit and Family Court of Australia (Division 2) for an order covered by subsection (2); and

(b)    the person indicates, in the manner (if any) prescribed by the regulations or by the rules of the court, that the person wants the small claims procedure to apply to the proceedings.

Orders for which small claims procedure triggered

199(2)    

The following table sets out when an order is covered by this subsection:

Section 106 of the National Credit Code

Orders for which small claims procedure triggered
Item	An order is covered by this subsection if it is made under …	but only if (if applicable) …
1	Section 178	the order is for an amount that is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
2	Section 37 of the National Credit Code	the value of the credit contract, mortgage or guarantee to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
3	Subsection 38(7) of the National Credit Code	the value of the credit contract, mortgage or guarantee to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
4	Section 74 of the National Credit Code	not applicable.
5	Section 75 of the National Credit Code	not applicable.
6	Section 76 of the National Credit Code	the value of the credit contract, mortgage or guarantee to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
7	Section 78 of the National Credit Code	the value of the credit contract, mortgage or guarantee to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
8	Section 96 of the National Credit Code	not applicable.
9	Section 101 of the National Credit Code	the value of the credit contract, mortgage or guarantee to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
10	the order is for an amount that is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
11	Subsection 107(3) of the National Credit Code	the order is for an amount that is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
12	Section 108 of the National Credit Code	the value of the credit contract, mortgage or guarantee to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
13	Section 118 of the National Credit Code	the order is for an amount that is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
14	Section 175F of the National Credit Code	the value of the consumer lease to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
15	Subsection 175G(6) of the National Credit Code	the value of the consumer lease to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
16	Section 177D of the National Credit Code	not applicable.
17	Section 177E of the National Credit Code	not applicable.
18	Section 177F of the National Credit Code	the value of the consumer lease to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
19	Section 179K of the National Credit Code	not applicable.
20	Section 179Q of the National Credit Code	the value of the consumer lease to which the order relates is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.
21	Subsection 179R(3) of the National Credit Code	the order is for an amount that is not more than:
		(a) $40,000; or
		(b) if a higher amount is prescribed by the regulations - that higher amount.

199(3)    

The value of a credit contract, mortgage, guarantee or consumer lease is:

(a)    worked out in accordance with the regulations; or

(b)    if there are no regulations in force for the purposes of paragraph (a):

(i) for a credit contract - the amount of credit that has been, or may be, provided under the contract; and

(ii) for a mortgage - the amount of credit that has been, or may be, provided under the credit contract to which the mortgage relates; and

(iii) for a guarantee - the amount of credit that has been, or may be, provided under the credit contract to which the guarantee relates; and

(iv) for a consumer lease - the amount payable under the consumer lease, as referred to in paragraph 170(1)(b) of the National Credit Code.

Court may make ancillary or consequential orders

199(4)    
To avoid doubt, the court may make any ancillary or consequential orders it considers appropriate in relation to the orders made under the provisions referred to in subsection (2). The limits referred to in column 3 of the table do not apply to those ancillary or consequential orders.

Procedure

199(5)    
In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:

(a)    in an informal manner; and

(b)    without regard to legal forms and technicalities.

199(6)    
At any stage of the small claims proceedings, the court may amend the papers commencing the proceedings if sufficient notice is given to any party adversely affected by the amendment.

Legal representation

199(7)    
A party to small claims proceedings may be represented in the proceedings by a lawyer only with the leave of the court.

199(8)    
If the court grants leave for a party to the proceedings to be represented by a lawyer, the court may, if it considers appropriate, do so subject to conditions designed to ensure that no other party is unfairly disadvantaged.

199(9)    
For the purposes of this section, a person is taken not to be represented by a lawyer if the lawyer is an employee or officer of the person.

SECTION 200   COSTS ONLY IF PROCEEDINGS BROUGHT VEXATIOUSLY ETC.  

200(1)   [Power of court]  

In proceedings that:

(a) are dealt with as small claims proceedings (see section 199); or

(b) relate to section 74, 96, 177D or 179K of the National Credit Code (which deal with hardship and postponement orders);

a party to the proceedings may be ordered by the court to pay costs incurred by another party to the proceedings only in accordance with subsection (2).

200(2)   [When court may order costs]  

The party may be ordered to pay the costs only if:

(a) the court is satisfied that the party brought the proceedings vexatiously or without reasonable cause; or

(b) the court is satisfied that the party's unreasonable act or omission caused the other party to incur the costs.

SECTION 201  

201   CIVIL PROCEEDINGS NOT TO BE STAYED  
No civil proceedings under this Act are to be stayed merely because the proceedings disclose, or arise out of, the commission of an offence.

SECTION 202  

202   STANDARD OF PROOF IN CIVIL PROCEEDINGS  
If, in proceedings (other than proceedings for an offence), it is necessary to establish, or for the court to be satisfied, for any purpose relating to a matter arising under this Act, that:

(a) a person has contravened a provision of this Act; or

(b) default has been made in complying with a provision of this Act; or

(c) an act or omission was unlawful because of a provision of this Act; or

(d) a person has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to a contravention, or a default in complying with, a provision of this Act;

it is sufficient if the matter referred to in paragraph (a), (b), (c) or (d) is established, or the court is so satisfied on the balance of probabilities.

Division 3 - Criminal proceedings  

Subdivision A - Application of this Division  

SECTION 203   APPLICATION OF THIS DIVISION  

203(1)   [Application]  

This Division applies to the exclusion of sections 68, 70 and 70A of the Judiciary Act 1903.

203(2)   [No limitation]  

However, this Division does not limit the application of the provisions of the Judiciary Act 1903 (other than sections 68, 70 and 70A). In particular, it does not limit the application of subsection 39(2) of that Act in relation to criminal matters arising under this Act.

203(3)   [Jurisdiction]  

Despite anything else in this Division, jurisdiction is conferred on the courts of a Territory only to the extent that the Constitution permits.

Subdivision B - Conferral of criminal jurisdiction  

SECTION 204   CRIMINAL JURISDICTION OF COURTS  
Cross-vesting of criminal jurisdiction of courts

204(1)    
Subject to this section, if a court of a State or Territory exercises jurisdiction in relation to a matter covered by subsection (2) in relation to offenders or persons ( State offenders ) charged with offences against the laws of the State or Territory, the court has the equivalent jurisdiction in relation to offenders or persons charged with offences against this Act.

204(2)    
The matters covered by this subsection are as follows:

(a)    the summary conviction of State offenders;

(b)    their examination and commitment for trial on indictment;

(c)    their trial and conviction on indictment;

(d)    their sentencing, punishment and release;

(e)    the liability to make reparation in connection with their offences;

(f)    the forfeiture of property in connection with their offences;

(g)    the proceeds of their crimes;

(h)    the hearing and determination of:

(i) proceedings connected with; or

(ii) appeals arising out of; or

(iii) appeals arising out of proceedings connected with;

any trial or conviction referred to in paragraph (a), (b) or (c), or any matter of a kind referred to in paragraph (d), (e), (f) or (g).

204(2A)    

However, this section does not apply in relation to the jurisdiction of a lower court of Norfolk Island.

Certain aspects of jurisdiction to be exercised only by magistrate

204(3)    
Only a magistrate may exercise the jurisdiction conferred by subsection (1) in relation to the summary conviction, or examination and commitment for trial, of any person.

Person who pleads guilty to an indictable offence may be sentenced or otherwise dealt with without trial

204(4)    
The jurisdiction conferred by subsection (1) includes jurisdiction in accordance with provisions of a relevant criminal law of a State or Territory, and:

(a)    the reference in paragraph (2)(h) to "any trial or conviction" includes a reference to any conviction or sentencing in accordance with the provisions of a relevant criminal law; and

(b)    unless the contrary intention appears, a reference to jurisdiction conferred by subsection (1) includes a reference to such included jurisdiction.

204(5)    
Relevant criminal law means a law providing that if, in proceedings before a court, a person pleads guilty to a charge for which the person could be prosecuted on indictment, the person may be committed, to a court having jurisdiction to try offences on indictment, to be sentenced or otherwise dealt with without being tried in that last-mentioned court.

204(6)    
A person may be dealt with in accordance with a relevant criminal law even if, apart from this section, the offence concerned:

(a)    would be required to be prosecuted on indictment; or

(b)    would be required to be prosecuted either summarily or on indictment.

204(7)    
For the purposes of the application of a relevant criminal law as provided by subsection (4):

(a)    a reference in that law to an indictable offence is taken to include a reference to an offence that may be prosecuted on indictment; and

(b)    in order to determine the sentence that may be imposed on a person by a court pursuant to the relevant criminal law, the person is taken to have been prosecuted and convicted on indictment in that court.

Jurisdiction in relation to summary offences is unlimited

204(8)    
Subject to subsection (10), the jurisdiction conferred on a court of a State or Territory by subsection (1) is conferred despite any limits as to locality of the jurisdiction of that court under the law of that State or Territory.

Court may decline to exercise jurisdiction in relation to summary offences

204(9)    
If:

(a)    jurisdiction is conferred on a court of a State or Territory in relation to the summary conviction of persons charged with offences against this Act by subsection (1); and

(b)    the court is satisfied that it is appropriate to do so, having regard to all the circumstances (including the public interest);

the court may decline to exercise that jurisdiction in relation to an offence committed in another State or Territory.

Limits on jurisdiction in relation to indictable offences

204(10)    
The jurisdiction conferred on a court of a State or Territory by subsection (1) in relation to:

(a)    the examination and commitment for trial on indictment; and

(b)    the trial and conviction on indictment;

of offenders or persons charged with offences against this Act is conferred only in relation to:

(c)    offences committed outside Australia (not including the coastal sea); and

(d)    offences committed, begun or completed in the State or the Territory concerned.

SECTION 205   CRIMINAL PROCEEDINGS - LAWS TO BE APPLIED  
Laws to be applied

205(1)    
Subject to this Division, the laws of a State or Territory in relation to:

(a) the arrest and custody in the State or Territory of offenders or persons charged with offences; and

(b) criminal procedure in the State or Territory in relation to such persons; and

(c) the rules of evidence applied in criminal procedure in the State or Territory in relation to such persons;

apply in the State or Territory, so far as they are applicable, to persons who are charged with offences against this Act.

Meaning of criminal procedure

205(2)    

Criminal procedure
means the procedure for:

(a) the summary conviction; and

(b)the examination and commitment for trial on indictment; and

(c) the trial and conviction on indictment; and

(d) the hearing and determination of appeals arising out of any such trial or conviction or out of any related proceedings;

of offenders or persons charged with offences, and includes the procedure for holding accused persons to bail.

SECTION 206   CRIMINAL PROCEEDINGS - HOW TAKEN  

206(1)   [Who may initiate]  

In any proceedings for an offence against this Act, any information, charge, complaint or application may be laid or made by:

(a) ASIC; or

(b) a delegate of ASIC; or

(c) another person authorised in writing by the Minister to bring the proceedings.

206(2)   [Delegation and authorisation]  

A delegation for the purposes of paragraph (1)(b), or an authorisation for the purposes of paragraph (1)(c), may relate to all offences, or to specified offences, against this Act.

206(3)   [Other legislation]  

Nothing in this section affects the operation of the Director of Public Prosecutions Act 1983.

SECTION 207   CERTAIN PERSONS TO ASSIST IN PROSECUTIONS  

207(1)    
If a prosecution in relation to an offence against this Act has been brought, or ASIC is of the opinion that a prosecution in relation to an offence against this Act ought to be brought, against a person (the defendant ), ASIC may:

(a) if the defendant is a natural person - require any person who is or was a partner, employee or agent of the defendant; or

(b) if the defendant is a body corporate - require any person who is or was an officer (within the meaning of the Corporations Act 2001), employee or agent of the defendant;

to assist in the prosecution, and the person who is so required must give all assistance in connection with the prosecution that that person is reasonably able to give.

207(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 20 penalty units.

207(3)    
Subsection (2) is an offence of strict liability.

Note:

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

207(4)    
For the purposes of subsection (2), it is a defence if the person:

(a) is the defendant; or

(b) is or has been the defendant's lawyer.

Note:

A defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

207(5)    
If a person (other than the defendant or a person who is, or has been, the defendant's lawyer) does not comply with a requirement under subsection (1), the court may, on the application of ASIC, order the person to comply with the requirement within such time, and in such manner, as the court orders.

207(6)    
If ASIC makes a requirement under subsection (1) in writing, the requirement is not a legislative instrument.

SECTION 208   PRIVILEGE AGAINST SELF-INCRIMINATION NOT AVAILABLE TO BODIES CORPORATE IN CRIMINAL PROCEEDINGS  

208(1)   [Body corporates]  

In proceedings in a court when exercising jurisdiction in relation to a criminal matter arising under this Act, a body corporate is not entitled to refuse or fail to comply with a requirement:

(a) to answer a question or give information; or

(b) to produce a book or any other thing; or

(c) to do any other act whatever;

on the ground that the answer or information, production of the book or other thing, or doing that other act might tend:

(d) to incriminate the body (whether in relation to an offence to which the proceedings relate or otherwise); or

(e) to make the body liable to a penalty (whether in relation to anything to which the proceedings relate or otherwise).

208(2)   [Application of subsection (1)]  

Subsection (1) applies whether or not the body concerned is a defendant in the proceedings or in any other proceedings.

Division 4 - Proceedings generally  

SECTION 209   ASIC'S POWER TO INTERVENE IN PROCEEDINGS  

209(1)   [Power to intervene]  

ASIC may intervene in any proceedings relating to a matter arising under this Act.

209(2)   [Where ASIC intervenes]  

If ASIC intervenes in proceedings referred to in subsection (1), ASIC is taken to be a party to the proceedings and, subject to this Act, has all the rights, duties and liabilities of such a party.

209(3)   [Representation of ASIC]  

Without limiting subsection (2), ASIC may appear and be represented in any proceedings in which it wishes to intervene pursuant to subsection (1):

(a) by an ASIC staff member; or

(b) by a natural person to whom, or by an officer or employee of a person or body to whom or to which, ASIC has delegated its functions and powers under this Act or such of those functions and powers as relate to a matter to which the proceedings relate; or

(c) by a lawyer.

SECTION 210  

210   EVIDENCE OF CONTRAVENTION  
For the purposes of this Act, a certificate that:

(a) purports to be signed by the Registrar or other proper officer of an Australian court; and

(b) states:

(i) that a person was convicted by that court on a specified day of a specified offence; or

(ii) that a person charged before that court with a specified offence was, on a specified day, found in that court to have committed the offence but that the court did not proceed to convict the person of the offence;

is, unless it is proved that the conviction was quashed or set aside, or that the finding was set aside or reversed, as the case may be, conclusive evidence:

(c) if subparagraph (b)(i) applies - that the person was convicted of the offence on that day; and

(d) if the offence was constituted by a contravention of a provision of a law - that the person contravened that provision.

SECTION 211  

211   POWER OF COURT TO PUNISH FOR CONTEMPT OF COURT  
Nothing in a provision of this Act that provides:

(a) that a person must not contravene an order of the court; or

(b) that a person who contravenes an order of the court contravenes a provision of this Act or commits an offence;

affects the powers of the court in relation to the punishment of contempts of the court.

CHAPTER 5 - ADMINISTRATION  

PART 5-1 - MATTERS RELATING TO HANDLING RECORDS AND INFORMATION  

Division 1 - Introduction  

SECTION 212   GUIDE TO THIS PART  

Division 1A - The Registrar  

Subdivision A - The Registrar  

SECTION 212A   APPOINTMENT OF THE REGISTRAR  

212A(1)    
The Minister may, by notifiable instrument, appoint a Commonwealth body to be the Registrar.

212A(2)    
The Minister may, by notifiable instrument, appoint a Commonwealth body to be the Registrar in relation to one or more functions or powers of the Registrar.

SECTION 212B  

212B   FUNCTIONS  

The Registrar's functions are:

(a)    such functions as are conferred on the Registrar by or under this Act; and

(b)    such functions as are prescribed by rules made for the purposes of this paragraph under section 212U; and

(c)    such functions as are incidental to the functions mentioned in paragraph (a) or (b).

SECTION 212C  

212C   POWERS  

The Registrar's powers include:

(a)    such powers as are conferred:

(i) on the Registrar in relation to the functions mentioned in section 212B; and

(ii) by or under this Act; and

(b)    the power to do all things necessary or convenient to be done for or in connection with the performance of those functions.

SECTION 212D   DIRECTIONS BY MINISTER  

212D(1)    
The Minister may, by legislative instrument, give written directions to the Registrar about the performance of its functions and the exercise of its powers.

Note:

Section 42 (disallowance) and Part 4 of Chapter 3 (sunsetting) of the Legislation Act 2003 do not apply to the directions (see regulations made for the purposes of paragraphs 44(2)(b) and 54(2)(b) of that Act).

212D(2)    
Without limiting subsection (1), a direction under that subsection may relate to any of the following:

(a)    matters to be dealt with in the data standards or disclosure framework;

(b)    consultation processes to be followed prior to making data standards or the disclosure framework.

212D(3)    
A direction under subsection (1) must be of a general nature only.

212D(4)    
Subsection (3) does not prevent a direction under subsection (1) from relating to a particular matter to be dealt with in the data standards or disclosure framework. However, the direction must not direct the Registrar how to apply the data standards or disclosure framework in a particular case.

212D(5)    
The Registrar must comply with a direction under subsection (1).

SECTION 212E   DELEGATION  

212E(1)    
The Registrar may, in writing, delegate all or any of the Registrar's functions or powers under this Act (other than the power to make data standards or the disclosure framework) to:

(a)    any person to whom it may delegate any of its other functions, as a Commonwealth body, under a law of the Commonwealth; or

(b)    any person of a kind specified in rules made under section 212U.

Note:

Sections 34AA to 34A of the Acts Interpretation Act 1901 contain provisions relating to delegations.

212E(2)    
In performing a delegated function or exercising a delegated power, the delegate must comply with any written directions of the Registrar.

SECTION 212F   ASSISTED DECISION MAKING  

212F(1)    
The Registrar may arrange for the use, under the Registrar's control, of processes to assist decision making (such as computer applications and systems) for any purposes for which the Registrar may make decisions in the performance or exercise of the Registrar's functions or powers under this Act, other than decisions reviewing other decisions.

212F(2)    
A decision the making of which is assisted by the operation of such a process under an arrangement made under subsection (1) is taken to be a decision made by the Registrar.

212F(3)    
The Registrar may substitute a decision for a decision (the initial decision ) the making of which is assisted by the operation of such a process under an arrangement under subsection (1) if the Registrar is satisfied that the initial decision is incorrect.

SECTION 212G  

212G   LIABILITY FOR DAMAGES  

None of the following:

(a)    the Minister;

(b)    the Registrar;

(c)    if the Registrar is a Commonwealth body that has members - a member of the Registrar;

(d)    a member of the staff of the Registrar;

(e)    a person who is, or is a member of or a member of the staff of, a delegate of the Registrar;

(f)    a person who is authorised to perform or exercise a function or power of, or on behalf of, the Registrar;

(g)    an APS employee, or an officer or employee of a Commonwealth body, whose services are made available to the Registrar in connection with the performance or exercise of any of the Registrar's functions or powers;

is liable to an action or other proceeding for damages for or in relation to an act done, or omitted to be done, in good faith in performance or purported performance of any function, or in exercise or purported exercise of any power, conferred or expressed to be conferred by or under this Part.

Subdivision B - How the Registrar is to perform and exercise functions and powers  

SECTION 212H   DATA STANDARDS  

212H(1)    
The Registrar may, by legislative instrument, make data standards on matters relating to the performance of the Registrar's functions and the exercise of the Registrar's powers under this Act.

212H(2)    
Without limiting subsection (1), the data standards may provide for any of the following:

(a)    what information may be collected for the purposes of the performance of the Registrar's functions and the exercise of the Registrar's powers under this Act;

(b)    how such information may be collected;

(c)    the manner and form in which such information is given to the Registrar;

(d)    when information is to be given to the Registrar;

(e)    how information held by the Registrar is to be authenticated, verified or validated;

(f)    how information held by the Registrar is to be stored;

(g)    correction of information held by the Registrar;

(h)    the manner and form of communication between the Registrar and persons who give information to the Registrar or seek to access information held by the Registrar;

(i)    integrating or linking information held by the Registrar.

212H(3)    
Without limiting subsection (1), the data standards may provide differently in relation to different functions or powers of the Registrar.

212H(4)    
If:

(a)    a Commonwealth body (the new Registrar ) is appointed as the Registrar with particular functions or powers under this Act; and

(b)    immediately before that appointment, another Commonwealth body was the Registrar with those functions or powers; and

(c)    the new Registrar does not have data standards that would apply to those functions or powers;

any data standards applying to those functions or powers immediately before that appointment continue to apply until the new Registrar makes data standards that apply to those functions or powers, or amends its existing data standards to apply to those functions or powers.

SECTION 212J   GIVING INFORMATION TO THE REGISTRAR  

212J(1)    
Without limiting section 212H, the data standards may provide that informationis to be given to the Registrar in electronic form, or any other specified form.

212J(2)    
A requirement under this Act that information is to be provided to the Registrar in a particular form or manner (however described), including a requirement:

(a)    that the information is to be "lodged" or "furnished"; and

(b)    that the information is to be "written" or "in writing"; and

(c)    that a "copy" of a document containing the information is to be provided;

is not taken to restrict by implication what the data standards may provide under subsection (1) in relation to that information.

SECTION 212K   HOW THE REGISTRAR IS TO PERFORM AND EXERCISE FUNCTIONS AND POWERS  

212K(1)    
The Registrar must perform its functions and exercise its powers under this Act in accordance with:

(a)    the data standards; or

(b)    if there are no data standards that apply to particular functions or powers - any requirement relating to those functions or powers as in force immediately before those functions or powers became functions or powers of the Registrar.

212K(2)    
This section does not affect the application to the Registrar of any other law of the Commonwealth.

Subdivision C - Disclosure of information  

SECTION 212L   DISCLOSURE FRAMEWORK  

212L(1)    
The Registrar may, by legislative instrument, make a disclosure framework relating to disclosing protected information.

212L(2)    
Without limiting subsection (1), the disclosure framework may provide for any of the following:

(a)    circumstances in which information must not be disclosed without the consent of the person to whom it relates;

(b)    circumstances in which de-identified information may be disclosed;

(c)    circumstances in which information may be disclosed to the general public;

(d)    circumstances in which confidentiality agreements are required for the disclosure of information;

(e)    imposing conditions on disclosure of information.

212L(3)    
Without limiting subsection (1), the disclosure framework may provide differently in relation to different functions or powers of the Registrar under this Act.

212L(4)    
A person commits an offence if:

(a)    the person is a party to a confidentiality agreement of a kind mentioned in paragraph (2)(d); and

(b)    the person fails to comply with the confidentiality agreement.

Penalty: 100 penalty units or imprisonment for 2 years, or both.

212L(5)    
The disclosure framework must not provide for disclosure of protected information unless the Registrar is satisfied that the benefits of the disclosure would outweigh the risks of the disclosure (taking into account any mitigation of those risks in accordance with the disclosure framework).

212L(6)    
However, subsection (5) does not apply to the extent that the disclosure framework deals with a matter in accordance with a direction under section 212D.

212L(7)    
If:

(a)    a Commonwealth body (the new Registrar ) is appointed as the Registrar with particular functions or powers under this Act; and

(b)    immediately before that appointment, another Commonwealth body was the Registrar with those functions or powers; and

(c)    the new Registrar does not have a disclosure framework that would apply to those functions or powers;

the disclosure framework applying to those functions or powers immediately before that appointment continues to apply until the new Registrar makes a disclosure framework that applies to those functions or powers, or amends its existing disclosure framework to apply to those functions or powers.

SECTION 212M   PROTECTION OF CONFIDENTIALITY OF PROTECTED INFORMATION  

212M(1)    
A person (the first person ) commits an offence if:

(a)    the first person is, or has been, in official employment; and

(b)    the first person makes a record of information, or discloses information to another person; and

(c)    the information is protected information that was obtained by the first person in the course of the first person's official employment.

Penalty: Imprisonment for 2 years.

212M(2)    
However, subsection (1) does not apply if the recording or disclosure is authorised by subsection (3).

212M(3)    
The recording or disclosure is authorised by this subsection if:

(a)    the recording or disclosure is for the purposes of this Part; or

(b)    the recording or disclosure happens in the course of the performance of the duties of the first person's official employment; or

(c)    in the case of a disclosure - the disclosure is to another person for use, in the course of the performance of the duties of the other person's official employment, in relation to the performance or exercise of the functions or powers of a government entity; or

(d)    in the case of a disclosure to another person who is an employee of a State, a Territory or an authority of a State or Territory - the disclosure:

(i) is to the other person for use, in the course of the performance of the duties of that employment, in relation to the performance or exercise of the functions or powers of a government entity; and

(ii) is in accordance with an agreement, about regulating the provision of credit, between the Commonwealth, the States, the Australian Capital Territory and the Northern Territory; or

(e)    in the case of a disclosure - each person to whom the information relates consents to the disclosure; or

(f)    in the case of a disclosure - the disclosure is in accordance with the disclosure framework.

Note:

A defendant bears an evidential burden in relation to the matters in subsection (3): see subsection 13.3(3) of the Criminal Code.

SECTION 212N   AUTHORISATION OF RECORDING OR DISCLOSURE  

212N(1)    
A person is not liable to any proceedings for contravening a secrecy provision in respect of a recording or disclosure authorised under subsection 212M(3), unless the secrecy provision is a designated secrecy provision.

212N(2)    
A secrecy provision is a provision that:

(a)    is a provision of a law of the Commonwealth (other than this Act); and

(b)    prohibits or regulates the use or disclosure of information.

212N(3)    
A designated secrecy provision is any of the following:

(a)    

sections 18 to 18B and 92 of the Australian Security Intelligence Organisation Act 1979;

(b)    section 34 of the Inspector-General of Intelligence and Security Act 1986;

(c)    sections 39 to 41 of the Intelligence Services Act 2001;

(d)    section 8WB of the Taxation Administration Act 1953;

(e)    a provision of a law of the Commonwealth prescribed by rules made for the purposes of this paragraph under section 212U;

(f)    a provision of a law of the Commonwealth of a kind prescribed by rules made for the purposes of this paragraph under section 212U.

SECTION 212P   PREVENTING DISCLOSURE OF PARTICULAR PROTECTED INFORMATION  

212P(1)    
If:

(a)    a person applies to the Registrar for particular protected information relating to the person not to be disclosed; and

(b)    the Registrar is satisfied that it is not appropriate to disclose that information;

a disclosure of that information is taken, for the purposes of this Act, not to be in accordance with the disclosure framework.

