Consumer and SME Credit law is a notable and important addition to the current rostrum of books profiling Irish financial services law.Footnote ¹ Its raison d’etre is to profile and analyse the full spectrum of conduct of business obligations imposed on the provision of credit to relevant borrowers, the consequences of non-compliance and the remedial frameworks available to borrowers under national law.Footnote ² Whilst other publications subsume credit law within a broader legal or financial services frame of reference,Footnote ³ Beausang has adopted a discrete and holistic “regulatory” focus in her contribution, thereby delivering the most expansive and forensic examination of the national framework of credit regulation to date. It is in particular distinguishable for the extent of its examination of the obligations emanating from the Central Bank of Ireland alongside those imposed through legislative frameworks of credit regulation and, more generally, for the rigour of its analysis on the significance and import of the various legal norms.

The book guides the reader through a well-structured journey of the multiple constituents of the national framework. This exploration is undertaken over 2,272 pages, prefaced by the introductory chapter which contextualises the scope of the subject matter to follow and outlines some fundamental concepts that are returned to throughout.Footnote ⁴ It identifies the scope of “credit” addressed,Footnote ⁵ the range of “regulated lenders”Footnote ⁶ as well as the scope of borrower comprised in “consumer” and “SME” under the various components of the relevant legal framework.Footnote ⁷ It also sets an overarching frame of reference for the subsequent component chapters by identifying the capacity for legally binding requirements to be imposed by the legislature, the relevant Minister or the Central Bank. Even at this stage, the author highlights subtleties and intricacies in the parameters of the regulatory landscape which point to the technicality of this area of law, and accordingly, the significance of the book from a compliance-orientated perspective.Footnote ⁸

Towards the end of Chapter 1, the author seeks to summarise and offer clarity as to the applicability of the various legislative and code-based requirements by providing a series of credit scenarios with variance in aspects such as the date of the agreement, the purpose of the loan and the nature of any related security.Footnote ⁹ This approach is novel among texts in the field and provides a quick, engaging and accessible reference point, enabling clearer understanding of the temporal and subject matter delineations within the national framework.

The subsequent chapters, 2–16, analyse the normative and institutional framework of credit regulation in Ireland. These include multiple chapters with a singular primary focus of analysis, eg, chapter 3 on the Consumer Credit Regulations 2010,Footnote ¹⁰ chapter 6 on the Code of Conduct on Mortgage Arrears,Footnote ¹¹ chapter 13 on the Credit Reporting Act 2013,Footnote ¹² and chapter 16 on the Financial Services and Pensions Ombudsman. Elsewhere, chapters deal simultaneously with a number of linked regulatory components of primary relevance, eg, chapter 15 on ‘Regulation of Mortgage LendingFootnote ¹³ or chapter 16 on “Redress on Regulatory Breach and Enforceability of Contracts Affected by Illegality”.Footnote ¹⁴

However, in keeping with the text’s holistic and integrative approach, the examination of these “primary” provisions is not disjointed from the broader regulatory landscape. Where relevant, other legislative or code-based conduct of business requirements are highlighted and addressed in each chapter.Footnote ¹⁵ This is notwithstanding that these ancillary provisions are the primary focus of another chapter of the text and the inevitable degree of duplication.Footnote ¹⁶ While contributing to the significant length of the tome, the result is a complete compliance and liability-orientated profile, not simply in the book as a whole, but also in each component chapter. Accordingly, in discussing the requirements of the Consumer Credit Act 1995 (CCA) in chapter 2, the author identifies the overlapping applicability of the Consumer Protection Code (CPC) 2012 and identifies, for example, the requirements to ensure compliance in the context of an unsolicited visit to a borrower who is classified as a “consumer” under the CCA. In doing so, the author considers the scope and context of the obligations imposed under the CCA, the CPC 2012 and related guidance provided by the Central Bank.Footnote ¹⁷ At another point, in a discussion on the capacity for the transparency related obligations of the EC (Unfair Terms in Consumer Contracts) Regulations 1995 (1995 Regs) to generate liability for lenders based on the content of their contracts, the author identifies the potential for offending terms to also breach a number of principles of the CPC.Footnote ¹⁸ These examples provide an insight into the complexity of compliance in the current fragmented landscape and hint at the contemporary significance of the CPC as a bedrock of consumer protection.

