Page 4941 - Week 15 - Thursday, 8 December 1994

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THE CODE ALSO CHANGES THE CIVIL PENALTY REGIME. MEMBERS WILL BE AWARE THAT UNDER THE EXISTING LEGISLATION, IN

ADDITION TO CRIMINAL PENALTIES, CREDIT PROVIDERS

AUTOMATICALLY LOSE ALL OF THEIR INTEREST IF THEY BREACH CERTAIN PROVISIONS OF THE ACT. CREDIT PROVIDERS HAVE TO MAKE REINSTATEMENT APPLICATIONS TO THE CREDIT TRIBUNAL. ALTHOUGH THE TERRITORY WOULD HAVE PREFERRED TO RETAIN SUCH AUTOMATIC CIVIL PENALTIES AS A DETERRENT, IT WAS IN THE END IMPOSSIBLE AGAINST THE ODDS TO SUCCEED ON THIS POINT. OTHERWISE THE WHOLE CODE MAY NOT HAVE PROCEEDED.

UNDER THE CONSUMER CREDIT CODE THE NUMBER OF CIVIL

PENALTY TRIGGERS HAS BEEN NARROWED AND MADE EXPLICIT. THE TRIGGERS ARE CALLED "KEY REQUIREMENTS" AND ARE SET OUT IN CLAUSE 100. THE PRESENT OPEN-ENDED LIABILITY OF

CREDIT PROVIDERS IS MODIFIED AND A CAP OF $500,000 FOR ALL

BREACHES OF A KEY REQUIREMENT IN AUSTRALIA IS PROPOSED. THIS CAPPING WILL DEAL WITH CONCERNS OF SOME OF THE

SMALLER LENDERS THAT THEIR PRUDENTIAL STANDING COULD HAVE BEEN OTHERWISE JEOPARDISED. IN ADDITION, WHEN

DETERMINING WHETHER TO IMPOSE A CIVIL PENALTY, A COURT IS SPECIFICALLY REQUIRED TO HAVE REGARD PRIMARILY TO THE

PRUDENTIAL STANDING OF THE CREDIT PROVIDER IF REQUESTED BY THE CREDIT PROVIDER.

APART FROM AN APPLICATION BY A BORROWER AFFECTED, THE DIRECTOR OF CONSUMER AFFAIRS CAN INTERVENE IN A CIVIL

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