Consumer Credit Bill

House of Commons

Session 2004 - 05
Internet Publications
Other Bills before Parliament

Consumer Credit Bill

Consumer Credit Bill
38

(a)
to provide such information as may be specified or described in
the notice; or
(b)
to produce such documents as may be so specified or described.
(2)
The notice shall set out the reasons why the OFT requires the
information or documents to be provided or produced.
5
(3)
The information or documents shall be provided or produced—
(a)
before the end of such reasonable period as may be specified in
the notice; and
(b)
at such place as may be so specified.
(4)
A requirement may be imposed under subsection (1) on a person who
10
is—
(a)
the holder of a standard licence, or
(b)
the original applicant for a group licence,

only if the provision or production of the information or documents in
question is reasonably required for purposes connected with the OFT’s
15
functions under this Act.
(5)
A requirement may be imposed under subsection (1) on any other
person only if—
(a)
an act or omission mentioned in subsection (6) has occurred or
the OFT has reason to suspect that such an act or omission has
20
occurred; and
(b)
the provision or production of the information or documents in
question is reasonably required for purposes connected with—
(i)
the taking by the OFT of steps under this Part as a
consequence; or
25
(ii)
its consideration of whether to take such steps as a
consequence.
(6)
Those acts or omissions are acts or omissions which—
(a)
cast doubt on whether, having regard to section 25(2), a person
is a fit person to carry on a business under a standard licence;
30
(b)
cast doubt on whether the public interest is better served by a
group licence remaining in effect, or being issued, than by
obliging the persons who are licensees under it, or who would
be licensees under it, to apply separately for standard licences;
(c)
give rise, or are likely to give rise, to dissatisfaction for the
35
purposes of section 33A(1) or 33B(1); or
(d)
constitute or give rise to a failure of the kind mentioned in
section 39A(1).”
47
Power of OFT to require access to premises
After section 36B of the 1974 Act (inserted by section 46 of this Act) insert—
40
“36C
Power of OFT to require access to premises
(1)
The OFT may by notice to a licensee under a licence require him to
secure that access to the premises specified or described in the notice is
given to an officer of an enforcement authority in order for the officer—
(a)
to observe the carrying on of a business under the licence by the
45
licensee; or

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(b)
to inspect such documents of the licensee relating to such a
business as are—
(i)
specified or described in the notice; and
(ii)
situated on the premises.
(2)
The notice shall set out the reasons why the access is required.
5
(3)
The premises which may be specified or described in the notice—
(a)
include premises which are not premises of the licensee if they
are premises from which he carries on activities in connection
with the business in question; but
(b)
do not include premises which are used only as a dwelling.
10
(4)
The licensee shall secure that the required access is given at such times
as the OFT reasonably requires.
(5)
The OFT shall give reasonable notice of those times.
(6)
Where an officer is given access to any premises by virtue of this
section, the licensee shall also secure that persons on the premises give
15
the officer such reasonable assistance as he may require.
(7)
The assistance that may be required under subsection (6) includes
(amongst other things) the giving to the officer of an explanation of a
document which he is inspecting.
(8)
A requirement may be imposed under subsection (1) on a person who
20
is—
(a)
the holder of a standard licence, or
(b)
the original applicant for a group licence,

only if the observation or inspection in question is reasonably required
for purposes connected with the OFT’s functions under this Act.
25
(9)
A requirement may be imposed under subsection (1) on any other
person only if—
(a)
an act or omission mentioned in section 36B(6) has occurred or
the OFT has reason to suspect that such an act or omission has
occurred; and
30
(b)
the observation or inspection in question is reasonably required
for purposes connected with—
(i)
the taking by the OFT of steps under this Part as a
consequence; or
(ii)
its consideration of whether to take such steps as a
35
consequence.
(10)
In this section—
(a)
references to a licensee under a licence include, in relation to a
group licence issued on application, references to the original
applicant; and
40
(b)
references to a business being carried on under a licence by a
licensee include, in relation to the original applicant for a group
licence, activities being carried on by him for the purpose of
regulating or otherwise supervising (whether by virtue of an
enactment, an agreement or otherwise) licensees under that
45
licence in connection with their carrying on of businesses under
that licence.”

