Consumer Credit (Exempt Agreements) Order 1980
| Jurisdiction | UK Non-devolved |
| Citation | SI 1980/52 |
| Year | 1980 |
1980 No. 52
CONSUMER CREDIT
The Consumer Credit (Exempt Agreements) Order 198017thJanuary 1980
29thJanuary 1980
28thApril 1980
The Secretary of State, after consulting in accordance with subsections (3) and (9) of section 16 of the Consumer Credit Act 1974(a) with the persons therein referred to, in exercise of powers conferred on him by sections 16(1) and (4) to (6) and 182(2) and (4) of that Act and of all other powers enabling him in that behalf, hereby makes the following Order:—
Citation, commencement, interpretation and revocation
1.—(1) This Order may be cited as the Consumer Credit (Exempt Agreements) Order 1980 and shall come into operation on 28th April 1980.
(2) In this Order—
"the Act" means the Consumer Credit Act 1974;
"business premises" means premises for occupation for the purposes of a business (including any activity carried on by a body of persons, whether corporate or unincorporate) or for those and other purposes;
and references to the total charge for credit and the rate thereof are respectively references to the total charge for credit and the rate thereof calculated in accordance with the Consumer Credit (Total Charge for Credit) Regulations 1980(b); and, except where the contrary intention appears, other expressions used in this Order have the same respective meanings as in the Act.
(3) The Consumer Credit (Exempt Agreements) Order 1977(c), the Consumer Credit (Exempt Agreements) (Amendment) Order 1977(d), the Consumer Credit (Exempt Agreements) (Amendment) Order 1978(e), the Consumer Credit (Exempt Agreements) (Amendment No. 2) Order 1978(f) and the Consumer Credit (Exempt Agreements) (Amendment) Order 1979(g) are hereby revoked.
Exemption of certain consumer credit agreements secured on land
2.—(1) The Act shall not regulate a consumer credit agreement which falls within section 16(2) of the Act, being an agreement to which this paragraph applies.
(a) 1974 c. 39.
(b) S.I. 1980/51.
(c) S.I. 1977/326.
(d) S.I. 1977/1493.
(e) S.I. 1978/126.
(f) S.I. 1978/1616.
(g) S.I. 1979/1099.
(2) Where the creditor is a body specified in Part I of the Schedule to this Order, paragraph (1) above applies only to—
(a) a debtor-creditor-supplier agreement falling within section 16(2)(a) of the Act;
(b) a debtor-creditor agreement secured by any land mortgage financing—
(i) the purchase of land; or
(ii) the provision of dwellings or business premises on any land; or
(iii) subject to paragraph (3) below, the alteration, enlarging, repair or improvement of a dwelling or business premises on any land;
(c) a debtor-creditor agreement secured by any land mortgage to refinance any existing indebtedness of the debtor's, whether to the creditor or another person, under any agreement by which the debtor was provided with credit for any of the purposes specified in heads (i) to (iii) of sub-paragraph (b) above.
(3) Head (iii) of sub-paragraph (b) of paragraph (2) above applies only where the creditor is the creditor under—
(a) an agreement (whenever made) by which the debtor is provided with credit for any of the purposes specified in head (i) and head (ii) of that sub-paragraph; or
(b) an agreement (whenever made) refinancing an agreement under which the debtor is provided with credit for any of the said purposes,
being, in either case, an agreement relating to the land referred to in the said head (iii) and secured by a land mortgage on that land.
(4) Where the creditor is a body specified in Part II of the Schedule to this Order, paragraph (1) above applies only to an agreement of a description specified in that Part in relation to that body and made pursuant to an enactment or for a purpose so specified.
