Consumer Credit Bill

House of Commons

Session 2005 - 06
Internet Publications
Other Bills before Parliament

Consumer Credit Bill

Consumer Credit Bill
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Appeals from the Consumer Credit Appeals Tribunal
In Part 3 of the 1974 Act after section 41 insert—
“41A
Appeals from the Consumer Credit Appeals Tribunal
(1)
A party to an appeal to the Tribunal may with leave appeal—
(a)
in England and Wales and Northern Ireland, to the Court of
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Appeal, or
(b)
in Scotland, to the Court of Session,

on a point of law arising from a decision of the Tribunal.
(2)
For the purposes of subsection (1) leave to appeal may be given by—
(a)
the Tribunal; or
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(b)
the Court of Appeal or the Court of Session.
(3)
An application for leave to appeal may be made to the Court of Appeal
or the Court of Session only if the Tribunal has refused such leave.
(4)
If on an appeal under this section the court considers that the decision
of the Tribunal was wrong in law, it may do one or more of the
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following—
(a)
quash or vary that decision;
(b)
substitute for that decision a decision of its own;
(c)
remit the matter to the Tribunal for rehearing and
determination in accordance with the directions (if any) given
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to it by the court.
(5)
An appeal may be brought from a decision of the Court of Appeal
under this section only if leave to do so is given by the Court of Appeal
or the House of Lords.
(6)
Rules under section 40A(3) may make provision for regulating or
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prescribing any matters incidental to or consequential on an appeal
under this section.
(7)
In this section ‘party’ means, in relation to an appeal to the Tribunal,
the appellant or the OFT.”
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Consequential amendments relating to appeals
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(1)
In section 2(7) of the 1974 Act (restriction on power to give directions to OFT)
for “Secretary of State” substitute “the Tribunal”.
(2)
In section 182 of that Act (regulations and orders) after subsection (1) insert—
“(1A)
The power of the Lord Chancellor to make rules under section 40A(3)
shall be exercisable by statutory instrument subject to annulment in
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pursuance of a resolution of either House of Parliament.”
(3)
In subsection (2) of that section—
(a)
after “orders” wherever occurring insert “or rules”;
(b)
after “by the Secretary of State” insert “or by the Lord Chancellor”;
(c)
in paragraph (c) for “Secretary of State” substitute “person making
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them”.
(4)
In section 189(1) of that Act (definitions)—

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(a)
in the definition of “appeal period” for “Secretary of State” substitute
“Tribunal”;
(b)
after the definition of “total price” insert—
“‘the Tribunal’ means the Consumer Credit Appeals
Tribunal;”.
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(5)
In Schedule 1 to the Tribunals and Inquiries Act 1992 (c. 53) (tribunals under
supervision of Council of Tribunals) after paragraph 9A insert—

“Consumer credit
9B. The Consumer Credit

Appeals Tribunal established

by section 40A of the

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Consumer Credit Act 1974.”

Ombudsman scheme
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Financial services ombudsman scheme to apply to consumer credit licensees
(1)
After section 226 of the 2000 Act insert—
“226A
Consumer credit jurisdiction
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(1)
A complaint which relates to an act or omission of a person (‘the
respondent’) is to be dealt with under the ombudsman scheme if the
conditions mentioned in subsection (2) are satisfied.
(2)
The conditions are that—
(a)
the complainant is eligible and wishes to have the complaint
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dealt with under the scheme;
(b)
the complaint falls within a description specified in consumer
credit rules;
(c)
at the time of the act or omission the respondent was the
licensee under a standard licence;
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(d)
the act or omission occurred in the course of a business being
carried on by the respondent which was of a type mentioned in
subsection (3);
(e)
at the time of the act or omission that type of business was
specified in an order made by the Secretary of State; and
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(f)
the complaint cannot be dealt with under the compulsory
jurisdiction.
(3)
The types of business referred to in subsection (2)(d) are—
(a)
a consumer credit business;
(b)
a consumer hire business;
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(c)
a business so far as it comprises or relates to credit brokerage;
(d)
a business so far as it comprises or relates to debt-adjusting;
(e)
a business so far as it comprises or relates to debt-counselling;
(f)
a business so far as it comprises or relates to debt-collecting;
(g)
a business so far as it comprises or relates to debt
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administration;
(h)
a business so far as it comprises or relates to the provision of
credit information services;