212P(2)    
Without limiting section 212L, the disclosure framework may provide for:

(a)    how applications referred to in paragraph (1)(a) are to be made; and

(b)    how those applications are to be decided.

SECTION 212Q  

212Q   AUTHORISATION FOR PURPOSES OF PRIVACY ACT  

A disclosure of personal information (within the meaning of the Privacy Act 1988) is taken to be authorised by law for the purposes of paragraph 6.2(b) of Schedule 1 to that Act if:

(a)    the information is protected information; and

(b)    the disclosure is authorised by subsection 212M(3) of this Act.

SECTION 212R  

212R   DISCLOSURE TO A COURT  

A person is not to be required:

(a)    to produce to a court any document that:

(i) contains protected information; and

(ii) was made or given under, or for the purposes of, this Act; and

(iii) was obtained by the person in the course of the person's official employment; or

(b)    to disclose to a court any protected information that the person obtained in the course of the person's official employment;

unless the production or disclosure is necessary for the purpose of giving effect to a taxation law or an Australian business law.

Subdivision D - Miscellaneous  

SECTION 212S   EXTRACTS OF INFORMATION TO BE ADMISSIBLE IN EVIDENCE  

212S(1)    
In any proceedings, a document, or a copy of a document, that purports (irrespective of the form of wording used) to be an extract of information held by the Registrar under, or for the purposes of, this Act:

(a)    is proof, in the absence of evidence to the contrary, of information that is stated in it and that purports to be held by the Registrar; and

(b)    is admissible without any further proof of, or the production of, the original;

if it does not appear to the Court to have been revised or tampered with in a way that affects, or is likely to affect, the information.

212S(2)    
The Registrar may give a person a certified copy of, or extract from, the information held by the Registrar under, or for the purposes of, this Act on payment of the fee (if any) prescribed by rules made under section 212U.

212S(3)    
In any proceedings, the certified copy:

(a)    is prima facie evidence of information that is stated in it and that purports to be held by the Registrar under, or for the purposes of, this Act; and

(b)    is admissible without any further proof of, or the production of, the original.

212S(4)    
This section does not limit the manner in which evidence may be adduced, or the admissibility of evidence, under the Evidence Act 1995.

SECTION 212T  

212T   ANNUAL REPORT  

Each annual report by the Registrar for a period must include information about the performance of the Registrar's functions and exercise of the Registrar's powers under, or for the purposes of, this Act during that period.

SECTION 212U   RULES  

212U(1)    
The Minister may, by legislative instrument, make rules prescribing matters:

(a)    required or permitted by this Part to be prescribed by rules made under this section; or

(b)    necessary or convenient to be prescribed for carrying out or giving effect to this Part.

212U(2)    
To avoid doubt, rules made under this section may not do the following:

(a)    create an offence or civil penalty;

(b)    provide powers of:

(i) arrest or detention; or

(ii) entry, search or seizure;

(c)    impose a tax;

(d)    set an amount to be appropriated from the Consolidated Revenue Fund under an appropriation in this Act;

(e)    directly amend the text of this Act.

Division 2 - Registers relating to credit activities  

SECTION 213   CREDIT REGISTERS  
ASIC must establish and maintain credit registers

213(1)    
ASIC must establish and maintain one or more registers (the credit registers ) relating to credit activities.

How credit registers are to be maintained

213(2)    
The regulations may prescribe the way in which the credit registers must be established or maintained, including the details that ASIC must enter in the credit registers in relation to the following persons:

(a)    licensees;

(b)    persons registered to engage in credit activities under the Transitional Act;

(c)    credit representatives of licensees or persons registered to engage in credit activities under the Transitional Act;

(d)    persons against whom a banning order or disqualification order is made under Part 2-4;

(e)    persons who are banned from engaging in a credit activity under a law of a State or Territory;

(f)    any other persons prescribed by the regulations.

213(3)    
Without limiting subsection (2), the credit registers:

(a)    may be maintained in an electronic form; and

(b)    may be maintained as part of, or together with, any register in relation to financial services maintained under section 922A of the Corporations Act 2001.

Credit register is not a legislative instrument

213(4)    
A credit register established under this section is not a legislative instrument.

SECTION 214   INSPECTION AND PUBLIC AVAILABILITY OF CREDIT REGISTERS  

214(1)    
A person may inspect the credit registers and may make copies of, or take extracts from, them.

214(2)    
ASIC may make the credit registers, or any part of them, available to the public on its website or by other means.

214(3)    
Any disclosure necessary for the purposes of this section is authorised by this section.

PART 5-2 - DOCUMENTS LODGED WITH ASIC OR REQUIRED BY THIS ACT  

Division 1 - Introduction  

SECTION 215  

215   GUIDE TO THIS PART  

Division 2 - Lodgment of documents with ASIC  

SECTION 216   WHEN DOCUMENTS ARE LODGED WITH ASIC  

216(1)   [When is a document "lodged with ASIC"]  

A document is lodged with ASIC under this Act if the document:

(a) is transmitted to ASIC in an electronic format approved by ASIC; or

(b) if ASIC approves another manner for the lodgment of a document with ASIC - is given to ASIC in that manner.

216(2)   [Refusal to accept document]  

However, a document is not lodged with ASIC under this Act if ASIC refuses to receive the document under subsection 218(1).

Note:

Subsection 232(3) provides for when a compliance certificate under section 53 is taken not to be lodged with ASIC.

216(3)   [Material lodged with document]  

If a document is lodged with ASIC, then any other material that is lodged with the document as required by this Act or an approved form is taken to be included in that document.

Note:

For example, this subsection means that a person will contravene section 225 if the person makes a false or misleading statement in the other material.

SECTION 217   APPROVED FORMS FOR DOCUMENTS TO BE LODGED WITH ASIC  

217(1)   [Form and content]  

A document that this Act requires to be lodged with ASIC in an approved form must, if ASIC has approved a form for the document:

(a) be in the approved form; and

(b) include the information, statements, explanations or other matters required by the form; and

(c) be accompanied by any other material required by the form.

217(2)   [Interpretation]  

If:

(a) this Act requires a document to be lodged with ASIC in an approved form; and

(b) a provision of this Act either specifies, or provides for regulations to prescribe, information, statements, explanations or other matters that must be included in the document, or other material that must accompany the document;

that other provision is not taken to exclude or limit the operation of subsection (1) in relation to the approved form (and so the approved form may also require information etc. to be included in the form or material to accompany the form).

SECTION 218   ASIC MAY REFUSE TO RECEIVE DOCUMENT ETC.  
ASIC may refuse to receive document etc.

218(1)    
If ASIC considers that a document submitted to ASIC for lodgment under this Act:

(a) contains matter contrary to law; or

(b) contains matter that, in a material particular, is false or misleading in the form or context in which it is included; or

(c) is incomplete; or

(d) contravenes this Act; or

(e) contains an error, alteration or erasure;

ASIC may refuse to receive the document and may make a request under subsection (2).

Note:

The effect of ASIC refusing to receive the document is that the document is not lodged with ASIC (see subsection 216(2)).

218(2)    
For the purposes of subsection (1), ASIC may request:

(a) that the document be appropriately amended or completed and resubmitted; or

(b) that a fresh document be submitted in its place; or

(c) if the document is incomplete - that a supplementary document in the approved form be lodged.

Notice to provide further document or information

218(3)    
ASIC may give a written notice to a person who submits a document (the first document ) for lodgment under this Act, requiring the person to:

(a) give to ASIC any other document; or

(b) give to ASIC any information;

that ASIC considers necessary in order to form an opinion as to whether it may refuse to receive the first document.

Notice must specify day by which person must comply

218(4)    
The notice must specify the day by which the 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 person.

Requirement to comply with notice

218(5)    

The person must comply with the notice within the time specified in the notice.

Civil penalty: 5,000 penalty units.

Strict liability offence

218(6)    

A person commits an offence if:

(a) the person is subject to a requirement under subsection (5); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 120 penalty units.

218(7)    
Subsection (6) is an offence of strict liability.

Note:

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

Division 3 - ASIC's register of documents  

SECTION 219   REGISTER OF DOCUMENTS LODGED WITH ASIC  
ASIC may maintain document registers

219(1)    
ASIC may establish and maintain one or more registers (the document registers ) of documents that have been lodged with ASIC under this Act.

How document registers to be maintained

219(2)   [Form of document registers]  

ASIC may establish and maintain the document registers in any form it considers appropriate.

219(3)   [Registers in electronic form]  

Without limiting subsection (2), the document registers may be maintained in an electronic form.

No entitlement to inspect document registers

219(4)    
ASIC is not required to:

(a) permit persons to inspect the document registers, or make copies of, or take extracts from, the document registers; or

(b) make any part of the document registers available to the public.

Document register is not a legislative instrument

219(5)    
A document register established under this section is not a legislative instrument.

SECTION 220   ASIC MAY REQUIRE PERSON TO GIVE INFORMATION FOR DOCUMENT REGISTERS  
Notice to person to give information

220(1)    
If information about a person is included on the document registers, ASIC may, at any time, give the person a written notice requiring the person to give to ASIC specified information about the person, being information of the kind included on the document registers.

Notice must specify day by which person must comply

220(2)    
The notice must specify the day by which the 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 person.

Requirement to comply with notice

220(3)    

The person must comply with the notice within the time specified in the notice.

Civil penalty: 5,000 penalty units.

Strict liability offence

220(4)    

A person commits an offence if:

(a) the person is subject to a requirement under subsection (3); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 120 penalty units.

220(5)    
Subsection (4) is an offence of strict liability.

Note:

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

SECTION 221   WRITTEN DOCUMENT SETTING OUT INFORMATION FROM DOCUMENT REGISTERS IS PRIMA FACIE EVIDENCE OF MATTERS  

221(1)   [Preparation of information]  

ASIC may, by using a mechanical, electronic or other device for processing data, prepare a written document that sets out information obtained by ASIC from the document registers.

221(2)   [Prima facie evidence]  

In proceedings in a court, a written document that purports to be a document prepared by ASIC under subsection (1) is admissible as prima facie evidence of the matters in the document.

221(3)   [Certification not required]  

A written document need not be certified by ASIC, or signed, in order to be taken to purport to have been prepared by ASIC.

Division 4 - Other provisions relating to documents lodged with ASIC or required under this Act  

SECTION 222   CERTIFIED COPY OR EXTRACT OF DOCUMENT LODGED WITH ASIC IS ADMISSIBLE IN EVIDENCE  

222(1)   [Documents admissible as evidence]  

In proceedings in a court, a copy of, or extract from, any document lodged with ASIC under this Act, and certified by ASIC, is admissible in evidence as of equal validity with the original document.

222(2)   [Interpretation]  

The reference in subsection (1) to a document includes, if a copy of that document has been included in the document register by ASIC, a reference to that copy.

SECTION 223  

223   ASIC MAY DESTROY OR DISPOSE OF CERTAIN DOCUMENTS  
ASIC may destroy or otherwise dispose of any document that is lodged with ASIC under this Act if:

(a) ASIC considers that it is no longer necessary or desirable to retain it; and

(b) either of the following apply:

(i) it has been in ASIC's possession for the period prescribed by the regulations;

(ii) a copy of the document has been included in the document register.

SECTION 224   COURT MAY ORDER LODGMENT OF DOCUMENT ETC.  

224(1)   [14 days notice to comply]  

If a person has failed to comply with:

(a) any provision of this Act that requires the lodgment of any document with ASIC; or

(b) any request of ASIC under subsection 218(2) (which deals with requests to resubmit documents etc.);

ASIC may give the person a written notice requiring the person to comply with the requirement or request within 14 days.

224(2)   [Non compliance within period]  

If the person does not comply with the notice within 14 days, the court may, on an application by ASIC, make an order directing the person to comply with the requirement or request.

224(3)   [Payment of costs]  

The order may provide that all costs of and incidental to the application are to be borne by one or more of the following:

(a) the person;

(b) if the person is a body corporate - a director, secretary or senior manager of the body corporate who is responsible for the failure to comply;

(c) if the person is a partnership or the trustees of a trust - a partner or trustee who is responsible for the failure to comply.

SECTION 225   FALSE OR MISLEADING DOCUMENTS  

Fault-based offence

225(1)    
A person commits an offence if:

(a) a document:

(i) is required under or for the purposes of this Act; or

(ii) is lodged with or submitted to ASIC under or for the purposes of this Act; and

(b) the person:

(i) makes, or authorises the making of, a statement in the document; or

(ii) omits, or authorises the omission of, a matter or thing from the document; and

(c) the person knows that the document is materially false or misleading because of the statement or omission.

Criminal penalty: 5 years imprisonment.

Note:

For when a document is materially false or misleading , see subsection (5).

Strict liability offence - failure to take reasonable steps

225(2)    
A person commits an offence of strict liability if:

(a) a document:

(i) is required under or for the purposes of this Act; or

(ii) is lodged with or submitted to ASIC under or for the purposes of this Act; and

(b) the person:

(i) makes, or authorises the making of, a statement in the document; or

(ii) omits, or authorises the omission of, a matter or thing from the document; and

(c) the document is materially false or misleading because of the statement or omission; and

(d) the person did not take all reasonable steps to ensure that the document was not materially false or misleading because of the statement or omission.

Criminal penalty: 20 penalty units.

Note 1:

For when a document is materially false or misleading , see subsection (5).

Note 2:

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

Civil penalty - knowledge or recklessness

225(3)    

A person contravenes this subsection if:

(a) a document:

(i) is required under or for the purposes of this Act; or

(ii) is lodged with or submitted to ASIC under or for the purposes of this Act; and

(b) the person:

(i) makes, or authorises the making of, a statement in the document; or

(ii) omits, or authorises the omission of, a matter or thing from the document; and

(c) the person knows that, or is reckless as to whether, the document is materially false or misleading because of the statement or omission.

Civil penalty: 5,000 penalty units.

Note:

For when a document is materially false or misleading , see subsection (5).

Civil penalty - failure to take reasonable steps

225(4)    

A person contravenes this subsection if:

(a) a document:

(i) is required under or for the purposes of this Act; or

(ii) is lodged with or submitted to ASIC under or for the purposes of this Act; and

(b) the person:

(i) makes, or authorises the making of, a statement in a document; or

(ii) omits, or authorises the omission of, a matter or thing from a document; and

(c) the document is materially false or misleading because of the statement or omission; and

(d) the person did not take all reasonable steps to ensure that the document was not materially false or misleading because of the statement or omission.

Civil penalty: 5,000 penalty units.

Note:

For when a document is materially false or misleading , see subsection (5).

When a document is materially false or misleading

225(5)    
For the purposes of this section, a document is materially false or misleading if:

(a) the document includes a statement that:

(i) is false in a material particular or materially misleading; or

(ii) is based on information that is false in a material particular or materially misleading, or has omitted from it a matter or thing the omission of which renders the document materially misleading; or

(b) a matter or thing is omitted from the document and, without the matter or thing, the document is false in a material particular or materially misleading.

Authorisations

225(6)    

For the purposes of this section, a person who votes in favour of a resolution approving, or who otherwise approves, a document is taken to have authorised:

(a) the making of any statement in the document; and

(b) the omission of any matter or thing from the document.

PART 5-3 - CONCEALMENT OR FALSIFICATION OF CREDIT BOOKS  

Division 1 - Introduction  

SECTION 226  

226   GUIDE TO THIS PART  

Division 2 - Prohibitions relating to the concealment or falsification of credit books  

SECTION 227   CONCEALING ETC. OF CREDIT BOOKS  
Prohibition on concealing credit books etc.

227(1)    
A person must not:

(a)    conceal, destroy, mutilate or alter a credit book; or

(b)    

send a credit book out of this jurisdiction.

Civil penalty: 5,000 penalty units.

Offence

227(2)    

A person commits an offence if:

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

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

Defence

227(3)    
For the purposes of subsections (1) and (2), it is a defence if the person did not act with intent to:

(a)    defraud; or

(b)    prevent, delay or obstruct the carrying out of an examination, investigation or audit, or the exercise of a power, under this Act.

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (3) (see subsection 13.3(3) of the Criminal Code).

Meaning of credit book

227(4)    
Credit book means:

(a)    a book (by whatever name it is known) that this Act requires to be kept; or

(b)    a document that is:

(i) prepared; or

(ii) lodged with or submitted to ASIC; or

(iii) given to a person;

under, or for the purposes of, this Act; or

(c)    a book relating to the credit activities engaged in by a licensee or a credit representative; or

(d)    a financial record.

SECTION 228   FALSIFICATION OF CREDIT BOOKS  
Requirements in relation to falsification of credit books

228(1)    

A person must not engage in conduct that results in the falsification of a credit book.

Civil penalty: 5,000 penalty units.

Offence

228(2)    

A person commits an offence if:

(a) the person engages in conduct; and

(b) the conduct results in the falsification of a credit book.

Criminal penalty: 6 months imprisonment.

Defence

228(3)    
For the purposes of subsections (1) and (2), it is a defence if:

(a) the person acted honestly; and

(b) in all the circumstances, the act or omission constituting the offence should be excused.

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (3) (see subsection 13.3(3) of the Criminal Code).

SECTION 229   PRECAUTIONS AGAINST FALSIFICATION OF CREDIT BOOKS  
Requirement to take precautions against falsification

229(1)    
A person who is required by this Act to keep a credit book must take reasonable steps to:

(a) guard against the falsification of the credit book; and

(b) facilitate the discovery of any falsification of the credit book.

Civil penalty: 5,000 penalty units.

Offence

229(2)    

A person commits an offence if:

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

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 6 months imprisonment.

PART 5-4 - FEES IMPOSED BY THE NATIONAL CONSUMER CREDIT PROTECTION (FEES) ACT 2009  

Division 1 - Introduction  

SECTION 230  

230   GUIDE TO THIS PART  

Division 2 - Fees imposed by the National Consumer Credit Protection (Fees) Act 2009  

SECTION 231  

231   FEES ARE PAYABLE TO THE COMMONWEALTH  
The fees imposed under the National Consumer Credit Protection (Fees) Act 2009 in relation to this Act are payable to the Commonwealth.

SECTION 232   LODGMENT OF DOCUMENT WITHOUT PAYMENT OF FEE  

232(1)   [Application of section]  

This section applies where:

(a) a fee is payable under section 231 for the lodgment of a document under this Act; and

(b) the document was submitted for lodgment without payment of the fee.

232(2)   [Non-payment of fee]  

The document is not taken not to have been lodged merely because of non-payment of the fee.

232(3)   [Exception]  

Despite subsection (2), a compliance certificate that is required to be lodged under section 53 is taken not to have been lodged until the fee is paid.

SECTION 233  

233   DOING ACT WITHOUT PAYMENT OF FEE  
If a fee is payable under section 231 for a matter involving the doing of an act by the Minister or ASIC under this Act, the Minister or ASIC may refuse to do that act until the fee is paid.

SECTION 234  

234   EFFECT OF SECTIONS 232 AND 233  
Sections 232 and 233 have effect despite anything in another Part of this Act.

SECTION 235  

235   WAIVER AND REFUND OF FEES  
Nothing in this Division or the National Consumer Credit Protection (Fees) Act 2009 prevents the Commonwealth from:

(a) waiving or reducing, in a particular case or in particular classes of cases, fees that would otherwise be payable under this Act; or

(b) refunding, in whole or in part, in a particular case or in particular classes of cases, fees paid under this Act.

SECTION 236  

236   DEBTS DUE TO THE COMMONWEALTH  
ASIC may, on behalf of the Commonwealth, recover a debt due under this Division.

SECTION 237  

237   PAYMENT OF FEE DOES NOT GIVE RIGHT TO INSPECT OR SEARCH  
To avoid doubt, nothing in this Division, and nothing done under this Division:

(a)    imposes on ASIC a duty to allow the inspection or search of a register or document, or to make available information; or

(b)    confers a right to inspect or search a register or document or to have information made available;

under this Act except so far as such a duty or right would, but for the effect of section 233, exist under a provision of another Part of this Act or under some other law.

PART 5-5 - OTHER ADMINISTRATIVE MATTERS  

Division 1 - Introduction  

SECTION 238  

238   GUIDE TO THIS PART  

Division 1A - Codes of conduct  

Subdivision A - Approved codes of conduct  

SECTION 238A   APPROVED CODES OF CONDUCT  

Applications

238A(1)    
If an application is made to approve a code of conduct, ASIC may, by legislative instrument, approve the code of conduct.

Identifying enforceable code provisions

238A(2)    
In the approval, ASIC may identify a provision of the code of conduct as an enforceable code provision if ASIC considers that:

(a)    the provision represents a commitment to a person by a subscriber to the code relating to transactions or dealings performed for, on behalf of or in relation to the person; and

(b)    a breach of the provision is likely to result in significant and direct detriment to the person; and

(c)    additional criteria prescribed by the regulations for the purposes of this paragraph (if any) are satisfied; and

(d)    it is appropriate to identify the provision of the code as an enforceable code provision, having regard to the matters prescribed by the regulations for the purposes of this paragraph (if any).

Note:

See also section 238E.

ASIC to be satisfied of certain matters before making approval

238A(3)    
ASIC must not approve a code of conduct unless it is satisfied that:

(a)    to the extent that the code is inconsistent with this Act or any other law of the Commonwealth under which ASIC has regulatory responsibilities - the code imposes an obligation on a subscriber that is more onerous than that imposed by this Act or any other law of the Commonwealth under which ASIC has regulatory responsibilities; and

(b)    each enforceable code provision:

(i) has been agreed with the applicant; and

(ii) is legally effective; and

(c)    it is appropriate to approve the code, having regard to the following matters:

(i) whether the obligations of subscribers to the code are capable of being enforced;

(ii) whether the applicant has effective administrative systems for monitoring compliance with the code and making information obtained as a result of monitoring publicly available;

(iii) whether the applicant has effective administrative systems for maintaining, and making publicly available, an accurate list of subscribers to the code.

Revocation

238A(4)    
ASIC may, by legislative instrument, revoke an approval of an approved code of conduct:

(a)    on application by the applicant for the approval; or

(b)    if ASIC ceases to be satisfied of the matters mentioned in subsection (3); or

(c)    if a review of the operation of the code is not completed by the applicant within the timeframe required by section 238C.

238A(5)    
Subsection (4) does not, by implication, limit the application of subsection 33(3) of the Acts Interpretation Act 1901.

SECTION 238B   VARIATIONS TO APPROVED CODES OF CONDUCT  

238B(1)    
If an application is made to vary an approved code of conduct, ASIC may, by legislative instrument, approve the variation.

238B(2)    
Subsections 238A(2) and (3) apply in relation to an application under subsection (1) as if it were an application to approve a code of conduct.

SECTION 238C   REVIEW OF APPROVED CODES OF CONDUCT  

238C(1)    
The applicant, in relation to an approved code of conduct, must ensure that, every 5 years, an independent review is undertaken of the operation of the approved code of conduct.

238C(2)    
A review under subsection (1) must make provision for public consultation.

238C(3)    
A review of an approved code of conduct must be completed:

(a)    for the first review - before the end of the 5 year period beginning on the day the code of conduct was approved; and

(b)    for a subsequent review - within 5 years after the completion of the previous review.

238C(4)    
For the purposes of this section, a review is completed when a report of the review is given to ASIC.

238C(5)    
Within 10 business days of completing a review, the applicant must publish the report of the review on its website.

SECTION 238D  

238D   OBLIGATION TO COMPLY WITH ENFORCEABLE CODE PROVISIONS  

If a person holds out that they comply with an approved code of conduct, the person must not breach an enforceable code provision of the approved code of conduct.

Civil penalty: 300 penalty units.

SECTION 238E  

238E   REGULATIONS  

The regulations may:

(a)    prescribe criteria of which ASIC must be satisfied before it identifies a provision of a code of conduct as an enforceable code provision; or

(b)    prescribe matters to which ASIC must have regard before it identifies a provision of a code of conduct as an enforceable code provision.

Subdivision B - Mandatory codes of conduct  

SECTION 238F   MANDATORY CODES OF CONDUCT  

238F(1)    
The regulations may prescribe a code of conduct for the purposes of this Division and declare it to be a mandatory code of conduct.

238F(2)    
Regulations declaring a code of conduct a mandatory code of conduct may also:

(a)    confer functions and powers on a person or body for the purposes of:

(i) monitoring compliance with the code of conduct; and

(ii) dealing with disputes or complaints arising under, or in relation to, the code of conduct; and

(iii) dealing with other associated administrative matters; or

(b)    provide for and in relation to:

(i) the keeping of records by persons bound by the code of conduct; and

(ii) reporting obligations of such persons.

238F(3)    
If regulations prescribe a code of conduct, the code of conduct may prescribe pecuniary penalties not exceeding 1,000 penalty units for civil penalty provisions of the code of conduct.

238F(4)    
To avoid doubt, subsections 167B(1) and (2) do not apply in relation to the contravention of a civil penalty provision of a mandatory code of conduct.

SECTION 238G  

238G   OBLIGATION TO COMPLY WITH MANDATORY CODE OF CONDUCT  

A person must not contravene a mandatory code of conduct.

Division 2 - Other administrative matters  

SECTION 239  

239   ASIC HAS GENERAL ADMINISTRATION OF THIS ACT  
Subject to the ASIC Act, ASIC has the general administration of this Act.

SECTION 240   OBSTRUCTING OR HINDERING ASIC ETC.  

240(1)    

A person must not engage in conduct that results in the obstruction or hindering of ASIC, or any other person, in the performance of a function or the exercise of a power under this Act.

Civil penalty: 5,000 penalty units.

240(2)    

A person commits an offence if:

(a)    the person engages in conduct; and

(b)    the conduct results in the obstruction or hindering of ASIC, or any other person, in the performance of a function or the exercise of a power under this Act.

Criminal penalty: 2 years imprisonment.

240(3)    
For the purposes of subsections (1) and (2), it is a defence if the person has a reasonable excuse.

Note:

For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (3) (see subsection 13.3(3) of the Criminal Code).

SECTION 241  

241   APPROVED CODES OF CONDUCT  
(Repealed by No 135 of 2020)

SECTION 242   ASIC MAY ARRANGE FOR USE OF COMPUTER PROGRAMS TO MAKE DECISIONS  

242(1)   [Computer programs]  

ASIC may arrange for the use, under ASIC's control, of computer programs for any purposes for which ASIC may make decisions under this Act.

242(2)   [Decisions made by computers are decisions of ASIC]  

A decision made by the operation of a computer program under an arrangement made under subsection (1) is taken to be a decision made by ASIC.

