PART 5Amendments of the Consumer Credit Act 1974 etc.

Amendments of the 1974 Act20

1

The 1974 Act is amended as follows.

2

Part 1 (sections 1 to 7) (Office of Fair Trading) M1 is omitted.

3

In section 8 (consumer credit agreements) M2, for subsection (3) substitute—

3

A consumer credit agreement is a regulated agreement within the meaning of this Act if it is a regulated credit agreement for the purposes of Chapter 14A of Part 2 of the Regulated Activities Order.

4

In section 15 (consumer hire agreements) M3 for subsection (2) substitute—

2

A consumer hire agreement is a regulated agreement with the meaning of this Act if it is a regulated consumer hire agreement for the purposes of Chapter 14B of Part 2 of the Regulated Activities Order.

5

Section 16 (exempt agreements) M4 is omitted.

6

Section 16A (exemption relating to high net worth debtors and hirers) M5 is omitted.

7

Section 16B (exemption relating to businesses) M6 is omitted.

8

Section 16C (exemption relating to investment properties) M7 is omitted.

9

For section 20 (total charge for credit), substitute—

20Total charge for credit

In this Act, “the total charge for credit” has the meaning given by the Regulated Activities Order for the purposes of Chapter 14A of Part 2 of that Order.

10

Part 3 (sections 21 to 41ZB) (licensing of credit and hire business) M8 is omitted M9.

11

Section 43 (advertisements to which Part IV applies) M10 and the heading immediately before it are omitted.

12

Section 44 (form and content of advertisements) is omitted.

13

Section 45 (prohibition of advertisement where goods etc. not sold for cash) is omitted.

14

Section 47 (advertising infringements) M11 is omitted.

15

Section 51 (prohibition of unsolicited credit-tokens) is omitted.

16

Section 51A (restrictions on provision of credit card cheques) M12 is omitted.

17

Section 51B (section 51A: exemption for business) is omitted.

18

Section 52 (quotations) M13 and the heading immediately before it are omitted.

19

Section 53 (duty to display information) M14 is omitted.

20

Section 54 (conduct of business regulations) M15 is omitted.

21

Section 55A (pre-contractual explanations etc.) M16 is omitted.

22

Section 55B (assessment of creditworthiness) is omitted.

23

In section 55C (copy of draft consumer credit agreement), for subsection (5) substitute—

5

Article 60C(5) and (6) of the Regulated Activities Order applies for the purposes of subsection (4)(d).

24

In section 60 (form and content of agreements) M17, for subsection (6) substitute—

6

Article 60C(5) and (6) of the Regulated Activities Order applies for the purposes of subsection (5)(d).

25

In section 61A (duty to supply copy of executed consumer credit agreement) M18, for subsection (7) substitute—

7

Article 60C(5) and (6) of the Regulated Activities Order applies for the purposes of subsection (6)(b)(iii).

8

In this section, “credit intermediary” means a person who in the course of business—

a

carries on any of the activities specified in article 36A(1)(d) to (f) of the Regulated Activities Order for a consideration that is or includes a financial consideration, and

b

does not do so as a creditor.

26

In section 74 (exclusion of certain agreements from Part V) M19—

a

in subsection (1B), omit paragraph (a);

b

in subsection (1C), omit paragraph (b);

c

in subsection (1D), omit paragraphs (b) and (c);

d

in subsection (1F), omit paragraphs (b) and (c).

27

Part 5A (sections 74A to 74B) (current account overdrafts) M20 is omitted.

28

In section 75A (further provision for liability of creditor for breaches by supplier) M21, for subsection (7) substitute—

7

Article 60C(5) and (6) of the Regulated Activities Order applies for the purposes of subsection (6)(c).

29

In section 77B (fixed-sum credit agreement: statement of account to be provided on request) M22, for subsection (10) substitute—

10

Article 60C(5) and (6) of the Regulated Activities Order applies for the purposes of subsection (9)(d).

30

Section 81 (appropriation of payments) is omitted.

31

In section 82 (variation of agreements) M23—

a

in subsection (2A), omit “as a result of section 16(6C) or 16C”;

b

in subsection (3)(b), omit “as a result of section 16(6C) or 16C”;

c

in subsection (5A), omit “as a result of section 16(6C) or 16C”;

d

after subsection (7) insert—

8

In this section, an “exempt agreement” means an agreement which is an exempt agreement for the purposes of Chapter 14A of Part 2 of the Regulated Activities Order by virtue of article 60C(2) (regulated mortgage contracts and regulated home purchase plans) or article 60D (exemption relating to the purchase of land for non-residential purposes) of that Order.

