Visa debit card - section 75???

grumbler

derps wrote: »

Nobody said the number of repayments point has anything to do with debit cards,

OFT did in the booklet that Armorica referred me to for some apparent clarification, although, it's not very clear what exactly they (OFT) meant by saying "This also applies to debit cards". As I said, I didn't expect anything intelligible from OFT.

you raised it as something you thought was wrong in the articles someone mentioned.

Really? What I said was that that made no sense to me and asked some questions. Nowhere did I say that anything was wrong.

One of the questions was: "what does a "fixed monthly payment" have to do with this?"

And your 'answer' was: "...fixed monthly payment issue is specifically mentioned in s.75 itself which makes me suspect that you may have never even read it."

I knew well that it was mentioned. The question was what it had to do with the elusive difference between credit and debit cards.

Okay, I think you might be a lost cause. The CCA does in very specific language explain what sort of agreements are regulated by it and it doesn't refer to debit cards or overdrafts in the relevant sections.

Please actually read it.

Well, as you seem to have read it and understood everything, I would expect some more intelligible comment/explanation/advice than this.
OK, "in very specific language" the CCA doesn't refer to debit cards. Does it refer to credit cards?

And not the unamended one from 40 years ago that you've apparently been using for some insane reason. Here's a link to the official legislation website. I guess I shouldn't be surprised at this point but it's amazing that you don't seem to realise that the Consumer Credit Act 2006 is a totally different piece of law to the Consumer Credit Act 1974 which, subject to many amendments, is still in force. The 2006 Act is not an updated version of the 1974 one and you won't get anywhere trying to find out about Section 75 of the 1974 Act in the wholly separate 2006 one.

Fine, I take my hat off to you.
You are an expert, and I am not as I have admitted many times.
Instead of directing me to "relevant sections" written in "very specific language" for some evasive explanation, can you just quote and explain the relevant bits that apparently make it clear why debit cards are not covered?
It should to be not too hard as section 75 is pretty short.

You have already quoted one, but unfortunately, failed to demonstrate any "relevance".

meer53

An overdraft isn't covered under the CCA as it's not a credit agreement.

As i mentioned previously, i've never seen a claim under Section 75 for a debit card transaction where an overdraft was used. And i've dealt with thousands of card disputes. Both credit and debit.

grumbler

meer53 wrote: »

An overdraft isn't covered under the CCA as it's not a credit agreement.

Again, I am no expert, but google search results seem to disagree:

CCA Regulated Agreements: overdrafts, mortgages and a few other bits (posted by Consumeractiongroup Site Team)

Consumer credit regulation - Parliament UK:

There are many types of agreement which can come within the terms of a ‘regulated consumer credit agreement' (provided they do not exceed the financial limit of £25,000). These include:
...
overdraft
...

I am surprised that you have not checked this yourself.



That said, it is possible that some parts of the CCA, e.g. section 75, don't cover overdrafts.

meer53

grumbler wrote: »

Again, I am no expert, but google search results seem to disagree:

CCA Regulated Agreements: overdrafts, mortgages and a few other bits (posted by Consumeractiongroup Site Team)

Consumer credit regulation - Parliament UK:
I am surprised that you have not checked this yourself.



That said, it is possible that some parts of the CCA, e.g. section 75, don't cover overdrafts.

When you agree an overdraft with a bank, no CCA agreement is signed.

Hanky_Panky

grumbler wrote: »

Again, I am no expert, but google search results seem to disagree:

CCA Regulated Agreements: overdrafts, mortgages and a few other bits (posted by Consumeractiongroup Site Team)

Consumer credit regulation - Parliament UK:
I am surprised that you have not checked this yourself.



That said, it is possible that some parts of the CCA, e.g. section 75, don't cover overdrafts.

Please bear in mind that the CAG's whole purpose is to try and reclaim/rip off as much as they can from banks so they interpret things in the way they want them to be - not always accurately - see this extract from one of their site admin peeps about this on your link:
'10 Running-account credit and fixed-sum credit

(1) For the purposes of this Act—
(a) running-account credit is a facility under a personal U]consumer[/U credit agreement whereby the debtor is enabled to receive from time to time (whether in his own person, or by another person) from the creditor or a third party cash, goods and services (or any of them) to an amount or value such that, taking into account payments made by or to the credit of the debtor, the credit limit (if any) is not at any time exceeded; and
(b) fixed-sum credit is any other facility under a personal U]consumer[/U credit agreement whereby the debtor is enabled to receive credit (whether in one amount or by instalments).'

I have embolden the important part for you - if you don't sign a consumer credit agreement regulated by the CCA then Section 75 wont apply as is the case with overdrafts.