SECTION 243   QUALIFIED PRIVILEGE FOR INFORMATION GIVEN TO ASIC  

243(1)    
A person has qualified privilege in relation to the giving of any information to ASIC:

(a) that the person is required or expressly permitted to give under this Act; or

(b) that relates to a contravention, or possible contravention, of the credit legislation; or

(c) that relates to a matter that is relevant to a decision of ASIC under:

(i) section 37 (which deals with when ASIC must grant a licence); or

(ia) section 46A (which deals with when ASIC may grant an application for a variation of the conditions on a licence); or

(ii) section 54 or 55 (which deal with ASIC's powers to suspend or cancel licences); or

(iii) subsection 80(1) (which deals with ASIC's power to make banning orders)

243(2)    
A person who has qualified privilege under subsection (1) in relation to conduct is also not liable for any action based on breach of confidence in relation to that conduct.

243(3)    
The protections given by this section to a person in relation to conduct extend to representatives of the person.

SECTION 244   ASIC CERTIFICATE IS PRIMA FACIE EVIDENCE OF MATTERS  

244(1)   [ASIC may issue certificate]  

ASIC may issue a certificate stating that a requirement of this Act specified in the certificate:

(a) had or had not been complied with at a date or within a period specified in the certificate; or

(b) had been complied with at a date specified in the certificate but not before that date.

244(2)   [Prima facie evidence]  

In proceedings in a court, a certificate issued by ASIC under subsection (1) is admissible as prima facie evidence of the matters stated in the certificate.

SECTION 245  

245   OPERATOR OF AFCA SCHEME MAY GIVE INFORMATION TO ASIC  

The operator of the AFCA scheme may give information to ASIC about:

(a) a person becoming a member of the scheme; or

(b) a person ceasing to be a member of the scheme.

CHAPTER 6 - COMPLIANCE AND ENFORCEMENT  

PART 6-1 - INVESTIGATIONS  

Division 1 - Introduction  

SECTION 246  

246   GUIDE TO THIS PART  

Division 2 - Investigations  

SECTION 247   GENERAL POWERS OF INVESTIGATION  

247(1)    
ASIC may make such investigation as it considers expedient for the due administration of the Commonwealth credit legislation if it has reason to suspect that there may have been committed:

(a) a contravention of the credit legislation; or

(b) a contravention of a law of the Commonwealth, or of a law of a referring State or a Territory, being a contravention that:

(i) concerns the management, conduct or affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity; or

(ii) involves fraud or dishonesty and relates to a credit activity engaged in by a person, or a credit contract, mortgage, guarantee or consumer lease.

SECTION 248   MINISTER MAY DIRECT INVESTIGATIONS  

248(1)   [Minister may direct investigation]  

If, in the Minister's opinion, it is in the public interest in relation to this jurisdiction for a particular matter to which subsection (2) applies to be investigated, he or she may by writing direct ASIC to investigate that matter.

248(2)   [Application of this subsection]  

This subsection applies to a matter relating to any of the following:

(a) an alleged or suspected contravention of the Commonwealth credit legislation;

(b) an alleged or suspected contravention of a law of the Commonwealth, or a law of a referring State or a Territory, being a contravention that:

(i) concerns the management, conduct or affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity; or

(ii) involves fraud or dishonesty and relates to a credit activity engaged in by a person, or a credit contract, mortgage, guarantee or consumer lease;

(c) a credit activity engaged in by a person.

248(3)   [Compliance]  

ASIC must comply with a direction under subsection (1).

248(4)   [Delegation]  

A direction under subsection (1) does not prevent ASIC from delegating a function or power.

248(5)   [Not a legislative instrument]  

A direction under subsection (1) is not a legislative instrument.

SECTION 249   INTERIM REPORT ON INVESTIGATION  

249(1)   [When report must be prepared]  

If, in the course of an investigation under this Part, ASIC forms the opinion that:

(a) a serious contravention of a law of the Commonwealth, or a law of a referring State or a Territory, has been committed; or

(b) to prepare an interim report about the investigation would enable or assist the protection, preservation or prompt recovery of property; or

(c) there is an urgent need for the Commonwealth credit legislation to be amended;

it must prepare an interim report that relates to the investigation and sets out:

(d) if paragraph (a) applies - its findings about the contravention, and the evidence and other material on which those findings are based; or

(e) if paragraph (b) applies - such matters as, in its opinion, will so enable or assist; or

(f) if paragraph (c) applies - its opinion about amendment of that legislation, and its reasons for that opinion;

and such other matters relating to, or arising out of, the investigation as it considers appropriate.

249(2)   [Direction by Minister]  

ASIC may prepare an interim report about an investigation under this Part and must do so if the Minister so directs.

249(3)   [Content of report in subsection (2)]  

A report under subsection (2) must set out such matters relating to, or arising out of, the investigation as ASIC considers appropriate or the Minister directs.

249(4)   [Not a legislative instrument]  

An interim report prepared under this section is not a legislative instrument.

SECTION 250   FINAL REPORT ON INVESTIGATION  

250(1)   [Para 247 investigations]  

At the end of an investigation under section 247, ASIC may prepare a report about the investigation and must do so if the Minister so directs.

250(2)   [Para 248 investigations]  

At the end of an investigation under section 248, ASIC must prepare a report about the investigation.

250(3)   [Content of report]  

A report under this section must set out:

(a) ASIC's findings about the matters investigated; and

(b) the evidence and other material on which those findings are based; and

(c) such other matters relating to, or arising out of, the investigation as ASIC considers appropriate or the Minister directs.

250(4)   [Direction not a legislative instrument]  

A direction under subsection (1) is not a legislative instrument.

250(5)   [Report not a legislative instrument]  

A report prepared under this section is not a legislative instrument.

SECTION 251   DISTRIBUTION OF REPORT  

251(1)   [Report to be given to Minister]  

As soon as practicable after preparing a report under this Part, ASIC must give a copy of the report to the Minister.

251(2)   [Other parties to whom report may be given]  

If a report, or part of a report, under this Part relates to a serious contravention of a law of the Commonwealth, or a law of a referring State or a Territory, ASIC may give a copy of the whole or a part of the report to:

(a) the Australian Federal Police; or

(b) the Chief Executive Officer of the Australian Crime Commission or a member of the staff of the ACC (within the meaning of the Australian Crime Commission Act 2002); or

(c) the Director of Public Prosecutions; or

(d) an agency, authority, body or person prescribed by the regulations.

251(3)   [Where report relates to a person's affairs]  

If a report, or part of a report, under this Part relates to a person's affairs to a material extent, ASIC may, at the person's request or of its own motion, give to the person a copy of the report or of part of the report.

251(4)   [Minister may print or publish report]  

The Minister may cause the whole or a part of a report under this Part to be printed and published.

PART 6-2 - EXAMINATION OF PERSONS  

Division 1 - Introduction  

SECTION 252  

252   GUIDE TO THIS PART  

Division 2 - Examination of persons  

SECTION 253   NOTICE REQUIRING APPEARANCE FOR EXAMINATION  

253(1)   [Application]  

This section applies if ASIC, on reasonable grounds, suspects or believes that a person can give information relevant to a matter that it is investigating, or is to investigate, under Part 6-1.

253(2)   [ASIC powers]  

ASIC may, by written notice given to the person in the form prescribed by the regulations, require the person:

(a) to give to ASIC all reasonable assistance in connection with the investigation; and

(b) to appear before a specified ASIC member or ASIC staff member for examination on oath and to answer questions.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

253(3)   [Content of notice]  

A notice given under subsection (2) must:

(a) state the general nature of the matter referred to in subsection (1); and

(b) set out the effect of subsection 257(1) and section 295.

SECTION 254  

254   PROCEEDINGS ATEXAMINATION  
The remaining provisions of this Part apply if, pursuant to a requirement made under section 253 for the purposes of an investigation under Part 6-1, a person (the examinee ) appears before another person (the inspector ) for examination.

SECTION 255   REQUIREMENTS MADE OF EXAMINEE  

255(1)   [Oath or affirmation]  

The inspector may examine the examinee on oath or affirmation and may, for that purpose:

(a) require the examinee to either take an oath or make an affirmation; and

(b) administer an oath or affirmation to the examinee.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

255(2)   [Strict liability]  

An offence under subsection 290(2) relating to subsection (1) of this section is an offence of strict liability.

Note:

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

255(3)   [Nature of oath or affirmation]  

The oath or affirmation to be taken or made by the examinee for the purposes of the examination is an oath or affirmation that the statements that the examinee will make will be true.

255(4)   [Examinee may be required to answer a question]  

The inspector may require the examinee to answer a question that is put to the examinee at the examination and is relevant to a matter that ASIC is investigating, or is to investigate, under Part 6-1.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

SECTION 256   EXAMINATION TO TAKE PLACE IN PRIVATE  

256(1)    
The examination must take place in private and the inspector may give directions about who may be present during it, or during a part of it.

256(2)    

A person must not be present at the examination unless he or she:

(a) is the inspector, the examinee or an ASIC member; or

(b) is an ASIC staff member approved by ASIC; or

(c) is entitled to be present by virtue of:

(i) a direction under subsection (1); or

(ii) subsection 257(1).

Criminal penalty: 30 penalty units.

256(3)    
Subsection (2) is an offence of strict liability.

Note:

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

SECTION 256A   PROCEEDINGS AT EXAMINATION  

256A(1)    
The inspector may decide to hold the examination:

(a)    at one or more physical venues; or

(b)    at one or more physical venues and using virtual enquiry technology; or

(c)    using virtual enquiry technology only.

256A(2)    
Subsection (3) applies if the examination is held:

(a)    at one or more physical venues and using virtual enquiry technology; or

(b)    using virtual enquiry technology only.

256A(3)    
The inspector must ensure that the use of the virtual enquiry technology is reasonable.

256A(4)    
If the examination is held:

(a)    at more than one physical venue; or

(b)    at one or more physical venues and using virtual enquiry technology; or

(c)    using virtual enquiry technology only;

the inspector may appoint a single place and time at which the examination is taken to have been held.

256A(5)    
This section applies to part of an examination in the same way that it applies to all of an examination.

SECTION 257   EXAMINEE'S LAWYER MAY ATTEND  

257(1)   [Examinee's lawyer]  

The examinee's lawyer may be present at the examination and may, at such times during it as the inspector determines:

(a) address the inspector; and

(b) examine the examinee;

about matters about which the inspector has examined the examinee.

257(2)   [Inspector may restrain person trying to obstruct]  

If, in the inspector's opinion, a person is trying to obstruct the examination by exercising rights under subsection (1), the inspector may require the person to stop addressing the inspector, or examining the examinee, as the case requires.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

257(3)   [Strict liability]  

An offence under subsection 290(3) relating to subsection (2) of this section is an offence of strict liability.

Note:

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

SECTION 258   RECORD OF EXAMINATION  

258(1)   [Record]  

The inspector may, and must if the examinee so requests, cause a record to be made of statements made at the examination.

258(2)   [When record reduced to writing]  

If a record made under subsection (1) is in writing or is reduced to writing:

(a) the inspector may requirethe examinee to read it, or to have it read to him or her, and may require him or her to sign it; and

(b) the inspector must, if requested in writing by the examinee to give to the examinee a copy of the written record, comply with the request without charge but subject to such conditions (if any) as the inspector imposes.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

258(3)   [Strict liability]  

An offence under subsection 290(2) relating to paragraph (2)(a) of this section is an offence of strict liability.

Note:

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

SECTION 259   GIVING TO OTHER PERSONS COPIES OF RECORD  

259(1)    
ASIC may give a copy of a written record of the examination, or such a copy together with a copy of any related book, to a person's lawyer if the lawyer satisfies ASIC that the person is carrying on, or is contemplating in good faith, proceedings in relation to a matter to which the examination related.

259(2)    

If ASIC gives a copy to a person under subsection (1), the person, or any other person who has possession, custody or control of the copy or a copy of it, must not, except in connection with preparing, beginning or carrying on, or in the course of, proceedings:

(a) use the copy or a copy of it; or

(b) publish, or communicate to a person, the copy, a copy of it, or any part of the copy's contents.

Criminal penalty: 30 penalty units.

259(3)    
Subsection (2) is an offence of strict liability.

Note:

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

259(4)    
ASIC may, subject to such conditions (if any) as it imposes, give to a person a copy of a written record of the examination, or such a copy together with a copy of any related book.

SECTION 260   COPIES GIVEN SUBJECT TO CONDITIONS  

260(1)    

If a copy is given to a person under subsection 258(2) or 259(4) subject to conditions, the person, and any other person who has possession, custody or control of the copy or a copy of it, must comply with the conditions.

Criminal penalty: 30 penalty units.

260(2)    
Subsection (1) is an offence of strict liability.

Note:

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

SECTION 261   RECORD TO ACCOMPANY REPORT  

261(1)   [Record]  

If a report about the investigation referred to in section 254 is prepared under section 250, each record (if any) of the examination must accompany the report.

261(2)   [Where statement relevant to other investigation]  

If:

(a) in ASIC's opinion, a statement made at an examination is relevant to any other investigation under Part 6-1; and

(b) a record of the statement was made under section 258; and

(c) a report about the other investigation is prepared under section 250;

a copy of the record must accompany the report.

PART 6-3 - INSPECTION OF BOOKS AND AUDIT INFORMATION-GATHERING POWERS  

Division 1 - Introduction  

SECTION 262   GUIDE TO THIS PART  

Division 2 - Inspection of books and audit information-gathering powers  

SECTION 263  

263   WHEN CERTAIN POWERS MAY BE EXERCISED  

A power conferred by this Part (other than sections 264, and 265) may only be exercised:

(a) for the purposes of the performance or exercise of any of ASIC's functions and powers under the Commonwealth credit legislation; or

(b) for the purposes of ensuring compliance with the Commonwealth credit legislation; or

(c) in relation to an alleged or suspected contravention of the credit legislation; or

(d) in relation to an alleged or suspected contravention of a law of the Commonwealth, or of a law of a referring State or a Territory, being a contravention that:

(i) concerns the management, conduct or affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity; or

(ii) involves fraud or dishonesty and relates to a credit activity engaged in by a person, or a credit contract, mortgage, guarantee or consumer lease; or

(e) for the purposes of an investigation under Part 6-1.

SECTION 264   ASIC MAY INSPECT BOOKS WITHOUT CHARGE  

264(1)   [Inspection]  

A book that the Commonwealth credit legislation requires a person to keep must be open for inspection (without charge) by a person authorised in writing by ASIC.

264(2)   [Authorised person may require inspection]  

A person (the authorised person ) authorised under this section may require a person in whose possession, custody or control the book is to make the book available for inspection by the authorised person.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

264(3)   [Strict liability]  

An offence under subsection 290(2) relating to subsection (2) of this section is an offence of strict liability.

Note:

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

264(4)   [Scope of authorisation]  

An authorisation under this section may be of general application or may be limited by reference to the books to be inspected.

SECTION 265   NOTICE TO AUDITORS CONCERNING INFORMATION AND BOOKS  

265(1)    
Subject to subsection (2), ASIC may give an auditor who prepares an audit report required under the Commonwealth credit legislation a written notice requiring the auditor:

(a) to give specified information; or

(b) to produce specified books;

to a specified ASIC member or ASIC staff member at a specified place and time.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

265(2)    
The power in subsection (1) may only be exercised:

(a) for the purposes of ascertaining compliance with audit requirements under the Commonwealth credit legislation; or

(b) in relation to an alleged or suspected contravention of audit requirements under the Commonwealth credit legislation; or

(c) in relation to an alleged or suspected contravention of a law of the Commonwealth, or of a law of a referring State or a Territory, being a contravention that:

(i) concerns the management, conduct or affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity; or

(ii) involves fraud or dishonesty and relates to a credit activity engaged in by a person, or a credit contract, mortgage, guarantee or consumer lease; or

(iii) is of a provision of Part 3-2CA (about mandatory comprehensive credit reporting); or

(d) for the purposes of an investigation under Part 6-1 relating to a contravention referred to in paragraph (b) or (c).

265(3)    
Without limiting subsection (1), a notice under that subsection may specify information or books that relate to any or all of the following:

(a) the policies relating to audit that the auditor has adopted or proposes to adopt, or the procedures relating to audit that the auditor has put in place or proposes to put in place;

(b) audits the auditor has conducted or proposes to conduct or in which the auditor has participated or proposes to participate;

(c) any other matter pertaining to audit that is prescribed by the regulations for the purposes of this paragraph.

265(4)    
Without limiting subsection (1), a notice under that subsection may require the auditor to give information or produce books even if doing so would involve a breach of an obligation of confidentiality that the auditor owes an audited person.

265(5)    
ASIC may, by written notice to an auditor who has received a notice under subsection (1), extend the period within which the auditor must give the information or produce the books to which the notice under that subsection relates.

SECTION 266   NOTICE TO PRODUCE BOOKS ABOUT CREDIT ACTIVITIES OR CREDIT REPORTING  

266(1)    
ASIC may give to:

(a) a person who engages in a credit activity (either alone or together with any other person or persons); or

(b) a person who ASIC, on reasonable grounds, suspects has been a party to engaging in a credit activity; or

(c) a representative, banker, lawyer or auditor of a person referred to in paragraph (a) or (b);

a written notice requiring the production to a specified ASIC member or ASIC staff member, at a specified place and time, of specified books relating to:

(d) a credit activity engaged in by a person; or

(e) the character or financial situation of, or a business carried on by, a person who engages, or has engaged, in a credit activity.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

266(2)    

ASIC may give to:

(a)    a Part 3-2CA body that is, or has been, subject to a requirement under Part 3-2CA (other than Division 4), either alone or together with any other person or persons; or

(b)    a representative, banker, lawyer or auditor of a person referred to in paragraph (a);

a written notice requiring the production to a specified ASIC member or ASIC staff member, at a specified place and time, of specified books relating to:

(c)    information, or a statement, to which that requirement relates; or

(d)    the character or financial situation of, or a business carried on by, a person who is, or has been, subject to that requirement.

Note 1:

Part 3-2CA is about mandatory comprehensive credit reporting.

Note 2:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

SECTION 267   NOTICE TO PRODUCE DOCUMENTS IN PERSON'S POSSESSION  

267(1)    
ASIC may give to a person (the recipient ) a written notice requiring the production to a specified ASIC member or ASIC staff member, at a specified place and time, of specified books that are in the recipient's possession, custody or control and relate to:

(a) affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity; or

(b) a matter referred to in paragraph 266(1)(d) or (e) or (2)(c) or (d).

267(2)    
ASIC may give to a person (the recipient ) a written notice requiring the production to a specified ASIC member or ASIC staff member, at a specified place and time, of specified books that are in the recipient's possession, custody or control and that relate to the question whether an auditor has complied with audit requirements under the Commonwealth credit legislation.

Note:

Failure to comply with a requirement made under this section is an offence (see section 290).

SECTION 268   ASIC MAY AUTHORISE PERSONS TO REQUIRE PRODUCTION OF BOOKS, GIVING OF INFORMATION ETC.  

268(1)   [ASIC powers]  

ASIC may by writing authorise an ASIC member or ASIC staff member (an authorised person ) to make a requirement of a kind that this Part empowers ASIC to make.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

268(2)   [Scope of authorisation]  

An authorisation under this section may be of general application or may be limited by reference to all or any of the following:

(a) the persons of whom requirements may be made;

(b) the books that may be required to be produced;

(c) the information that may be required to be given.

268(3)   [Interpretation]  

If an authorisation of an authorised person is in force under this section, the authorised person may make a requirement in accordance with the authorisation as if, in sections 265, 266 and 267:

(a) a reference to ASIC were a reference to the authorised person; and

(b) a reference to specified books were a reference to books that the authorised person specifies, whether in the requirement or not and whether orally or in writing, to the person of whom the requirement is made; and

(c) a reference to specified information were a reference to information that the authorised person specifies, whether in the requirement or not and whether orally or in writing, to the person of whom the requirement is made; and

(d) a reference to giving or producing to a specified person were a reference to giving or producing to the authorised person.

SECTION 269  

269   APPLICATION FOR WARRANT TO SEIZE BOOKS NOT PRODUCED  
(Repealed by No 3 of 2020)

SECTION 270  

270   GRANT OF WARRANT  
(Repealed by No 3 of 2020)

SECTION 271   POWERS IF BOOKS PRODUCED OR SEIZED  

271(1)    
This section applies if:

(a) books are produced to a person under a requirement made under this Part; or

(b) under a warrant issued under Division 2 of Part IAA of the Crimes Act 1914, as applied under section 272B of this Act, a person:

(i) takes possession of books; or

(ii) secures books against interference; or

(c) by virtue of a previous application of subsection (8) of this section, books are delivered into a person's possession.

271(1A)    

However, if paragraph (1)(b) applies, subsections (4), (5), (6), (7) and (8) do not apply.

271(2)    
If paragraph (1)(a) applies, the person may take possession of any of the books.

271(3)    
The person may inspect, and may make copies of, or take extracts from, any of the books.

271(4)    
The person may use, or permit the use of, any of the books for the purposes of proceedings.

271(5)    
The person may retain possession of any of the books for so long as is necessary:

(a) for the purposes of exercising a power conferred by this section (other than this subsection and subsection (7)); or

(b) for any of the purposes referred to in paragraphs 263(a), (b) and (e) or 265(2)(a) and (d), as the case requires; or

(c) for a decision to be made about whether or not proceedings (including proceedings under a law of the Commonwealth, or a law of a referring State or a Territory) to which the books concerned would be relevant should be begun; or

(d) for such proceedings to be begun and carried on.

271(6)    
No-one is entitled, as against the person, to claim a lien on any of the books, but such a lien is not otherwise prejudiced.

271(7)    
While the books are in the possession of a person (the possessor ), the possessor:

(a) must permit another person to inspect at all reasonable times such (if any) of the books as the other person would be entitled to inspect if they were not in the possessor's possession; and

(b) may permit another person to inspect any of the books.

271(8)    

The person may deliver any of the books into the possession of ASIC or of a person authorised by it to receive them.

271(9)    

If paragraph (1)(a) or (b) applies, the person, or if paragraph (1)(a) applies a person into whose possession the person delivers any of the books under subsection (8), may require:

(a) if paragraph (1)(a) applies - a person who so produced any of the books; or

(b) in any case - a person who was a party to the compilation of any of the books;

to explain any matter about the compilation of any of the books or to which any of the books relate.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

SECTION 272  

272   POWERS IF BOOKS NOT PRODUCED  
If a person (the first person ) fails or refuses to produce particular books in compliance with a requirement made by another person under this Part, the other person may require the first person to state:

(a) if the books may be found; and

(b) who last had possession, custody or control of the books and if that person may be found.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

PART 6-3A - SEARCH WARRANTS  

Division 1 - Introduction  

SECTION 272A   GUIDE TO THIS PART  

Division 2 - Extra application of Crimes Act search warrant provisions  

Subdivision A - Basic extra application  

SECTION 272B   EXTRA APPLICATION OF CRIMES ACT SEARCH WARRANT PROVISIONS  

272B(1)    
In addition to the application that the applied provisions have (disregarding this subsection) in relation to offences mentioned in subsection (3), the applied provisions also apply under this subsection in relation to those offences, with the modifications set out in Subdivision B.

272B(2)    
To avoid doubt, subsection (1) does not limit the application that the applied provisions have (disregarding that subsection).

272B(3)    
For the purposes of subsection (1), the offences are indictable offences under any of the following:

(a) the credit legislation;

(b) a provision of a law of the Commonwealth, or of a law of a referring State or a Territory, a contravention of which:

(i) concerns the management, conduct or affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity; or

(ii) involves fraud or dishonesty and relates to a credit activity engaged in by a person, or a credit contract, mortgage, guarantee or consumer lease.

272B(4)    
For the purposes of this Division, the applied provisions are as follows:

(a) Divisions 1, 2, 4C and 5 of Part IAA of the Crimes Act 1914;

(b) any other provisions of that Act, to the extent that those other provisions relate to the operation of the provisions mentioned in paragraph (a).

SECTION 272C  

272C   INTERPRETATION OF MODIFICATIONS  

To avoid doubt, a term used in Subdivision B in a modification of an applied provision has the same meaning as in the Crimes Act 1914 unless specified otherwise.

Subdivision B - Modifications  

SECTION 272D  

272D   MAJOR MODIFICATIONS - EVIDENTIAL MATERIAL  

For the purposes of subsection 272B(1), in the definition of evidential material in subsection 3C(1) of the Crimes Act 1914, omit the words "or a thing relevant to a summary offence".

SECTION 272E   MAJOR MODIFICATIONS - WHO MAY APPLY FOR A WARRANT ETC.  

272E(1)    
For the purposes of subsection 272B(1), in subsection 3E(1) of the Crimes Act 1914, after the words "by information on oath or affirmation", insert "given by a constable, or by a member of ASIC or an ASIC staff member authorised in writing by ASIC for the purposes of this subsection".

272E(2)    
For the purposes of subsection 272B(1), in subsection 3E(2) of the Crimes Act 1914, after the words "by information on oath or affirmation", insert "given by a constable, or by a member of ASIC or an ASIC staff member authorised in writing by ASIC for the purposes of this subsection".

272E(3)    
For the purposes of subsection 272B(1), in subsection 3LA(1) of the Crimes Act 1914, after the words "A constable", insert ", or a member of ASIC or an ASIC staff member authorised in writing by ASIC for the purposes of this subsection,".

272E(4)    
For the purposes of subsection 272B(1), in subsection 3R(1) of the Crimes Act 1914, after the words "A constable", insert ", or a member of ASIC or an ASIC staff member authorised in writing by ASIC for the purposes of this subsection,".

SECTION 272F  

272F   MAJOR MODIFICATIONS - PURPOSES FOR WHICH THINGS MAY BE USED AND SHARED  

For the purposes of subsection 272B(1), replace section 3ZQU of the Crimes Act 1914 with the following 2 sections.

SECTION 3ZQU PURPOSES FOR WHICH THINGS MAY BE USED AND SHARED  

3ZQU(1)
A constable or Commonwealth officer may use, or make available to a member of ASIC or an ASIC staff member to use, a thing seized under this Part for the purpose of the performance of ASIC's functions or duties or the exercise of its powers.

3ZQU(2)
Without limiting the scope of subsection (1), a constable or Commonwealth officer may use, or make available to a person covered under subsection (3) to use, a thing seized under this Part for the purpose of any or all of the following if it is necessary to do so for that purpose:

(a) preventing or investigating any of the following:

(i) a breach of an offence provision;

(ii) a breach of a civil penalty provision;

(iii) a breach of an obligation (whether under statute or otherwise), other than an obligation of a private nature (such as an obligation under a contract, deed, trust or similar arrangement);

(b) prosecuting a breach of an offence provision;

(c) prosecuting a breach of a civil penalty provision;

(d) taking administrative action, or seeking an order of a court or tribunal (within the meaning of the Australian Securities and Investments Commission Act 2001), in response to a breach of an obligation (whether under statute or otherwise), other than an obligation of a private nature (such as an obligation under a contract, deed, trust or similar arrangement).

