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Financial Service Providers (Registration and Dispute Resolution) Act 2008

Dispute resolution - Approval of dispute resolution schemes - Rules about approved dispute resolution scheme

63: Rules about approved dispute resolution scheme

You could also call this:

“Rules for solving problems with financial service providers”

The person in charge of an approved dispute resolution scheme must create rules for the scheme. These rules need to cover many important things:

You can join the scheme if you’re a certain type of financial service provider. The scheme must accept you unless there’s a good reason not to, like if you’ve broken the rules before.

The rules explain how to become a member and how you might lose your membership. You could lose your membership if you break the rules, don’t fix problems when asked, don’t pay fees, or stop being the right type of provider.

If you’re a consumer or a small business with 19 or fewer full-time workers, you can make complaints to the scheme. The rules say how to make complaints and how they’ll be looked into fairly.

The scheme can deal with complaints about broken contracts, not following laws, or not following industry rules. They can look at any information that’s fair and reasonable to solve the complaint.

If the complaint is proved right, the scheme can make the financial service provider do things to fix the problem, like changing how they work or paying money to the person who complained.

The scheme is free for people making complaints. If the scheme decides on a solution, the financial service provider must follow it. The person who complained can choose to accept the solution or not.

You can still go to court about your complaint at any time, even if you don’t like the scheme’s solution. But if you do go to court, the scheme might stop looking into your complaint.

The scheme must be checked by an independent reviewer at least every 5 years. The person in charge and the members must tell people about the scheme.

If a complaint is about something being taken away because of a loan, the scheme can make the provider pay extra for causing stress or inconvenience.

The government can add more rules to the scheme, and these rules are just as important as the ones the scheme makes itself.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1109578.

Topics:
Money and consumer rights > Banking and loans Money and consumer rights > Consumer protection Business > Industry rules Business > Fair trading
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Part 3 Dispute resolution
Approval of dispute resolution schemes: Rules about approved dispute resolution scheme

63Rules about approved dispute resolution scheme

  1. The person responsible for an approved dispute resolution scheme must issue rules about that scheme, and those rules must provide for, or set out, the following:

  2. which types of financial service providers may be members of the scheme:
    1. that the types of financial service providers referred to in paragraph (a) must be accepted as members of the scheme, unless—
      1. refused membership for a reason set out in paragraph (ba); or
        1. a provider is not eligible for registration under this Act:
        2. how financial service providers become members of the scheme and how membership is terminated:
          1. that membership may be refused or terminated because of an applicant's, or a member's,—
            1. material or persistent breach of a scheme's rules:
              1. failure to take remedial action imposed on that provider by a scheme (whether or not that scheme still exists):
                1. failure to pay a scheme's membership fee:
                  1. failure to continue to be a type of financial service provider that may be a member of the scheme:
                  2. that consumers and businesses that have no more than 19 full-time equivalent employees may make complaints for resolution by the scheme:
                    1. how complaints about a member may be made for resolution by the scheme:
                      1. a period after which the scheme, if asked by a complainant, must investigate a complaint that has been made directly to a member:
                        1. that complaints about members must be investigated in a way that is consistent with the rules of natural justice:
                          1. that the scheme has jurisdiction in respect of—
                            1. a breach of contract, a statutory obligation, or an industry code; and
                              1. any other prescribed matters; and
                                1. any other matter provided for in the rules:
                                2. that any information may be considered in relation to a complaint and any inquiry made that is fair and reasonable in the circumstances:
                                  1. the remedial action that the scheme can impose on a member to resolve a complaint (for example, a requirement to change systems or to compensate a complainant up to a certain amount stated in the rules):
                                    1. how remedial action may be enforced against the scheme’s members, including after members have left the scheme:
                                        1. that the scheme will not charge a fee to any complainant to investigate or resolve a complaint:
                                          1. that a resolution of a complaint about a member of the scheme is binding on the member concerned:
                                            1. that a resolution of a complaint about a member of the scheme is binding on the complainant concerned, if the complainant accepts the resolution:
                                              1. that the complainant may take alternative court action against the member at any time, including if the complainant rejects the resolution:
                                                1. that the scheme may cease investigating and resolving a complaint if the complainant takes alternative court action against the member:
                                                  1. that an independent review of the scheme must occur at least once every 5 years after the date of the scheme’s approval and must be supplied to the Minister within 3 months of completion:
                                                    1. that the person responsible for the scheme and the scheme’s members must inform the people referred to in paragraph (c) about the scheme:
                                                      1. any other prescribed matters.

                                                        1. The compensation referred to in subsection (1)(i) that the scheme can impose on a member must be able to include, in the case of a complaint relating to a repossession under Part 3A of the Credit Contracts and Consumer Finance Act 2003, compensation for non-financial loss, stress, humiliation, and inconvenience up to a certain amount stated in the rules.

                                                        2. The rules about an approved dispute resolution scheme must be treated as containing any provision that is implied into those rules by regulations made under this Act.

                                                        3. A rule about an approved dispute resolution scheme has no effect to the extent that it is inconsistent with any provision implied into the rules by those regulations.

                                                        Notes
                                                        • Section 63(1)(a): amended, on , by section 36(1) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(1)(aa): inserted, on , by section 36(2) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(1)(ba): inserted, on , by section 36(3) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(1)(g): replaced, on , by section 36(4) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(1)(k): repealed, on , by section 36(5) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(1)(s): inserted, on , by section 36(6) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(2): inserted, on , by section 36(7) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(3): inserted, on , by section 36(7) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).
                                                        • Section 63(4): inserted, on , by section 36(7) of the Financial Service Providers (Registration and Dispute Resolution) Amendment Act 2014 (2014 No 34).