Consumer Credit Bill

House of Commons

Session 2005 - 06
Internet Publications
Other Bills before Parliament

Consumer Credit Bill

Consumer Credit Bill
Schedule 3 — Transitional Provision and Savings
62

(c)
that on a specified date the rules were made available to the public
in accordance with paragraph 16E(4).
      (3)
A certificate purporting to be signed as mentioned in sub-paragraph (1) is to
be taken to have been duly signed unless the contrary is shown.
Consultation
5
16G   (1)
If the scheme operator proposes to make consumer credit rules, it must
publish a draft of the proposed rules in the way appearing to it to be best
calculated to bring the draft to the attention of the public.
      (2)
The draft must be accompanied by—
(a)
an explanation of the proposed rules; and
10
(b)
a statement that representations about the proposals may be made to
the scheme operator within a specified time.
      (3)
Before making any consumer credit rules, the scheme operator must have
regard to any representations made to it in accordance with sub-paragraph
(2)(b).
15
      (4)
If consumer credit rules made by the scheme operator differ from the draft
published under sub-paragraph (1) in a way which the scheme operator
considers significant, the scheme operator must publish a statement of the
difference.
Schedule 3
20
Section 69

Transitional Provision and Savings
Interpretation
1     (1)
Expressions used in the 1974 Act have the same meaning in this Schedule
(apart from paragraphs 14 to 16 and 26) as they have in that Act.
      (2)
For the purposes of this Schedule an agreement becomes a completed
25
agreement once—
(a)
there is no sum payable under the agreement; and
(b)
there is no sum which will or may become so payable.
Statements to be provided in relation to regulated agreements
2     (1)
Section 77A of the 1974 Act applies in relation to agreements whenever
30
made.
      (2)
Section 77A shall have effect in relation to agreements made before the
commencement of section 6 of this Act as if the period mentioned in
subsection (1)(a) were the period of one year beginning with the day of the
commencement of section 6.
35
3
Regulations made under section 78(4A) of the 1974 Act may apply in relation
to agreements regardless of when they were made.
4     (1)
Section 7(3) of this Act shall have effect in relation to agreements whenever
made.

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Schedule 3 — Transitional Provision and Savings
63

      (2)
A dispensing notice given under section 185(2) of the 1974 Act which is
operative immediately before the commencement of section 7(3)—
(a)
shall, on the commencement of section 7(3), be treated as having
been given under section 185(2) as substituted by section 7(3); and
(b)
shall continue to be operative accordingly.
5
Default under regulated agreements
5
The OFT shall prepare, and give general notice of, the arrears information
sheet and the default information sheet required under section 86A of the
1974 Act as soon as practicable after the commencement of section 8 of this
Act.
10
6     (1)
Section 86B of the 1974 Act applies in relation to agreements whenever
made.
      (2)
In the application of section 86B in relation to an agreement made before the
commencement of section 9 of this Act, the conditions under subsection (1)
can be satisfied only if the two payments mentioned in paragraph (c) were
15
not required to have been made before the commencement of section 9.
      (3)
In the case of an agreement within subsection (9) of section 86B, sub-
paragraph (2) has effect as if for “two” there were substituted “four”.
7     (1)
Section 86C of the 1974 Act applies in relation to agreements whenever
made.
20
      (2)
In the application of section 86C in relation to an agreement made before the
commencement of section 10 of this Act, the conditions mentioned in
subsection (1) can be satisfied only if the two payments mentioned in
paragraph (b) were not required to have been made before the
commencement of section 10.
25
8
Section 86E of the 1974 Act applies in relation to agreements whenever made
but only as regards default sums which become payable after the
commencement of section 12 of this Act.
9     (1)
Section 86F of the 1974 Act applies in relation to agreements whenever made
but only as regards default sums which become payable after the
30
commencement of section 13 of this Act.
      (2)
Where section 86F applies in relation to an agreement made before the
commencement of section 13, the agreement shall have effect as if any right
of the creditor or owner to recover compound interest in connection with the
default sum in question at a particular rate were a right to recover simple
35
interest in that connection at that rate.
10
Section 14 of this Act shall have effect in relation to any default notice served
after the commencement of that section, regardless of—
(a)
when the breach of the agreement in question occurred; or
(b)
when that agreement was made.
40
11
The repeal by this Act of—
(a)
the words “(subject to subsections (3) and (4))” in subsection (1) of
section 127 of the 1974 Act,
(b)
subsections (3) to (5) of that section, and
(c)
the words “or 127(3)” in subsection (3) of section 185 of that Act,
45

