Stakeholder Notice: September 2008
1. This Notice provides an update on implementation of the Consumer Credit Act 2006 (CCA06). It relates specifically to the draft Legislative Reform (Consumer Credit) Order 2008, post-contract information requirements and the Consumer Credit Register.
Legislative Reform (Consumer Credit) Order 2008
2. The draft LRO was laid in Parliament on 17 June and has been approved by the House of Commons. It will be debated in the House of Lords on 8 October. Subject to final approval in the Lords we plan to make the LRO so that it can enter into force on 31 October 2008.
3. Further information on the LRO can be found on the BERR website at: www.berr.gov.uk/consumers/consumer-finance/credit-act-2006/documents/index.html
Transitional provision for buy-to-let lending
4. A transitional provision was included in the 4th Commencement Order to prevent section 2 of CCA06 applying to agreements which meet the new criteria for buy-to-let lending as set out in the LRO. At the time we made the Commencement Order we expected the LRO to come into force on 1 October and so the transitional was made to apply until then. In view of the delay in making the LRO, we have extended the application of the transitional provision in the Commencement Order to 31 October, by making an amending Statutory Instrument.
5. The SI amending the 4th Commencement Order was made on 15 September and can now be viewed at: www.opsi.gov.uk/si/si2008/uksi_20082444_en_1.
Post-contract information requirements - gone aways and IVAs
6. In May the Minister asked for a paper setting out in detail all the possible options (including “do nothing”) to address the issue of the requirement to send post-contract information to customers who have either “gone away” or agreed an IVA. We expect a decision from the Minister shortly following which we will issue a further stakeholder notice.
Consumer Credit Register
7. The OFT has a statutory duty under CCA to make information on applicants and applications available via a Public Register. On 21 August, the OFT launched its online Consumer Credit Register (also known as Public Register). Previously details of consumer credit licence holders were only available upon enquiry to the OFT (by telephone or in writing) – now enquirers have the option of searching instantly at: www.oft.gov.uk/ConsumerCreditRegister.
8. The Register provides details of applications for, and holders of, consumer credit licences, both current and past. It also contains details of the OFT’s decision to refuse an application or revoke a consumer credit licence as well as information relating to any appeal to the Consumer Credit Appeals Tribunal against this decision (or to the Secretary of State for appeals on an OFT decision made before 6 April 2008).
OFT consultation on scoping of irresponsible lending project
9. As mentioned in the previous Notice, the OFT is currently consulting on the scope of a project covering the irresponsible lending element of the fitness test introduced by CCA06 in April 2008. The consultation, which closes on 24 October, can be found at www.oft.gov.uk/news/press/2008/91-08
Further information on the Consumer Credit Act 2006
10. Either visit the BERR website or email CCA.06@berr.gsi.gov.uk