Criminal Code (R.S.C., 1985, c. C-46)

Marginal note:Definitions

• 347.1 (1) The following definitions apply in subsection (2).

  interest

  interest has the same meaning as in subsection 347(2). (intérêts)

  payday loan

  payday loan means an advancement of money in exchange for a post-dated cheque, a pre-authorized debit or a future payment of a similar nature but not for any guarantee, suretyship, overdraft protection or security on property and not through a margin loan, pawnbroking, a line of credit or a credit card. (prêt sur salaire)

• Marginal note:Non-application — person

  (2) Section 347 and section 2 of the Interest Act do not apply to a person, other than a financial institution within the meaning of paragraphs (a) to (d) of the definition financial institution in section 2 of the Bank Act, who has entered into or has offered to enter into a payday loan agreement to receive interest, has advertised an offer to enter into a payday loan agreement that provides for the receipt of interest or has received interest under a payday loan agreement, if

  • (a) the amount of money that is or would be advanced under the agreement is $1,500 or less and the term of the agreement is or would be 62 days or less;

  • (a.1) the total cost of borrowing under the agreement does not or would not exceed the limit fixed by regulation;

  • (b) the person is licensed or otherwise specifically authorized under the laws of a province to enter into the agreement; and

  • (c) the province is designated under subsection (3).

• Marginal note:Regulation — limit

  (2.1) For the purposes of paragraph (2)(a.1), the Governor in Council may, by regulation, on the recommendation of the Minister of Justice and after that Minister’s consultation with the Minister of Finance, fix the limit.

• Marginal note:Clarification

  (2.2) If section 347 does not apply to a person by reason of subsection (2) immediately before a regulation made under subsection (2.1) comes into force, that section continues not to apply to the person if the total cost of borrowing under the agreement did not exceed the limit that applied immediately before the regulation came into force.

• Marginal note:Designation of province

  (3) The Governor in Council shall, by order and at the request of the lieutenant governor in council of a province, designate the province for the purposes of this section if the province has legislative measures that protect recipients of payday loans and that provide for limits on the total cost of borrowing under the agreements.

• Marginal note:Revocation

  (4) The Governor in Council shall, by order, revoke the designation made under subsection (3) if requested to do so by the lieutenant governor in council of the province or if the legislative measures described in that subsection are no longer in force in that province.