Cost of Borrowing (Retail Associations) Regulations

12 (1) A retail association that enters into a credit agreement for a credit card must provide the borrower with an initial disclosure statement that includes the following information in addition to that required by paragraphs 10(1)(a) and (c) to (k):

• (a) the manner in which interest is calculated and the information required by paragraph 11(1)(a);

• (b) if the borrower is required by the credit agreement to pay the outstanding balance in full on receiving a statement of account,

  • (i) mention of that requirement,

  • (ii) the grace period by the end of which the borrower must have paid that balance, and

  • (iii) the annual interest rate charged on any outstanding balance not paid when due;

• (c) if a lost or stolen credit card is used in an unauthorized manner, the maximum liability of the borrower is the lesser of $50 and the maximum set by the credit agreement;

• (d) if a transaction is entered into at an automated teller machine by using the borrower’s personal identification number, the liability incurred by the transaction is, despite paragraph (c), the maximum liability; and

• (e) if the retail association has received a report from the borrower, whether written or verbal, of a lost or stolen credit card, the borrower has no liability to pay for any transaction entered into through the use of the card after the receipt of the report.

(2) If the initial credit limit is not known when the initial disclosure statement is made, the retail association must disclose it in

• (a) the first statement of account provided to the borrower; or

• (b) a separate statement that the borrower receives on or before the date on which the borrower receives that first statement of account.

(3) Despite section 13, if a credit agreement for a credit card is amended, the retail association must, in writing and 30 days or more before the amendment takes effect, disclose to the borrower the changes to the information required to be disclosed in the initial statement other than any of those changes that involve

• (a) a change in the credit limit;

• (b) an extension to the grace period;

• (c) a decrease in non-interest charges or default charges referred to in paragraphs 10(1)(c) and (g);

• (d) a change concerning information about any optional service in relation to the credit agreement that is referred to in paragraph 10(1)(i);

• (e) a change in a variable interest rate referred to in subparagraph 11(1)(a)(ii) as a result of a change in the public index referred to in that subparagraph; and

• (f) a decrease in the fixed rate of interest or a decrease in the fixed percentage rate of interest referred to in subparagraph 11(1)(a)(ii).

(4) An amendment referred to in any of paragraphs (3)(a) to (d) or (f) must be disclosed not later than in the first subsequent periodic disclosure statement that is provided after the date of the amendment.

(5) Subject to subsections (8) and (9), a retail association that issues credit cards must provide borrowers with supplementary disclosure statements on a regular periodic basis, at least once a month, that disclose the information referred to in paragraphs 10(3)(a) and (d) to (h) and that, in addition, contain the following information:

• (a) an itemized statement of account that describes each transaction and discloses each amount credited or charged, including interest, and the dates when those amounts were posted to the account;

• (b) the amount that the borrower must pay, on or before a specified due date, in order to have the benefit of a grace period; and

• (c) the sum for payments and the sum for purchases, credit advances and interest and non-interest charges.

(6) For the purpose of paragraph (5)(a), an itemized statement of account is adequate if it permits the borrower to verify each transaction described by linking it with a transaction record provided to the borrower.