3ZQU(3)
A person is covered under this subsection if the person is any of the following:

(a) a constable;

(b) a Commonwealth officer.

3ZQU(4)
Without limiting the scope of subsections (1) and (2), a constable or Commonwealth officer may use, or make available to a person covered under subsection (3) to use, a thing seized under this Part for the purpose of any or all of the following if it is necessary to do so for that purpose:

(a) proceedings under the Proceeds of Crime Act 1987 or the Proceeds of Crime Act 2002;

(b) proceedings under a corresponding law (within the meaning of either of the Acts mentioned in paragraph (a)) that relate to a State offence that has a federal aspect;

(c) proceedings for the forfeiture of the thing under a law of the Commonwealth, a State or a Territory;

(d) the performance of a function or duty, or the exercise of a power, by a person, court or other body under, or in relation to a matter arising under, Division 104, 105 or 105A of the Criminal Code;

(e) investigating or resolving a complaint or an allegation of misconduct relating to an exercise of a power or the performance of a function or duty under this Part;

(f) investigating or resolving an AFP conduct or practices issue (within the meaning of the Australian Federal Police Act 1979) under Part V of that Act;

(g) investigating or resolving a complaint under the Ombudsman Act 1976 or the Privacy Act 1988;

(h) conducting a NACC Act process (within the meaning of the National Anti-Corruption Commission Act 2022);

(i) proceedings in relation to a complaint, allegation or issue mentioned in paragraph (e), (f), (g) or (h);

(j) deciding whether to institute proceedings, to make an application or request, or to take any other action, mentioned in:

(i) any of the preceding paragraphs of this subsection; or

(ii) subsection (1) or (2);

(k) the performance of the functions of the Australian Federal Police under section 8 of the Australian Federal Police Act 1979.

 View history note

 Hide history note

History

S 3ZQU(4) amended by No 89 of 2022, s 3 and Sch 1[123], effective 1 July 2023.

3ZQU(5)
A constable or Commonwealth officer may use a thing seized under this Part for any other use that is required or authorised by or under a law of a State or a Territory.

3ZQU(6)
A constable or Commonwealth officer may make available to another constable or Commonwealth officer to use a thing seized under this Part for any purpose for which the making available of the thing is required or authorised by a law of a State or Territory.

3ZQU(7)
To avoid doubt, this section does not limit any other law of the Commonwealth that:

(a) requires or authorises the use of a document or other thing; or

(b) requires or authorises the making available (however described) of a document or other thing.

3ZQU(8)
A constable or Commonwealth officer may make available to an agency that has responsibility for:

(a) law enforcement in a foreign country; or

(b) intelligence gathering for a foreign country; or

(c) the security of a foreign country;

a thing seized under this Part to be used by that agency for:

(d) a purpose mentioned in subsection (1), (2), (4), (5) or (6); or

(e) the purpose of performing a function, or exercising a power, conferred by a law in force in that foreign country.

Ministerial arrangements for sharing

3ZQU(9)
This Division does not prevent the Minister from making an arrangement with a Minister of a State or Territory for:

(a) the making available to a State or Territory law enforcement agency of that State or Territory, for purposes mentioned in subsections (1), (2), (4), (6) and (8), of things seized under this Part; and

(b) the disposal by the agency of such things, originals and copies when they are no longer of use to that agency for those purposes.

Note:

This subsection does not empower the Minister to make such an arrangement.

Definition

3ZQU(10)
In this section:

State or Territory law enforcement agency
means:

(a) the police force or police service of a State or Territory; or

(b) the New South Wales Crime Commission; or

(c) the Independent Commission Against Corruption of New South Wales; or

(d) the Law Enforcement Conduct Commission of New South Wales; or

(e) the Independent Broad-based Anti-corruption Commission of Victoria; or

(f) the Crime and Corruption Commission of Queensland; or

(g) the Corruption and Crime Commission of Western Australia; or

(h) the Independent Commissioner Against Corruption of South Australia.

SECTION 3ZQUA COMMONWEALTH LAW PERMITTING ACCESS TO THINGS SEIZED UNDER THIS PART DOES NOT APPLY  

3ZQUA(1)
This section applies if, disregarding this section, a law of the Commonwealth (other than this Part) requires or permits any of the following to be made available to a person covered under subsection (3):

(a) a thing seized under this Part;

(b) if a thing contains data that ASIC or the Australian Federal Police came into possession of as a result of exercising powers under this Part - the thing.

3ZQUA(2)
Subject to subsection (4), that law does not require or permit the thing to be made available to the person.

3ZQUA(3)
A person is covered under this subsection if the person is not, and is not representing, the Commonwealth, a State or a Territory.

3ZQUA(4)
This section does not affect any of the following:

(a) the power of a court, or of a tribunal (within the meaning of the Australian Securities and Investments Commission Act 2001), to make an order;

(b) the effect of an order of a court, or of a tribunal (within the meaning of that Act).

3ZQUA(5)
This section does not affect the operation of the Freedom of Information Act 1982.

SECTION 272G   MINOR MODIFICATIONS  

272G(1)    
For the purposes of subsection 272B(1), the applied provisions apply with the modifications set out in this section.

272G(2)    
To avoid doubt, those modifications have no effect other than for the purposes mentioned in subsection (1).

272G(3)    
In subsection 3C(1) of the Crimes Act 1914, insert the following definitions:

ASIC
means the Australian Securities and Investments Commission.

ASIC senior staff member
means a senior staff member (within the meaning of the Australian Securities and Investments Commission Act 2001).

ASIC staff member
means a staff member (within the meaning of the Australian Securities and Investments Commission Act 2001).

responsible agency
, in relation to data or a thing, means:

(a) if the data, or a device containing the data, or the thing, is in the control of the Australian Federal Police - the Australian Federal Police; or

(b) if the data, or a device containing the data, or the thing, is in the control of ASIC - ASIC.

responsible Commissioner
, in relation to data or a thing, means:

(a) if the data, or a device containing the data, or the thing, is in the control of the Australian Federal Police - the Commissioner of the Australian Federal Police; or

(b) if the data, or a device containing the data, or the thing, is in the control of ASIC - the Chairperson of ASIC.

272G(4)    
In section 3E of the Crimes Act 1914:

(a) omit the note to subsection (1) of that section; and

(b) omit the words "is a member or special member of the Australian Federal Police and" in subsection (4) of that section.

272G(5)    
In subsections 3L(1B) and 3LAA(3) and sections 3ZQX and 3ZQZB of the Crimes Act 1914:

(a) treat the references to the Commissioner as being references to the responsible Commissioner; and

(b) treat the references to the Australian Federal Police as being references to the responsible agency.

PART 6-4 - PROCEEDINGS AFTER AN INVESTIGATION  

Division 1 - Introduction  

SECTION 273  

273   GUIDE TO THIS PART  

Division 2 - Proceedings after an investigation  

SECTION 274   ASIC MAY PROSECUTE  

274(1)   [Application]  

This section applies if:

(a) as a result of an investigation; or

(b) from a record of an examination;

conducted under this Chapter, it appears to ASIC that a person:

(c) may have committed an offence against the Commonwealth credit legislation; and

(d) ought to be prosecuted for the offence.

274(2)   [ASIC may prosecute]  

ASIC may cause a prosecution of the person for the offence to be brought and carried on.

274(3)   [ASIC may make requirements under subsection (4)]  

ASIC may make a requirement under subsection (4) if:

(a) ASIC, on reasonable grounds, suspects or believes that a person can give information relevant to a prosecution for the offence; or

(b) the offence relates to matters being, or connected with, affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity, or to matters including such matters.

274(4)   [Reasonable assistance]  

ASIC may, whether before or after a prosecution for the offence is begun, by writing given to any of the following persons:

(a) the person referred to in paragraph (3)(a);

(b) a representative, banker, lawyer orauditor of a person referred to in paragraph (3)(b);

require the person to give all reasonable assistance in connection with such a prosecution.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

274(5)   [Strict liability]  

An offence under subsection 290(2) relating to subsection (4) of this section is an offence of strict liability.

Note:

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

274(6)   [When subsection (4) does not apply]  

Subsection (4) does not apply in relation to:

(a) the person referred to in subsection (1); or

(b) a person who is or has been that person's lawyer.

Note:

A defendant bears an evidential burden in relation to the matter in subsection (6), see subsection 13.3(3) of the Criminal Code.

274(7)   [Not a legislative instrument]  

A requirement made by ASIC under subsection (4) is not a legislative instrument.

274(8)   [Affect on other legislation]  

Nothing in this section affects the operation of the Director of Public Prosecutions Act 1983.

SECTION 275  

275   ASIC MAY BRING CIVIL PROCEEDINGS  
If, as a result of an investigation or from a record of an examination (being an investigation or examination conducted under this Chapter), it appears to ASIC to be in the public interest for a person to bring and carry on proceedings (other than proceedings under the Commonwealth credit legislation) for:

(a) the recovery of damages for fraud, negligence, default, breach of duty, or other misconduct, committed in connection with a matter to which the investigation or examination related; or

(b) recovery of property of the person;

ASIC:

(c) if the person is a company (within the meaning of the Corporations Act 2001) - may cause; or

(d) otherwise - may, with the person's written consent, cause;

such proceedings to be begun and carried on in the person's name.

PART 6-5 - HEARINGS  

Division 1 - Introduction  

SECTION 276  

276   GUIDE TO THIS PART  

Division 2 - Hearings  

SECTION 277  

277   POWER TO HOLD HEARINGS  
ASIC may hold hearings for the purposes of the performance or exercise of any of its functions and powers under the Commonwealth credit legislation, other than a function or power conferred on it by Part 6-1 (which deals with investigations).

SECTION 278   GENERAL DISCRETION TO HOLD HEARING IN PUBLIC OR PRIVATE  

278(1)   [ASIC powers]  

Subject to sections 279 and 280, ASIC may direct that a hearing take place in public or take place in private.

278(2)   [Matters taken into account]  

In exercising its discretion under subsection (1), ASIC must have regard to:

(a) whether evidence that may be given, or a matter that may arise, during the hearing is of a confidential nature or relates to the commission, or to the alleged or suspected commission, of an offence against a law of the Commonwealth, a State or a Territory; and

(b) any unfair prejudice to a person's reputation that would be likely to be caused if the hearing took place in public; and

(c) whether it is in the public interest that the hearing take place in public; and

(d) any other relevant matter.

SECTION 279   REQUEST BY PERSON APPEARING AT HEARING THAT IT TAKE PLACE IN PUBLIC  

279(1)   [Public hearings]  

Subject to section 280, if:

(a) the Commonwealth credit legislation requires ASIC to give a person an opportunity to appear at a hearing; and

(b) the person requests that the hearing or part of the hearing take place in public;

the hearing or part must take place in public.

279(2)   [Exception to subsection (1)]  

Despite subsection (1), if ASIC is satisfied, having regard to the matters referred to in subsection 278(2), that it is desirable that a hearing or part of a hearing take place in private, it may direct that the hearing or part take place in private.

279(3)   [Not a legislative instrument]  

If a direction given under subsection (2) is in writing, it is not a legislative instrument.

SECTION 280  

280   CERTAIN HEARINGS TO TAKE PLACE IN PRIVATE  
If the Commonwealth credit legislation (other than this section) requires a hearing to take place in private, the hearing must take place in private.

SECTION 281   ASIC MAY RESTRICT PUBLICATION OF CERTAIN MATERIAL  

281(1)    
If, at a hearing that is taking place in public or in private, ASIC is satisfied that it is desirable to do so, ASIC may give directions preventing or restricting the publication of evidence given before, or of matters contained in documents lodged with, ASIC.

Note:

Failure to comply with a direction given under this subsection is an offence (see section 293).

281(2)    
In determining whether or not to give a direction under subsection (1), ASIC must have regard to:

(a)    whether evidence that has been or may be given, or a matter that has arisen or may arise, during the hearing is of a confidential nature or relates to the commission, or to the alleged or suspected commission, of an offence against a law of the Commonwealth, a State or a Territory; and

(b)    any unfair prejudice to a person's reputation that would be likely to be caused unless ASIC exercises its powers under this section; and

(c)    whether it is in the public interest that ASIC exercises its powers under this section; and

(d)    any other relevant matter.

281(3)    
If a direction given under subsection (1) is in writing, it is not a legislative instrument.

SECTION 282   WHO MAY BE PRESENT WHEN HEARING TAKES PLACE IN PRIVATE  

282(1)    
ASIC may give directions about who may be present during a hearing that is to take place in private.

282(2)    
A direction under subsection (1) does not prevent:

(a) a person whom the Commonwealth credit legislation requires to be given the opportunity to appear at a hearing; or

(b) a person representing under section 285:

(i) a person of a kind referred to in paragraph (a) of this subsection; or

(ii) a person who, by virtue of such a direction, is entitled to be present at a hearing;

from being present during the hearing.

282(3)    

If ASIC directs that a hearing take place in private, a person must not be present at the hearing unless he or she:

(a) is an ASIC member; or

(b) is an ASIC staff member approved by ASIC; or

(c) is entitled to be present by virtue of:

(i) a direction under subsection (1); or

(ii) subsection (2).

Criminal penalty: 30 penalty units.

282(4)    
Subsection (3) is an offence of strict liability.

Note:

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

282(5)    
If a direction given under subsection (1) is in writing, it is not a legislative instrument.

SECTION 283   INVOLVEMENT OF PERSON ENTITLED TO APPEAR AT HEARING  

283(1)   [Application]  

This section applies if the Commonwealth credit legislation requires ASIC to give a person an opportunity to appear at a hearing and to make submissions and give evidence to it.

283(2)   [Details of hearing]  

ASIC must appoint a place and time for the hearing and cause written notice of that place and time to be given to the person.

283(3)   [Submissions]  

If the person does not wish to appear at the hearing, the person may, before the day of the hearing, lodge with ASIC any written submissions that the person wishes ASIC to take into account in relation to the matter concerned.

SECTION 284   POWER TO SUMMON WITNESSES AND TAKE EVIDENCE  

284(1)   [ASIC powers]  

An ASIC member may, by written summons given to a person in the form prescribed by the regulations:

(a) require the person to appear before ASIC at a hearing to give evidence, to produce specified documents, or to do both; and

(b) require the person to attend from day to day unless excused, or released from further attendance, by an ASIC member.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

284(2)   [Oath or affirmation]  

At a hearing, ASIC may take evidence on oath or affirmation, and for that purpose an ASIC member may:

(a) require a witness at the hearing to either take an oath or make an affirmation; and

(b) administer an oath or affirmation to a witness at the hearing.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

284(3)   [Truth of evidence]  

The oath or affirmation to be taken or made by a person for the purposes of this section is an oath or affirmation that the evidence the person will give will be true.

284(4)   [Powers of member presiding at hearing]  

The ASIC member presiding at a hearing:

(a) may require a witness at the hearing to answer a question put to the witness; and

(b) may require a person appearing at the hearing pursuant to a summons issued under this section to produce a document specified in the summons.

Note:

Failure to comply with a requirement made under this subsection is an offence (see section 290).

284(5)   [Strict liability]  

An offence under subsection 290(2) relating to subsection (1), (2) or (4) of this section is an offence of strict liability.

Note:

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

284(6)   [Written statements]  

ASIC may permit a witness at a hearing to give evidence by tendering, and if ASIC so requires, verifying by oath, a written statement.

SECTION 285   PROCEEDINGS AT HEARINGS  

285(1)   [Conduct of hearing]  

A hearing must be conducted with as little formality and technicality, and with as much expedition, as the requirements of the Commonwealth credit legislation and a proper consideration of the matters before ASIC permit.

285(2)   [ASIC powers at hearing]  

At a hearing, ASIC:

(a) is not bound by the rules of evidence; and

(b) may, on such conditions as it considers appropriate, permit a person to intervene; and

(c) must observe the rules of natural justice.

285(3)   [Interpretation]  

Subject to subsection (4), Division 4 of Part 4 of the ASIC Act (other than section 104 of that Act) applies, so far as practicable, in relation to a hearing as if the hearing were a meeting of ASIC.

285(4)   [Quorum]  

At a hearing before a Division of ASIC (established under section 97 of the ASIC Act), 2 members of the Division form a quorum.

285(5)   [Appear in person or representation by employee]  

At a hearing, a natural person may appear in person or be represented by an employee of the person approved by ASIC.

285(6)   [Representation for body corporate]  

A body corporate may be represented at a hearing by an officer (within the meaning of section 5 of the ASIC Act) or employee of the body corporate approved by ASIC.

285(7)   [Representation for unincorporated association]  

An unincorporated association, or a person in the person's capacity as a member of an unincorporated association, may be represented at a hearing by a member, officer (within the meaning of section 5 of the ASIC Act) or employee of the association approved by ASIC.

285(8)   [Legal representation]  

Any person may be represented at a hearing by a lawyer.

SECTION 285A   PROCEEDINGS AT HEARINGS  

285A(1)    
ASIC may decide to hold the hearing:

(a)    at one or more physical venues; or

(b)    at one or more physical venues and using virtual enquiry technology; or

(c)    using virtual enquiry technology only.

285A(2)    
Subsections (3) and (4) apply if the hearing is held:

(a)    at one or more physical venues and using virtual enquiry technology; or

(b)    using virtual enquiry technology only.

285A(3)    
ASIC must ensure that the use of the virtual enquiry technology is reasonable.

285A(4)    
If the hearing is held in public, ASIC must ensure that:

(a)    the virtual enquiry technology provides the public with a reasonable opportunity to observe the hearing; and

(b)    information sufficient to allow the public to observe the hearing using the virtual enquiry technology is made publicly available in a reasonable way.

285A(5)    
If the hearing is held:

(a)    at more than one physical venue; or

(b)    at one or more physical venues and using virtual enquiry technology; or

(c)    using virtual enquiry technology only;

ASIC may appoint a single place and time at which the hearing is taken to have been held.

285A(6)    
This section applies to part of a hearing in the same way that it applies to all of a hearing.

SECTION 286  

286   ASIC TO TAKE ACCOUNT OF EVIDENCE AND SUBMISSIONS  
ASIC must take into account:

(a) evidence given, or a submission made, to it at a hearing; or

(b) a submission lodged with it under section 283;

in making a decision on a matter to which the evidence or submission relates.

SECTION 287   REFERENCE TO COURT OF QUESTION OF LAW ARISING AT HEARING  

287(1)   [ASIC may refer to court]  

ASIC may, of its own motion or at a person's request, refer to the court for decision a question of law arising at a hearing.

287(2)   [Restrictions on ASIC]  

If a question has been referred under subsection (1), ASIC must not, in relation to a matter to which the hearing relates:

(a) give while the reference is pending a decision to which the question is relevant; or

(b) proceed in a manner, or make a decision, that is inconsistent with the court's opinion on the question.

287(3)   [Documents]  

If a question is referred under subsection (1):

(a) ASIC must send to the court all documents that were before ASIC in connection with the hearing; and

(b) at the end of the proceedings in the court in relation to the reference, the court must cause the documents to be returned to ASIC.

SECTION 288   PROTECTION OF ASIC MEMBERS ETC.  

288(1)   [ASIC members]  

An ASIC member has, in the performance or exercise of any of his or her functions and powers as an ASIC member in relation to a hearing, the same protection and immunity as a Justice of the High Court.

288(2)   [Delegates of ASIC members]  

A delegate of an ASIC member has, in the performance or exercise of any delegated function or power in relation to a hearing, the same protection and immunity as a Justice of the High Court.

288(3)   [Lawyers and other persons]  

A lawyer or other person appearing on a person's behalf at a hearing has the same protection and immunity as a barrister has in appearing for a party in proceedings in the High Court.

288(4)   [Witnesses]  

Subject to this Act, a person who is required by a summons under section 284 to appear at a hearing, or a witness at a hearing, has the same protection as a witness in proceedings in the High Court.

PART 6-5A - PENALTIES FOR OFFENCES  

Division 1 - Introduction  

SECTION 288A  

288A   GUIDE TO THIS PART  

Division 2 - Penalty for committing an offence  

SECTION 288B  

288B   PENALTY FOR COMMITTING AN OFFENCE  

A person who commits an offence against this Act is punishable on conviction by a penalty not exceeding the penalty applicable to the offence.

SECTION 288C   PENALTY APPLICABLE TO AN OFFENCE COMMITTED BY AN INDIVIDUAL  

288C(1)    
The penalty applicable to an offence committed by an individual is:

(a) for an offence for which a fine is the only penalty specified - the fine specified; and

(b) for an offence for which a term of imprisonment is the only penalty specified - either the term of imprisonment, the fine worked out under this section, or both.

288C(2)    
If:

(a) a term of imprisonment is the only penalty specified for an offence; and

(b) the term of imprisonment is less than 10 years;

the fine mentioned in paragraph (1)(b) is the number of penalty units worked out using the individual fine formula.

288C(3)    
The individual fine formula is:

Term of imprisonment, expressed in months

×

10

288C(4)    
If:

(a) a term of imprisonment is the only penalty specified for the offence; and

(b) the term of imprisonment is 10 years or more;

the fine mentioned in paragraph (1)(b) is the greater of:

(c) 4,500 penalty units; and

(d) if the court can determine the benefit derived and detriment avoided because of the offence - that amount multiplied by 3.

Note:

See section 14 in relation to contraventions by partners in a partnership and section 15 in relation to contraventions by multiple trustees.

288C(5)    
This section applies in relation to an offence committed by an individual unless there is a contrary intention under this Act in relation to the penalty applicable to the offence. In that case, the penalty applicable is the penalty specified for the offence.

SECTION 288D   PENALTY APPLICABLE TO AN OFFENCE COMMITTED BY A BODY CORPORATE  

288D(1)    
The penalty applicable to an offence committed by a body corporate is:

(a) for an offence for which a fine is the only penalty specified - the fine specified multiplied by 10; and

(b) for an offence for which a term of imprisonment is the only penalty specified - the fine worked out under this section.

288D(2)    
If:

(a) a term of imprisonment is the only penalty specified for an offence; and

(b) the term of imprisonment is less than 10 years;

the fine mentioned in paragraph (1)(b) is the number of penalty units worked out using the individual fine formula, multiplied by 10.

288D(3)    
If:

(a) a term of imprisonment is the only penalty specified for an offence; and

(b) the term of imprisonment is 10 years or more;

the fine mentioned in paragraph (1)(b) is the greatest of:

(c) 45,000 penalty units; and

(d) if the court can determine the benefit derived and detriment avoided because of the offence - that amount multiplied by 3; and

(e) 10% of the annual turnover of the body corporate for the 12-month period ending at the end of the month in which the body corporate committed, or began committing, the offence.

288D(4)    
This section applies in relation to an offence committed by a body corporate unless there is a contrary intention under this Act in relation to the penalty applicable to the offence. In that case, the penalty applicable is the penalty specified for the offence.

SECTION 288E  

288E   MEANING OF BENEFIT DERIVED AND DETRIMENT AVOIDED BECAUSE OF AN OFFENCE  

The benefit derived and detriment avoided because of an offence is the sum of:

(a) the total value of all benefits obtained by one or more persons that are reasonably attributable to the commission of the offence; and

(b) the total value of all detriments avoided by one or more persons that are reasonably attributable to the commission of the offence.

SECTION 288F   WHERE IS THE PENALTY FOR AN OFFENCE SPECIFIED?  

288F(1)    
The penalty specified for an offence is the penalty, pecuniary or otherwise, specified in any provision of this Act for the offence.

288F(2)    
To avoid doubt, a penalty is not specified for an offence if it is a consequence for committing the offence that is not a punishment on conviction for the offence.

288F(3)    
Without limiting subsection (2), each of the following is a consequence for committing an offence that is not a punishment on conviction for the offence:

(a) the availability of a pecuniary penalty order for the contravention of a civil penalty provision that relates to the same conduct as that which gave rise to the offence;

(b) the availability of an infringement notice in relation to an alleged commission of the offence;

(c) the availability of administrative consequences as a result of the commission of the offence, such as:

(i) disqualification from any office; or

(ii) consequences in relation to a licence; or

(iii) other actions that may be taken by ASIC under this Act or any other Act;

(d) the availability under any law of the Commonwealth or of a State or Territory (including the general law) of an order to refund money, pay compensation, relinquish a benefit or make any other payment if the offence is committed;

(e) the availability under any law of the Commonwealth or of a State or Territory (including the general law) of an injunction or any other order directing a person to take, or refrain from taking, action if the offence is committed.

SECTION 288G  

288G   IF NO PENALTY IS SPECIFIED  

If no penalty is specified for an offence:

(a) the offence is an offence of strict liability; and

(b) 20 penalty units is taken to be the penalty specified for the offence.

PART 6-5B - INFRINGEMENT NOTICES  

Division 1 - Introduction  

SECTION 288H  

288H   GUIDE TO THIS PART  

Division 2 - Infringement notices  

SECTION 288J   WHEN AN INFRINGEMENT NOTICE MAY BE GIVEN  

288J(1)    
If ASIC believes on reasonable grounds that a person has contravened a provision subject to an infringement notice under this Part, ASIC may give the person an infringement notice for the alleged contravention.

288J(2)    
The infringement notice must be given within 12 months after the day on which the contravention is alleged to have taken place.

288J(3)    
A single infringement notice must relate only to a single contravention of a single provision unless subsection (4) applies.

288J(4)    
ASIC may give a person a single infringement notice relating to multiple contraventions of a single provision if:

(a) the provision requires the person to do a thing within a particular period or before a particular time; and

(b) the person fails or refuses to do that thing within that period or before that time; and

(c) the failure or refusal occurs on more than 1 day; and

(d) each contravention is constituted by the failure or refusal on one of those days.

288J(5)    
If an alleged contravention would, if proved, constitute both a contravention of a civil penalty provision and of an offence provision, the infringement notice must relate to the alleged contravention of the offence provision.

SECTION 288K   PROVISIONS SUBJECT TO AN INFRINGEMENT NOTICE  

288K(1)    
The following provisions are subject to an infringement notice under this Part:

(a)    strict liability offences against this Act;

(b)    other prescribed offences against this Act;

(c)    prescribed civil penalty provisions;

(ca)    

civil penalty provisions of an approved code of conduct;

(cb)    

civil penalty provisions of a mandatory code of conduct;

(d)    prescribed provisions of the National Credit Code containing key requirements (as defined for the purposes of the National Credit Code).

288K(2)    
This Part applies in relation to a provision prescribed under paragraph (1)(d) in the same way as it applies in relation to a civil penalty provision.