32

Section 82A (assignment of rights) M24 is omitted.

33

In section 93 (interest not to be increased on default), in paragraph (b) for “section 20(2)” substitute “ rules made by the FCA under paragraph (2)(d) of article 60M of the Regulated Activities Order ”.

34

Section 112 (realisation of securities) is omitted.

35

In section 113 (Act not to be evaded by use of security) M25, in subsection (3)(c), for “40(2), 65(1), 124(1) or 149(2)” substitute “ 65(1) or 124(1) or a notice under section 28A of the Financial Services and Markets Act 2000 M26 ”.

36

In section 114(3) (pawn-receipts) M27, for “115” substitute “ 117 ”.

37

Section 115 (penalty for failure to supply copies of pledge agreement, etc.) is omitted.

F138

For section 126 (enforcement of land mortgages) substitute—

1

A land mortgage securing an agreement of one the following types is enforceable (so far as is provided in relation to the agreement) on an order of the court only—

a

a regulated agreement;

b

a regulated mortgage contract;

c

a consumer credit agreement which would, but for article 60D of the Regulated Activities Order (exempt agreements: exemption relating to the purchase of land for non-residential purposes), be a regulated agreement.

2

Subject to section 140A(5) (unfair relationships between creditors and debtors), a regulated mortgage contract which would, but for article 60C(2) of the Regulated Activities Order (exempt agreements: exemption relating to the nature of the agreement), be a regulated agreement is to be treated for the purposes of Part 9 (judicial control) as if it were a regulated agreement.

3

In this section, “regulated mortgage contract” has the meaning given by article 61(3) of the Regulated Activities Order (regulated mortgage contracts)).

39

In section 140A(5) (unfair relationships between creditors and debtors) M28, for “by virtue of section 16(6C)” substitute “ for the purposes of Chapter 14A of Part 2 of the Regulated Activities Order by virtue of article 60C(2) of that Order (regulated mortgage contracts and regulated home purchase plans) ”.

40

Section 140D (advice and information) M29 is omitted.

41

In section 145 (types of ancillary credit business) M30—

a

for subsections (2) to (4) substitute—

2

“Credit brokerage” means the carrying on of an activity of the kind specified by article 36A(1)(a) to (c) of the Regulated Activities Order (credit broking), disregarding the effect of paragraph (2) of that article.

b

for subsection (5), substitute—

5

“Debt adjusting” means the carrying on of an activity of the kind specified by article 39D of that Order (debt adjusting).

c

for subsection (6), substitute—

6

“Debt-counselling” means the carrying on of an activity of the kind specified by article 39E of that Order (debt-counselling).

d

for subsection (7), substitute—

7

“Debt-collecting” means the carrying on of an activity of the kind specified by article 39F of that Order (debt-collecting).

e

for subsection (7A), substitute—

7A

“Debt administration” means the carrying on of an activity of the kind specified by article 39G of that Order (debt administration), disregarding the effect of paragraph (3) of that article.

f

for subsections (7B) to (7D) substitute—

7B

A person (“P”) provides credit information services if P carries on, by way of business, an activity of the kind specified by article 89A(1) or (2) of that Order (providing credit information services).

g

for subsection (8) substitute—

8

A person (“P”) operates a credit reference agency if P carries on, by way of business, an activity of the kind specified by article 89B of that Order (providing credit references).

42

Sections 146 to 152 (including the heading immediately before section 147) M31 are omitted.

43

In section 155 (right to recover brokerage fees) M32—

a

in subsection (2)—

i

in paragraph (b), for “such as is referred to in section 145(2)(a)(ii)” substitute “ desiring to obtain credit to finance the acquisition or provision of a dwelling occupied or to be occupied by that individual or a relative of that individual ”;

ii

for paragraph (c) and the “or” before it, substitute—

c

a credit agreement which is an exempt agreement for the purposes of Chapter 14A of Part 2 of the Regulated Activities Order, or

d

an agreement which is not a regulated credit agreement or a regulated consumer hire agreement but which would be such an agreement if the law applicable to the agreement were the law of a part of the United Kingdom.

b

in subsection (2A)(a), for “section 146(5A)” substitute “ article 36E of the Regulated Activities Order (activities in relation to certain agreements relating to land) ”.

