Payday Loans Act, 2008, S.O. 2008, c. 9

• Jurisdiction: Ontario

Payday Loans Act, 2008

S.o. 2008, chapter 9

Consolidation Period: From October 19, 2021 to the e-Laws currency date.

Last amendment: 2020, c. 18, Sched. 16.

CONTENTS

Part I
Interpretation, application and Administration

Interpretation

1 (1) In this Act,

“administrative penalty” means an administrative penalty imposed under section 59; (“pénalité administrative”)

“advance” means the money transferred to or to the order of the borrower under a payday loan agreement and any other value, as prescribed, that the borrower receives under the agreement; (“avance”)

“assessor” means a person designated in writing by the prescribed person as authorized to make an order under section 59 imposing an administrative penalty; (“évaluateur”)

“borrower” means a corporation, partnership, sole proprietor, association or other entity or individual that receives a payday loan or indicates an interest in receiving a payday loan; (“emprunteur”)

“Corporation” means the Ontario Payday Lending Education Fund Corporation designated under section 68; (“Société”)

“cost of borrowing” means the total of all amounts that a borrower is required to pay under, or as a condition of entering into, a payday loan agreement and all amounts that are prescribed as included in the cost of borrowing, but does not include default charges and the repayment of the advance; (“coût d’emprunt”)

“default charge” means a charge imposed against a borrower who does not make a payment as it comes due under a payday loan agreement or who does not comply with any other obligation under a payday loan agreement, but does not include interest on an overdue payment; (“frais de défaut”)

“Director” means the person designated as the Director under the Ministry of Consumer and Business Services Act; (“directeur”)

“equity share” means, in respect of a corporation, a share of a class or series of shares of a corporation, where the class or series carries a voting right either under all circumstances or under circumstances that have occurred and are continuing; (“action participante”)

“Fund” means the Ontario Payday Lending Education Fund established in section 66; (“Fonds”)

“investigator” means an investigator appointed under subsection 48 (1); (“enquêteur”)

“lender” means a corporation, partnership, sole proprietor, association or other entity or individual that makes a payday loan to a borrower or that holds itself out as available to make such a loan; (“prêteur”)

“licence” means a licence issued under this Act; (“permis”)

“licensee” means a person who holds a licence issued under this Act; (“titulaire”, “titulaire de permis”)

“loan broker” means a corporation, partnership, sole proprietor, association or other entity or individual that assists a borrower in obtaining a payday loan or that holds itself out as available to provide such assistance; (“courtier en prêts”)

“Minister” means the Minister of Government and Consumer Services or whatever other member of the Executive Council to whom administration for this Act is assigned under the Executive Council Act; (“ministre”)

“Ministry” means the ministry of the Minister; (“ministère”)

“officer” includes,

(a) with respect to a corporation, the chair and any vice-chair of the board of directors, the president and any vice-president, the secretary and assistant secretary, the treasurer and assistant treasurer and the general manager and assistant general manager of the corporation,

(b) with respect to a partnership, a partner or general manager and assistant general manager of the partnership, and

(c) with respect to a corporation or partnership, any other individual designated as an officer by by-law or resolution or any other individual who performs functions normally performed by an individual occupying such office; (“dirigeant”)

“payday loan” means an advancement of money in exchange for a post-dated cheque, a pre-authorized debit or a future payment of a similar nature but not for any guarantee, suretyship, overdraft protection or security on property and not through a margin loan, pawnbroking, a line of credit or a credit card; (“prêt sur salaire”)

“payday loan agreement” means an agreement under which a lender makes a payday loan to a borrower; (“convention de prêt sur salaire”)

“prescribed” means prescribed by the regulations; (“prescrit”)

“regulations” means the regulations made under this Act; (“règlements”)

“Tribunal” means the Licence Appeal Tribunal established under the Licence Appeal Tribunal Act, 1999 or whatever other tribunal is prescribed. (“Tribunal”) 2008, c. 9, s. 1 (1).

Associated persons and entities

(2) For purposes of this Act, one person or entity is associated with another person or entity in any of the following circumstances:

1. One person or entity is a corporation of which the other person or entity is an officer or director.

2. One person or entity is a partnership of which the other person or entity is a partner.

3. Both persons or entities are partners of the same partnership.

4. One person or entity is a corporation that is controlled directly or indirectly by the other person or entity.

5. Both persons or entities are corporations and one corporation is controlled directly or indirectly by the same person or entity who controls directly or indirectly the other corporation.