SECTION 288L   MATTERS TO BE INCLUDED IN AN INFRINGEMENT NOTICE  

288L(1)    
An infringement notice must:

(a)    be identified by a unique number; and

(b)    state the day on which it is given; and

(c)    state the name of the person to whom the notice is given; and

(d)    state the name and contact details of the person who gave the notice; and

(e)    give brief details of the alleged contravention, or each alleged contravention, to which the notice relates, including:

(i) the provision that was allegedly contravened; and

(ii) the maximum penalty that a court could impose for each contravention, if the provision were contravened; and

(iii) the time (if known) and day of, and the place of, each alleged contravention; and

(f)    state the amount that is payable under the notice; and

(g)    give an explanation of how payment of the amount is to be made; and

(h)    

state that the payment period for the notice will be 28 days, beginning on the day after the notice is given, unless the period is extended, an arrangement is made for payment by instalments or the notice is withdrawn; and

(i)    state that, if the person to whom the notice is given pays the amount within the payment period, then (unless the notice is withdrawn):

(i) if the alleged contravention is of an offence provision and would not also constitute a contravention of a civil penalty provision - the person will not be liable to be prosecuted in a court for the alleged contravention; or

(ii) if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision - the person is not liable to be prosecuted in a court, and proceedings seeking a pecuniary penalty order will not be brought, in relation to the alleged contravention; or

(iii) if the alleged contravention is of a civil penalty provision - proceedings seeking a pecuniary penalty order will not be brought in relation to the alleged contravention; and

(j)    state that payment of the amount is not an admission of guilt or liability; and

(k)    state that the person may apply to ASIC to have the period in which to pay the amount extended or for an arrangement to pay the amount by instalments; and

(l)    state that the person may choose not to pay the amount and, if the person does so:

(i) if the alleged contravention is of an offence provision and would not also constitute a contravention of a civil penalty provision - the person may be prosecuted in a court for the alleged contravention; or

(ii) if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision - the person may be prosecuted in a court, or proceedings seeking a pecuniary penalty order may be brought, in relation to the alleged contravention; or

(iii) if the alleged contravention is of a civil penalty provision - proceedings seeking a pecuniary penalty order may be brought in relation to the alleged contravention; and

(m)    set out how the notice can be withdrawn; and

(n)    state that if the notice is withdrawn:

(i) if the alleged contravention is of an offence provision and would not also constitute a contravention of a civil penalty provision - the person may be prosecuted in a court for the alleged contravention; or

(ii) if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision - the person may be prosecuted in a court, or proceedings seeking a pecuniary penalty order may be brought, in relation to the alleged contravention; or

(iii) if the alleged contravention is of a civil penalty provision - proceedings seeking a pecuniary penalty order may be brought in relation to the alleged contravention; and

(o)    state that the person may make written representations to ASIC seeking the withdrawal of the notice.

288L(2)    
The amount to be stated in the notice for the purposes of paragraph (1)(f) is:

(a)    for a single contravention of an offence provision - one-fifth of the maximum penalty that a court could impose on the person for the contravention; and

(b)    for multiple contraventions of an offence provision - the amount worked out under paragraph (a) for a single contravention multiplied by the number of contraventions; and

(c)    for a single contravention of a civil penalty provision - 50 penalty units for an individual and 250 penalty units for a body corporate; and

(d)    for multiple contraventions of a civil penalty provision - the amount worked out under paragraph (c) for a single contravention multiplied by the number of contraventions.

SECTION 288M   PAYMENT PERIOD  

Usual payment period

288M(1)    
The payment period for an infringement notice begins on the day after the notice is given and, unless otherwise specified in this section, continues for 28 days.

Payment period extended under section 288N

288M(2)    
If, under section 288N, ASIC extends the payment period for the notice, the payment period is as extended.

288M(3)    

If ASIC refuses an application under subsection 288N(1) for an extension of the payment period for the notice, the payment period ends on the latest of the following days:

(a)    the last day of the period that, without the extension that has been refused, would be the payment period for the notice;

(b)    the day that is 7 days after the day the applicant was given notice of ASIC's decision not to extend;

(c)    the day that is 7 days after the day the application is taken to have been refused under subsection 288N(4).

Instalments

288M(4)    
If, under section 288P, ASIC makes an arrangement for the amount payable under the notice to be paid by instalments, the payment period ends on the earlier of the following days:

(a)    the last day on which an instalment is to be paid under the arrangement;

(b)    if the person fails to pay an instalment in accordance with the arrangement, the last day on which the missed instalment was to be paid.

288M(5)    

If ASIC refuses an application made under subsection 288P(1) to make an arrangement for the amount payable under the notice to be paid by instalments, the payment period ends on the latest of the following days:

(a)    the last day of the period that, without the instalment arrangement, would be the payment period for the notice;

(b)    the day that is 7 days after the day the applicant was given notice of ASIC's decision not to make the arrangement;

(c)    the day that is 7 days after the day the application is taken to have been refused under subsection 288P(4).

Payment period if ASIC refuses to withdraw infringement notice

288M(6)    

If ASIC refuses a representation made under subsection 288Q(1) for the notice to be withdrawn, the payment period ends on the latest of the following days:

(a)    the last day of the period that, without the withdrawal, would be the payment period for the notice;

(b)    the day that is 7 days after the day the person was given notice of ASIC's decision not to withdraw the notice;

(c)    the day that is 7 days after the day on which, under subsection 288Q(5), ASIC is taken to have refused to withdraw the infringement notice.

SECTION 288N   EXTENSION OF TIME TO PAY AMOUNT  

288N(1)    
A person to whom an infringement notice has been given may, during the payment period for the notice, apply to ASIC for an extension of the payment period for the notice.

288N(2)    
ASIC may, in writing, extend the payment period for an infringement notice:

(a) if a person makes an application in accordance with subsection (1); or

(b) on ASIC's own initiative.

ASIC may do so before or after the end of the payment period.

288N(3)    
ASIC must do each of the following within 14 days after an application in accordance with subsection (1) is made:

(a) grant or refuse to grant an extension of the payment period for the infringement notice;

(b) give the applicant notice in writing of ASIC's decision.

288N(4)    
If ASIC does not comply with subsection (3):

(a) ASIC is taken to have refused to grant an extension of the payment period for the infringement notice; and

(b) the refusal is taken to have occurred on the last day of the 14 day period.

288N(5)    
ASIC may extend the payment period more than once under subsection (2).

SECTION 288P   PAYMENT BY INSTALMENTS  

288P(1)    
A person to whom an infringement notice has been given may, within 28 days after the infringement notice is given, apply to ASIC to make an arrangement to pay the amount payable under the infringement notice by instalments.

288P(2)    
ASIC may, in writing, make an arrangement for a person to pay the amount payable under an infringement notice by instalments:

(a) if a person makes an application in accordance with subsection (1); or

(b) on ASIC's own initiative.

ASIC may do so before or after the end of the payment period.

288P(3)    
ASIC must do each of the following within 14 days after an application in accordance with subsection (1) is made:

(a) decide to make, or refuse to make, an arrangement for the applicant to pay the amount payable under the infringement notice by instalments;

(b) give the applicant notice in writing of ASIC's decision;

(c) if ASIC decides to make the arrangement, specify in the notice:

(i) the day by which each instalment is to be paid; and

(ii) the amount of each instalment.

288P(4)    
If ASIC does not comply with subsection (3):

(a) ASIC is taken to have refused to make an arrangement for the applicant to pay the amount payable under the infringement notice by instalments; and

(b) the refusal is taken to have occurred on the last day of the 14 day period.

288P(5)    
ASIC may vary an arrangement for a person to pay the amount payable under an infringement notice by instalments.

288P(6)    
If:

(a) a person does not pay all of the instalments in accordance with an arrangement made under this section; and

(b) the person is prosecuted, or proceedings seeking a pecuniary penalty order are brought, for the alleged contravention;

ASIC must refund to the person the amount of any instalments paid.

SECTION 288Q   WITHDRAWAL OF AN INFRINGEMENT NOTICE  

Representations seeking withdrawal of notice

288Q(1)    
A person to whom an infringement notice has been given may, within 28 days after the infringement notice is given, make written representations to ASIC seeking the withdrawal of the notice.

Withdrawal of notice

288Q(2)    
ASIC may withdraw an infringement notice given to a person:

(a) if the person makes representations to ASIC in accordance with subsection (1); or

(b) on ASIC's own initiative.

ASIC may do so before or after the end of the payment period.

288Q(3)    
ASIC must, within 14 days after a representation is made in accordance with subsection (1):

(a) decide to withdraw, or refuse to withdraw, the infringement notice; and

(b) if ASIC decides to withdraw the notice - give the person to whom the notice was issued a withdrawal notice in accordance with subsection (6); and

(c) if ASIC decides to refuse to withdraw the notice - give the applicant notice of that fact.

288Q(4)    
When deciding whether to withdraw, or refuse to withdraw, an infringement notice, ASIC:

(a) must take into account any written representations seeking the withdrawal that were given by the person to ASIC; and

(b) may take into account the following:

(i) whether a court has previously imposed a penalty on the person for a contravention of a provision of this Act;

(ii) the circumstances of the alleged contravention;

(iii) whether the person has paid an amount, stated in an earlier infringement notice, for a contravention of a provision of this Act;

(iv) any other matter ASIC considers relevant.

288Q(5)    
If ASIC does not comply with subsection (3):

(a) ASIC is taken to have refused to withdraw the infringement notice; and

(b) the refusal is taken to have occurred on the last day of the 14 day period.

Notice of withdrawal

288Q(6)    
The withdrawal notice must state:

(a) the person's name and address; and

(b) the day the infringement notice was given; and

(c) the identifying number of the infringement notice; and

(d) that the infringement notice is withdrawn; and

(e) that:

(i) if the alleged contravention is of an offence provision and would not also constitute a contravention of a civil penalty provision - the person may be prosecuted in a court for the alleged contravention; or

(ii) if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision - the person may be prosecuted in a court, or proceedings seeking a pecuniary penalty order may be brought, in relation to the alleged contravention; or

(iii) if the alleged contravention is of a civil penalty provision - proceedings seeking a pecuniary penalty order may be brought in relation to the alleged contravention.

Refund of amount if infringement notice withdrawn

288Q(7)    
If:

(a) ASIC withdraws the infringement notice; and

(b) the person has already paid all or part of the amount stated in the notice;

ASIC must refund to the person an amount equal to the amount paid.

SECTION 288R   EFFECT OF PAYMENT OF AMOUNT  

288R(1)    
If the person to whom an infringement notice for an alleged contravention of a provision is given pays the amount stated in the notice before the end of the payment period for the notice:

(a) any liability of the person for the alleged contravention is discharged; and

(b) if the alleged contravention is of an offence provision and would not also constitute a contravention of a civil penalty provision - the person may not be prosecuted in a court for the alleged contravention; and

(c) if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision - the person may not be prosecuted in a court, and proceedings seeking a pecuniary penalty order may not be brought, in relation to the alleged contravention; and

(d) if the alleged contravention is of a civil penalty provision - proceedings seeking a pecuniary penalty order may not be brought in relation to the alleged contravention; and

(e) the person is not regarded as having admitted guilt or liability for the alleged contravention; and

(f) if the provision is an offence provision - the person is not regarded as having been convicted of the alleged offence.

288R(2)    
Subsection (1) does not apply if the notice has been withdrawn.

SECTION 288S  

288S   EFFECT OF THIS PART  

This Part does not:

(a) require an infringement notice to be given to a person for an alleged contravention of a provision subject to an infringement notice under this Part; or

(b) affect the liability of a person for an alleged contravention of a provision subject to an infringement notice under this Part if:

(i) the person does not comply with an infringement notice given to the person for the contravention; or

(ii) an infringement notice is not given to the person for the contravention; or

(iii) an infringement notice is given to the person for the contravention and is subsequently withdrawn; or

(c) prevent the giving of 2 or more infringement notices to a person for an alleged contravention of a provision subject to an infringement notice under this Part; or

(d) limit a court's discretion to determine the amount of a penalty to be imposed on a person who is found to have contravened a provision subject to an infringement notice under this Part.

PART 6-6 - OFFENCES UNDER THIS CHAPTER  

Division 1 - Introduction  

SECTION 289  

289   GUIDE TO THIS PART  

Division 2 - Offences  

SECTION 290   CONTRAVENTIONS OF REQUIREMENTS MADE UNDER THIS CHAPTER  

290(1)    

A person must not intentionally or recklessly refuse or fail to comply with a requirement made under:

(a) section 253; or

(b) subsection 255(4); or

(c) section 265, 266, 267 or 268; or

(d) subsection 271(9); or

(e) section 272.

Criminal penalty: 2 years imprisonment.

290(2)    

A person must not refuse or fail to comply with a requirement made under subsection 255(1) or 264(2), paragraph 258(2)(a) or subsection 274(4), 284(1), (2) or (4).

Criminal penalty: 30 penalty units.

290(3)    

A person must comply with a requirement made under subsection 257(2).

Criminal penalty: 20 penalty units.

290(4)    
Subsections (1) and (2) do not apply to the extent that the person has a reasonable excuse.

Note:

A defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).

290(5)    
Paragraph (1)(d) does not apply to the extent that the person has explained the matter to the best of his or her knowledge or belief.

Note:

A defendant bears an evidential burden in relation to the matter in subsection (5) (see subsection 13.3(3) of the Criminal Code).

290(6)    
Paragraph (1)(e) does not apply to the extent that the person has stated the matter to the best of his or her knowledge or belief.

Note:

A defendant bears an evidential burden in relation to the matter in subsection (6) (see subsection 13.3(3) of the Criminal Code).

SECTION 291   FALSE INFORMATION  

291(1)    

A person must not:

(a) in purported compliance with a requirement made under this Chapter; or

(b) in the course of an examination of the person;

give information, or make a statement, that is false or misleading in a material particular.

Criminal penalty: 5 years imprisonment.

291(2)    

A person must not, at a hearing, give evidence that is false or misleading in a material particular.

Criminal penalty: 2 years imprisonment.

291(3)    
It is a defence to a prosecution for a contravention of subsection (1) or (2) if it is proved that the defendant, when giving the information or evidence or making the statement, believed on reasonable grounds that it was true and not misleading.

Note:

A defendant bears a legal burden in relation to the matter in subsection (3) (see section 13.4 of the Criminal Code).

SECTION 292  

292   OBSTRUCTING PERSON EXECUTING A WARRANT UNDER THIS CHAPTER  
(Repealed by No 3 of 2020)

SECTION 293   DISRUPTING HEARINGS  

293(1)    

A person must not engage in conduct that results in the disruption of a hearing.

Criminal penalty: 1 year imprisonment.

293(2)    

A person must not contravene a direction given under subsection 281(1).

Criminal penalty: 120 penalty units.

293(3)    
Subsection (2) does not apply to the extent that the person has a reasonable excuse.

Note:

A defendant bears an evidential burden in relation to the matter in subsection (3) (see subsection 13.3(3) of the Criminal Code).

293(4)    
Subsection (2) is an offence of strict liability.

Note:

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

293(5)    
An offence constituted by a contravention of subsection (1) or (2) is punishable on summary conviction.

SECTION 294   CONCEALING BOOKS RELEVANT TO INVESTIGATION  

294(1)    

If ASIC is investigating, or is about to investigate, a matter, a person must not:

(a) in any case - engage in conduct that results in the concealment, destruction, mutilation or alteration of a book relating to that matter; or

(b) if a book relating to that matter is in a particular State or Territory - engage in conduct that results in the taking or sending of the book out of that State or Territory or out of Australia.

Criminal penalty: 5 years imprisonment.

294(2)    
It is a defence to a prosecution for a contravention of subsection (1) if it is proved that the defendant intended neither to defeat the purposes of the Commonwealth credit legislation, nor to delay or obstruct an investigation, or a proposed investigation, by ASIC.

Note:

A defendant bears a legal burden in relation to a matter referred to in subsection (2) (see section 13.4 of the Criminal Code).

SECTION 295   SELF-INCRIMINATION  

295(1)   [Not reasonable excuse]  

For the purposes of this Chapter, it is not a reasonable excuse for a person to refuse or fail:

(a) to give information; or

(b) to sign a record; or

(c) to produce a book;

in accordance with a requirement made of the person, that the information, signing the record or production of the book, as the case may be, might tend to incriminate the person or make the person liable to a penalty.

295(2)   [Application of subsection (3)]  

Subsection (3) applies if:

(a) before:

(i) making an oral statement giving information; or

(ii) signing a record;

pursuant to a requirement made under this Chapter, a person (other than a body corporate) claims that the statement, or signing the record, as the case may be, might tend to incriminate the person or make the person liable to a penalty; and

(b) the statement, or signing the record, as the case may be, might in fact tend to incriminate the person or make the person so liable.

295(3)   [Evidence]  

The statement, or the fact that the person has signed the record, as the case may be, is not admissible in evidence against the person in:

(a) criminal proceedings; or

(b) proceedings for the imposition of a penalty;

other than proceedings in relation to:

(c) in the case of the making of a statement - the falsity of the statement; or

(d) in the case of the signing of a record - the falsity of any statement contained in the record.

SECTION 296   LEGAL PROFESSIONAL PRIVILEGE  

296(1)    
This section applies if:

(a) under this Chapter, a person requires a lawyer:

(i) to give information; or

(ii) to produce a book; and

(b) giving the information would involve disclosing, or the book contains, as the case may be, a privileged communication made by, on behalf of or to the lawyer in his or her capacity as a lawyer.

296(2)    
The lawyer is entitled to refuse to comply with the requirement unless:

(a) if the person to whom, or by or on behalf of whom, the communication was made is a body corporate that is being wound up - the liquidator (within the meaning of section 9 of the Corporations Act 2001) of the body; or

(b) otherwise - the person to whom, or by or on behalf of whom, the communication was made;

consents to the lawyer complying with the requirement.

296(3)    

If the lawyer so refuses, he or she must, as soon as practicable, give to the person who made the requirement a written notice setting out:

(a) if the lawyer knows the name and address of the person to whom, or by or on behalf of whom, the communication was made - that name and address; and

(b) if subparagraph (1)(a)(i) applies and the communication was made in writing - sufficient particulars to identify the document containing the communication; and

(c) if subparagraph (1)(a)(ii) applies - sufficient particulars to identify the book, or the part of the book, containing the communication.

Criminal penalty: 3 months imprisonment.

SECTION 297   POWERS OF COURT RELATING TO CONTRAVENTIONS OF THIS CHAPTER  

297(1)   [Application of section]  

This section applies if ASIC is satisfied that a person has, without reasonable excuse, refused or failed to comply with a requirement made under this Chapter, other than Part 6-7 (which deals with ASIC's powers in relation to non-compliance with this Chapter).

297(2)   [Certification of refusal or failure]  

ASIC may by writing certify the refusal or failure to the court.

297(3)   [Court powers]  

If ASIC does so, the court may inquire into the case and may order the person to comply with the requirement as specified in the order.

PART 6-7 - ASIC'S POWERS IN RELATION TO CONTRAVENTIONS OF THIS CHAPTER  

Division 1 - Introduction  

SECTION 298  

298   GUIDE TO THIS PART  

Division 2 - ASIC's powers in relation to contraventions of this Chapter  

SECTION 299  

299   APPLICATION OF THIS PART  
This Part applies if, in ASIC's opinion, information about a credit contract, mortgage, guarantee or consumer lease needs to be found out for the purposes of the exercise of any of ASIC's powers under this Chapter but cannot be found out because a person has refused or failed to comply with a requirement made under this Chapter.

SECTION 300   ORDERS BY ASIC RELATING TO CREDIT CONTRACTS, MORTGAGES, GUARANTEES OR CONSUMER LEASES  

300(1)   [ASIC powers]  

ASIC may make one or more of the following:

(a) an order restraining a specified person from assigning any interest in a credit contact, mortgage, guarantee or consumer lease;

(b) an order restraining a specified person from acquiring any interest in a credit contact, mortgage, guarantee or consumer lease;

(c) an order restraining the exercise of rights under a credit contract, mortgage, guarantee or consumer lease;

(d) an order directing a:

(i) credit provider under a credit contract; or

(ii) mortgagee under a mortgage; or

(iii) beneficiary of a guarantee under a guarantee; or

(iv) lessor under a consumer lease;

in relation to which an order under this section is in force to give written notice of that order to any person whom the credit provider, mortgagee, beneficiary or lessor knows to be entitled to exercise a right in relation to the credit contract, mortgage, guarantee or consumer lease.

300(2)   [Strict liability]  

An offence under subsection 301(4) relating to subsection (1) of this section is an offence of strict liability.

Note:

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

300(3)   [Not a legislative instrument]  

An order made under subsection (1) is not a legislative instrument.

SECTION 301   ORDERS UNDER THIS PART  

301(1)    
ASIC may make an order varying or revoking an order in force under this Part.

301(2)    
An order under this Part must be made by notice published in the Gazette or on ASIC's website.

301(3)    
If an order is made under this Part (other than subsection (1)), ASIC must cause to be given to the person to whom the order is directed:

(a) a copy of the order; and

(b) a copy of each order varying or revoking it.

301(4)    

A person must comply with an order in force under this Part.

Criminal penalty: 60 penalty units.

PART 6-7A - PRODUCT INTERVENTION ORDERS  

Division 1 - Introduction  

SECTION 301A   GUIDE TO THIS PART  

Division 2 - Product intervention orders  

SECTION 301B  

301B   DEFINITIONS  

In this Part:

credit product
has the meaning given by paragraph 301D(1)(a).

product intervention order
means an order made under subsection 301D(1) or (3).

SECTION 301C   APPLICATION OF PRODUCT INTERVENTION ORDERS  

301C(1)    
A product intervention order does not apply to a credit product entered into by a person if the person entered into the product before the order comes into force.

301C(2)    
A product intervention order does not apply to a person:

(a) in the person's capacity as a consumer; or

(b) who is in a class of persons specified in regulations made for the purposes of this paragraph.

301C(3)    
The regulations may provide that this Part does not apply to a credit product specified in the regulations.

Note:

In a prosecution for an offence, the defendant bears an evidential burden in relation to the matters in this section (see subsection 13.3(3) of the Criminal Code).

SECTION 301D   ASIC MAY MAKE PRODUCT INTERVENTION ORDERS  

Making product intervention orders

301D(1)    
Subject to subsection (5), if ASIC is satisfied that:

(a)    a person is engaging, or is likely to engage, in credit activity in relation to a credit contract, mortgage, guarantee or consumer lease ( credit product ) or a proposed credit product; and

(b)    the credit product has resulted in, or will or is likely to result in, significant detriment to consumers;

ASIC may, in accordance with this Part, order that a specified person must not engage in specified conduct in relation to the product, either entirely or except in accordance with conditions specified in the order.

Note 1:

Section 301E specifies matters to be taken into account in considering whether a credit product has resulted in, or will or is likely to result in, significant detriment to consumers.

Note 2:

Section 301N also provides that product intervention orders may include requirements for notifying consumers.

301D(2)    
An order under subsection (1) is not a legislative instrument.

301D(3)    
Subject to subsection (5), if ASIC is satisfied that:

(a)    a person is engaging, or is likely to engage, in credit activity in relation to a class of credit products or proposed credit products; and

(b)    the class of products has resulted in, or will or is likely to result in, significant detriment to consumers;

ASIC may, in accordance with this Part and by legislative instrument, order that a person must not engage in specified conduct in relation to the class of products and consumers, either entirely or except in accordance with conditions specified in the order.

Note 1:

Section 301E specifies matters to be taken into account in considering whether a credit product has resulted in, or will or is likely to result in, significant detriment to consumers.

Note 2:

Section 301N also provides that product intervention orders may include requirements for notifying consumers.

Restrictions on product intervention orders

301D(4)    
A product intervention order must not specify any of the following for subsection (1) or (3):

(a)    a condition that a person satisfy a standard of training, or meet a professional standard, other than a standard prescribed for the person by or under this Act;

(b)    a condition that a person who is not required to hold an Australian credit licence become a member of an external dispute resolution scheme;

(c)    

a condition related to a person's remuneration, other than a condition related to:

(i) so much of the person's remuneration as is conditional on the achievement of objectives directly related to the credit product; or

(ii) a fee, charge or other consideration paid or payable to the person by a consumer.

301D(5)    
Conduct covered by a product intervention order must be limited to conduct in relation to a consumer.

SECTION 301E   SIGNIFICANT DETRIMENT TO CONSUMERS  

301E(1)    
In considering whether a credit product has resulted in, or will or is likely to result in, significant detriment to consumers for the purposes of this Part, the following must be taken into account:

(a) the nature and extent of the detriment;

(b) without limiting paragraph (a), the actual or potential financial loss to consumers resulting from the product;

(c) the impact that the detriment has had, or will or is likely to have, on consumers;

(d) any other matter prescribed by regulations made for the purposes of this paragraph.

301E(2)    
Subsection (1) does not limit the matters to be taken into account in considering whether a credit product has resulted in, or will or is likely to result in, significant detriment to consumers for the purposes of this Part.

301E(3)    
A credit product may result in significant detriment to consumers even if a person has complied with the disclosure requirements in the National Credit Code in relation to the product.

SECTION 301F   ASIC TO CONSULT BEFORE MAKING PRODUCT INTERVENTION ORDERS  

301F(1)    
ASIC must not make a product intervention order unless ASIC has:

(a) consulted persons who are reasonably likely to be affected by the proposed order; and

(b) if the proposed order will apply to a body that is regulated by APRA - consulted APRA; and

(c) complied with any other requirements as to consultation prescribed by regulations made for the purposes of this paragraph.

301F(2)    
Without limiting paragraph (1)(a), ASIC is taken to comply with that paragraph if ASIC, on its website:

(a) makes the proposed order, or a description of the content of the proposed order, available; and

(b) invites the public to comment on the proposed order.

301F(3)    
A failure to comply with subsection (1) does not invalidate a product intervention order.

301F(4)    
Section 17 of the Legislation Act 2003 (rule-makers should consult before making legislative instruments) does not apply to the making of a product intervention order.

SECTION 301G   COMMENCEMENT AND DURATION OF PRODUCT INTERVENTION ORDERS  

Commencement of product intervention orders

301G(1)    
A product intervention order comes into force:

(a) for an order that is a legislative instrument - on the day after the instrument is registered under the Legislation Act 2003; or

(b) otherwise - on the day after the notice under subsection 301L(3) in relation to the order is published;

or a later day specified in the order.

Duration of product intervention orders

301G(2)    
A product intervention order remains in force for:

(a) 18 months, or any shorter period specified by the regulations; or

(b) any shorter period specified in the order.

However, if a court makes an order staying or otherwise affecting the operation or enforcement of a product intervention order, then, in determining when the period referred to in paragraph (a) or (b) ends, disregard the period during which the court's order has that effect.

301G(3)    
Subsection (2) does not apply to a product intervention order if a declaration under section 301H (which relates to extensions of product intervention orders) is in force in relation to the order.

301G(4)    
Subsection (2) does not prevent the revocation of a product intervention order.

