Draft legislation to give ASIC a product intervention power in relation to
financial products and credit products has been released by
Treasury.
Submissions on the draft legislation are due by 9 February
2018.
This article focuses on the provisions relating to credit
products.
Key proposals for credit products
If ASIC is satisfied that a business is engaging in or is likely
to engage in a credit activity which has or is likely to result in
significant detriment to consumers, ASIC may order that the
specified conduct cease or is modified. Engaging in a credit
activity will include businesses conducting lending and finance
broking.
The matters that ASIC can consider when deciding whether a
credit product may result in significant detriment to consumers are
not limited. However, ASIC must consider the nature and extent of
the detriment and the actual or potential financial loss or
detriment to consumers. ASIC will have the ability to make such an
order
