The Australian Government has released amendments to the National Consumer Credit Protection Regulations, as a result of further consultations with industry - and more are on the way.
These Amendment Regulations do two main things:
- make an exemption for special purpose funding entities: special purpose funding entities that are credit providers or lessors in the securitisation industry and other parts of the non-bank lending sector will not be required to hold an Australian credit licence, but will have to engage a third party who is licensed (or, during the transitional period, registered) and who will act on their behalf in complying with the Act. They will also need to join an ASIC approved external dispute resolution scheme.
- change the arrangements for unlicensed lenders and lessors with carried over instruments: there are new requirements for unlicensed lenders and lessors who fail certain probity requirements. There is also relief from making certain disclosures for unlicensed lenders and lessors who are not members of an ASIC approved external dispute resolution scheme.
What's next
The Government will release further regulations in the next few weeks which will include:
- an additional exemption for referrers where they pass on a consumer's contact details directly to a licensee or registered person;
- clarification of the treatment of locums and temporary employees; and
- transitional arrangements for residential investment property loans.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.