ASIC has updated regulatory guidance to help individuals and entities in the credit industry decide whether they engage in credit activities and whether they need an Australian credit licence.
Regulatory Guide 203 Do I need an Australian credit licence? (RG 203) has been updated to help new participants in the credit industry who are trying to decide whether they need to obtain a licence, and existing licensees and representatives who need to understand when certain exemptions can and can’t be relied on.
RG 203 has been updated to:
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reflect the current form of the National Consumer Credit Protection Act 2009 (National Credit Act) and National Consumer Credit Protection Regulations 2010, and remove information that is no longer relevant since the end of the transitional registration regime
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provide additional guidance about, and examples to illustrate, the different types of credit activities, and
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provide additional information about licence exemptions, including examples to illustrate the scope of some of the exemptions that are more commonly relied on.
ASIC has also made structural changes to RG 203 clarifying the three main things individuals and entities should consider when deciding whether they need an Australian credit licence:
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whether the provision of credit or consumer lease is regulated under the National Credit Code. If it is not, the licensing requirements in the National Credit Act will not apply. A number of exclusions you should be aware of are outlined in the guide
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if it is regulated under the National Credit Code, whether you engage in one or more of the specified types of activities in relation to that provision of credit or consumer lease, and
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if you do engage in credit activities, whether one or more of the licence exemptions apply. All of the current exemptions are outlined in the guide.
These changes have been made to clarify the guidance included in RG 203, rather than make substantive changes to ASIC’s approach to administering the credit licensing regime.
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Background
RG 203 was first released in December 2009 prior to the commencement of the legislation. This was to ensure those likely to be impacted by the reforms could determine whether they would need to be licensed, and to help them prepare their businesses in readiness for when the requirements came into effect. RG 203 was then reissued in June 2010 once the legislation had been finalised.
A number of regulations have also been made under the National Credit Act, many of these being made after the previous release of RG 203.
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