Repeal of product intervention orders

301G(5)    
A product intervention order that is a legislative instrument that ceases to be in force is repealed by force of this subsection.

SECTION 301H   EXTENSION OF PRODUCT INTERVENTION ORDERS  

301H(1)    
ASIC may, in accordance with an approval under subsection (4), by legislative instrument, declare that a product intervention order that is in force:

(a) remains in force until it is revoked; or

(b) remains in force for a specified period, unless it is revoked earlier.

Note:

A declaration under this subsection has the effect of overriding any provisions in a product intervention order about the duration of the order: see subsection 301G(3).

301H(2)    
ASIC may make more than one declaration under subsection (1) in relation to a product intervention order that is in force.

Approval of Minister

301H(3)    
ASIC may, at any time before the order ceases to be in force, give the Minister a report on whether the declaration should be made.

301H(4)    
After considering the report, the Minister may give an approval in writing for the purposes of subsection (1).

SECTION 301J   AMENDMENT OF PRODUCT INTERVENTION ORDERS  

301J(1)    
Subject to this section, ASIC may, in writing, amend a product intervention order that is in force.

Requirements before amending product intervention orders

301J(2)    
If a declaration under section 301H is in force in relation to a product intervention order, ASIC must not amend the order without the Minister's approval, given after considering a report from ASIC on whether the amendment should be made.

301J(3)    
ASIC may, at any time before the order ceases to be in force, give the Minister a report on whether the amendment should be made.

Amendments of product intervention orders

301J(4)    
An amendment of a product intervention order must not be such that the order remains in force for a period longer than the maximum period determined for the order in accordance with subsection 301G(2) or 301H(1).

301J(5)    
An amendment of a product intervention order comes into force:

(a) for an amendment of an order that is a legislative instrument - on the day after the amendment is registered under the Legislation Act 2003; or

(b) otherwise - on the day after the day on which the notice under subsection 301L(6) in relation to the amendment is published;

or a later day specified in the amendment.

Amendments of orders that are legislative instruments

301J(6)    
An amendment of a product intervention order that is a legislative instrument must be by legislative instrument.

SECTION 301K   REVOCATION OF PRODUCT INTERVENTION ORDERS  

301K(1)    
Subject to this section, ASIC may, in writing, revoke a product intervention order.

Requirements for revocation of product intervention orders

301K(2)    
If a declaration under section 301H is in force in relation to a product intervention order, ASIC must not revoke the order without the Minister's approval, given after considering a report from ASIC on whether the order should be revoked.

301K(3)    
ASIC may, at any time before the order ceases to be in force, give the Minister a report on whether the order should be revoked.

Revocation of orders that are legislative instruments

301K(4)    
A revocation of a product intervention order that is a legislative instrument must be by legislative instrument.

SECTION 301L   ASIC TO ISSUE PUBLIC NOTICE OF PRODUCT INTERVENTION ORDERS  

Product intervention orders

301L(1)    
ASIC must serve a copy of a product intervention order that is not a legislative instrument on any person to whom ASIC considers the order applies. Failure to comply with this subsection does not invalidate the order.

301L(2)    
ASIC must publish each product intervention order, as in force for the time being, on its website.

Note:

The Legislation Act 2003 requires legislative instruments to be registered on the Federal Register of Legislation and provides for compilations of legislative instruments.

301L(3)    
ASIC must also publish on its website, with the product intervention order, a notice that:

(a) describes the significant detriment to consumers that has resulted from, or will or is likely to result from, the credit product or class of credit products to which the order relates, and sets out why the order is an appropriate way of reducing the detriment; and

(b) describes the consultation that ASIC undertook in relation to the order; and

(c) if the order comes into force after it is published - specifies the day it comes into force.

301L(4)    
ASIC must publish on its website, with the product intervention order, each declaration under section 301H (which relates to extensions of product intervention orders) that relates to the order.

Amendments of product intervention orders

301L(5)    
ASIC must serve a copy of the instrument amending a product intervention order that is not a legislative instrument on any person to whom ASIC considers the order applies. Failure to comply with this subsection does not invalidate the order.

301L(6)    
ASIC must publish on its website, with the product intervention order, each amendment of the product intervention order.

301L(7)    
ASIC must also publish on its website, with the amendment, a notice that:

(a) sets out why the amendment is appropriate; and

(b) describes the consultation that ASIC undertook in relation to the amendment; and

(c) if the day the amendment is to take effect is later than the day after the day of publication of the amendment - specifies the day the amendment is to take effect.

Revocation of product intervention orders

301L(8)    
If a product intervention order is revoked, ASIC must publish notice of the revocation on its website.

SECTION 301M  

301M   REMAKING PRODUCT INTERVENTION ORDERS  

If a product intervention order ceases to be in force or is revoked, ASIC must not remake the order, or make an order in substantially the same terms, unless:

(a) ASIC is satisfied the circumstances have materially changed since the order was made; or

(b) the Minister approves, in writing, the remaking or making of the order.

SECTION 301N  

301N   PRODUCT INTERVENTION ORDERS MAY REQUIRE NOTIFICATION  

A product intervention order in relation to a credit product may:

(a) require that a specified person who has engaged in a credit activity in relation to the product in respect of a consumer take reasonable steps to notify the consumer:

(i) of the terms of the order; and

(ii) of any other matter specified in regulations made for the purposes of this subparagraph; and

(b) specify requirements in relation to giving those notifications (including requirements as to the periods within which to give those notifications).

SECTION 301P   ENFORCEMENT OF PRODUCT INTERVENTION ORDERS  

301P(1)    

A person must not engage in conduct contrary to a product intervention order that is in force in relation to the person.

Civil penalty: 5,000 penalty units.

301P(2)    

A person must not engage in conduct contrary to a product intervention order.

Criminal penalty: 5 years imprisonment.

301P(3)    

A person who is required by a product intervention order to take reasonable steps to notify a consumer must comply with the requirement.

Civil penalty: 5,000 penalty units.

Note:

For this requirement, see section 301N.

301P(4)    

A person who is required by a product intervention order to take reasonable steps to notify a consumer must comply with the requirement.

Criminal penalty: 5 years imprisonment.

Note:

For this requirement, see section 301N.

301P(5)    
Subsections (1), (2), (3) and (4) do not apply if:

(a) the product intervention order is not a legislative instrument; and

(b) the person was not aware, and could not reasonably have been aware, of the order.

301P(6)    

If a product intervention order has been served on a person, the person must take all reasonable steps to ensure that other persons who engage in conduct to which the order applies are aware of the order.

Civil penalty: 5,000 penalty units.

301P(7)    

If a product intervention order has been served on a person, the person must take all reasonable steps as soon as practicable to ensure that other persons who engage in conduct to which the order applies are aware of the order.

Criminal penalty: 5 years imprisonment.

PART 6-8 - EVIDENTIARY USE OF CERTAIN MATERIAL  

Division 1 - Introduction  

SECTION 302  

302   GUIDE TO THIS PART  

Division 2 - Evidentiary use of certain material  

SECTION 303   STATEMENTS MADE AT AN EXAMINATION: PROCEEDINGS AGAINST EXAMINEE  

303(1)   [When statements not admissible]  

A statement that a person makes at an examination of the person is admissible in evidence against the person in proceedings unless:

(a) because of subsection 295(3), the statement is not admissible in evidence against the person in the proceedings; or

(b) the statement is not relevant to the proceedings and the person objects to the admission of evidence of the statement; or

(c) the statement (the first statement ) is qualified or explained by some other statement made at the examination, evidence of the other statement is not tendered in the proceedings and the person objects to the admission of evidence of the first statement; or

(d) the statement discloses matter in relation to which the person could claim legal professional privilege in the proceedings if this subsection did not apply in relation to the statement, and the person objects to the admission of evidence of the statement.

303(2)   [Application of subsection (1)]  

Subsection (1) applies in relation to proceedings against a person even if it is heard together with proceedings against another person.

303(3)   [Written record]  

If a written record of an examination of a person is signed by the person under subsection 258(2) or authenticated in any other manner prescribed by the regulations, the record is, in proceedings, prima facie evidence of the statements it records, but nothing in this Chapter limits or affects the admissibility in the proceedings of other evidence of statements made at the examination.

SECTION 304  

304   STATEMENTS MADE AT AN EXAMINATION: OTHER PROCEEDINGS  
If direct evidence by a person (the absent witness ) of a matter would be admissible in proceedings, a statement that the absent witness made at an examination of the absent witness and that tends to establish that matter is admissible in the proceedings as evidence of that matter:

(a) if it appears to the court or tribunal that:

(i) the absent witness is dead or is unfit, because of physical or mental incapacity, to attend as a witness; or

(ii) the absent witness is outside the State or Territory in which the proceedings is being heard and it is not reasonably practicable to secure his or her attendance; or

(iii) all reasonable steps have been taken to find the absent witness but he or she cannot be found; or

(b) if it does not so appear to the court or tribunal - unless another party to the proceedings requires the party tendering evidence of the statement to call the absent witness as a witness in the proceedings and the tendering party does not so call the absent witness.

SECTION 305   WEIGHT OF EVIDENCE ADMITTED UNDER SECTION 304  

305(1)   [Application of section]  

This section applies if evidence of a statement made by a person at an examination of the person is admitted under section 304 in proceedings.

305(2)   [Assessing quality of evidence]  

In deciding how much weight (if any) to give to the statement as evidence of a matter, regard is to be had to:

(a) how long after the matters to which it related the statement was made; and

(b) any reason the person may have had for concealing or misrepresenting a material matter; and

(c) any other circumstances from which it is reasonable to draw an inference about how accurate the statement is.

305(3)   [When person not called as witness]  

If the person is not called as a witness in the proceedings:

(a) evidence that would, if the person had been so called, have been admissible in the proceedings for the purpose of destroying or supporting his or her credibility is so admissible; and

(b) evidence is admissible to show that the statement is inconsistent with another statement that the person has made at any time.

305(4)   [When evidence not admissible]  

However, evidence of a matter is not admissible under this section if, had the person been called as a witness in the proceedings and denied the matter in cross-examination, evidence of the matter would not have been admissible if adduced by the cross-examining party.

SECTION 306   OBJECTION TO ADMISSION OF STATEMENTS MADE AT EXAMINATION  

306(1)   [Written notice]  

A party (the adducing party ) to proceedings may, not less than 14 days before the first day of the hearing of the proceedings, give to another party to the proceedings written notice that the adducing party:

(a) will apply to have admitted in evidence in the proceedings specified statements made at an examination; and

(b) for that purpose, will apply to have evidence of those statements admitted in the proceedings.

306(2)   [Content of notice in subsection (1)]  

A notice under subsection (1) must set out, or be accompanied by writing that sets out, the specified statements.

306(3)   [Receiving party to give notice]  

Within 14 days after a notice is given under subsection (1), the other party may give to the adducing party a written notice:

(a) stating that the other party objects to specified statements being admitted in evidence in the proceedings; and

(b) specifies, in relation to each of those statements, the grounds of objection.

306(4)   [Extension of time]  

The period prescribed by subsection (3) may be extended by the court or tribunal or by agreement between the parties concerned.

306(5)   [Copy to be given to court or tribunal]  

On receiving a notice given under subsection (3), the adducing party must give to the court or tribunal a copy of:

(a) the notice under subsection (1) and any writing that subsection (2) required to accompany that notice; and

(b) the notice under subsection (3).

306(6)   [Court powers following compliance with subsection (5)]  

If subsection (5) is complied with, the court or tribunal may either:

(a) determine the objections as a preliminary point before the hearing of the proceedings begins; or

(b) defer determination of the objections until the hearing.

306(7)   [Conditions to making objections during proceedings]  

If a notice has been given in accordance with subsections (1) and (2), the other party is not entitled to object at the hearing of the proceedings to a statement specified in the notice being admitted in evidence in the proceedings, unless:

(a) the other party has, in accordance with subsection (3), objected to the statement being so admitted; or

(b) the court or tribunal gives the other party leave to object to the statement being so admitted.

SECTION 307   COPIES OF, OR EXTRACTS FROM, CERTAIN BOOKS  

307(1)    
A copy of, or an extract from, a book relating to:

(a) affairs of a licensee, credit representative or other person who engages, or has engaged, in a credit activity; or

(b) a matter referred to in paragraph 266(1)(d) or (e) or (2)(c) or (d);

is admissible in evidence in proceedings as if the copy were the original book, or the extract were the relevant part of the original book, as the case may be, whether or not the copy or extract was made under section 271.

307(2)    
A copy of, or an extract from, a book is not admissible in evidence under subsection (1) unless it is proved that the copy or extract is a true copy of the book, or of the relevant part of the book, as the case may be.

307(3)    
For the purposes of subsection (2), a person who has compared:

(a) a copy of a book with the book; or

(b) an extract from a book with the relevant part of the book;

may give evidence, either orally or by an affidavit or statutory declaration, that the copy or extract is a true copy of the book or relevant part, as the case may be.

SECTION 308  

308   REPORT UNDER PART 6-1  
Subject to section 309, if a copy of a report under Part 6-1 purports to be certified by ASIC as a true copy of such a report, the copy is admissible in proceedings (other than criminal proceedings) as prima facie evidence of any facts or matters that the report states ASIC to have found to exist.

SECTION 309   EXCEPTIONS TO ADMISSIBILITY OF REPORT  

309(1)   [Application of section]  

This section applies if a party to proceedings tenders a copy of a report as evidence against another party.

309(2)   [When copy of report is admissible under s 308]  

The copy is not admissible under section 308 in the proceedings as evidence against the other party unless the court or tribunal is satisfied that:

(a) a copy of the report has been given to the other party; and

(b) the other party, and the other party's lawyer, have had a reasonable opportunity to examine that copy and to take its contents into account in preparing the other party's case.

309(3)   [Application for cross-examination]  

Before or after the copy referred to in subsection (1) is admitted in evidence, the other party may apply to cross-examine, in relation to the report, a specified person who, or 2 or more specified persons each of whom:

(a) was concerned in preparing the report or making a finding about a fact or matter that the report states ASIC to have found to exist; or

(b) whether or not pursuant to a requirement made under this Part, gave information, or produced a book, on the basis of which, or on the basis of matters including which, such a finding was made.

309(4)   [Grant of application under subsection (3)]  

The court or tribunal must grant an application made under subsection (3) unless it considers that, in all the circumstances, it is not appropriate to do so.

309(5)   [When court must refuse to admit copy of report]  

If:

(a) the court or tribunal grants an application or applications made under subsection (3); and

(b) a person to whom the application or any of the applications relate, or 2 or more such persons, is or are unavailable, or does not or do not attend, to be cross-examined in relation to the report; and

(c) the court or tribunal is of the opinion that to admit the copy under section 308 in the proceedings as evidence against the other party without the other party having the opportunity so to cross-examine the person or persons would unfairly prejudice the other party;

the court or tribunal must refuse so to admit the copy, or must treat the copy as not having been so admitted, as the case requires.

SECTION 310  

310   MATERIAL OTHERWISE ADMISSIBLE  
Nothing in this Part renders evidence inadmissible in proceedings in circumstances if it would have been admissible in those proceedings if this Part had not been enacted.

PART 6-9 - MISCELLANEOUS PROVISIONS RELATING TO COMPLIANCE AND ENFORCEMENT  

Division 1 - Introduction  

SECTION 311  

311   GUIDE TO THIS PART  

Division 2 - Miscellaneous provisions relating to compliance and enforcement  

SECTION 312  

312   REQUIREMENT MADE OF A BODY CORPORATE  
If a provision of this Chapter empowers a person to make a requirement of a body corporate, the provision also empowers the person to make that requirement of a person who is or has been an officer (within the meaning of section 5 of the ASIC Act) or employee of the body.

SECTION 313   EVIDENCE OF AUTHORITY  

313(1)   [Obligation to produce]  

A person (the inspector ), other than ASIC, who is about to make, or has made, a requirement of another person under this Chapter (other than Part 6-5) must, if the other person requests evidence of the inspector's authority to make the requirement, produce to the other person:

(a) a current identity card that was issued to the inspector by ASIC and incorporates a photograph of the inspector; and

(b) if the requirement will be, or was, made under an authorisation by ASIC - a document that was issued by ASIC and sets out the effect of so much of the authorisation as is relevant to making the requirement; and

(c) otherwise - such evidence (if any) of the inspector's authority to make the requirement as ASIC determines.

313(2)   [Not a legislative instrument]  

An identity card under paragraph (1)(a) is not a legislative instrument.

SECTION 314  

314   GIVING DOCUMENTS TO NATURAL PERSONS  
Section 109X of the Corporations Act 2001 applies for the purposes of this Chapter as if a reference in subsection (2) of that section to leaving a document at an address were a reference to leaving it at that address with a person whom the person leaving the document believes on reasonable grounds:

(a) to live or work at that address; and

(b) to have attained the age of 16 years.

SECTION 315  

315   PLACE AND TIME FOR PRODUCTION OF BOOKS  
A provision of this Chapter that empowers a person to require the production of books at a place and time specified by the person is taken:

(a) to require the person to specify a place and time that are reasonable in all the circumstances; and

(b) if it is reasonable in all the circumstances for the person to require the books to be produced forthwith - to empower the person to require the books to be produced forthwith.

SECTION 316   APPLICATION OF CRIMES ACT AND EVIDENCE ACT  

316(1)   [Crimes Act 1914]  

For the purposes of Part III of the Crimes Act 1914, an examination or a hearing is a judicial proceeding.

316(2)   [Evidence Act 1995]  

Part 2.2, sections 69, 70, 71 and 147 and Division 2 of Part 4.6 of the Evidence Act 1995 apply to an examination in the same way that they apply to proceedings to which that Act applies under section 4 of that Act.

SECTION 317   ALLOWANCES AND EXPENSES  

317(1)   [Section 253]  

A person who, pursuant to a requirement made under section 253, appears for examination is entitled to the allowances and expenses prescribed by the regulations (if any).

317(2)   [Section 284]  

A person who, pursuant to a summons issued under section 284, appears at a hearing is entitled to be paid:

(a) if the summons was issued at another person's request - by that other person; or

(b) otherwise - by ASIC;

allowances and expenses prescribed by the regulations (if any).

317(3)   [ASIC discretion]  

ASIC may pay such amount as it considers reasonable on account of the costs and expenses (if any) that a person incurs in complying with a requirement made under this Chapter.

SECTION 318  

318   EXPENSES OF INVESTIGATION UNDER PART 6-1  
Subject to section 319, ASIC must pay the expenses of an investigation.

SECTION 319   RECOVERY OF EXPENSES OF INVESTIGATION  

319(1)    
If:

(a) a person is convicted of an offence against a law of the Commonwealth, or a law of a referring State or a Territory, in a prosecution; or

(b) a judgment is awarded, or a declaration or other order is made, against a person in proceedings in a court or tribunal of this jurisdiction;

brought as a result of an investigation under Part 6-1, ASIC may make one of the following orders:

(c) an order that the person pay the whole, or a specified part, of the expenses of the investigation;

(d) an order that the person reimburse ASIC to the extent of a specified amount of such of the expenses of the investigation as ASIC has paid;

(e) an order that the person pay, or reimburse ASIC in relation to, the whole, or a specified part, of the cost to ASIC of making the investigation, including the remuneration of an ASIC member or ASIC staff member concerned in the investigation.

319(2)    
An order under this section must be in writing and must specify when and how the payment or reimbursement is to be made.

319(3)    

A person must comply with an order under this section that is applicable to the person.

Criminal penalty: 120 penalty units.

319(4)    
Subsection (3) is an offence of strict liability.

Note:

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

319(5)    
ASIC may recover in a court of competent jurisdiction as a debt due to ASIC so much of the amount payable under an order made under this section as is not paid in accordance with the order.

319(6)    
A report under Part 6-1 may include recommendations about the making of orders under this section.

319(7)    
An order made under this section is not a legislative instrument.

SECTION 320  

320   COMPLIANCE WITH THIS CHAPTER  
A person is neither liable to proceedings, nor subject to a liability, merely because the person has complied, or proposes to comply, with a requirement made, or purporting to have been made, under this Chapter.

SECTION 321   EFFECT OF THIS CHAPTER  

321(1)   [Limitation]  

Except as expressly provided, nothing in this Chapter limits the generality of anything else in this Chapter.

321(2)   [Interpretation]  

The functions and powers that this Chapter confers are in addition to, and do not derogate from, any other function or power conferred by a law of the Commonwealth, a State or a Territory.

SECTION 322   ENFORCEMENT OF UNDERTAKINGS  

322(1)   [Undertakings]  

ASIC may accept a written undertaking given by a person in connection with a matter in relation to which ASIC has a function or power under the Commonwealth credit legislation.

322(2)   [Withdrawal and variation]  

The person may withdraw or vary the undertaking at any time, but only with ASIC's consent.

322(3)   [Where breach of terms]  

If ASIC considers that the person who gave the undertaking has breached any of its terms, ASIC may apply to the court for an order under subsection (4).

322(4)   [Court's power to make orders]  

If the court is satisfied that the person has breached a term of the undertaking, the court may make all or any of the following orders:

(a) an order directing the person to comply with that term of the undertaking;

(b) an order directing the person to pay to the Commonwealth an amount up to the amount of any financial benefit that the person has obtained directly or indirectly and that is reasonably attributable to the breach;

(c) any order that the court considers appropriate directing the person to compensate any other person who has suffered loss or damage as a result of the breach;

(d) any other order that the court considers appropriate.

CHAPTER 7 - MISCELLANEOUS  

PART 7-1 - MISCELLANEOUS  

Division 1 - Introduction  

SECTION 323  

323   GUIDE TO THIS PART  

Division 1A - Avoidance schemes  

SECTION 323A   SCHEMES FOR AVOIDANCE PURPOSES  

General prohibition

323A(1)    
A person must not, either alone or with others, engage in any of the following conduct:

(a)    enter into a scheme;

(b)    begin to carry out a scheme;

(c)    carry out a scheme;

if, having regard to any matters as required under subsection 323B(1) or (3), it would be reasonable to conclude that the purpose, or one of the purposes, of the person engaging in that conduct was an avoidance purpose.

Civil penalty: 5,000 penalty units.

What is an avoidance purpose?

323A(2)    
Each of the following is an avoidance purpose :

(a)    to prevent a contract from being a small amount credit contract or a consumer lease;

(b)    to cause a contract to cease to be a small amount credit contract or a consumer lease;

(c)    to avoid the application of a provision of this Act to a small amount credit contract or a consumer lease;

(d)    to avoid the application of a provision of this Act to a contract that has ceased to be a small amount credit contract or a consumer lease;

(e)    to avoid the application of a product intervention order made under Part 6-7A.

Constitutional corporations

323A(3)    
A constitutional corporation must not, either alone or with other persons, engage in any of the following conduct:

(a)    enter into a scheme;

(b)    begin to carry out a scheme;

(c)    carry out a scheme;

if, having regard to any matters as required under subsection 323B(1) or (3), it would be reasonable to conclude that the purpose, or one of the purposes, of the constitutional corporation engaging in that conduct was an avoidance purpose.

Civil penalty: 5,000 penalty units.

Constitutional trade and commerce

323A(4)    
A person must not in the course of constitutional trade and commerce, either alone or with others, engage in any of the following conduct:

(a)    enter into a scheme;

(b)    begin to carry out a scheme;

(c)    carry out a scheme;

if, having regard to any matters as required under subsection 323B(1) or (3), it would be reasonable to conclude that the purpose, or one of the purposes, of the person engaging in that conduct was an avoidance purpose.

Civil penalty: 5,000 penalty units.

Use of communications service

323A(5)    
A person must not use postal, telegraphic, telephonic or other like services (within the meaning of paragraph 51(v) of the Constitution), either alone or with other persons, in order to engage in any of the following conduct:

(a)    enter into a scheme;

(b)    begin to carry out a scheme;

(c)    carry out a scheme;

if, having regard to any matters as required under subsection 323B(1) or (3), it would be reasonable to conclude that the purpose, or one of the purposes, of the person engaging in that conduct was an avoidance purpose.

Civil penalty: 5,000 penalty units.

Prohibitions independent of each other

323A(6)    
To avoid doubt, subsections (1), (3), (4) and (5) are independent from and do not limit each other.

Note:

However, a person can be ordered to pay a pecuniary penalty under only one of those subsections in relation to the same conduct: see section 175.

Offence

323A(7)    
A person commits an offence if:

(a)    the person is subject to a requirement under subsection (1), (3), (4) or (5); and

(b)    the person engages in conduct; and

(c)    the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

SECTION 323B   WHETHER IT IS REASONABLE TO DRAW CONCLUSION AS TO PURPOSE  

Avoidance purposes relating to contracts

323B(1)    
Regard must be had to the following matters in determining, for the purposes of section 323A, whether it would be reasonable to conclude that a purpose of a person (the first person ) entering into or carrying out (to any extent) a scheme was an avoidance purpose relating to a contract:

(a)    whether the scheme or the contract was, is or would be:

(i) a means of providing a consumer with credit in a manner more complex, or more costly to the consumer, than a small amount credit contract would have been; or

(ii) a means of providing a consumer with financial accommodation equivalent to providing the consumer with credit in a manner more complex, or more costly to the consumer, than a small amount credit contract would have been; or

(iii) a means of enabling a consumer to have the use of goods in a manner more complex, or more costly to the consumer, than a consumer lease would have been;

(b)    whether representations were made (by the first person or anyone else, and whether in an advertisement or otherwise) about the scheme or the contract, or about schemes or contracts of that kind, that:

(i) were similar to representations made (by the first person or anyone else, and whether in an advertisement or otherwise) about small amount credit contracts or consumer leases; or

(ii) were made to persons in a group similar to a group of persons to whom representations about small amount credit contracts or consumer leases were made (by the first person or anyone else, and whether in an advertisement or otherwise);

(c)    any matters prescribed by the regulations.

323B(2)    
Subsection (1) does not limit the matters to which regard may be had in making a determination described in that subsection.

Avoidance purposes relating to product intervention orders

323B(3)    
In determining, for the purposes of section 323A, whether it would be reasonable to conclude that a purpose of a person entering into or carrying out (to any extent) a scheme was a purpose referred to in paragraph 323A(2)(e), regard must be had to any matters prescribed by the regulations.

323B(4)    
Subsection (3) does not limit the matters to which regard may be had in making a determination described in that subsection.

SECTION 323C   PRESUMPTION OF AVOIDANCE FOR CERTAIN SCHEMES IN CIVIL CASES  

323C(1)    
For the purposes of subsection 323A(1), (3), (4) or (5), it is reasonable to conclude that a person entered into or carried out a scheme for an avoidance purpose if:

(a)    the scheme is of a kind prescribed by the regulations; or

(b)    the scheme is of a kind determined by ASIC under subsection (3).

