This week the Commission for the Financial Market (“CMF”) issued General Rule No. 484 that sets the requirements that must be met by commissions charged in money credit operations in order to not be considered as interest, in accordance with the provisions in Law No. 18,010 on Money Credit Operations (hereinafter, the “NCG”).
Pursuant to Law No. 18,010, interest is any sum received or entitled to receive by the creditor over and above the capital or readjusted capital, depending on whether they are non-adjustable or readjustable credit operations. On the other hand, Law No. 21,314 of 2021, which establishes new transparency requirements and reinforces the responsibilities of market agents, modified the aforementioned Law No. 18,010, establishing, among others, that the CMF will determine through a general rule the requirements, rules and conditions that must be met by the commissions charged with respect to money credit operations granted by entities supervised by the CMF and those subject to its supervision. Collections that do not meet such requirements will be considered as interest.
In this context, and in order to comply with the provisions of the aforementioned Law No. 21,314 of 2021, the CMF presented a series of regulatory projects, put up for public consultation during the months of December 2021 and in April and June 2022, respectively; that today converge in the new NCG.
Regarding the content of the NCG, those collections that meet the following conditions will be considered commission:
- That the collection made to the debtor is calculated based on the cost of providing the service.
- That the service is real, effectively provided to the debtor and different from those inherent to the money credit operation. For these purposes, the service inherent to the credit operation is considered to be: (i) that which is necessary to initiate, celebrate, materialize or terminate the credit operation; and (ii) that which the creditor is obliged to lend to the debtor in compliance with legal and regulatory requirements applicable to credit operations. On the other hand, the service provided by third parties for the fulfillment of solemnities established by law to the celebration of said credit operation or for the constitution, realization or release of its guarantees or sureties will not be considered inherent to the credit operation; nor that payment service provided by a third party to the debtor when said service is an alternative to that provided by the creditor and voluntary for the debtor. In turn, it is provided that for the purposes of the provisions of article 2 of Law No. 18,010, it will also be considered that the collection is received by the creditor if the service is inherent to the money credit operation, even when be provided by third parties.
- That the concept to which the payment corresponds, as well as its total amount for the debtor, has been expressly informed and accepted by the debtor, prior to its collection and the provision of the service, regardless of whether the collection for said service is made in advance of its provision.
- That the information on the charges associated with these services contracted for credit operations be made available through the same channels used by the creditor to make offers of money credit operations or contract them.
Regarding the definition of interest established in Law 18,010, it will be considered that the collection is received by the creditor if: (i) the service is provided directly by him or by a company of his business group; and (ii) the service is inherent to the money credit operation, even when it is provided by third parties.
It should be noted that the NCG does not apply to those credit operations that are not subject to the Maximum Conventional Rate, nor to those operations and services that are not part of the credit operation or that are ancillary to it.
On the other hand, the NCG deals with credit operations originating from the use of lines of credit, clarifying that the same requirements regarding commissions apply, depending on the nature of each operation. In this sense, the charges that do not meet the stated requirements will be considered as interest for the computation of the maximum conventional rate. In this type of operations, the administration, operation and maintenance services of the line or card will not be considered as inherent, therefore, the charges to the debtor for these concepts are identified as commission. The foregoing, provided that said collection is not a function of the amount of the money credit operation and that the cost of providing the service has not been charged by another product or service.
It will be up to the creditor to adopt the safeguards that are necessary in order to prove compliance with the established requirements, when the supervision processes of the CMF so require.
In addition, institutions whose contracts for lines of credit associated with credit cards or checking accounts that have been signed prior to the entry into force of this regulation do not comply with it, must adapt their credit card or account contracts current, having to inform at their expense, and by those means agreed with their clients for the sending of periodic information, a communication indicating this fact, together with an annex with the detail of the modifications and their justifications, for their acceptance or rejection. The foregoing, without prejudice to the fact that, in accordance with Law No. 21,314, the offeror may only terminate the corresponding contract against the rejection of those modifications that are intended to adapt the contracts to the changes introduced by this law.
This communication must be made in a clear and easily understood language for a person without financial or legal knowledge and must include at least 20 business days for the express statement of the debtor. If, as a result of the rejection of the modifications that are intended to adapt the contracts to the changes introduced by Law 21,314, the offeror decides to terminate the corresponding contract, the respective institution must respect the payment terms originally agreed upon.
These entities will have until the date of entry into force of the NCG to complete the adjustments to the contracts.
Entry into force
The provisions of the NCG will come into force as of August 1st, 2023, the date from which commission charges that do not comply with the new regulations will be considered as interest.