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(i)
a business so far as it comprises or relates to the operation of a
credit reference agency.
(4)
A complainant is eligible if—
(a)
he is—
(i)
an individual; or
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(ii)
a surety in relation to a security provided to the
respondent in connection with the business mentioned
in subsection (2)(d); and
(b)
he falls within a class of person specified in consumer credit
rules.
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(5)
The approval of the Treasury is required for an order under subsection
(2)(e).
(6)
The jurisdiction of the scheme which results from this section is
referred to in this Act as the ‘consumer credit jurisdiction’.
(7)
In this Act ‘consumer credit rules’ means rules made by the scheme
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operator with the approval of the Authority for the purposes of the
consumer credit jurisdiction.
(8)
Consumer credit rules under this section may make different provision
for different cases.
(9)
Expressions used in the Consumer Credit Act 1974 have the same
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meaning in this section as they have in that Act.”
(2)
In Schedule 17 to that Act (the ombudsman scheme) after Part 3 insert the Part
3A set out in Schedule 2 to this Act.
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Funding of ombudsman scheme
In Part 16 of the 2000 Act after section 234 insert—
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“234A
Funding by consumer credit licensees etc.
(1)
For the purpose of funding—
(a)
the establishment of the ombudsman scheme so far as it relates
to the consumer credit jurisdiction (whenever any relevant
expense is incurred), and
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(b)
its operation in relation to the consumer credit jurisdiction,

the scheme operator may from time to time with the approval of the
Authority determine a sum which is to be raised by way of
contributions under this section.
(2)
A sum determined under subsection (1) may include a component to
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cover the costs of the collection of contributions to that sum (‘collection
costs’) under this section.
(3)
The scheme operator must notify the OFT of every determination
under subsection (1).
(4)
The OFT must give general notice of every determination so notified.
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(5)
The OFT may by general notice impose requirements on—
(a)
licensees to whom this section applies, or
(b)
persons who make applications to which this section applies,

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to pay contributions to the OFT for the purpose of raising sums
determined under subsection (1).
(6)
The amount of the contribution payable by a person under such a
requirement—
(a)
shall be the amount specified in or determined under the
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general notice; and
(b)
shall be paid before the end of the period or at the time so
specified or determined.
(7)
A general notice under subsection (5) may—
(a)
impose requirements only on descriptions of licensees or
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applicants specified in the notice;
(b)
provide for exceptions from any requirement imposed on a
description of licensees or applicants;
(c)
impose different requirements on different descriptions of
licensees or applicants;
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(d)
make provision for refunds in specified circumstances.
(8)
Contributions received by the OFT must be paid to the scheme
operator.
(9)
As soon as practicable after the end of—
(a)
each financial year of the scheme operator, or
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(b)
if the OFT and the scheme operator agree that this paragraph is
to apply instead of paragraph (a) for the time being, each period
agreed by them,

the scheme operator must pay to the OFT an amount representing the
extent to which collection costs are covered in accordance with
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subsection (2) by the total amount of the contributions paid by the OFT
to it during the year or (as the case may be) the agreed period.
(10)
Amounts received by the OFT from the scheme operator are to be
retained by it for the purpose of meeting its costs.
(11)
The Secretary of State may by order provide that the functions of the
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OFT under this section are for the time being to be carried out by the
scheme operator.
(12)
An order under subsection (11) may provide that while the order is in
force this section shall have effect subject to such modifications as may
be set out in the order.
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(13)
The licensees to whom this section applies are licensees under standard
licences which cover to any extent the carrying on of a type of business
specified in an order under section 226A(2)(e).
(14)
The applications to which this section applies are applications for—
(a)
standard licences covering to any extent the carrying on of a
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business of such a type;
(b)
the renewal of standard licences on terms covering to any extent
the carrying on of a business of such a type.
(15)
Expressions used in the Consumer Credit Act 1974 have the same
meaning in this section as they have in that Act.”
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