Consumer Leases and Consumer Protection: Regulatory Arbitrage and Consumer Harm

Australian Business Law Review, Vol. 41, No. 5, pp. 240-269, 2013

30 Pages Posted: 1 Mar 2014

See all articles by Paul Ali

Paul Ali

University of Melbourne - Law School

Cosima Hay McRae

University of Melbourne - Law School

Ian Ramsay

Melbourne Law School - University of Melbourne

Tiong Saw

University of Melbourne - Law School

Date Written: December 31, 2013

Abstract

Consumer leases are regulated in Australia separately from credit contracts. This has created opportunities for regulatory arbitrage and has resulted in significant harm to consumers. Recent reforms, which commenced on 1 March 2013, have addressed this problem by applying to consumer leases many of the statutory protections available to consumers under credit contracts. However, the distinction between consumer leases and credit contracts has been retained. We argue in this article that the distinction is artificial and should be abandoned. We also examine how the uneven regulation of consumer leases and credit contracts has harmed consumers and we assess the recent reforms to the regulation of consumer leases. Finally, we investigate the practice of consumer leasing in Australia by reference to our survey of the consumer leasing industry, the cost of consumer leases, and selected “real life” case studies.

Suggested Citation

Ali, Paul and McRae, Cosima Hay and Ramsay, Ian and Saw, Tiong, Consumer Leases and Consumer Protection: Regulatory Arbitrage and Consumer Harm (December 31, 2013). Australian Business Law Review, Vol. 41, No. 5, pp. 240-269, 2013. Available at SSRN: https://ssrn.com/abstract=2402518

Paul Ali

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia
+61 3 8344 1088 (Phone)
+61 3 8344 5285 (Fax)

HOME PAGE: http://www.law.unimelb.edu.au

Cosima Hay McRae

University of Melbourne - Law School ( email )

185 Pelham Street
Carlton, Victoria 3053
Australia

HOME PAGE: http://www.unimelb.edu.au

Ian Ramsay (Contact Author)

Melbourne Law School - University of Melbourne ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia
+61 3 8344 5332 (Phone)

HOME PAGE: http://law.unimelb.edu.au/about/staff/ian-ramsay

Tiong Saw

University of Melbourne - Law School ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia

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