The Consumer Credit Act 2006 (c.14) is an Act of the

Parliament of the United Kingdom The Parliament of the United Kingdom of Great Britain and Northern Ireland is the supreme legislative body of the United Kingdom, and may also legislate for the Crown Dependencies and the British Overseas Territories. It meets at the Palace ...

intended to increase

consumer protection Consumer protection is the practice of safeguarding buyers of goods and services, and the public, against unfair practices in the marketplace. Consumer protection measures are often established by law. Such laws are intended to prevent business ...

when borrowing money.

Provisions

The main provisions of the Act are to extend the scope of the

Consumer Credit Act 1974 The Consumer Credit Act 1974 (c. 39) is an Acts of Parliament in the United Kingdom, Act of the Parliament of the United Kingdom that significantly reformed the law relating to consumer credit within the United Kingdom. The act remains in force ...

, to create an

Ombudsman An ombudsman ( , also ) is a government employee who investigates and tries to resolve complaints, usually through recommendations (binding or not) or mediation. They are usually appointed by the government or by parliament (often with a sign ...

scheme, and to increase the powers of the

Office of Fair Trading The Office of Fair Trading (OFT) was a non-ministerial government department of the United Kingdom, established by the Fair Trading Act 1973, which enforced both consumer protection and competition law, acting as the United Kingdom's economi ...

in relation to consumer credit, including consumer credit agreements (CCA), and similar borrowing facilities. In addition, it permits borrowers to challenge unfair debtor-creditor relationships in court.

Consumer Credit Act 1974

The 2006 Act brings two further types of agreement under the scope of the 1974 Act: *Consumer agreements above £25,000, to reflect growing levels of consumer borrowing and

debt Debt is an obligation that requires one party, the debtor, to pay money Loan, borrowed or otherwise withheld from another party, the creditor. Debt may be owed by a sovereign state or country, local government, company, or an individual. Co ...

; *I
section 1
to include small, one-man businesses and partnerships of up to three people.

Ombudsman scheme

The 2006 Act gives consumers the option of using the

Financial Ombudsman Service The Financial Ombudsman Service is an ombudsman in the United Kingdom. It was established in 2000, and given statutory powers in 2001 by the Financial Services and Markets Act 2000, to help settle disputes between consumers and UK-based busi ...

if they are unhappy with their lender's dispute resolution service, whether the lender consents or not. Complaints may also be raised against other types of credit related companies, such as debt-collection agencies.

Office of Fair Trading

The 2006 Act empowers the

(OFT) to investigate applicants for consumer credit licences, to impose conditions on licences, and to impose civil penalties of up to £50,000 on companies, or £5,000 on individuals, failing to comply with its conditions. Appeal is to the

First-tier Tribunal The First-tier Tribunal is a first-instance general tribunal in the United Kingdom. It was created in 2008 as part of a programme, enacted in the Tribunals, Courts and Enforcement Act 2007, to rationalise the tribunal system, and has since t ...

(formerly the Consumer Credit Appeals Tribunal) and thence, with leave, to the Upper Tribunal.

Section 71 - Short title, commencement and extent

The following orders have been made under section 71(2):
The Consumer Credit Act 2006 (Commencement No. 1) Order 2006
(S.I. 2006/1508 (C. 52))
The Consumer Credit Act 2006 (Commencement No. 2 and Transitional Provisions and Savings) Order 2007
(S.I. 2007/123 (C. 6))
The Consumer Credit Act 2006 (Commencement No. 2 and Transitional Provisions and Savings) (Amendment) Order 2007
(S.I. 2007/387 (C. 14))
The Consumer Credit Act 2006 (Commencement No. 3) Order 2007
(S.I. 2007/3300 (C. 136))
The Consumer Credit Act 2006 (Commencement No. 4 and Transitional Provisions) Order 2008
(S.I. 2008/831 (C. 40))
The Consumer Credit Act 2006 (Commencement No. 4 and Transitional Provisions) (Amendment) Order 2008
(S.I. 2008/2444 (C. 105))

References

External links

Times Online article about the Act

UK Legislation

*
Explanatory notes
to the Consumer Credit Act 2006. {{UK legislation United Kingdom Acts of Parliament 2006