Treasury Laws Amendment (Miscellaneous Amendments) Regulations 2019 (F2019L01641)

Schedule 3   Credit card contracts

National Consumer Credit Protection Regulations 2010

2   After regulation 28LB

Insert:

28LBA Key Facts Sheets for credit card contracts

(1) For the purposes of section 133BB of the Act, Schedule 6 sets out:

(a) the Key Facts Sheet for a credit card contract; and

(b) requirements for how the information in a Key Facts Sheet is to be prepared.

(2) A Key Facts Sheet is taken to comply with Schedule 6 if:

(a) it does not refer to a term or condition that is, or may, only be available to a particular class of consumer; and

(b) the term or condition does not cause the consumers in that class to be worse off than they would be under the terms and conditions described in the Key Facts Sheet.

Example: A licensee makes a special promotional offer to customers who have a home loan with the licensee. The terms and conditions of the credit card contract under the offer are more advantageous than the terms and conditions of the credit card contract as described in the Key Facts Sheet.

It would be difficult to provide a new Key Facts Sheet for each promotional offer of this kind.

28LBB Application forms in electronic form

For the purposes of subsection 133BC(1) of the Act, if a licensee:

(a) makes available, in an electronic form, an application form that can be used to apply for a credit card contract; and

(b) includes, as part of the electronic form, a hyperlink to a Key Facts Sheet for the contract;

the application form is taken to include a Key Facts Sheet for the contract.

Example: A licensee may provide an application form as an online document, in an email, or as an attachment to an email.

Note: Subsection 133BC(1) of the Act requires the Key Facts Sheet to contain up-to-date information.

28LBC Circumstances in which application form may include out-of-date Key Facts Sheet

(1) For the purposes of subsection 133BC(3) of the Act, a circumstance in which a licensee may make available an application form that includes a Key Facts Sheet containing information that has ceased to be up-to-date is that the information ceased to be up-to-date no more than 3 months before the day on which the licensee makes the application form available.

(2) If the licensee makes the application form available by means that are under the licensee's control, the period for which the licensee may make the application form available is 3 months after the day on which the information ceased to be up-to-date.

(3) For the purposes of subsection 133BC(3) of the Act, a circumstance in which a licensee may make available an application form that includes a Key Facts Sheet containing information that has ceased to be up-to-date is that:

(a) the application form forms part of an advertisement in a publication published by a third party who is authorised to act for the licensee; and

(b) the licensee approved the application form for publication by the third party; and

(c) the information in the Key Facts Sheet was up to date when the licensee approved the application form for publication; and

(d) the expected date of publication of the advertisement was less than 30 days after the licensee approved the application form for publication.

28LBD Circumstances in which up-to-date information can be provided otherwise than in Key Facts Sheet

For the purposes of subparagraph 133BD(1)(b)(ii) of the Act, a requirement for the provision of up-to-date information to a consumer if a Key Facts Sheet contains information that has ceased to be up-to-date is that the licensee provides the up-to-date information no later than the time at which the licensee provides the consumer with the credit card to which the Key Facts Sheet related.

28LBE Meaning of credit limit increase invitation

(1) For the purposes of subsection 133BE(6) of the Act, a communication is covered by the definition of credit limit increase invitation in subsection 133BE(5) of the Act if it:

(a) includes a proposed credit limit that is higher than the consumer's existing credit limit; or

(b) suggests that a higher credit limit may benefit the consumer.

(2) For the purposes of subsection 133BE(6) of the Act, a communication is not covered by the definition of credit limit increase invitation in subsection 133BE(5) of the Act if it only provides generic information about credit limits that is applicable to each consumer who is a party to a credit card contract with the licensee.

Note: Subsection 133BE(6) of the Act provides that the regulations may make provisions that apply to determining whether a communication is covered by the definition of credit limit increase invitation in subsection 133BE(5) of the Act.

28LBF Licensee to notify consumer of use of credit card in excess of credit limit

(1) For the purposes of subsection 133BH(1) of the Act, if a consumer who is the debtor under a credit card contract has used a card in excess of the credit limit for the contract, the licensee who is the credit provider under the contract must take reasonable steps to notify the consumer of that matter, not later than 2 business days after becoming aware of the use of the card in excess of the limit.

(2) However, if:

(a) the consumer pays the amount by which the credit limit has been exceeded within 2 business days after the day on which the balance under the credit card contract first exceeds the credit limit; and

(b) the licensee has not already notified the consumer when the amount is paid;

the licensee is not required to notify the consumer.

(3) The licensee is only required to notify the consumer once during a statement period.

(4) The licensee must include in the notification information about exceeding the credit limit that is sufficient to lead a reasonable consumer to check the balance under the consumer's credit card contract.

28LBG Fees charges and higher rates of interest

For the purposes of paragraph 133BI(1)(c) of the Act, if a licensee provides a form to allow a consumer to consent to have fees, charges or a higher rate of interest charged on a credit card that is used in a way mentioned in subsection 133BI(1) of the Act, the licensee must ensure that the invitation to give consent:

(a) allows the consumer to withdraw the consent; and

(b) discloses any fee charged in relation to the consumer's consent; and

(c) discloses the fee, charge or higher rate of interest that will be charged on the credit card if it is used in the way mentioned in subsection 133BI(1) of the Act; and

(d) explains that the fee may increase at any time, in accordance with the terms of the credit card contract; and

(e) explains that fees, charges or a higher rate of interest may be charged on the credit card for the amount by which the balance under the credit card contract exceeds the credit limit; and

(f) explains that fees, charges or a higher rate of interest are likely to be charged on the credit card for the statement period in which the credit card was used in a way mentioned in subsection 133BI(1) of the Act.

28LBH Records of elections and withdrawals to be kept

(1) For the purposes of subsection 133BJ(1) of the Act, if a consumer in relation to a credit card contract has:

(a) given a consent covering the imposition of fees or charges, or a higher rate of interest, in relation to the contract; or

(b) withdrawn a consent of that kind;

the licensee in relation to the contract must keep a record stating that a consent or withdrawal is current and showing the date on which the consent was given or withdrawn.

Note: The consent is described in detail in section 133BI of the Act.

(2) The licensee must keep the record for the period during which the consent or withdrawal is in effect.

28LBI Agreement to apply payment against particular amount owed

For the purposes of subsection 133BP(5) of the Act, a licensee that proposes to agree to a request by a consumer to apply certain payments made under the credit card contract against a particular amount must, before agreeing to the request, advise the consumer that the consumer:

(a) may be liable to pay an amount or rate of interest under the agreement that is greater than the consumer would be liable to pay under section 133BQ of the Act; and

(b) may withdraw the request at a later time.