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Brexit Corner

Consumer Credit

Whilst it is too early to predict the likely effects of Brexit on legal issues in the asset finance industry, it is worth noting that much of the current legislation affecting consumer credit derives from EU Directives.

Of course the detailed provisions of the Consumer Credit Act 1974 and attendant regulations preceded most of the EU Directives affecting consumer credit, but wholesale changes to UK law were required in particular as a result of the 2010 EU Consumer Credit Directive.

This led to a Byzantine series of Regulations in which the UK government appeared in the view of many in the industry to “gold plate” the requirements dictated by Brussels, whilst other areas of consumer credit (in particular in relation to consumer hire agreements) remained governed by the previous regime.

Whilst it is unlikely that there will be a major retreat from the consumer protection provisions dictated by Europe into the UK consumer credit regime, once the dust has settled it can be expected that some adjustments will be made to the current consumer credit regime once the UK leaves the EU.

One possibility is that the government will take a serious look at removing business customers from the protection of consumer credit legislation altogether.

Data Protection

Another issue affecting the asset finance industry likely to be directly affected by Brexit is data protection law, most of which derives directly from the EU.

The Information Commissioner’s Office has published its new Privacy Notices, Transparency and Control – Code of Practice on Communicating Privacy Information to Individuals. The Code sets out how organisations should explain to customers how they are using their personal information.

The ICO has produced the Code to explain how firms can comply with both the existing Data Protection Act and the new EU General Data Protection Regulation, which at present must be implemented by 25 May 2018 but which may be affected by the UK’s departure from the EU.