6. Both persons or entities are members of the same voting trust relating to shares of a corporation.

7. Both persons or entities are associated within the meaning of paragraphs 1 to 6 with the same person or entity. 2008, c. 9, s. 1 (2).

Application of Act

2 (1) Subject to the regulations, this Act applies in respect of all payday loans if the borrower, lender or loan broker is located in Ontario when the loan is made or to be made. 2008, c. 9, s. 2 (1).

Other loans

(2) Except for section 32, this Act applies with necessary modifications to those loans, other than payday loans, that are prescribed and in that case the references to payday loans in this Act shall be read as references to those other loans. 2008, c. 9, s. 2 (2).

Exemptions

3 This Act does not apply to the persons, entities or payday loans or classes of persons, entities or payday loans that are prescribed. 2008, c. 9, s. 3.

Anti-avoidance

4 In determining whether this Act applies to a person, entity, agreement or transaction, a court or other tribunal shall consider the real substance of the person, entity, agreement or transaction and in so doing may disregard the outward form. 2008, c. 9, s. 4.

Registrar

5 (1) The Deputy Minister shall appoint a person as Registrar for the purposes of this Act. 2008, c. 9, s. 5 (1).

Powers and duties

(2) The Registrar may exercise the powers and shall perform the duties conferred on the Registrar under this Act. 2008, c. 9, s. 5 (2); 2009, c. 33, Sched. 10, s. 12.

Section Amendments with date in force (d/m/y)

2009, c. 33, Sched. 10, s. 12 - 15/12/2009

PART II
Licences

Requirement for licence

6 (1) No person or entity shall act as a lender unless the person or entity,

(a) is licensed as a lender and, subject to section 17, has received notice in writing from the Registrar of the licence; or

(b) is deemed to be licensed under section 18. 2008, c. 9, s. 6 (1).

Same, loan broker

(2) No person or entity shall act as a loan broker unless the person or entity,

(a) is licensed as a loan broker and, subject to section 17, has received notice in writing from the Registrar of the licence; or

(b) is deemed to be licensed under section 18. 2008, c. 9, s. 6 (2).

Consequence

(3) If a lender who is not licensed enters into a payday loan agreement with a borrower, the borrower is only required to repay the advance to the lender and is not liable to pay the cost of borrowing. 2008, c. 9, s. 6 (3).

Dealings between lenders and loan brokers

7 (1) For the purposes of this Act, no lender shall deal with or through a loan broker who is not licensed. 2008, c. 9, s. 7 (1).

Same

(2) For the purposes of this Act, no loan broker shall deal with or through a lender who is not licensed. 2008, c. 9, s. 7 (2).

Change in partnership

8 A change in the membership of a partnership is deemed to create a new partnership for the purpose of a licence. 2008, c. 9, s. 8.

No right to hearing

9 (1) If an applicant for a licence or renewal of a licence does not meet the prescribed requirements, the Registrar shall refuse to issue or renew the licence, as the case may be. 2008, c. 9, s. 9 (1).

Non-application

(2) Section 13 does not apply to a refusal under subsection (1) to issue or renew a licence. 2008, c. 9, s. 9 (2).

Notice of refusal

(3) The Registrar shall give the applicant written notice of a refusal under subsection (1), setting out the reasons for the refusal. 2008, c. 9, s. 9 (3).

Service of notice

(4) Subsection 64 (3) does not apply to the notice. 2008, c. 9, s. 9 (4).

Right to hearing

10 (1) If an applicant for a licence or renewal of a licence meets the prescribed requirements, the applicant is entitled to have the Registrar issue or renew the licence, as the case may be, unless,

(a) the applicant is not a corporation and,

(i) having regard to the applicant’s financial position or the financial position of an interested person or entity in respect of the applicant, the applicant cannot reasonably be expected to be financially responsible in the conduct of business,

(ii) the past conduct of the applicant or of an interested person or entity in respect of the applicant affords reasonable grounds for belief that the applicant will not carry on business in accordance with law and with integrity and honesty, or

(iii) the applicant or an employee or agent of the applicant makes a false statement or provides a false statement in the application;

(b) the applicant is a corporation and,

(i) having regard to its financial position or the financial position of an interested person or entity in respect of the corporation, the applicant...