Exemption of certain consumer credit agreements by reference to the number of payments to be made by the debtor
3.—(1) The Act shall not regulate a consumer credit agreement which is an agreement of one of the following descriptions, that is to say,—
(a) a debtor-creditor-supplier agreement being either—
(i) an agreement for fixed-sum credit under which the number of payments to be made by the debtor does not exceed four; or
(ii) an agreement for running-account credit which provides for the making of payments by the debtor in relation to specified periods and requires that the number of payments to be made by the debtor in repayment of the whole amount of the credit provided in each such period shall not exceed one;
not being, in either case, an agreement of a description specified in paragraph (2) below; and in this sub-paragraph, "payment" means a payment comprising an amount in respect of credit with or without any other amount;
(b) a debtor-creditor-supplier agreement financing the purchase of land, being an agreement under which the number of payments to be made by the debtor does not exceed four; and in this sub-paragraph, "payment" means a payment comprising or including an amount in respect of credit or the total charge for credit (if any);
(c) a debtor-creditor-supplier agreement for fixed-sum credit to finance a premium under a contract of insurance relating to any land or to any thing thereon where—
(i) the creditor is the creditor under an agreement secured by a land mortgage on that land which either is an exempt agreement by virtue of section 16(1) of the Act or of article 2 above or is a personal credit agreement which would be an exempt agreement by virtue of either of those provisions if the credit provided were not to exceed £5,000;
(ii) the amount of the credit is to be repaid within the period to which the premium relates, not being a period exceeding 12 months; and
(iii) there is no charge for the credit other than interest at a rate not exceeding the rate of interest from time to time payable under the agreement mentioned in head (i) above,
and the number of payments to be made by the debtor does not exceed twelve; and in this sub-paragraph "payment" has the same meaning as it has in paragraph (1)(b) above; and
(d) a debtor-creditor-supplier agreement for fixed-sum credit where—
(i) the creditor is the creditor under an agreement secured by a land mortgage on any land which either is an exempt agreement by virtue of section 16(1) of the Act or of article 2 above or is a personal credit agreement which would be an exempt agreement by virtue of either of those provisions if the credit provided were not to exceed £5,000;
(ii) the agreement is to finance a premium under a contract of life insurance which provides, in the event of the death before the credit under the agreement referred to in head (i) above has been repaid of the person on whose life the contract is effected, for payment of a sum not exceeding the amount sufficient to defray the sums which, immediately after that credit has been advanced, would be payable to the creditor in respect of that credit and of the total charge for that credit; and
(iii) there is no charge for the credit other than interest at a rate not exceeding the rate of interest from time to time payable under the agreement referred to in head (i) above,
and the number of payments to be made by the debtor does not exceed twelve; and in this sub-paragraph, "payment" has the same meaning as it has in sub-paragraph (1)(b) above.
(2) The descriptions of agreement referred to in sub-paragraph (a) of paragraph (1) above and to which accordingly that sub-paragraph does not apply are—
(a) agreements financing the purchase of land;
(b) agreements which are conditional sale agreements or hire-purchase agreements; and
(c) agreements secured by a pledge (other than a pledge of documents of title or of bearer bonds).
Exemption of certain consumer credit agreements by reference to the rate of the total charge for credit
4.—(1) The Act shall not regulate a consumer credit agreement which is an agreement of one of the following descriptions, that is to say,—
(a) subject to paragraphs (2) and (3) below, any debtor-creditor agreement in respect of which the rate of the total charge for credit does not exceed the rate referred to in paragraph (4) below;
(b) a debtor-creditor-supplier agreement for fixed-sum credit where—
(i) the creditor is the creditor under an agreement secured by a land mortgage on any land which either is an exempt agreement by virtue of section 16(1) of the Act or of article 2 above or is a personal credit agreement which would be an exempt agreement by virtue of either of those provisions if the credit provided were not to exceed £5,000;
(ii) the agreement is to finance a premium under a contract of life insurance which provides, in the event of the death before the credit under the agreement referred to in head (i) above has been repaid of the person on whose life the contract is effected, for payment of a sum not exceeding the amount sufficient to defray the sums which immediately after that credit has been advanced, would be payable to the creditor in respect of that credit and of the total charge for that credit; and
(iii) there is no charge for the credit other than interest at a rate not exceeding the rate of interest from time to time payable under the agreement referred to in head (i) above,
and in respect of which the rate of the total charge for credit does not exceed the rate referred to in paragraph (4) below;
(c) subject to paragraph (3) below, a debtor-creditor agreement in respect of which the only amount included in the total charge for credit is interest which cannot under the agreement at any time exceed the higher of the following, that is to say,—
(i) the sum of one per cent and the minimum lending rate determined by the Bank of England, being the rate in operation at that time; and
(ii) 13 per cent;
and for the purposes of this sub-paragraph, "interest" means interest at a rate determined in accordance with the formula set out in paragraph (1) of regulation 7 of the Consumer Credit (Total Charge for Credit) Regulations 1980(a), and in that formula as applied by this paragraph "period rate of charge" has the...
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