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48
Entry to premises under warrant
After section 36C of the 1974 Act (inserted by section 47 of this Act) insert—
“36D
Entry to premises under warrant
(1)
A justice of the peace may issue a warrant under this section if satisfied
on information on oath given on behalf of the OFT that there are
5
reasonable grounds for believing that the following conditions are
satisfied.
(2)
Those conditions are—
(a)
that there is on the premises specified in the warrant
information or documents in relation to which a requirement
10
could be imposed under section 36B; and
(b)
that if such a requirement were to be imposed in relation to the
information or documents—
(i)
it would not be complied with; or
(ii)
the information or documents would be tampered with.
15
(3)
A warrant under this section shall authorise an officer of an
enforcement authority—
(a)
to enter the premises specified in the warrant;
(b)
to search the premises and to seize and detain any information
or documents appearing to be information or documents
20
specified in the warrant or information or documents of a
description so specified;
(c)
to take any other steps which may appear to be reasonably
necessary for preserving such information or documents or
preventing interference with them; and
25
(d)
to use such force as may be reasonably necessary.
(4)
An officer entering premises by virtue of this section may take such
persons and equipment with him as he thinks necessary.
(5)
In the application of this section to Scotland—
(a)
the reference to a justice of the peace includes a reference to a
30
sheriff;
(b)
for ‘information on oath’ there is substituted ‘evidence on
oath’.”
49
Failure to comply with information requirement
After section 36D of the 1974 Act (inserted by section 48 of this Act) insert—
35
“36E
Failure to comply with information requirement
(1)
If on an application made by the OFT it appears to the court that a
person (the ‘information defaulter’) has failed to do something that he
was required to do by virtue of section 36B or 36C, the court may make
an order under this section.
40
(2)
An order under this section may require the information defaulter—
(a)
to do the thing that it appears he failed to do within such period
as may be specified in the order;

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(b)
otherwise to take such steps to remedy the consequences of the
failure as may be so specified.
(3)
If the information defaulter is a body corporate, a partnership or an
unincorporated body of persons which is not a partnership, the order
may require an officer, who is (wholly or partly) responsible for the
5
failure, to meet such costs or expenses of the application as are specified
in the order.
(4)
In this section—
‘court’ means—
(a)
in England and Wales and Northern Ireland, the High
10
Court or the county court;
(b)
in Scotland, the Court of Session or the sheriff;
‘officer’ means—
(a)
in relation to a body corporate, a person holding a
position of director, manager or secretary of the body or
15
any similar position;
(b)
in relation to a partnership or to an unincorporated
body of persons, a member of the partnership or body.
(5)
In subsection (4) ‘director’ means, in relation to a body corporate whose
affairs are managed by its members, a member of the body.”
20
50
Officers of enforcement authorities other than OFT
After section 36E of the 1974 Act (inserted by section 49 of this Act) insert—
“36F
Officers of enforcement authorities other than OFT
(1)
Anything done or omitted to be done by, or in relation to, a relevant
officer in the exercise or purported exercise of a power by virtue of
25
section 36C or 36D shall be treated for all purposes as having been done
or omitted to be done by, or in relation to, an officer of the OFT.
(2)
Subsection (1) does not apply for the purposes of any criminal
proceedings brought against a relevant officer or the enforcement
authority of which he is an officer in respect of anything done or
30
omitted to be done by the officer.
(3)
A relevant officer shall not disclose to a person other than the OFT
information obtained by his exercise of a power by virtue of section 36C
or 36D unless—
(a)
he has the approval of the OFT to do so; or
35
(b)
he is under a duty to make the disclosure.
(4)
In this section ‘relevant officer’ means an officer of an enforcement
authority other than the OFT.”
51
Consequential amendments relating to information
(1)
For section 7 of the 1974 Act (penalty for false information) substitute—
40
“7
Penalty for false information
A person commits an offence if, for the purposes of, or in connection
with, any requirement imposed or other provision made by or under

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this Act, he knowingly or recklessly gives information to the OFT, or to
an officer of the OFT, which, in a material particular, is false or
misleading.”
(2)
In subsection (1)(b)(ii) of section 162 of that Act (powers of entry and
inspection) for the words from “recorded” onwards substitute “to provide him
5
with that information;”.
(3)
At the end of that section insert—
“(8)
References in this section to a breach of any provision of or under this
Act do not include references to—
(a)
a failure to comply with a requirement imposed under section
10
33A or 33B;
(b)
a failure to comply with section 36A; or
(c)
a failure in relation to which the OFT can apply for an order
under section 36E.”
(4)
In section 165 of that Act (obstruction of authorised officers) after subsection (1)
15
insert—
“(1A)
A failure to give assistance or information shall not constitute an
offence under subsection (1)(c) if it is also—
(a)
a failure to comply with a requirement imposed under section
33A or 33B;
20
(b)
a failure to comply with section 36A; or
(c)
a failure in relation to which the OFT can apply for an order
under section 36E.”
(5)
In Part 12 of that Act before section 175 insert—
“174A
Powers to require provision of information or documents etc.
25
(1)
Every power by virtue of this Act to require the provision or production
of information or documents includes the power—
(a)
to require information to be provided or produced in such form
as the person exercising the power may specify, including, in
relation to information recorded otherwise than in a legible
30
form, in a legible form;
(b)
to take copies of, or extracts from, any documents provided or
produced by virtue of the exercise of the power; and
(c)
to require the person who is required to provide or produce any
information or document by virtue of the exercise of the
35
power—
(i)
to give an explanation of the information or document;
(ii)
to state, to the best of his knowledge and belief, where
the information or document is;
(iii)
to secure that any information provided or produced,
40
whether in a document or otherwise, is verified in such
manner as may be specified by the person exercising the
power; or
(iv)
to secure that any document provided or produced is
authenticated in such manner as may be so specified.
45
(2)
A requirement imposed by virtue of subsection (1)(c) shall be complied
with at or by such time as the person exercising the power may specify.