44

Section 156 (entry into agreements) M33 and the heading immediately before it are omitted.

45

In section 159(5) (correction of wrong information) M34, for “the specified fee” substitute “ the prescribed fee ”.

46

In section 160(4)(c) (alternative procedure for business consumers) M35, for “the specified fee” substitute “ the prescribed fee ”.

47

Section 160A (credit intermediaries) M36 is omitted.

48

In section 161 (enforcement authorities) M37—

a

paragraph (a) of subsection (1) is omitted;

b

after subsection (1), insert—

1A

Subsection (1) does not limit any function of the FCA in relation to the enforcement of this Act or regulations made under it.

49

In section 162 (powers of entry and inspection) M38, subsections (5) and (8) are omitted.

50

In section 165 (obstruction of authorised officers) M39, subsection (1A) is omitted.

51

In section 167 (penalties), subsection (2) is omitted.

52

In section 171 (onus of proof in various proceedings), subsection (3) is omitted.

53

In section 173(3) (contracting-out forbidden) M40, for “OFT” substitute “ FCA ”.

54

In section 174A (powers to require provision of information or documents etc) M41, for subsection (5) substitute—

5

In this section, “relevant authority” means an enforcement authority or an officer of an enforcement authority.

55

In section 180(2) (power to prescribe form etc. of copies), omit “(except section 35)”.

56

In section 181 (power to alter monetary limits etc) M42—

a

in subsection (1), omit “16B(1),”, “39A(3),” and “118(1)(b), 120(1)(a),”;

b

in subsection (2), omit “16B(1),” and “39A(3),”.

57

In section 182 (regulations and orders) M43, in subsection (1), omit “2(1)(a),”.

58

In section 183 (determinations etc. by OFT) M44, omit subsection (2).

59

In section 185 (agreement with more than one debtor or hirer) M45, omit subsection (1A).

60

In section 189 (definitions)—

a

in subsection (1)—

i

omit the definitions of “advertiser”, “appeal period”M46, “exempt agreement”M47, “group licence”, “licence”M48, “licensed”, “licensee”, “quotation”, “register”M49, “specified fee”, “standard licence” and “unlicensed”;

ii

in the definition of “credit information services”M50, for “has the meaning given by” substitute “ is to be read in accordance with ”;

iii

in the definition of “credit reference agency”, for “has the meaning given by” substitute “ is to be read in accordance with ”;

iv

in the definition of “deposit”M51, omit “(except in section 16(10) and 25(1B)”;

v

after the definition of “redemption period” insert—

“Regulated Activities Order” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;

vi

for the definition of “regulated agreement” substitute—

“regulated agreement” means a consumer credit agreement which is a regulated agreement (within the meaning of section 8(3)) or a consumer hire agreement which is a regulated agreement (within the meaning of section 15(2));

vii

for the definition of “total charge for credit” substitute—

“total charge for credit” has the meaning given by section 20;

b

in subsection (1A) M52, omit “36E(3),”;

c

in subsection (2A) M53, for the words from “subsections (2) to (5)” to the end, substitute “ article 60C(5) and (6) of the Regulated Activities Order applies ”;

d

in subsection (5) M54, omit “or the OFT” in the first place and “or the OFT (as the case may be)”.

61

Section 189A (meaning of “consumer credit EEA firm”) M55 is omitted.

62

In section 190 (financial provisions) M56, subsection (2) is omitted.

63

In section 191 (special provisions as to Northern Ireland) M57, subsections (1) and (2) are omitted.

64

In Schedule 1 (prosecution and punishment of offences) M58, in the table, omit the entries for sections 7, 39(1), 39(2), 39(3), 45, 47(1), 51(1), 51A(1), 115, 160A, 167(2) and 174(5).

65

In Schedule 2 (examples of use of new terminology)—

a

in Part 1, omit the entry for “advertiser”;

b

in example 5, for “, according to regulations made under section 20(1), constitutes the total charge for credit” substitute “ constitutes the total charge for credit (within the meaning given by section 20) ”.

66

In Schedule 3 (transitional and commencement provisions) M59—

a

omit paragraphs 5 to 7 M60 and the headings immediately before each of those paragraphs;

b

omit paragraph 11 M61 and the heading immediately before it;

c

omit paragraphs 44, 45 and 46 M62 and the headings immediately before each of those paragraphs.