It was a major court case with CALC, ASIC, Ratesetter all involved who opposed BNPL finance for Solar Panels
Flexigroup sort a review and were successful
On 30 December 2019, Flexigroup Limited (Flexigroup) filed an application pursuant to s 101 of the Competition and Consumer Act 2010 (Cth) (CCA) for a review of the authorisation of the Australian Competition and Consumer Commission (ACCC) dated 5 December 2019 (Commission file no. AA1000439) granted under s 88(1) of the CCA.
2 The applicants for the authorisation were the Australian Energy Council (AEC), Clean Energy Council (CEC), Smart Energy Council (SEC) and Energy Consumers Australia (ECA) (together, the authorisation applicants). The authorisation concerned a document called the New Energy Tech Consumer Code (Consumer Code) which sets minimum standards that suppliers of “New Energy Tech” products (e.g. solar panels, energy storage systems and other emerging products and services) must comply with when interacting with customers, including from initial marketing and promotion through to installation and complaints handling. The authorisation granted by the ACCC enables the authorisation applicants and future signatories to the Consumer Code to agree, sign up to and comply with provisions of the Consumer Code:
(a) according to which signatories will commit to abide by minimum standards of good practice as set out in the Consumer Code, which are intended to cover all aspects of the customer experience;
(b) for monitoring and sanctioning non-compliance, where the Code Administrator has powers requiring a signatory to rectify issues giving rise to a breach of the Consumer Code and, where there is serious non-compliance, the Code Administrator may propose to the Code Monitoring and Compliance Panel that the signatory should be suspended or expelled; and
(c) requiring signatories to only offer deferred payment arrangements that are regulated under the National Consumer Credit Protection Act 2009 (Cth) (NCCPA) and the National Credit Code (NCC), and provided by credit providers licensed under the NCCPA, or to offer deferred payment arrangements that are provided by “buy now pay later” (BNPL) providers only in certain circumstances.
3 The authorisation was granted subject to a number of conditions. Most relevantly, the ACCC imposed conditions concerning BNPL finance. Those conditions were:
(a) with respect to finance arrangements not regulated by and/or exempt from the NCCPA and NCC (i.e. BNPL), signatories will be required to only offer such arrangements from credit providers that have been assessed as having specified consumer safeguards in place, as set out in the versions of clause 25 and clauses A7 and A7A of the Annexure to the Consumer Code at Attachment A to the authorisation;
(b) signatories must not offer customers finance arrangements not regulated by and/or exempt from the NCCPA and NCC (i.e. BNPL) in connection with the sale of a New Energy Tech product if the sale of the New Energy Tech product is unsolicited; and
(c) the condition outlined at (a) above, including the wording found in Attachment A, may be subject to variation where approved by the ACCC in writing and published on the public register.
4 In its application for review, Flexigroup states that it is a diversified financial services group with operations in, relevantly, Australia across a diverse range of industries including, relevantly, solar energy. It provides a range of finance products and payment solutions to consumers and businesses including interest free cards and no interest ever payment plans. Flexigroup is a provider of no interest ever payment plans to retail customers through its product “humm” which is a form of BNPL financial product. Flexigroup says that humm has financed the purchase of more than 180,000 solar installations (approximately 10% of all installations) in Australia and almost half of the revenue generated by Flexigroup’s humm product is from providing credit for sales of solar panels and other home improvements. Flexigroup says that, of the top 50 solar sellers with whom Flexigroup does business, approximately 60% were expected to or have become members of one of the authorisation applicants and would therefore also likely become signatories to the Consumer Code.
5 By its application, Flexigroup seeks the review of the conditions of authorisation imposed by the ACCC that relate to the provision of BNPL finance. Specifically, Flexigroup contends that the conditions identified in paragraphs 3(a) and (b) above should not have been imposed and that authorisation should not be granted to any provisions of the Consumer Code that have the effect of preventing signatories from offering BNPL products to consumers in any way.
,
(20min delay)