Consumer Credit Bill
Schedule 3 — Transitional Provision and Savings
64


has no effect in relation to improperly-executed agreements made before the
commencement of section 15 of this Act.
12
A debtor or hirer under an agreement may make an application under
section 129(1)(ba) of the 1974 Act regardless of when that agreement was
made.
5
13
Section 130A of the 1974 Act applies in relation to agreements whenever
made but only as regards sums payable under judgments given after the
commencement of section 17 of this Act.
Unfair relationships
14    (1)
The court may make an order under section 140B of the 1974 Act in
10
connection with a credit agreement made before the commencement of
section 20 of this Act but only—
(a)
on an application of the kind mentioned in paragraph (a) of
subsection (2) of section 140B made at a time after the end of the
transitional period; or
15
(b)
at the instance of the debtor or a surety in any proceedings of the
kind mentioned in paragraph (b) or (c) of that subsection which were
commenced at such a time.
      (2)
But the court shall not make such an order in connection with such an
agreement so made if the agreement—
20
(a)
became a completed agreement before the commencement of section
20; or
(b)
becomes a completed agreement during the transitional period.
      (3)
Expressions used in sections 140A to 140C of the 1974 Act have the same
meaning in this paragraph as they have in those sections.
25
      (4)
In this paragraph “the transitional period” means the period of one year
beginning with the day of the commencement of section 20.
      (5)
An order under section 69 of this Act may extend, or further extend, the
transitional period.
15    (1)
The repeal by this Act of sections 137 to 140 of the 1974 Act shall not affect
30
the court’s power to reopen an existing agreement under those sections as
set out in this paragraph.
      (2)
The court’s power to reopen an existing agreement which—
(a)
became a completed agreement before the commencement of section
22(3) of this Act, or
35
(b)
becomes a completed agreement during the transitional period,

is not affected at all.
      (3)
The court may also reopen an existing agreement—
(a)
on an application of the kind mentioned in paragraph (a) of
subsection (1) of section 139 made at a time before the end of the
40
transitional period; or
(b)
at the instance of the debtor or a surety in any proceedings of the
kind mentioned in paragraph (b) or (c) of that subsection which were
commenced at such a time.

Consumer Credit Bill
Schedule 3 — Transitional Provision and Savings
65

      (4)
Nothing in section 16A or 16B of the 1974 Act shall affect the application of
sections 137 to 140 (whether by virtue of this paragraph or otherwise).
      (5)
The repeal or revocation by this Act of the following provisions has no effect
in relation to existing agreements so far as they may be reopened as set out
in this paragraph—
5
(a)
section 16(7) of the 1974 Act;
(b)
in section 143(b) of that Act, the words “, 139(1)(a)”;
(c)
section 171(7) of that Act;
(d)
in subsection (1) of section 181 of that Act, the words “139(5) and
(7),”;
10
(e)
in subsection (2) of that section, the words “or 139(5) or (7)”;
(f)
in section 61(6) of the Bankruptcy (Scotland) Act 1985 (c. 66), the
words from the beginning to “but”;
(g)
in section 343(6) of the Insolvency Act 1986 (c. 45), the words from
the beginning to “But”;
15
(h)
Article 316(6) of the Insolvency (Northern Ireland) Order 1989 (S.I.
1989/2405 (N.I. 19)).
      (6)
Expressions used in sections 137 to 140 of the 1974 Act have the same
meaning in this paragraph as they have in those sections.
      (7)
In this paragraph—
20
“existing agreement” means a credit agreement made before the
commencement of section 22(3) of this Act;
“the transitional period” means the period of one year beginning with
the day of the commencement of section 22(3).
      (8)
An order under section 69 of this Act may extend, or further extend, the
25
transitional period.
16    (1)
It is immaterial for the purposes of section 140C(4)(a) to (c) of the 1974 Act
when (as the case may be) a credit agreement or a linked transaction was
made or a security was provided.
      (2)
In relation to an order made under section 140B of the 1974 Act during the
30
transitional period in connection with a credit agreement—
(a)
references in subsection (1) of that section to any related agreement
shall not include references to a related agreement to which this sub-
paragraph applies;
(b)
the reference to a security in paragraph (d) of that subsection shall
35
not include a reference to a security to which this sub-paragraph
applies;