The book’s approach to the CPC merits highlighting. Beausang understandably considers it “the centrepiece of our consumer protection framework”, therefore giving considerable attention to it. Its requirements are deconstructed and extensively analysed over four chapters; an approach which is in part attributable to the variance in the orientation and applicability of its requirements.Footnote ¹⁹ Code-based obligations are recognised not as an adjunct of legislative provisions, but as the core of the national framework.Footnote ²⁰ The regulatory significance of the codes from a liability perspective was recently highlighted by the extent to which breach of the principles of the codes were cited as one of the bases of administrative sanction in the Tracker Mortgage scandal.Footnote ²¹

The book weaves the relevant EU and national policy and political economy backdrop through its analysis of obligations, identifying the stimulus to existing obligations and, in some contexts, unsuccessful proposals. In the realm of secured lending, the author notes the national policy emphasis on protection of the primary residence and the inherent policy tension between the home as financial collateral and access to housing; noting that the “balancing of constitutional rights and proportionality has very much been a live issue in the context of mortgage arrears resolution strategies”.Footnote ²² Unsuccessful proposals in the Irish parliament to impose a consent requirement on the transfer of loans secured on a principal private residence (PPR) are highlighted, as is the suggested conferral on the Central Bank of a power to cap variable rates over PPR loans.Footnote ²³ It further identifies the inclusion of certain information and transparency-based requirements in the CPC as reflecting commitments given by the Irish state to the European Commission in the context of its bailout.Footnote ²⁴ In respect of the Central Bank’s supervisory competence for charges, the book highlights policy discussion seeking to balance profitability for banks with the risk inherent in unfettered price-setting capacity.Footnote ²⁵ Further, the author profiles, for example, the socio-economic importance of SME’s to the Irish economy as a pre-cursor to analysis of the regulatory framework for business lending in chapter 12, and charts the evolution of EU consumer protection policy through maximum harmonisation of consumer credit provisions and the imposition of responsible lending obligations in both consumer and mortgage credit.Footnote ²⁶

A point of interest is the author’s intermittent use of the terms “statutory” and “regulatory” to refer to the legislation and codes which comprise the national framework. There is no direct discussion of the purpose or significance of the distinction but it could be inferred that it is intended to demarcate between norms imposed by the Central Bank as the national supervisory authority with regulatory capacity, from those imposed by the legislature.Footnote ²⁷ As all conduct of business measures profiled in the book “regulate” market activity, indeed on its broadest framing all law could be said to be instrumental and regulatory, the use of differential terminology is interesting and the question is whether it has a practical or conceptual significance.Footnote ²⁸ Certainly, in EU consumer and financial services literature the concept of European Supervision Private law has in the past been used to identify a subset of European Regulatory Private law imposing contract-related conduct of business requirements set as public supervision standards. However, one of the distinguishing characteristics of the former was the restriction to public law enforcement mechanisms.Footnote ²⁹ Notably in the evolution of the Irish remedial framework in 2013 there has been a fusing of public and private enforcement mechanisms with applicability to the full spectrum of regulatory obligations.Footnote ³⁰ The question is therefore whether the distinction between the source of norms (or indeed forms of norm) has any substantive significance in the current framework where the measures have the same regulatory function, and are subject to the same compliance and remedial consequences.Footnote ³¹ Perhaps the question is whether there should be, a point which is implicit in the author’s critique of the private right of action’s applicability to the general principles of the CPC.

Further, the common law contractual foundation on which the conduct of business framework is overlaid, is not addressed within its own chapter. This is consistent with the orientation of the work as one anchored in conduct of business regulation. Accordingly relevant aspects of common law doctrine, and private law more generally, are embedded in the regulatory analysis at appropriate junctures. Common law principles on penalty charges are, for example, included in the context of a discussion on regulatory obligations applicable to default charges and fees eg, whether a clause imports a disproportionate penalty on a consumer under the 1995 Regs.Footnote ³² Similarly, the property law framework attendant to secured credit is not the focus of a standalone chapter but relevant aspects are interwoven through the examination of regulatory obligations. Accordingly, a legislative amendment to expand the scope of formal consideration by the courts in enforcement proceedings in respect of a borrower’s primary residence, is highlighted in the context of a discussion as to whether acceleration clauses could potentially be deemed unfair under the 1995 Regs as well as in the context of analysis of the role of compliance with the Code of Conduct on Mortgage Arrears 2013 (CCMA) in the granting of a possession order over a borrower’s primary residence.Footnote ³³