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(3)
Every power by virtue of this Act to inspect or to seize documents at
any premises includes the power to take copies of, or extracts from, any
documents inspected or seized by virtue of the exercise of the power.
(4)
But a person has no power by virtue of this Act—
(a)
to require another person to provide or to produce,
5
(b)
to seize from another person, or
(c)
to require another person to give access to premises for the
purposes of the inspection of,

any information or document which the other person would be entitled
to refuse to provide or produce in proceedings in the High Court on the
10
grounds of legal professional privilege or (in Scotland) in proceedings
in the Court of Session on the grounds of confidentiality of
communications.
(5)
In subsection (4) ‘communications’ means—
(a)
communications between a professional legal adviser and his
15
client;
(b)
communications made in connection with or in contemplation
of legal proceedings and for the purposes of those
proceedings.”
(6)
In section 189(1) of that Act (definitions) after the definition of “deposit”
20
insert—
“‘documents’ includes information recorded in any form;”.
(7)
In section 66(4)(d) of the Criminal Justice and Police Act 2001 (c. 16)
(interpretation provision relating to search powers) after “section” insert
“36D(3) or”.
25
(8)
In Part 1 of Schedule 1 to that Act (powers of seizure to which section 50
applies) before paragraph 19 insert—
“18A
The power of seizure conferred by section 36D(3) of the Consumer
Credit Act 1974.”
Civil penalties
30
52
Power of OFT to impose civil penalties
After section 39 of the 1974 Act insert—
“39A
Power of OFT to impose civil penalties
(1)
Where the OFT is satisfied that a person (the ‘defaulter’) has failed or is
failing to comply with a requirement imposed on him by virtue of
35
section 33A, 33B or 36A, it may by notice to him (a ‘penalty notice’)
impose on him a penalty of such amount as it thinks fit.
(2)
The penalty notice shall—
(a)
set out the OFT’s reasons for determining to impose a penalty;
(b)
state the amount of the penalty that is being imposed;
40
(c)
set out the OFT’s reasons for determining that amount;
(d)
specify how the payment of the penalty may be made; and

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(e)
specify the period within which the penalty is required to be
paid to the OFT.
(3)
The amount of the penalty shall not exceed £50,000.
(4)
The period specified in the penalty notice for the purposes of
subsection (2)(e) shall not end earlier than the end of the period during
5
which an appeal may be brought against the imposition of the penalty
under section 41.
(5)
If the defaulter does not pay the penalty to the OFT within the period
so specified—
(a)
the penalty shall be recoverable by the OFT; and
10
(b)
the unpaid balance from time to time shall carry interest at the
applicable rate.
(6)
For the purposes of subsection (5)(b) the applicable rate is—
(a)
in England and Wales and Scotland, the rate for the time being
specified in section 17 of the Judgments Act 1838;
15
(b)
in Northern Ireland, the rate for the time being applying to a
money judgment of the High Court.”
53
Further provision relating to civil penalties
(1)
After section 39A of the 1974 Act (inserted by section 52 of this Act) insert—
“39B
Further provision relating to civil penalties
20
(1)
Before determining to impose a penalty on a person under section 39A
the OFT shall give a notice to that person—
(a)
informing him that it is minded to impose a penalty on him;
(b)
setting out its reasons for being so minded;
(c)
stating the proposed amount of the penalty;
25
(d)
setting out its reasons for proposing that amount;
(e)
setting out the proposed period for the payment of the penalty;
and
(f)
inviting him to submit representations to it about the matters
mentioned in the preceding paragraphs in accordance with
30
section 34.
(2)
In determining whether to impose a penalty on a person under section
39A and the amount of the penalty, the OFT shall have regard (amongst
other things) to—
(a)
any penalty or fine that has been imposed on that person by
35
another body in relation to the conduct giving rise to the failure
in question;
(b)
other steps that the OFT has taken or might take under this Part
in relation to that conduct.
(3)
General notice shall be given of the imposition of a penalty under
40
section 39A on a person who is a responsible person in relation to a
group licence.
(4)
That notice shall include the matters set out in the notice imposing the
penalty in accordance with section 39A(2)(a) to (c).”