ASIC credit licensing guidance released

The Australian Securities and Investment Commission (ASIC) has released a package of regulatory guidance to help entities and individuals prepare for the new National Consumer Credit regime.

ASIC has made it clear that it is important for potential licensees and their representatives prepare themselves at the earliest opportunity to ensure a smooth transition to the new regime. Persons who engage in credit activities can apply to ASIC to be registered from 1 April 2010 until 30 June 2010. Registered persons will then have six months to apply for an Australian Credit Licence, between 1 July 2010 and 31 December 2010.

The key aspects of the package include:

Information Sheet 96: Getting ready for credit

The information sheet explains how the new national consumer credit regime applies and what people can do to start getting ready for credit under the new regime. This guide:

• suggests that people think about whether they will need to be registered and licensed under the new regime;
• sets out some things people can start doing to make the process of registering with ASIC quicker and easier; and
• provides a timeline that sets out the important dates for when new requirements start, and what needs to be done by those dates if people are going to continue to provide credit or credit services.

Regulatory Guide 203: Do I need a credit licence?

This guide is designed to help people who engage in credit activities understand whether they need to be licensed and thus register with ASIC. This guide contains guidance to:

• help people who engage in credit activities understand whether they need to be licensed;
• explain some key concepts such as ‘credit’, ‘credit activity’, ‘credit provider’ and ‘credit assistance’; and
• explains which people are exempt from the licensing requirements.

Regulatory Guide 202: Credit registration and transition

This guide outlines the process for registering with ASIC and the transition from registration to licensing, including:

• how to apply to register with ASIC to engage in credit activities;
• an overview of the obligations that registered persons will have under the new credit legislation; and
• information for people who are registered with ASIC from 1 April 2010 will move to the new licensing regime after 1 July 2010.

Assistance

Having assisted many financial services providers obtain their Australian Financial Services Licence under a similar regime, the Hall & Wilcox Financial Services and Banking & Financeteams are able to:

• provide specific advice as to how the new regime will apply to you;
• assist in preparing Australian Credit Licence applications including all necessary proof documents in accordance with ASIC requirements; and
• assist in drafting template documents which comply with all of the disclosure requirements contained in the bill.