new ePayments Code commences

6 October 2011

Partner Paul Lutvey reports on the introduction of a new ePayments Code. The Code regulates electronic payments, including ATM, EFTPOS and credit card transactions, online payments, internet and mobile banking, and BPAY.

ePayments Code

The ePayment Code complements other regulatory requirements, including financial services and consumer credit licensing, advice, training and disclosure obligations under the Corporations Act 2001 and the National Consumer Credit Protection Act 2009.

The ePayments Code:

requires subscribers to give consumers terms and conditions,
information about changes to terms and conditions (such as fee increases), receipts and statements, sets out the rules for determining who pays for unauthorised transactions, and
establishes a regime for recovering mistaken internet payments.

There are more limited requirements for low value facilities that can hold a balance of no more than $500 at any one time.

Who is bound by the new ePayments Code?

ASIC advises that virtually all banks, credit unions and building societies currently subscribe to the current EFT Code along with a number of non traditional banking subscribers. The new ePayments Code continues to be a voluntary code of practice.

Re-subscription from previous EFT Code subscribers to the new ePayments Code commenced on 20 September 2011, the day on which the Code was released. ASIC strongly encourages those organisations that provide electronic payments and have not previously subscribed to the EFT Code, to subscribe to the new ePayments Code.

Impact on the consumer

The Code only protects consumers when dealing with a subscriber. Consumers should check that the banking or payment services organisation they are dealing with is a subscriber. This can be done by

checking the ASIC register of subscribers; or
checking the product's terms and conditions (if the company is a subscriber, it will say so in the product's terms and conditions)

Going forward

ASIC continues to be responsible for the administration of the ePayments Code, including monitoring compliance and reviewing it regularly.

Organisations are progressively transitioning from the old EFT Code. The process will be complete by 20 March 2013.

Paul Lutvey | Partner
Mullins Lawyers
t +61 7 3224 0240
f +61 7 3224 0333
plutvey@mullinslaw.com.au