National Consumer Credit Protection (Fees) Amendment Regulations 2010 (No. 2)

Overview

The National Consumer Credit Protection (Fees) Amendment Regulations 2010 (No. 2) were enacted to address issues related to the indexing of fees under the National Consumer Credit Protection (Fees) Act 2009. This regulation, which commenced on 1 July 2010, was issued by the Australian Government in accordance with section 10 of the Fees Act and is part of the broader National Credit Legislation. The primary objective of these regulations is to introduce indexation for fees, ensuring they adjust with inflation, and to specify no fees for the lodgment or provision of information required by the National Consumer Credit Protection (Transitional and Consequential Provisions) Regulations 2010 that pertains to carried over instruments, thereby encouraging compliance with the National Credit Legislation. The indexation mechanism is designed to maintain the real value of fees by adjusting them based on changes in the Consumer Price Index, thereby reflecting economic conditions more accurately.

Scope and Application

The National Consumer Credit Protection (Fees) Amendment Regulations 2010 (No. 2) applies to the fees imposed under the National Consumer Credit Protection Act 2009 and the National Consumer Credit Protection (Transitional and Consequential Provisions) Act 2009, which are collectively known as the National Credit Legislation. The Act applies to persons and entities involved in transactions regulated by the National Credit Legislation, including consumer credit providers, credit representatives, and credit licensees. The Regulations amend the National Consumer Credit Protection (Fees) Regulations 2010 to introduce indexation for fees and to specify no fees for the lodgment or provision of information as required by the National Consumer Credit Protection (Transitional and Consequential Provisions) Regulations 2010 that relates to carried over instruments. The Regulations have a national jurisdictional reach, applying to the whole of Australia. The Regulations do not specify any exclusions, exemptions, or thresholds. The Regulations extend the application of the Fees Act through subordinate instruments, as they amend the Principal Regulations to introduce indexation for fees and to specify no fees for the lodgment or provision of information as required by the National Consumer Credit Protection (Transitional and Consequential Provisions) Regulations 2010 that relates to carried over instruments.

Key Provisions

The National Consumer Credit Protection (Fees) Amendment Regulations 2010 (No. 2) primarily concern the amendment of fees under the National Consumer Credit Protection (Fees) Regulations 2010 (Principal Regulations) (reg 3). These amendments are made to facilitate the introduction of indexation for fees under the Principal Regulations, as stipulated in section 10 of the National Consumer Credit Protection (Fees) Act 2009 (Fees Act). The Regulations also specify that there will be no fees for the lodgment or provision of information as required by the National Consumer Credit Protection (Transitional and Consequential Provisions) Regulations 2010 that relates to carried over instruments (item 9). This is intended to encourage compliance with the National Credit Legislation. Furthermore, the Regulations revise the fees for late lodgment of documents, maintaining consistency with similar fees under the Corporations Act 2001 (items 10 and 11). The Regulations also remove an obsolete section on rounding (item 12). The Obligations and requirements imposed by these Regulations are primarily concerned with the adjustment and indexing of fees under the Principal Regulations. The Regulations require that fees under the Principal Regulations be indexed in accordance with the Consumer Price Index (CPI) if the CPI number is greater than the earlier CPI number in the financial year starting on 1 July 2011 or a subsequent 1 July (subreg 6(1)). If the latest CPI number is not greater than the earlier CPI number, no indexation for fees applies (subreg 6(2)). The Regulations also require that any amounts worked out using the amended regulations be rounded to the nearest whole dollar (rounding up an amount of 50 cents) (reg 7). Furthermore, the Regulations specify that there will be no fees for the lodgment or provision of information as required by the National Consumer Credit Protection (Transitional and Consequential Provisions) Regulations 2010 that relates to carried over instruments (item 9). The Regulations do not specify any offences or penalties for breach. However, they do outline the civil and criminal consequences for non-compliance with the National Credit Legislation. Non-compliance with the National Credit Legislation could result in a range of civil and criminal penalties, depending on the nature and severity of the breach. These could include fines, imprisonment, or both. The maximum penalties for breaches of the National Credit Legislation are set out in the relevant Acts and Regulations. For example, section 12AA of the Corporations Act 2001 provides that a person who contravenes a civil penalty provision is liable for a penalty not exceeding the greater of three times the penalty applicable under section 1311 or $222,000. Section 12AH of the Corporations Act 2001 provides that a person who is found guilty of an offence against a civil penalty provision is liable for a penalty not exceeding the greater of six times the penalty applicable under section 1311 or $666,000.