323C(2)    
A conclusion that this section provides for has effect except so far as the contrary is proved by the person, having regard to any matters as required under subsection 323B(1) or (3).

323C(3)    
ASIC may, by legislative instrument, determine a scheme, or a class of schemes, for the purposes of this section.

323C(4)    
This section does not have effect for the purposes of subsection 323A(7).

SECTION 323D   EXEMPTION BY ASIC  

323D(1)    
ASIC may, by legislative instrument, exempt a scheme, or class of schemes, from all or specified provisions of section 323A.

323D(2)    
An exemption may apply subject to any specific conditions imposed by ASIC.

Division 2 - Liability of persons for conduct of their agents etc.  

SECTION 324   LIABILITY FOR BODIES CORPORATE FOR CONDUCT OF THEIR AGENTS, EMPLOYEES ETC.  
Liability of bodies corporate

324(1)   [Conduct on behalf of body corporate]  

Any conduct engaged in on behalf of a body corporate:

(a) by a director, employee or agent (an official ) of the body within the scope of the person's actual or apparent authority; or

(b) by any other person at the direction or with the consent or agreement (whether express or implied) of an official of the body, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the official;

is taken, for the purposes of this Act (other than the National Credit Code), to have been engaged in also by the body.

324(2)   [Conduct at direction of an official of the body]  

Any conduct engaged in by a person (for example, the giving of money) in relation to:

(a) an official of the body acting within the scope of his or her actual or apparent authority; or

(b) any other person acting at the direction or with the consent or agreement (whether express or implied) of an official of the body, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the official;

is taken, for the purposes of this Act (other than the National Credit Code), to have been engaged in also in relation to the body.

State of mind of a body corporate

324(3)    
If, for the purposes of this Act (other than the National Credit Code), it is necessary to establish the state of mind of the body corporate in relation to particular conduct, it is enough to show:

(a) that the conduct was engaged in by a person referred to in paragraph (1)(a) or (b); and

(b) that the person had that state of mind.

Disapplication of Part 2.5 of the Criminal Code

324(4)    
Part 2.5 of the Criminal Code does not apply to an offence against this Act.

Note:

Part 2.5 of the Criminal Code deals with corporate criminal responsibility, but this section instead deals with that for the purposes of this Act (other than the National Credit Code), and section 199 of the National Credit Code deals with that for the purpose of that Code.

SECTION 325   LIABILITY OF PERSONS (OTHER THAN BODIES CORPORATE) FOR THE CONDUCT OF THEIR AGENTS, EMPLOYEES ETC.  
Liability of principals

325(1)   [Conduct on behalf of principal]  

Any conduct engaged in on behalf of a person (the principal ) who is not a body corporate:

(a) by any of the following persons (an official ) within the scope of the person's actual or apparent authority:

(i) an employee or agent of the principal;

(ii) if the principal is a partnership - a partner;

(iii) if the principal is the trustees of a trust - a trustee; or

(b) by any other person at the direction or with the consent or agreement (whether express or implied) of an official of the principal, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the official;

is taken, for the purposes of this Act (other than the National Credit Code), to have been engaged in also by the principal.

325(2)   [Conduct at direction of an official of the principal]  

Any conduct engaged in by a person (for example, the giving of money) in relation to:

(a) an official of the principal acting within the scope of his or her actual or apparent authority; or

(b) any other person acting at the direction or with the consent or agreement (whether express or implied) of an official of the principal, if the giving of the direction, consent or agreement is within the scope of the actual or apparent authority of the official;

is taken, for the purposes of this Act (other than the National Credit Code), to have been engaged in also in relation to the principal.

State of mind of the principal

325(3)    
If, for the purposes of this Act (other than the National Credit Code), it is necessary to establish the state of mind of the principal in relation to particular conduct, it is enough to show:

(a) that the conduct was engaged in by a person referred to in paragraph (1)(a) or (b); and

(b) that the person had that state of mind.

SECTION 326  

326   REGULATIONS FOR THE PURPOSES OF THIS DIVISION  
The regulations may modify this Division for the purposes prescribed in the regulations.

Division 3 - Review of ASIC's decisions  

SECTION 327   REVIEW BY ADMINISTRATIVE APPEALS TRIBUNAL OF DECISIONS BY ASIC UNDER THIS ACT  

327(1)    

An application may be made to the Administrative Appeals Tribunal for review of a decision (within the meaning of the Administrative Appeals Tribunal Act 1975) made by ASIC under this Act other than:

(aa)    

a decision of ASIC under subsection 54(1B) (which deals with immediate cancellation of a licence); or

(a)    a decision of ASIC under subsection 109(3) (which deals with certain exemptions from, and modifications of, Chapter 2); or

(b)    a decision of ASIC under subsection 163(3) (which deals with certain exemptions from, and modifications of, Chapter 3); or

(c)    

a decision of ASIC under section 238A or 238B (which deals with approved codes of conduct); or

(d)    

a decision of ASIC under Chapter 6 (which deals with compliance and enforcement), except for a decision of ASIC:

(i) to make an order under subsection 300(1) (which deals with orders relating to credit contracts, mortgages, guarantees or consumer leases); or

(ii) to make, or refuse to make, an order under subsection 301(1) (which deals with orders varying or revoking orders made under section 300); or

(iii) to make an order under subsection 301D(1) (which deals with product intervention orders); or

(iv) to amend a product intervention order under section 301J unless, under subsection 301J(6), the amendment must be by legislative instrument; or

(v) to revoke a product intervention order under section 301K unless, under subsection 301K(4), the revocation must be by legislative instrument; or

(e)    a decision of ASIC to make a determination under subsection 328(3) (which deals with determinations in relation to notice of reviewable decisions etc.); or

(f)    a decision of ASIC under subsection 6(17) of the National Credit Code (which deals with the exclusion of provisions of credit from the application of the National Credit Code); or

(g)    a decision of ASIC under subsection 171(6) of the National Credit Code (which deals with the exclusion of consumer leases from the application of the National Credit Code); or

(h)    a decision of ASIC under subsection 203A(3) of the National Credit Code (which deals with certain exemptions from the National Credit Code); or

(i)    

a decision of ASIC under the regulations, unless the regulations specify that an application may be made to the Administrative Appeals Tribunal for review of the decision.

327(1A)    

An application may also be made to the Administrative Appeals Tribunal for review of a decision (within the meaning of the Administrative Appeals Tribunal Act 1975) made by the Registrar under the data standards or disclosure framework.

327(2)   

Section 27A of the Administrative Appeals Tribunal Act 1975 does not apply to the decision.

SECTION 328   NOTICE OF REVIEWABLE DECISION AND REVIEW RIGHTS  

328(1)    
This section applies if ASIC makes a decision to which section 327 applies.

328(2)    
Subject to subsection (3), ASIC must take such steps as are reasonable in the circumstances to give to each person whose interests are affected by the decision notice, in writing or otherwise:

(a)    of the making of the decision; and

(b)    

of the person's right to have the decision reviewed by the Administrative Appeals Tribunal.

328(3)    
Subsection (2) does not require ASIC to give notice to a person affected by the decision or to the persons in a class of persons affected by the decision, if ASIC determines that giving notice to the person or persons is not warranted, having regard to:

(a)    the cost of giving notice to the person or persons; and

(b)    the way in which the interests of the person or persons are affected by the decision.

328(4)    
A determination made under subsection (3) is not a legislative instrument.

328(5)    
A failure to comply with this section does not affect the validity of the decision.

Division 4 - Regulations  

SECTION 329  

329   REGULATIONS  
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.

SECTION 330  

330   REGULATIONS - WHERE PROCEEDINGS MAY BE BROUGHT  
The regulations may prescribe the location for where court proceedings in relation to the following must be brought:

(a) matters arising under this Act;

(b) credit contracts;

(c) mortgages;

(d) guarantees;

(e) consumer leases.

SECTION 331  

331   REGULATIONS - INFRINGEMENT NOTICES  
(Repealed by No 17 of 2019)

Division 5 - Other miscellaneous provisions  

SECTION 332  

332   CIVIL PENALTY PROVISIONS CONTRAVENED OR OFFENCES COMMITTED PARTLY IN AND PARTLY OUT OF THIS JURISDICTION  
If:

(a) a person does or omits to do an act outside this jurisdiction; and

(b) if that person had done or omitted to do that act in this jurisdiction, the person would, by reason of also having done or omitted to do an act in this jurisdiction, have contravened a civil penalty provision or committed an offence against this Act;

the person contravenes that provision or commits that offence.

SECTION 333   CONTRAVENTION OF ACT DOES NOT GENERALLY AFFECT VALIDITY OF TRANSACTIONS ETC.  

333(1)   [Failure to comply does not affect enforceability]  

A failure to comply with any requirement of this Act does not affect the validity or enforceability of any transaction, contract, instrument or other arrangement.

333(2)   [Interpretation]  

Subsection (1) has effect subject to any express provision to the contrary in:

(a) this Act (including regulations made under this Act); or

(b) regulations referred to in subsection (3).

333(3)   [Regulations]  

Regulations may provide that a failure to comply with a specified requirement referred to in subsection (1) has a specified effect on the validity or enforceability of a transaction, contract, instrument or arrangement.

SECTION 334   CONTRACTING OUT ETC.  

334(1)   [Avoidance or modification of Act void]  

A provision of a contract or other instrument by which a person seeks to avoid or modify the effect of this Act (other than the National Credit Code) is void.

Note:

A similar rule applies for the purposes of the National Credit Code (see section 191 of that Code).

334(2)   [Other circumstances when provision of contract or other instrument void]  

A provision of a contract or other instrument by which a person seeks to have:

(a) a debtor indemnify a credit provider; or

(b) a mortgagor indemnify a mortgagee; or

(c) a guarantor indemnify a beneficiary of a guarantee; or

(d) a lessee indemnify a lessor;

for any loss or liability arising under this Act (other than the National Credit Code) is void.

Note:

A similar rule applies for the purposes of the National Credit Code (see section 191 of that Code).

334(3)   [Commission of offence]  

A person commits an offence if:

(a) the person is a credit provider, mortgagee, beneficiary of a guarantee or lessor; and

(b) the person is a party to a contract or other instrument; and

(c) the contract or other instrument is void under subsection (1) or (2).

Criminal penalty: 100 penalty units.

334(4)   [Strict liability]  

Subsection (3) is an offence of strict liability:

Note:

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

334(5)   [Other legislation]  

Subsection (2) does not affect the operation of subsection 60(2) of the National Credit Code.

SECTION 335   INDEMNITIES  

335(1)   [Indemnity for liability]  

An indemnity for any liability under this Act (other than the National Credit Code) is not void, and cannot be declared void, on the grounds of public policy, despite any rule of law to the contrary.

Note:

A similar rule applies for the purposes of the National Credit Code (see section 192 of that Code).

335(2)   [Liabilities to which section applies]  

The liabilities to which this section applies include the following:

(a) a liability for any criminal or civil penalty incurred by any person under this Act (other than the National Credit Code);

(b) a payment in settlement of a liability or alleged liability under this Act (other than the National Credit Code);

(c) a liability under another indemnity for any liability under this Act (other than the National Credit Code).

335(3)   [Interpretation]  

This section is subject to subsection 334(2).

335(4)   [Other rights and remedies]  

This section does not derogate from any other rights and remedies that exist apart from this section.

SECTION 335A  

335A   REVIEW RELATING TO SMALL AMOUNT CREDIT CONTRACTS  
(Repealed by No 87 of 2022)

SECTION 336   ACQUISITION OF PROPERTY  

336(1)   [Application of Act]  

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.

336(2)   [Definition]  

In subsection (1), acquisition of property and just terms have the same meanings as in paragraph 51(xxxi) of the Constitution.

SECTION 337   MINISTER MAY DELEGATE PRESCRIBED FUNCTIONS AND POWERS UNDER THIS ACT  

337(1)    
The Minister may, by signed instrument, delegate to:

(a) an ASIC member; or

(b) an ASIC staff member;

such of the Minister's functions and powers under this Act as are prescribed.

337(1A)    

However, the Minister must not delegate the Minister's powers under section 301H, 301J, 301K or 301M (which deal with product intervention orders) to a person other than ASIC.

337(2)    
In performing functions or exercising powers under a delegation, the delegate must comply with any directions of the Minister.

SCHEDULE 1 - NATIONAL CREDIT CODE  

Note:

See section 3 of the National Credit Act.

PART 1 - PRELIMINARY  

1  

1   Short title  
This Code may be cited as the National Credit Code.

2   Interpretation generally  

2(1)    
Part 13 contains the principal definitions of words and expressions used in this Code.

2(2)    
Part 14 contains other miscellaneous provisions relating to the interpretation of this Code.

3   Meaning of credit and amount of credit  

3(1)    
For the purposes of this Code, credit is provided if under a contract:

(a) payment of a debt owed by one person (the debtor ) to another (the credit provider ) is deferred; or

(b) one person (the debtor ) incurs a deferred debt to another (the credit provider ).

3(2)    
For the purposes of this Code, the amount of credit is the amount of the debt actually deferred. The amount of credit does not include:

(a) any interest charge under the contract; or

(b) any fee or charge:

(i) that is to be or may be debited after credit is first provided under the contract; and

(ii) that is not payable in connection with the making of the contract or the making of a mortgage or guarantee related to the contract.

4  

4   Meaning of credit contract  
For the purposes of this Code, a credit contract is a contract under which credit is or may be provided, being the provision of credit to which this Code applies.

5   Provision of credit to which this Code applies  

5(1)    
This Code applies to the provision of credit (and to the credit contract and related matters) if when the credit contract is entered into or (in the case of precontractual obligations) is proposed to be entered into:

(a) the debtor is a natural person or a strata corporation; and

(b) the credit is provided or intended to be provided wholly or predominantly:

(i) for personal, domestic or household purposes; or

(ii) to purchase, renovate or improve residential property for investment purposes; or

(iii) to refinance credit that has been provided wholly or predominantly to purchase, renovate or improve residential property for investment purposes; and

(c) a charge is or may be made for providing the credit; and

(d) the credit provider provides the credit in the course of a business of providing credit carried on in this jurisdiction or as part of or incidentally to any other business of the credit provider carried on in this jurisdiction.

5(2)    
If this Code applies to the provision of credit (and to the credit contract and related matters):

(a) this Code applies in relation to all transactions or acts under the contract whether or not they take place in this jurisdiction; and

(b) this Code continues to apply even though the credit provider ceases to carry on a business in this jurisdiction.

5(3)    
For the purposes of this section, investment by the debtor is not a personal, domestic or household purpose.

5(4)    
For the purposes of this section, the predominant purpose for which credit is provided is:

(a) the purpose for which more than half of the credit is intended to be used; or

(b) if the credit is intended to be used to obtain goods or services for use for different purposes, the purpose for which the goods or services are intended to be most used.

6   Provision of credit to which this Code does not apply  
Short term credit

6(1)    
This Code does not apply to the provision of credit if, under the contract:

(a) the provision of credit is limited to a total period that does not exceed 62 days; and

(b) the maximum amount of credit fees and charges that may be imposed or provided for does not exceed 5% of the amount of credit; and

(c) the maximum amount of interest charges that may be imposed or provided for does not exceed an amount (calculated as if the Code applied to the contract) equal to the amount payable if the annual percentage rate were 24% per annum.

6(2)    
For the purposes of paragraph (1)(b), credit fees and charges imposed or provided for under the contract are taken to include the following, whether or not payable under the contract:

(a) a fee or charge payable by the debtor to any person for an introduction to the credit provider;

(b) a fee or charge payable by the debtor to any person for any service if the person has been introduced to the debtor by the credit provider;

(c) a fee or charge payable by the debtor to the credit provider for any service related to the provision of credit, other than a service mentioned in paragraph (b).

6(3)    
For the purposes of paragraphs (2)(a) and (b), it does not matter whether or not there is an association between the person and the credit provider.

Credit without express prior agreement

6(4)    
This Code does not apply to the provision of credit if, before the credit was provided, there was no express agreement between the credit provider and the debtor for the provision of credit. For example, when a cheque account becomes overdrawn but there is no expressly agreed overdraft facility or when a savings account falls into debit.

Credit for which only account charge payable

6(5)    
This Code does not apply to the provision of credit under a continuing credit contract if the only charge that is or may be made for providing the credit is a periodic or other fixed charge that does not vary according to the amount of credit provided. However, this Code applies if the charge is of a nature prescribed by the regulations for the purposes of this subsection or if the charge exceeds the maximum charge (if any) so prescribed.

Joint credit and debit facilities

6(6)    
This Code does not apply to any part of a credit contract under which both credit and debit facilities are available to the extent that the contract or any amount payable or other matter arising out of it relates only to the debit facility.

Bill facilities

6(7)    
This Code applies to the provision of credit arising out of a bill facility, that is, a facility under which the credit provider provides credit by accepting, drawing, discounting or endorsing a bill of exchange or promissory note. However, it does not apply if:

(a) the credit is provided by an authorised deposit-taking institution (within the meaning of subsection 5(1) of the Banking Act 1959); or

(b) the regulations provide that the Code does not apply to the provision of all or any credit arising out of such a facility.

Insurance premiums by instalments

6(8)    
This Code does not apply to the provision of credit by an insurer for the purpose of the payment to the insurer of an insurance premium by instalments, even though the instalments exceed the total of the premium that would be payable if the premium were paid in a lump sum, if on cancellation the insured would have no liability to make further payments under the contract.

Pawnbrokers

6(9)    
This Code does not apply to the provision of credit on the security of pawned or pledged goods by a pawnbroker in the ordinary course of a pawnbroker's business (being a business which is being lawfully conducted by the pawnbroker) as long as it is the case that, if the debtor is in default, the pawnbroker's only recourse is against the goods provided as security for the provision of the credit. However, sections 76 to 81 (Court may reopen unjust transactions) apply to any such provision of credit.

Trustees of estates

6(10)    
This Code does not apply to the provision of credit by the trustee of the estate of a deceased person by way of an advance to a beneficiary or prospective beneficiary of the estate. However, sections 76 to 81 (Court may reopen unjust transactions) apply to any such provision of credit.

Employee loans

6(11)    
This Code (other than this Part, Part 4, Division 3 of Part 5, Divisions 4 and 5 of Part 7 and Parts 12, 13 and 14) does not apply to the provision of credit by an employer, or a related body corporate within the meaning of the Corporations Act 2001 of an employer, to an employee or former employee (whether or not it is provided to the employee or former employee with another person). However, for a credit provider that provides credit to which this Code applies in the course of a business of providing credit to which this Code applies to employees or former employees and to others, this subsection applies only to the provision of credit on terms that are more favourable to the debtor than the terms on which the credit provider provides credit to persons who are not employees or former employees of the credit provider or a related body corporate.

Margin loans

6(12)    
This Code does not apply to the provision of credit by way of a margin loan (within the meaning of subsection 761EA(1) of the Corporations Act 2001).

Regulations may exclude credit

6(13)    
The regulations may exclude, from the application of this Code, the provision of credit of a class specified in the regulations. In particular (but without limiting the generality of the foregoing), the regulations may so exclude the provision of credit if the amount of the credit exceeds or may exceed a specified amount or if the credit is provided by a credit provider of a specified class.

ASIC may exclude credit

6(14)    
ASIC may exclude, from the application of this Code, a provision of credit specified by ASIC.

6(15)    
Without limiting subsection (14), ASIC may exclude a provision of credit if:

(a) the amount of the credit exceeds, or may exceed, a specified amount; or

(b) the credit is provided by a specified credit provider.

6(16)    
An exemption under subsection (14) is not a legislative instrument.

6(17)    
ASIC may, by legislative instrument, exclude from the application of this Code, the provision of credit of a class specified in the instrument.

6(18)    
Without limiting subsection (17), ASIC may exclude a provision of credit if:

(a) the amount of the credit exceeds, or may exceed, a specified amount; or

(b) the credit is provided by a specified credit provider, or a class of credit providers.

Definitions

6(19)    
In this section:

fee or charge
does not include a government fee, charge or duty of any kind.

security
, of pawned or pledged goods, means security by way of bailment of the goods under which the title to the goods does not pass, conditionally or unconditionally, to the bailee.

7   Mortgages to which this Code applies  

7(1)    
This Code applies to a mortgage if:

(a) it secures obligations under a credit contract or a related guarantee; and

(b) the mortgagor is a natural person or a strata corporation.

7(2)    
If any such mortgage also secures other obligations, this Code applies to the mortgage to the extent only that it secures obligations under the credit contract or related guarantee.

7(3)    
The regulations may exclude, from the application of all or any provisions of this Code, a mortgage of a class specified in the regulations.

8   Guarantees to which this Code applies  

8(1)    
This Code applies to a guarantee if:

(a) it guarantees obligations under a credit contract; and

(b) the guarantor is a natural person or a strata corporation.

8(2)    
If any such guarantee also guarantees other obligations, this Code applies to the guarantee to the extent only that it guarantees obligations under the credit contract.

8(3)    
The regulations may exclude, from the application of all or any provisions of this Code, a guarantee of a class specified in the regulations.

9   Goods leases with option to purchase to be regarded as sale by instalments  

9(1)    
For the purposes of this Code, a contract for the hire of goods under which the hirer has a right or obligation to purchase the goods, is to be regarded as a sale of the goods by instalments if the charge that is or may be made for hiring the goods, together with any other amount payable under the contract (including an amount to purchase the goods or to exercise an option to do so) exceeds the cash price of the goods.

Note:

A contract includes a series of contracts, or contracts and arrangements (see Part 13).

9(2)    
A debt is to be regarded as having been incurred, and credit provided, in such circumstances.

9(3)    
Accordingly, if because of subsection 5(1) the contract is a credit contract, this Code (including Part 6) applies as if the contract had always been a sale of goods by instalments, and for that purpose:

(a) the amounts payable under the contract are the instalments; and

(b) the credit provider is the person who is to receive those payments; and

(c) the debtor is the person who is to make those payments; and

(d) the property of the supplier in the goods passes under the contract to the person to whom the goods are hired on delivery of the goods or the making of the contract, whichever occurs last; and

(e) the charge for providing the credit is the amount by which the charge that is or may be made for hiring the goods, together with any other amount payable under the contract (including an amount to purchase the goods or to exercise an option to do so), exceeds the cash price of the goods; and

(f) a mortgage containing the terms and conditions set out in the regulations is taken to have been entered into in writing between the person to whom the goods are hired under the contract and the supplier as security for payment to the supplier of the amount payable to the supplier by the person to whom the goods are hired under the contract; and

(g) any provision in the contract for hiring by virtue of which the supplier is empowered to take possession, or dispose, of the goods to which the contract relates is void.

9(4)    
For the purposes of this section, the amount payable under the contract includes any agreed or residual value of the goods at the end of the hire period or on termination of the contract, but does not include the following amounts:

(a) any amount payable in respect of services that are incidental to the hire of goods under the contract;

(b) any amount that ceases to be payable on the termination of the contract following the exercise of a right of cancellation by the hirer at the earliest opportunity.

Note:

Part 11 (Consumer leases) applies to the contracts specified in that Part for the hire of goods under which the hirer does not have a right or obligation to purchase the goods.

10   Deciding application of Code to particular contracts for the sale of land by instalments  

10(1)    
This section applies to an executory contract for the sale of land if:

(a) under the contract, the purchaser:

(i) is entitled to enter into possession of the land before becoming entitled to receive a conveyance or transfer of the land; and

(ii) is bound to make a payment or payments (other than a deposit or rent payment) to, or in accordance with the instructions of, the vendor without becoming entitled to receive a conveyance or transfer of the land in exchange for the payment or payments; and

(b) the amount payable to purchase the land under the contract exceeds the cash price of the land.

Note:

Cash price is defined in Part 13 in terms of goods or services.

Services is defined in Part 13 to include rights in relation to, and interests in, real property.

10(2)    
For the purpose of deciding whether the contract is a credit contract and, if it is a credit contract, of applying this Code (including Part 6) to it:

(a) a debt is to be regarded as having been incurred, and credit provided, in the circumstances mentioned in subsection (1); and

(b) the debtor is the purchaser under the contract; and

(c) the credit provider is the vendor under the contract; and

(d) the charge for providing the credit is the amount by which the amount payable to purchase the land, together with any other amount payable under the contract other than outgoings for the land, exceeds the cash price of the land.

10(3)    
This section does not affect the application of this Code to a contract that is, apart from this section, a credit contract.

10(4)    
In this section:

deposit
, in relation to a contract, means an amount:

(a) not exceeding 10% of the amount payable to purchase the land under the contract; and

(b) paid or payable in one or more amounts; and

(c) liable to be forfeited and retained by the vendor in the event of a breach of contract by the purchaser.

outgoings
includes rates, water charges and house and contents insurance.

rent payment
, under a contract, means a payment:

(a) made by the purchaser to the vendor in exchange for possession of the land before becoming entitled to receive a conveyance or transfer of the land; and

(b) that is not deductible from the amount payable to purchase the land.

11   Deciding application of Code to particular contracts for the sale of goods by instalments  

11(1)    
This section applies to a contract for the sale of goods if the amount payable to purchase the goods under the contract:

(a) is payable by instalments; and

(b) exceeds the cash price of the goods.

11(2)    
This section does not apply to a contract for the hire of goods even if the hirer has a right or obligation to purchase the goods.

11(3)    
For the purpose of deciding whether the contract is a credit contract and, if it is a credit contract, of applying this Code (including Part 6) to it:

(a) a debt is to be regarded as having been incurred, and credit provided, in the circumstances mentioned in subsection (1); and

(b) the debtor is the person who is to make the payments; and

(c) the credit provider is the person who is to receive the payments; and

(d) the charge for providing the credit is the amount by which the amount payable to purchase the goods, together with any other amount payable under the contract, exceeds the cash price of the goods.

11(4)    
This section does not affect the application of this Code to a contract that is, apart from this section, a credit contract.

12   Deciding application of Code to particular contracts for the sale of goods by instalments under related contracts  

12(1)    
For the purpose of this section, a contract is a related contract to a contract for the sale of goods (the goods contract ) if:

(a) the sale of goods is financed, wholly or partly, by the provision of credit under the contract; and

(b) the credit provider under the contract is:

(i) the supplier of goods under the goods contract; or

(ii) a related body corporate within the meaning of the Corporations Act 2001 of the supplier of the goods under the goods contract; and

(c) the amount payable under the contract is payable by instalments.

12(2)    
For the purpose of deciding whether a related contract to a goods contract is a credit contract and, if it is a credit contract, of applying this Code (including Part 6) to it, the charge for providing the credit is the amount by which the amount payable to purchase the goods, together with any other amount payable under the related contract, exceeds the cash price of the goods.

12(3)    
This section does not affect the application of this Code to a contract that is, apart from this section, a credit contract.

