If you provide credit to Victorian residents (even if your business is based outside Victoria) you are affected by the Victorian Fair Trading and Other Acts Amendment Act 2009 which commenced operation on 11 June 2009.
The 2 main requirements are:
- to comply with new unfair contract terms rules; and
- to join an ASIC-approved External Dispute Resolution scheme relating to credit disputes.
Unfair consumer credit contract terms
The new unfair contract law (set out in Part 2B of Victoria’s Fair Trading Act 1999) pre-empts the Commonwealth's unfair contract terms law which is due to apply nationally from 1 January 2010,
Consumer Affairs Victoria has published Guidelines on unfair terms in consumer credit contracts.
EDR Scheme for credit
Amendments to Victoria's Consumer Credit Act require credit providers lending to Victorian residents to join an ASIC-approved External Dispute Resolution scheme by 1 July 2009.
Whilst many credit providers will already be in an EDR scheme for the purpose of their AFS Licence, their existing scheme may not extend to credit disputes. Credit providers who are affected should confirm extended coverage with their EDR scheme provider.
Dispute resolution brochures provided to consumers will need to confirm the applicability of the EDR scheme to credit disputes.