and the order shall not under paragraph (g) of that subsection direct
accounts to be taken, or (in Scotland) an accounting to be made, between any
persons in relation to a related agreement to which this sub-paragraph
40
applies.
      (3)
Sub-paragraph (2) applies to a related agreement or a security if—
(a)
it was made or provided before the commencement of section 21 of
this Act; and
(b)
it ceased to have any operation before the order under section 140B
45
is made.

Consumer Credit Bill
Schedule 3 — Transitional Provision and Savings
66

      (4)
In relation to an order made under section 140B after the end of the
transitional period in connection with a credit agreement—
(a)
references in subsection (1) of that section to any related agreement
shall not include references to a related agreement to which this sub-
paragraph applies;
5
(b)
the reference to a security in paragraph (d) of that subsection shall
not include a reference to a security to which this sub-paragraph
applies;

and the order shall not under paragraph (g) of that subsection direct
accounts to be taken, or (in Scotland) an accounting to be made, between any
10
persons in relation to a related agreement to which this sub-paragraph
applies.
      (5)
Sub-paragraph (4) applies to a related agreement or a security if—
(a)
it was made or provided before the commencement of section 21;
and
15
(b)
it ceased to have any operation before the end of the transitional
period.
      (6)
Expressions used in sections 140A to 140C of the 1974 Act have the same
meanings in this paragraph as they have in those sections.
      (7)
In this paragraph “the transitional period” means the period of one year
20
beginning with the day of the commencement of section 21.
      (8)
An order under section 69 of this Act may extend, or further extend, the
transitional period.
17
Section 1 of this Act shall have no effect for the purposes of section 140C(1)
of the 1974 Act in relation to agreements made before the commencement of
25
section 1.
Applications for licences and fitness to hold a licence etc.
18    (1)
Section 6A of the 1974 Act shall not apply in relation to applications made
before the commencement of section 27 of this Act.
      (2)
Section 6(2A) of the 1974 Act shall not apply in relation to applications so
30
made.
      (3)
The repeal by this Act of the words “and must be accompanied by the
specified fee” in section 6(2) of the 1974 Act has no effect in relation to
applications so made.
19    (1)
The OFT shall prepare and publish the guidance required by section 25A of
35
the 1974 Act as soon as practicable after the commencement of section 30 of
this Act.
      (2)
The requirements of subsection (4) of section 25A may be satisfied in relation
to the preparation of that guidance by steps taken wholly or partly before the
commencement of section 30.
40
Further powers of OFT to regulate conduct of licensees etc.
20
The cases in which the OFT may impose requirements under section 33A of
the 1974 Act include cases where the matter with which the OFT is
dissatisfied arose before the commencement of section 38 of this Act.