13   Presumptions relating to application of Code  

13(1)    
In any proceedings (whether brought under this Code or not) in which a party claims that a credit contract, mortgage or guarantee is one to which this Code applies, it is presumed to be such unless the contrary is established.

13(2)    
It is presumed for the purposes of this Code that credit is not provided or intended to be provided under a contract wholly or predominantly for any or all of the following purposes (a Code purpose ):

(a) for personal, domestic or household purposes;

(b) to purchase, renovate or improve residential property for investment purposes;

(c) to refinance credit that has been provided wholly or predominantly to purchase, renovate or improve residential property for investment purposes;

if the debtor declares, before entering the contract, that the credit is to be applied wholly or predominantly for a purpose that is not a Code purpose, unless the contrary is established.

13(3)    
However, the declaration is ineffective if, when the declaration was made, the credit provider or a person (the prescribed person ) of a kind prescribed by the regulations:

(a) knew, or had reason to believe; or

(b) would have known, or had reason to believe, if the credit provider or prescribed person had made reasonable inquiries about the purpose for which the credit was provided, or intended to be provided, under the contract;

that the credit was in fact to be applied wholly or predominantly for a Code purpose.

13(4)    
If the declaration is ineffective under subsection (3), paragraph 5(1)(b) is taken to be satisfied in relation to the contract.

13(5)    
A declaration under this section is to be substantially in the form (if any) required by the regulations and is ineffective for the purposes of this section if it is not.

13(6)    

A person commits an offence if:

(a) the person engages in conduct; and

(b) the conduct induces a debtor to make a declaration under this section that is false or misleading in a material particular; and

(c) the declaration is false or misleading in a material particular.

Criminal penalty: 2 years imprisonment.

13(7)    
Strict liability applies to paragraph (6)(c).

Note:

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

13A   Reverse mortgages  

13A(1)    
For the purposes of this Code, an arrangement is a reverse mortgage if the arrangement involves a credit contract, except a bridging finance contract, and a mortgage over a dwelling or land securing a debtor's obligations under the contract and either:

(a) the conditions in subsections (2) and (3) are met; or

(b) the arrangement is of a kind declared by ASIC under subsection (4) and is made on or after the commencement of that declaration.

Conditions

13A(2)    
The first condition is that the debtor's total liability under the credit contract or mortgage may exceed (to a limited or unlimited extent) the maximum amount of credit that may be provided under the contract without the debtor being obliged to reduce that liability to or below that maximum amount.

Note:

The debtor's total liability can exceed the maximum amount of credit because interest and some other fees and charges are not included in an amount of credit: see subsection 3(2).

13A(3)    
The second condition is that, if the regulations prescribe any prerequisites for the arrangement to be a reverse mortgage, those prerequisites are met.

Declarations by ASIC

13A(4)    
ASIC may by legislative instrument declare specified kinds of arrangements involving a credit contract and a mortgage over a dwelling or land securing a debtor's obligations under the contract to be reverse mortgages.

PART 2 - CREDIT CONTRACTS  

Division 1 - Negotiating and making credit contracts  

14   Credit contract to be in form of written contract document  

14(1)    
A credit contract must be in the form of:

(a) a written contract document signed by the debtor and the credit provider; or

(b) a written contract document signed by the credit provider and constituting an offer to the debtor that is accepted by the debtor in accordance with the terms of the offer.

14(2)    
An offer may be accepted by the debtor for the purposes of paragraph (1)(b):

(a) by the debtor or a person authorised by the debtor accessing or drawing down credit to incur a liability; or

(b) by any other act of the debtor or of any such authorised person that satisfies the conditions of the offer and constitutes an acceptance of the offer at law.

14(3)    
The credit provider, or a person associated with the credit provider, may not be authorised by the debtor for the purposes of subsection (2). However, this subsection does not prevent the debtor authorising the credit provider to debit the debtor's account.

14(4)    
In the case of a contract document consisting of more than one document, it is sufficient compliance with this section if one of the documents is duly signed and the other documents are referred to in the signed document.

15   Other forms of contract  

15(1)    
The regulations may authorise other ways of making a credit contract that do not involve a written document.

15(2)    
In that case, the provisions of this Division apply with such modifications as are prescribed by the regulations.

16   Precontractual disclosure  

16(1)    
A credit provider must not enter into a credit contract unless the credit provider has given the debtor:

(a) a precontractual statement setting out the matters required by section 17 to be included in the contract document; and

(b) an information statement in the form required by the regulations of the debtor's statutory rights and statutory obligations.

16(2)    
Those statements must be given:

(a) before the contract is entered into; or

(b) before the debtor makes an offer to enter into the contract;
whichever first occurs.

16(3)    
Before entering into a credit contract, the credit provider may inform the debtor of the comparison rate. If the credit provider does so, the comparison rate must be calculated as prescribed by the regulations and be accompanied by the warnings set out in the regulations.

16(4)    
The precontractual statement must contain the financial information specified by the regulations in the form prescribed by the regulations.

16(5)    
The precontractual statement may be the proposed contract document or be a separate document or documents.

16(6)    
A document forming part of a precontractual statement consisting of more than one document when the precontractual statement is first given must indicate that it does not contain all of the required precontractual information.

16(7)    
A precontractual statement may be varied, within the time referred to in subsection (2), by written notice containing particulars of the variation given to the debtor.

17   Matters that must be in contract document  

17(1)    
The contract document must contain the following matters.

Credit provider's name

17(2)    
The contract document must contain the credit provider's name.

Amount of credit

17(3)    
The contract document must contain:

(a) if the amount of credit to be provided is ascertainable:

(i) that amount; and

(ii) the persons, bodies or agents (including the credit provider) to whom it is to be paid and the amounts payable to each of them, but only if both the person, body or agent and the amount are ascertainable; and

(b) if the amount of the credit to be provided is not ascertainable - the maximum amount of credit agreed to be provided, or the credit limit under the contract, if any; and

(c) if the credit is provided by the supplier for a sale of land or goods by instalments - a description of the land and its cash price or of the goods and their cash price.

The requirement under paragraph (c) is in addition to, and does not limit, the requirement under paragraph (a) or (b).

Note:

A penalty may be imposed for contravention of a key requirement in this subsection: see Part 6.

Annual percentage rate or rates

17(4)    

In the case of a credit contract other than a small amount credit contract, the contract document must contain:

(a) the annual percentage rate or rates under the contract; and

(b) if there is more than one rate, how each rate applies; and

(c) if an annual percentage rate under the contract is determined by referring to a reference rate:

(i) the name of the rate or a description of it; and

(ii) the margin or margins (if any) above or below the reference rate to be applied to determine the annual percentage rate or rates; and

(iii) where and when the reference rate is published or, if it is not published, how the debtor may ascertain the rate; and

(iv) the current annual percentage rate or rates.

Note:

A penalty may be imposed for contravention of a key requirement in this subsection: see Part 6.

Calculation of interest charges

17(5)    

In the case of a credit contract other than a small amount credit contract, the contract document must contain the method of calculation of the interest charges payable under the contract and the frequency with which interest charges are to be debited under the contract.

Note:

A penalty may be imposed for contravention of a key requirement in this subsection: see Part 6.

Total amount of interest charges payable

17(6)    

In the case of a credit contract other than a small amount credit contract, the contract document must contain the total amount of interest charges payable under the contract, if ascertainable (but only if the contract would, on the assumptions under sections 180 and 182, be paid out within 7 years of the date on which credit is first provided under the contract).

Note:

A penalty may be imposed for contravention of a key requirement in this subsection: see Part 6.

Repayments

17(7)    
The contract document must contain:

(a) if more than one repayment is to be made:

(i) the amount of the repayments or the method of calculating the amount; and

(ii) if ascertainable, the number of the repayments; and

(iii) if ascertainable, the total amount of the repayments, but only if the contract would, on the assumptions under sections 180 and 182, be paid out within 7 years of the date on which credit is first provided under the contract; and

(iv) when the first repayment is to be paid, if ascertainable, and the frequency of payment of repayments; and

(b) if the contract provides for a minimum repayment, the amount of that repayment, if ascertainable, but, if not, the method of calculation of the minimum repayment.

Paragraph (a) does not apply to minimum repayments under a continuing credit contract.

Credit fees and charges

17(8)    
The contract document must contain:

(a) a statement of the credit fees and charges that are, or may become, payable under the contract, and when each such fee or charge is payable, if ascertainable; and

(b) the amount of any such fee or charge if ascertainable, but, if not, the method of calculation of the fee or charge, if ascertainable; and

(c) the total amount of credit fees and charges payable under the contract to the extent that it is ascertainable.

Note:

A penalty may be imposed for contravention of a key requirement in paragraph (a) or (b), but only in respect of retained credit fees and charges: see Part 6.

Changes affecting interest and credit fees and charges

17(9)    
If the annual percentage rate or rates or the amount or frequency of payment of a credit fee or charge or instalment payable under the contract may be changed, or a new credit fee or charge may be imposed, the contract document must contain a statement or statements to that effect and of the means by which the debtor will be informed of the change or the new fee or charge.

Note:

A penalty may be imposed for contravention of a key requirement in this subsection: see Part 6.

Statements of account

17(10)    
The contract document must contain the frequency with which statements of account are to be provided to the debtor (except in the case of a credit contract for which the annual percentage rate is fixed for the whole term of the contract and under which there is no provision for varying the rate).

Default rate

17(11)    
The contract document must contain:

(a) if the contract is a contract under which a default rate of interest may be charged when payments are in default - a statement to that effect and the default rate and how it is to be applied; and

(b) if the default rate under the contract is determined by referring to a reference rate:

(i) the name of the rateor a description of it; and

(ii) the margin or margins (if any) above or below the reference rate to be applied to determine the default rate; and

(iii) when and where the reference rate is published or, if it is not published, how the debtor may ascertain the rate; and

(iv) the current default rate.

Note:

A penalty may be imposed for contravention of a key requirement in this subsection: see Part 6.

Enforcement expenses

17(12)    
The contract document must contain a statement that enforcement expenses may become payable under the credit contract or mortgage (if any) in the event of a breach.

Mortgage or guarantee

17(13)    
The contract document must contain:

(a) if any mortgage or guarantee is to be or has been taken by the credit provider - a statement to that effect; and

(b) in the case of a mortgage - a description of the property subject to, or proposed to be subject to, the mortgage, to the extent to which it is ascertainable.

Commission

17(14)    
If a commission is to be paid by or to the credit provider for the introduction of credit business or business financed by the contract, the contract document must contain:

(a) a statement of that fact; and

(b) the person by whom the commission is payable; and

(c) the person to whom the commission is payable; and

(d) the amount if ascertainable.

Commission
does not include fees payable by a supplier under a merchant service agreement with a credit provider, an amount payable in connection with a credit-related insurance contract or commission paid to employees of the credit provider.

Insurance financed by contract

17(15)    
If the credit provider knows that the debtor is to enter into a credit-related insurance contract and that the insurance is to be financed under the credit contract, the contract document must contain:

(a) the name of the insurer; and

(b) the amount payable to the insurer or, if it is not ascertainable, how it is calculated; and

(c) the kind of insurance and any other particulars that may be prescribed by the regulations; and

(d) if the credit provider knows of any commission to be paid by the insurer for the introduction of the insurance business - a statement that it is to be paid and, if ascertainable, the amount of the commission expressed either as a monetary amount or as a proportion of the premium.

In the case of consumer credit insurance that includes a contract of general insurance within the meaning of the Insurance Contracts Act 1984:

(e) it is sufficient compliance with paragraphs (a) and (b) if the contract document contains the name of the general insurer and the total amount payable to the insurers (or, if it is not ascertainable, how it is calculated); and

(f) it is sufficient compliance with paragraph (d) relating to the amount of commission if the contract document contains the total amount of commission (expressed as a monetary amount or as a proportion of the premium) to be paid by the insurers.

Note:

A penalty may be imposed for contravention of a key requirement in paragraph (a) or (b): see Part 6.

Provisions for person other than debtor to occupy reverse mortgaged property

17(15A)    

If the credit contract for a reverse mortgage is to make provision for a person other than the debtor to occupy the reverse mortgaged property, the contract document must contain provisions that have the following effect (whether or not the document also contains other provisions relating to such occupation by such a person):

(a)the debtor may at any time (before, when or after the contract is made):

(i) nominate to the credit provider a person who is to be allowed to occupy the property (whether alone or with other persons); and

(ii) revoke such a nomination by notice given to the credit provider;

(b) while a nomination described in paragraph (a) is in force, the nominated person has the same rights (against the credit provider) to occupy the property as the debtor has or would have apart from the death of the debtor or vacation of the property by the debtor.

Note:

Other provisions contained in the contract document may, for example, limit the kinds of persons whom the debtor may nominate to the credit provider as persons who are to be allowed to occupy the property.

Other information

17(16)    
The contract document must contain any information or warning required by the regulations.

Note:

Sections 180 to 182 set out the tolerances and assumptions applicable to matters required to be disclosed.

18  

18   Form and expression of contract document  
The contract document must conform to the requirements of the regulations as to its form and the way it is expressed and, subject to any such requirements, may consist of one or more separate documents.

18A   Provisions that must not be included in credit contract for reverse mortgage  

18A(1)    
A credit provider must not enter into a credit contract for a reverse mortgage that provides a basis for beginning enforcement proceedings relating to the contract for an event described in subsection (3).

18A(2)    
A credit provider must not agree to change, or unilaterally change, a credit contract for a reverse mortgage so that it provides a basis for beginning enforcement proceedings relating to the contract for an event described in subsection (3).

18A(3)    
For the purposes of subsections (1) and (2), the events are as follows:

(a) the debtor failing to inform the credit provider that another person occupies the reverse mortgaged property;

(b) the debtor failing, when the debtor occupies the reverse mortgaged property, to give the credit provider evidence that the debtor, or another person nominated by the debtor to the credit provider, occupies or occupied the reverse mortgaged property;

(c) the debtor leaving the reverse mortgaged property unoccupied while it is the debtor's principal place of residence;

(d) the debtor failing to pay a cost to a person other than the credit provider within 3 years after the payment became due;

(e) the debtor failing to comply with a provision of the credit contract if the contract does not make it clear how the debtor is to comply with the provision;

(f) the debtor breaching another credit contract with the credit provider;

(g) an event that involves an act or omission by the debtor and is prescribed by the regulations.

18B   Disclosure if credit contract for reverse mortgage does not protect tenancy of person other than debtor  

18B(1)    
This section applies if a proposed credit contract for a reverse mortgage does not include a provision (a tenancy protection provision ) for a person other than the debtor to have a right against the credit provider to occupy the reverse mortgaged property.

18B(2)    
A person must not provide a credit service relating to the contract unless the person has told the debtor, in writing in the form (if any) prescribed by the regulations, that the contract does not include a tenancy protection provision.

Criminal penalty: 50 penalty units.

18B(3)    
Subsection (2) does not apply if the person is or will be the credit provider under the contract.

18B(4)    
The credit provider must not enter into the contract unless the credit provider has told the debtor, in writing in the form (if any) prescribed by the regulations, that the contract does not include a tenancy protection provision.

Criminal penalty: 50 penalty units.

18B(5)    
An offence against subsection (2) or (4) is an offence of strict liability.

Note:

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

18C   Independent legal advice before entry into credit contract for reverse mortgage  

18C(1)    
The regulations may regulate or prohibit the entry by a credit provider into a credit contract for a reverse mortgage if the debtor has not obtained legal advice, in accordance with the regulations, about the contract or reverse mortgage.

18C(2)    
The regulations may provide for offences and civil penalties for contraventions of regulations made for the purposes of subsection (1).

18C(3)    

The penalties for offences described in subsection (2) must not be more than 50 penalty units for an individual or 500 penalty units for a body corporate.

18C(4)    

The civil penalty for a contravention of a regulation made for the purposes of subsection (1) by an individual is 5,000 penalty units. However, section 167B of the National Credit Act applies in the same way as it would apply if the regulation contravened were a civil penalty provision under that Act.

19   Alteration of contract document  

19(1)    

An alteration of (including an addition to) a new contract document by the credit provider after it is signed by the debtor is ineffective unless the debtor has agreed in writing to the alteration.

19(2)    
This section does not apply to an alteration having the effect of reducing the debtor's liabilities under the credit contract.

20   Copy of contract for debtor  

20(1)    
If a contract document is to be signed by the debtor and returned to the credit provider, the credit provider must give the debtor a copy to keep.

20(2)    
A credit provider must, not later than 14 days after a credit contract is made, give a copy of the contract in the form in which it was made to the debtor.

20(3)    
Subsection (2) does not apply if the credit provider has previously given the debtor a copy of the contract document to keep.

21   When debtor may terminate contract  

21(1)    
Although a credit contract has been made, the debtor may nevertheless, by written notice to the credit provider, terminate the contract unless:

(a) any credit has been obtained under the contract; or

(b) a card or other means of obtaining credit provided to the debtor by the credit provider has been used to acquire goods or services for which credit is to be advanced under the contract.

21(2)    
Nothing in this section prevents the credit provider from retaining or requiring payment of fees or charges incurred before the termination and which would have been payable under the credit contract.

22   Offence for noncompliance  

22(1)    
A credit provider must not:

(a) enter into a credit contract that contravenes a requirement of this Division; or

(b) otherwise contravene a requirement of this Division.

Criminal penalty: 100 penalty units.

22(2)    
Subsection (1) is an offence of strict liability.

Note:

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

22(3)    

Subsection (1) does not apply to a contravention of a requirement of section 18B.

Division 2 - Debtor's monetary obligations  

23   Prohibited monetary obligations - general  

23(1)    

A credit contract (other than a small amount credit contract) must not impose a monetary liability on the debtor:

(a) in respect of a credit fee or charge prohibited by this Code; or

(b) in respect of an amount of a fee or charge exceeding the amount that may be charged consistently with this Code; or

(c) in respect of an interest charge under the contract exceeding the amount that may be charged consistently with this Code.

Note 1:

A penalty may be imposed for contravention of a key requirement in this subsection, but only at the time the credit contract is entered into: see Part 6.

Note 2:

This subsection also applies to liabilities imposed contrary to section 133BI of the National Credit Act: see subsection (7) of that section.

Civil effect

23(2)    
Any provision of a credit contract that imposes a monetary liability prohibited by subsection (1) is void to the extent that it does so. If an amount that is prohibited by subsection (1) is paid, it may be recovered.

23(3)    
A credit fee or charge cannot be charged in respect of a credit contract unless the contract authorises it to be charged.

Civil effect

23(4)    
If an amount that is prohibited by subsection (3) is paid, it may be recovered.

23A   Prohibited monetary obligations - small amount credit contracts  

23A(1)    
A small amount credit contract must not impose a monetary liability on the debtor:

(a) in respect of an interest charge (including a default rate of interest) under the contract; or

(b) in respect of a fee or charge prohibited by this Code; or

(c) in respect of an amount of a fee or charge exceeding the amount that may be charged consistently with this Code.

23A(2)    
If a provision of a small amount credit contract imposes a monetary liability prohibited by subsection (1) then:

(a) each provision (the void provisions ) of the contract that imposes a monetary liability of a kind referred to in that subsection (whether or not the liability is imposed consistently with this Code) is void to the extent that the provision relates to the liability; and

(b) the debtor may recover as a debt due to the debtor any amount paid to the credit provider under the void provisions to the extent that the amount relates to the liability.

24   Offences related to prohibited monetary obligations - credit providers  

24(1)    

A credit provider must not:

(a) enter into a credit contract on terms imposing a monetary liability prohibited by subsection 23(1); or

(b) require or accept payment of an amount in respect of a monetary liability that cannot be imposed consistently with this Code.

Civil penalty: 5,000 penalty units.

24(1A)    

A credit provider must not:

(a) enter into a small amount credit contract on terms imposing a monetary liability prohibited by subsection 23A(1); or

(b) require or accept payment of an amount in respect of a monetary liability that cannot be imposed consistently with this Code.

Civil penalty: 5,000 penalty units.

Offence

24(2)    

A person commits an offence of strict liability if:

(a) the person is subject to a requirement under subsection (1) or (1A); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 100 penalty units.

24A   Offences related to prohibited monetary obligations - credit assistance providers  

24A(1)    
A person must not provide credit assistance to a consumer by:

(a) suggesting that the consumer apply for a particular small amount credit contract with a particular credit provider; or

(b) assisting the consumer to apply for a particular small amount credit contract with a particular credit provider;

if the person knows, or is reckless as to whether, the contract will contravene subsection 23A(1).

Criminal penalty: 50 penalty units.

24A(2)    
If a person provides credit assistance to a consumer that is prohibited by subsection (1):

(a) the consumer is not liable (and is taken never to have been liable) to pay any fees or charges to the person in relation to:

(i) the credit assistance; or

(ii) any other services provided by the person in connection with the credit assistance; and

(b) the consumer may recover as a debt due to the consumer the amount of any such fees or charges paid by the consumer to the person.

25   Loan to be in money or equivalent  

25(1)    
A credit provider must not under a credit contract pay an amount to or in accordance with the instructions of the debtor unless the payment is in cash or money's worth and is made in full without deducting an amount for interest charges under the contract.

Criminal penalty: 100 penalty units.

25(2)    
Subsection (1) is an offence of strict liability.

Note:

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

25(3)    
The regulations may provide that subsection (1) does not apply to the deduction of an amount for the first payment of interest charges under the contract.

26   Early payments and crediting of payments  

26(1)    
A credit provider must accept any payment under a credit contract that is made before it is payable under the contract unless the contract prohibits its early payment.

Criminal penalty: 100 penalty units.

26(2)    
A credit provider must credit each payment made under a credit contract to the debtor as soon as practicable after receipt of the payment.

Criminal penalty: 100 penalty units.

26(3)    
Subsections (1) and (2) are offences of strict liability.

Note:

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

26(4)    
Despite subsection (2), a credit provider is not required to credit a payment under a credit contract before it is payable under the contract if the contract prohibits its early payment and:

(a) the credit provider informs the debtor, as soon as practicable after the credit provider becomes aware of the payment, that it will not be credited to the debtor (or that any credit will be reversed) until it becomes payable under the contract, and the debtor elects to leave the payment with the credit provider; or

(b) the credit provider informs the debtor, before accepting the payment, that it will not be credited to the debtor until it becomes payable under the contract; or

(c) the credit provider refunds the payment to the debtor.

26(5)    
A credit contract may not, under this section, prohibit the paying out of the contract at any time under section 82.

26(6)    

A credit contract for a reverse mortgage may not prohibit an early payment that:

(a) is made in the circumstances described in paragraph 86A(1)(a); and

(b) is of the amount described in paragraph 86A(1)(b).

26A  

26A   Regulations about residential investment property  
The regulations may provide that section 25 or 26 applies in relation to a provision of credit covered by subparagraph 5(1)(b)(ii) or (iii) as if specified provisions were omitted, modified or varied as specified in the regulations.

Division 3 - Interest charges  

27   Definitions relating to interest  

27(1)    
In this Code:

annual percentage rate
under a credit contract means a rate specified in the contract as an annual percentage rate.

daily percentage rate
means the rate determined by dividing the annual percentage rate by 365.

default rate
means a higher annual percentage rate permitted by section 30.

unpaid balance
under a credit contract at any time means the difference between all amounts credited and all amounts debited to the debtor under the contract at that time.

unpaid daily balance
for a day under a credit contract means the unpaid balance under the contract at the end of that day.

27(2)    
A credit contract may specify, for the purposes of payments or any other purposes under the contract, when a day ends. Different times of the day may be specified for different purposes.

27A  

27A   Application of this Division  

This Division does not apply to a small amount credit contract.

28   Limit on interest charges  

28(1)    
The maximum amount of an interest charge that may be imposed or provided for under a credit contract is:

(a) where only one annual percentage rate applies to the unpaid balances under the contract - the amount determined by applying the daily percentage rate to the unpaid daily balances; or

(b) in any other case - the sum of each of the amounts determined by applying each daily percentage rate to that part of the unpaid daily balances to which it applies under the contract.

28(2)    
However, an interest charge under a credit contract for a month, a quarter or half a year may be determined by applying the annual percentage rate or rates, divided by 12 (for a month), by 4 (for a quarter) or by 2 (for half a year), to the whole or that part of the average unpaid daily balances to which it applies. The regulations may provide for the calculation of unpaid daily balances in these circumstances.

28(3)    
This section does not prevent the imposition of a default rate of interest permitted by section 30.

29   Early debit or payment of interest charges prohibited  

29(1)    
A credit provider must not, at any time before the end of a day to which an interest charge applies, require payment of or debit the interest charge.

29(2)    
A credit contract may provide for an interest charge to become payable or be debited at any time after the day to which it applies.

29(3)    
The regulations may provide that subsection (1) does not apply to the first payment of interest charges under a credit contract.

29(4)    
This section does not apply to the debit of an interest charge under a credit contract before the end of the period to which the charge applies if:

(a) the charge is debited on the last day of the period; and

(b) the amount debited is not treated by the credit provider as part of the unpaid daily balance for that day for the purpose of calculating interest charges under the contract.

30   Default interest  

30(1)    
A credit contract may not provide that an annual percentage rate applicable under a credit contract to any part of the unpaid balance will differ according to whether the debtor is in default under the contract.

30(2)    
However, a credit contract may provide for such a differential rate if the higher rate is imposed only in the event of default in payment, in respect of the amount in default and while the default continues.

30A  

30A   Regulations about residential investment property  
The regulations may provide that this Division applies in relation to a provision of credit covered by subparagraph 5(1)(b)(ii) or (iii) as if specified provisions were omitted, modified or varied as specified in the regulations.

30B   Regulations about credit card contracts  

30B(1)    
The regulations may make provision in relation to any of the following matters relating to interest charges under credit card contracts:

(a) the day from which a daily percentage rate may be applied, and the balance (or the part of a balance) to which it may be applied;

(b) how matters relating to interest charges may be described in:

(i) credit card contracts; and

(ii) other documents or advertisements published or broadcast by or on behalf of licensees who are credit providers under credit card contracts.

30B(2)    
Regulations made for the purpose of subsection (1) may:

(a) provide for offences against the regulations; and

(b) provide for civil penalties for contraventions of the regulations.

30B(3)    

The penalties for offences referred to in paragraph (2)(a) must not be more than 50 penalty units for an individual or 500 penalty units for a body corporate.

30B(4)    

The civil penalty for a contravention of a regulation made for the purposes of subsection (1) by an individual is 5,000 penalty units. However, section 167B of the National Credit Act applies in the same way as it would apply if the regulation contravened were a civil penalty provision under that Act.

30B(5)    
This Division has effect subject to regulations made for the purpose of subsection (1).

Division 4 - Fees and charges  

31   Prohibited credit fees or charges  

31(1)    
The regulations may specify credit fees or charges or classes of credit fees or charges that are prohibited for the purposes of this Code.