Australia: Senate Inquiry Into The National Consumer Credit Protection Reform Package: Inquiry Report Released

The National Consumer Credit Protection Reform Package (NCCP Package) was referred to the Senate Economics Legislation Committee on 25 June 2009 for inquiry. The Committee's inquiry report was released on 7 September 2009.

The NCCP Package comprises the National Consumer Credit Protection Bill 2009 (NCCP Bill), the National Consumer Credit Protection (Fees) Bill 2009 and the National Consumer Protection (Transitional and Consequential Provision) Bill 2009.  

The inquiry report also referred to the Corporations Legislation Amendment (Financial Services Modernisation) Bill 2009, an independent bill that contains a number of new strategies for regulation of margin lending, trustee corporations and promissory notes.

Under the NCCP Bill, the current state/territory based Uniform Consumer Credit Code will be replaced with the National Consumer Credit Code (NCCC).

Government's proposed timeline for implementing the NCCP Package:

1 Nov 2009

Credit providers and credit assistants to be registered with ASIC

1 Jan to 30 June 2010

Credit providers and credit assistants to be issued with an Australian Credit Licence (ACL)

1 Jan 2010

Main suite of changes – including increased hardship threshold commences for licensees other than banks and Australian finance companies

1 July 2010

Some of the new responsible lending obligations and other improvements commence

1 Jan 2011

Full range of responsible lending obligations commence for all licensees (including banks and Australian finance companies)

Key recommendations made by the Senate Committee include:

  • All three bills in the NCCP Package be passed before 1 November 2009
  • Initial implementation of reforms to be deferred from 1 January to 1 July 2010
  • Responsible lending provisions should still operate from 1 January 2011
  • The credit provider of a credit contract with a mortgage over residential property should only be required to re-assess suitability (where the assessment has not taken place within 90 days of the contract being written as required by section 128 of the NCCP Bill) if the credit provider has reason to believe that the situation of the consumer has changed such that the credit contract may no longer be suitable
  • The exemption under section 130(3) for credit providers not to re-verify information provided by a broker for suitability be omitted.

The 12 Recommendations By The Senate Committee In Its Inquiry Report Are As Follows:

Recommendation 1

The Committee recommends that at least the three bills of the NCCP Package be passed, subject to the Committee's recommendations, before 1 November 2009 to facilitate the necessary referrals by state parliaments.

Recommendation 2

The Committee recommends that implementation of the reforms due to begin on 1 January 2010 be deferred to 1 July 2010 to allow sufficient time for industry to prepare and ensure state parliaments are able to facilitate the necessary referrals.  However the responsible lending provisions due to start on 1 January 2011 should still operate from this date.

Recommendation 3

The Committee recommends that state parliaments ensure their own 'turn off dates' are legislated for so that consumers are not left without protection before the national scheme is in place.

Recommendation 4

The Committee recommends that ASIC consider a form of streamlined process for holders of an Australian Financial Licence when they apply for an Australian Credit Licence.

Recommendation 5

The Committee recommends that section 128 of the NCCP Bill be amended so that, where the credit contract involves a mortgage over a residential property, the credit provider should only be required to re-assess the suitability of the credit contract if:

  • an assessment has not taken place within 90 days of the contract being written, and
  • the credit provider has reason to believe that the situation of the consumer has changed such that the credit contract may no longer be suitable.

Recommendation 6

The Committee recommends that subsection 130(3) be omitted.

(Subsection 130(3) of the NCCP Bill states that if a preliminary assessment has been made by a credit assistant (such as a mortgage broker) in the preceding 90 days and the credit contract is found to be not unsuitable, the credit provider is not required to verify the consumer's financial situation).

Recommendation 7

The Committee recommends that the Government undertake further consultation to determine whether the definition of "credit assistance" in section 8 of the NCCP Bill is sufficient to prevent persons benefiting from referring a consumer to a person who engages in credit activity avoiding responsibility under the responsible lending obligations.

Recommendation 8

The Committee recommends that Part 4-2 of the NCCP Bill be amended to allow consumers to seek remedies and compensation for loss suffered as a result of a contravention of any responsible lending provision, regardless of whether a civil penalty is declared or a breach of a civil penalty is found to have occurred.

Recommendation 9

The Committee recommends that the Government investigate means to ensure that the national legislation does not inadvertently reduce the current access of any consumer to low-cost tribunals.

Recommendation 10

The Committee recommends that the increased hardship threshold ($500,000) should apply to all applications for a variation of the terms of a credit contract on the grounds of hardship (made under section 72 of the NCCC) regardless of when the credit contract commenced.

Recommendation 11

The Committee recommends that, in the event that a hardship application is rejected by a credit provider, the lender be required to provide, in writing, the reason(s) for the rejection.

Recommendation 12

The Committee recommends that the Corporations Legislation Amendment (Financial Services Modernisation) Bill 2009 be passed.

A copy of the Senate Committee's inquiry report can be accessed from the Senate's website.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.