They of course would like them to apply as that's more opportunity for rip offs, sorry reclaims, to happen. I love it when sites like that try to take the high ground and then fail miserably on their so righteous crusade, bit like the old house price crash site in the early noughties. Frankly they should all be ashamed that they have (with others), as a result of the bank charge reclaim scam pulled tens of thousands of people INTO bank charges and now the banks make even more money on it than they did before. Scandalous.

chattychappy

After writing to the effect that S75 would apply to debit card transactions if you are overdrawn, I realised I was muddling up the legal authorities. Late in the day I've returned to the thread. When I wrote my post at #21, I was thinking about the FOS's findings on debit cards and that they become credit tokens when using an agreed overdraft. This means you have the same protection as credit cards in the event of unauthorised usage, even if you are negligent or gross negligent. This has nothing to do with S75, of course - but it is still within the CCA1974.


This is my legal analysis. My conclusion is that S75 probably doesn't apply to debit cards in an overdraft situation.


Are overdrafts regulated by CCA1974?

s8(1) "a consumer credit agreement an agreement between an individual ("the debtor") and any other person ("the creditor") by which the creditor provides the debtor with credit of any amount."

s8(3) "a consumer credit agreement is a regulated agreement ... if it is not an agreement (an "exempt agreement") specified in... section 16, 16A, 16B or 16C."

Checking s16, nothing refers to anything that could be an overdraft.

So first conclusion: An overdraft facility is a regulated agreement. s74 exempts certain types of lending from Part V (s55 to s74). For example s74(1C) exempts overdrafts from s60 "regulation on form and content or agreements". So though regulated, overdrafts do not have to comply will all the provisions of the CCA1974 that other lending would. Additionally s74A and s74B contain extra provisions that apply to current account overdrawing.

Application of s75

s75 is under Part VI of CCA1974. There is no separate application section within Part VI excluding any type of agreement from any of the sections. So we must follow the provisions of S75 itself.

s75(1) If the debtor under a debtor-creditor-supplier agreement falling within section 12(b) or (c) has, in relation to a transaction financed by the agreement,..

So for S75(1) to bite, there are 3 issues:
1) is there a debtor-credit-supplier agreement?
2) did the agreement finance the transaction?
3) does the agreement fall within section 12(b) or (c)

1) I believe is not an issue. For this test, the situation would be the same as if the OP was using a credit card as no particular type of agreement is specified at this point (running credit etc). But see s12 discussion below.
2) Again, not an issue.
3) Is more tricky.

s12 "A debtor-creditor-supplier agreement is a regulated consumer credit agreement being— ... (c)an unrestricted-use credit agreement which is made by the creditor under pre-existing arrangements between himself and a person (the “supplier ”) other than the debtor in the knowledge that the credit is to be used to finance a transaction between the debtor and the supplier."

(s12(b) applies to restricted-use credit agreements, so wouldn't apply.)

s12(c) is the route via which CCs are on the hook. So why shouldn't debit cards? Note again: we haven't seen anything that distiguishes overdrafts from CCs in this chain.

If I was the bank, I would argue that at the time of making the pre-existing arrangements (setting up the merchant and putting the debit card acceptance in place) there isn't knowledge that credit is to be used. With a CC it is*. This is the key point of the section and why debit cards and CCs should be treated differently. CC acceptance is set up in the knowledge that purchases are being financed by CCs. Debit card/cheque facilities are not provided in this knowledge.

If I was the consumer, I would have to argue that the networks are set up provide for the use of debit cards in overdraft situations in the same way that CCs are and in the absence of an express exemption of overdrafts from s75, it can't be the intention of the Act to exclude them. Afterall, there are plenty of other express exemptions from other sections in the case of of overdrafts.

On balance, I think debit cards aren't covered. I'm not aware of any caselaw and until there is I think it will remain unclear. As grumbler says, S75 is a bit of a relic. The drafting hasn't anticipated with the modern world and with a number of amendments (in part due to EU harmonisation) it has become more messy. Indeed it might be there is something somewhere somebody has missed. This has happened with default charges and cancelling CPAs where the law changed and CCs went on as before oblivious (as did posters on this forum) until somebody finally noticed.


[*an argument could be made that this applies to CCs since they can be in credit too, even when operated properly. So at the very least, the knowledge isn't certain.]

fermi

rainbow1066 wrote: »

Apologies from a newbie if I should be starting a new thread, but does section 75 cover the following :

Moved to a new thread --> https://forums.moneysavingexpert.com/discussion/5103395

Armorica

chattychappy wrote: »

3) does the agreement fall within section 12(b) or (c)

He didn't like that answer tho

(Another quirk, of course, is that when the legislation was written, debit cards simply didn't exist)

debitcardmayhem

I wonder if the OP can claim back from HMRC the duty they paid on import for the goods which were not worth £1k+ ...? I can't speculate on whether the case falls under the various sections of the aforementioned acts

meer53

debitcardmayhem wrote: »

I wonder if the OP can claim back from HMRC the duty they paid on import for the goods which were not worth £1k+ ...? I can't speculate on whether the case falls under the various sections of the aforementioned acts

No one has mentioned import duty. The OP bought the goods there and brought them back. I would assume no import duty was paid.