DECEMBER 2004

Credit Reform in the U.K.

Concerns over abusive lending practices, overindebtedness and poor disclosures have prompted the British government to commit to a review and overhaul of regulations governing consumer lending in the U.K. In her annual speech to Parliament outlining the government's agenda for the coming year, Queen Elizabeth II announced that a new Consumer Credit Bill will update existing law "to provide greater protection from unfair lending practices and create a fairer and more competitive credit market." In addition, the Office of Fair Trading will acquire more enforcement power over lenders, require greater disclosures, and create an "unfair credit" test that will allow consumers to take lenders to court.