Consumer Credit Bill
Schedule 3 — Transitional Provision and Savings
67

21
The cases in which the OFT may impose requirements under section 33B of
the 1974 Act include cases where the matters giving rise to the OFT’s
dissatisfaction arose before the commencement of section 39 of this Act.
22    (1)
The OFT shall prepare and publish the guidance required by section 33E of
the 1974 Act as soon as practicable after the commencement of section 42 of
5
this Act.
      (2)
The requirements of subsection (4) of section 33E may be satisfied in relation
to the preparation of that guidance by steps taken wholly or partly before the
commencement of section 42.
Powers and duties in relation to information
10
23    (1)
Section 44 of this Act has no effect in relation to applications made before the
commencement of that section.
      (2)
Paragraph 12(6) of Schedule A1 to the 1974 Act does not apply in relation to
applications so made.
24
A person is not required by section 36A of the 1974 Act to do anything in
15
relation to an application made by him before the commencement of section
45 of this Act.
Civil penalties
25    (1)
The OFT shall prepare and publish the statement of policy required by
section 39C of the 1974 Act as soon as practicable after the commencement
20
of section 54 of this Act.
      (2)
The requirements of subsection (5) of section 39C may be satisfied in relation
to the preparation of that statement of policy by steps taken wholly or partly
before the commencement of section 54.
Appeals
25
26    (1)
A person who—
(a)
immediately before the commencement of section 55 of this Act is a
member of a panel established under regulation 24 of the appeals
regulations, and
(b)
at the time of his appointment to that panel fell within paragraph
30
(2)(a) of that regulation,

shall be treated as having been appointed to the panel of chairmen on the
day of the commencement of section 55.
      (2)
A person who—
(a)
immediately before the commencement of section 55 is a member of
35
a panel established under regulation 24 of the appeals regulations,
and
(b)
is not to be treated as having been appointed to the panel of chairmen
in accordance with sub-paragraph (1),

shall be treated as having been appointed to the lay panel on the day of the
40
commencement of section 55.
      (3)
A person who is to be treated as having been appointed to the panel of
chairmen or to the lay panel in accordance with this paragraph shall, subject

Consumer Credit Bill
Schedule 4 — Repeals
68

to paragraph 4(2) and (3) of Schedule A1 to the 1974 Act, hold office as a
member of the panel in question—
(a)
for the remainder of the period for which he was appointed under
regulation 24 of the appeals regulations; and
(b)
on the terms on which he was so appointed (except as to the renewal
5
of his appointment).
      (4)
In this paragraph—
“appeals regulations” means the Consumer Credit Licensing (Appeals)
Regulations 1998 (S.I. 1998/1203);
“lay panel” and “panel of chairmen” have the same meanings as in
10
Schedule A1 to the 1974 Act.
27    (1)
Neither—
(a)
subsections (1) and (2) of section 56 of this Act, nor
(b)
the repeal by this Act of subsections (2) to (5) of section 41 of the 1974
Act,
15

has effect in relation to determinations of the OFT made before the
commencement of section 56.
      (2)
This Act, so far as it repeals section 11 of the Tribunals and Inquiries Act 1992
(c. 53), has no effect in relation to such determinations so made.
      (3)
The repeal by this Act of paragraph 27(2) of Schedule 25 to the Enterprise Act
20
2002 (c. 40) has no effect in relation to such determinations so made.
28
Neither subsection (1) nor (4)(a) of section 58 of this Act has effect in relation
to determinations of the OFT made before the commencement of that
section.
Ombudsman scheme
25
29
Section 1 of this Act shall have no effect for the purposes of section
226A(4)(a) of the 2000 Act in relation to a complaint which relates to an act
or omission occurring before the commencement of section 1.
Schedule 4
Section 70

Repeals
30

Act or instrument
Extent of repeal

Consumer Credit Act 1974
In section 2(7), the words “or 150”.

(c. 39)
In section 6(2), the words “and must be

accompanied by the specified fee”.

Section 8(2).

35

In section 15, subsection (1)(c) and the “and”

immediately preceding it.

Section 16(7).

Section 22(9) and (10).

Section 23(2).

40

Section 25(1A).

Section 29(5).

Section 32(5).

Section 36(6).