The Law Commission is seeking public feedback on New Zealand’s credit repossession laws – the rules that apply when consumers default on a credit contract.

Among the questions the Commission is asking the public to consider is whether there should be a ban on the repossession of certain basic items, such as children’s belongings and medical necessities; and whether the law should more clearly state that the taking of other items is prohibited, such as passports and eftpos cards.

The Commission is working alongside the Ministry of Consumer Affairs, reviewing the Credit (Repossession) Act 1997. This is part of the wider review of consumer credit law announced by Commerce and Consumer Affairs Minister Hon Simon Power last month.

Issues on which feedback is sought include whether:

-household items or tools of trade up to a certain value should be protected from repossession;

-consent of a court should be required for repossession in all cases, as in both Australia and England, or in cases where a certain amount of equity has been built up in the goods;

-whether rights of entry on to private property should be contractually conferred, or dealt with in the Act;

- the fitness of a credit provider should be assessed, or their financial services registration affected, by misconduct when they repossess goods;

- there should be oversight and enforcement by the Commerce Commission or another body;

-the Credit (Repossession) Act should be incorporated into the Credit Contracts and Consumer Finance Act, which is being reviewed by the Ministry of Consumer Affairs.

Submissions closed on 31 August 2011.

The Commissioner responsible for the project is Professor Geoff McLay.

IP25 Review of the Credit (Repossession) Act 1997