Question proposed, That the clause stand part of the Bill.

I should read out the detail on clause 11, which covers particularly important areas that we should put on the record. The clause sets out the consequences for the creditor or owner offering to give an arrears notice. The Government have carefully considered appropriate sanctions where there has been a failure to provide notices, and the best way to make creditors or owners give arrears notices is to penalise them for non-compliance in a way that hurts them most.  

Subsections (1) and (2) set out the periods in which a creditor or owner will not have complied with the requirement to send an arrears notice. For fixed-term credit agreements that will be either after the 14-day period when the conditions in clause 9(1) have been met or for further notices after the six-month period. For running-account credit agreements, it will be after the time when the next statement was due. The creditor or owner will comply with the relevant requirements when they have sent a notice to the debtor or hirer.

Subsection (3) and (4) establish the consequences for the creditor or owner during the period when they should have provided an arrears notice to the debtor or hirer. They will not be entitled to enforce the agreement, charge any interest and impose any default sum for a breach by the debtor or hirer that occurs during that period. Clause 11 ensures that creditors or owners cannot profit from an agreement when they have failed to comply with the arrears notice requirements.

Question put and agreed to.

Clause 11 ordered to stand part of the Bill.