Australian Credit licensees must have adequate
documentation and systems to show they are complying with their
obligations under the National Consumer Credit Protection
Holders of an Australian Credit Licence may be getting a visit
from ASIC between April and 30 June this year. ASIC has announced
it intends to conduct a compliance check on the information that
licensees have provided in their Annual Compliance
Licensees are required to submit an Annual Compliance
Certificate no later than 45 days after the anniversary that their
licence was first issued. ASIC's announcement shows that
licensees must have adequate documentation and systems to show they
are complying with their obligations under the National Consumer
Credit Protection Act (NCCP Act)
As ASIC Commissioner Greg Tanzer commented, the Certificate
information "is critical to ensure those activities are
conducted appropriately and that there are relevant processes and
programs in place to identify non-compliance".
What information does a licence-holder have to provide?
Australian Credit Licence-holders are required to do the
following in their Annual Compliance Certificate:
update details about the licensee's business activities,
credit or credit intermediary activities and representatives for
the previous 12 months;
if the licence holder provides credit services, it should
provide information about the money held, the number of complaints
received and the number of voluntary, proactive compensation
programs it runs;
certify that the licensee is complying with its credit licence
certify matters and notify changes about all of the
licensee's fit and proper people, both current and those that
have ceased to perform that role in the past 12 months –
or provide details of any exceptions;
complete a statement of personal information for all new fit
and proper people; and
notify changes regarding responsible managers.
It is important that licence-holders show they have practices,
procedures and systems in place demonstrating they are acting in
accordance with their obligations under the NCCP Act. Not only
should licensees have an NCCP Plan, but they will also need to
demonstrate that the Plan has been implemented and is being
Recommendations for licence-holders
To ensure you are prepared for an ASIC visit, some useful steps
which can be taken before lodging your Annual Compliance
review your NCCP Plan for business and regulatory
ensure complaints are being regularly monitored and analysed
and there is regular reporting on complaints;
check with Responsible Managers on their compliance activities,
including that they are documenting steps taken to comply with
credit obligations; and
review Responsible Manager competency requirements and ensure
that all training is up-to-date and documented.
Merely signing off on your Annual Compliance Certificate without
undertaking some of these basic steps (amongst others) could come
at a high cost to licensees. The National Governance and Compliance
Division of Clayton Utz can assist you with preparing for
submission of your Annual Compliance Certificates such as by
facilitating a health check or mock audit of your
Thanks to Mark Teys for his help in writing this
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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