Hyperlawhypertext legal database Criminal Interest Rate Regulations current to 2025-01-22

SOR-2024-114 Criminal Interest Rate Regulations

Current to 2025-01-22 · last amended 2025-01-01

Contents
Provision

Whereas the Minister of Justice has, in accordance with subsections 347.01(2) a and 347.1(2.1) b of the Criminal Code c, consulted with the Minister of Finance with respect to the annexed Regulations; S.C. 2023, c. 26, s. 611 S.C. 2023, c. 26, s. 612(2) R.S., c. C-46

Provision

Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Justice, makes the annexed Criminal Interest Rate Regulations under subsections 347.01(2) a and 347.1(2.1) b of the Criminal Code c.

Non-application — Business or Commercial Purposes

s. 1 — Criteria

For the purposes of subsection 347.01(1) of the Criminal Code, section 347 of that Act does not apply in respect of an agreement or arrangement if

s. 1(a)

the borrower is not a natural person;

s. 1(b)

the borrowing is for a business or commercial purpose; and

s. 1(c)

either

s. 1(c)(i)

the amount of the credit advanced is more than $10,000 but less than or equal to $500,000 and the annual percentage rate of interest — calculated in accordance with generally accepted actuarial practices and principles — does not exceed 48% on the credit advanced, or

s. 1(c)(ii)

the amount of the credit advanced is more than $500,000.

Non-Application — Pawnbroking Loans

s. 2 — Criteria

For the purposes of subsection 347.01(1) of the Criminal Code, section 347 of that Act does not apply in respect of an agreement or arrangement if

s. 2(a)

the person who receives interest carries on a business related to pawnbroking;

s. 2(b)

the credit is advanced in exchange for the pawning of tangible personal property or corporeal movable property, other than a vehicle;

s. 2(c)

in the event of the borrower’s default, the only recourse of the person referred to in paragraph (a) is the seizure of the pawned property; and

s. 2(d)

the amount of the credit advanced is less than $1,000 and the annual percentage rate of interest — calculated in accordance with generally accepted actuarial practices and principles — does not exceed 48% on the credit advanced.

Limit — Payday Loans

s. 3 — Limit on total cost of borrowing
s. 3(1)

For the purposes of paragraph 347.1(2)(a.1) of the Criminal Code, the limit on the total cost of borrowing under a payday loan agreement is 14% of the amount of money advanced to the borrower under the agreement.

s. 3(2) — Clarification

In determining whether a payday loan agreement complies with the limit fixed under subsection (1), the total cost of borrowing does not include a fee, fine, penalty or other charge that is specifically authorized under the applicable provincial law and imposed on the borrower

s. 3(2)(a)

for defaulting in any payment; or

s. 3(2)(b)

for providing a dishonoured cheque or other dishonoured instrument, if the amount of the fee, fine, penalty or other charge is $20 or less.

s. 3(3) — Definition of applicable provincial law

In subsection (2), applicable provincial law means the legislative measures referred to in subsection 347.1(3) of the Criminal Code that apply in the province in which the payday loan agreement is entered into.

Coming into Force

*4 — S.C. 2023, c. 26

These Regulations come into force on the first day on which sections 610 to 612 of the Budget Implementation Act, 2023, No. 1 are all in force, but if these Regulations are registered after that day, they come into force on the day on which they are registered.[Note: Regulations in force January 1, 2025.]