Debt Collection Down Under

September 29, 2006

The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) are both responsible for enforcement of fair debt collection practices in Australia.

Though Australia lacks laws specific to debt collection that are comparable to the Fair Debt Collection Practices Act (FDCPA), both the Trade Practices Act of 1974 and the Australian Securities and Investments Commission Act of 2001 place restrictions on debt collection practices. The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) are both responsible for enforcement of fair debt collection practices in Australia.

The ASIC is responsible for regulation of debt collection activity as it relates to the provision of financial services including credit card accounts, consumer loans, finance companies, and fees for the provision of financial advice. The ACCC is responsible for regulation of debt collection activity as it relates to telephone or other utility service debts, and debts for services offered by trades or professional persons.

The ACCC and ASIC recently released a joint publication titled, Debt Collection Guideline: For Collectors and Creditors. The guide covers the Trade Act of 1974 and the Australian Securities and Investments Commission Act of 2001, as they relate to the debt collection industry.

Parts IVA and V of the Trade Practices and of 1974, and Part 2, Division 2 of the Australian Securities and Investments Commission act of 2001 all relate to debt collection, and the implications of these sections are summarized in the guide. The guide covers recent court decisions that have interpreted the body of law that governs debt collection in Australia, and also examines the Privacy Act of 1988, which has ramifications for debt collectors and creditors as well.

Additionally, the guide looks at the Bankruptcy Act of 1966, the Uniform Consumer Credit Code (UCCC), and state and territory trading laws, all of which have implications for debt collectors and creditors operating in Australia.

The 65-page manual offers guidance on what collectors and creditors should and should not do in order to minimize the risk of breaching laws administered by the ACCC and ASIC. Similar in nature to informal FTC staff opinions regarding the FDCPA, the guide does not have legal force, and is only meant to clarify and provide a general compliance framework for creditors and collectors. 

ACA members logged in to ACA Online may download a summary of the guide by requesting document #431 from E–Compliance.

This article is provided as a service of ACA International’s Legal and Government Affairs Department.

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