Finally, one of the challenges of such an extensive profile in a dynamic legal arena is ongoing development. The author has admirably incorporated reforms pending at the time of publication into the profile and has analysed the significance of these developments. Of particular note are new national provisions on unfair contract terms which serve largely to embed contemporary EU jurisprudence on the directive and the proposed imposition of requirements under the Consumer Rights Bill 2022, including a subjective requirement for conformity of the service contract, which the author views as unnecessary and inappropriately applied to financial services.Footnote ³⁴

Fundamentally, this book represents a compliance tour de force in which the author offers an in-depth and complete profile of the credit-related obligations contained in national law, informed where relevant, by national and EU caselaw, and guidance from the Central Bank and counterpart EU competent bodies.Footnote ³⁵ Within the analysis of the obligations imposed, at relevant junctures, process-oriented advice is offered to lenders and those in compliance-orientated roles. This is manifest, for example, in the identification of the potential for a single protocol conforming to the highest regulatory threshold to resolve the inefficiency and cost stemming from a multiplicity of processes linked to differential requirements, eg, arrears-related obligations under the CPC and the CCMA.Footnote ³⁶ Similarly, advice is provided as to the prudence of borrower representations as a practical step in rebutting assertions of “consumer” lending under the CCA.Footnote ³⁷ In other contexts it offers reassurance or suggests caution regarding potential sources of liability, for example, the relative ineffectiveness of broadly drafted consent clauses regarding unsolicited visits to a borrower’s home in respect of the CPC requirements in contrast with their potential utility in respect of CCA based requirements,Footnote ³⁸ The analysis offers practical guidance regarding the extent to which buy-to-let borrowing falls within the scope of various frameworks.Footnote ³⁹ It also offers reassurances that the procedural framework for mortgage enforcement is robust in vindicating the rights conferred under the Unfair Contract Terms Directive (UCTD) and EU guaranteed fundamental and human rights, and lender enforcement is thus immune from challenge on these basis.Footnote ⁴⁰ The book thereby is an essential guide for those practicing in the field or in related areas.

However, of particular note is the book’s critique of unnecessary complexity, uncertainty and lack of transparency in aspects of the national framework. The assertion repeated at several junctures and exemplified through the profiles is that the fragmentation of regulation has increased the complexity of compliance for lenders, supervision for enforcement authorities, and, in some instances, reduced the effective level of consumer protection for borrowers. This observation is centrally focused on the normative framework of consumer and mortgage credit regulation. The author suggests it is “confusing”, “labyrinthine” and “entirely unsatisfactory”.Footnote ⁴¹ Notwithstanding that the bifurcation of normative requirements as between the Oireachtas and the Central Bank is broadly acknowledged as a contributory factor in the preface and introduction, a significant point of discussion is the contributory role of the legislature through its approach to the transposition of relevant EU directives.

The use of standalone statutory instruments, ie, Ministerial Regulations, to transpose is characterised as time-efficient but suboptimal in ensuring a sufficiently integrative and holistic incorporation of EU obligations into the national framework.Footnote ⁴² An example which illustrates the resulting difficulties is the transposition of the second consumer credit directive (CCD1).Footnote ⁴³ The existing national framework (including elements derived from the first EU directive addressing consumer credit, ie, Directive 87/102/EEC) at the time was laid out in the Consumer Credit Act 1995 (CCA). Rather than repeal the CCA and introduce a revised framework incorporating the new EU requirements, Ireland transposed the second consumer credit directive via the EC (Consumer Credit Agreement) Regulations 2010 (2010 Regs), with disapplication of relevant provisions of the CCA. The inevitable result was structural fragmentation of the legislative framework of consumer credit regulation into parallel but differential regimes under the CCA and the 2010 Regs.Footnote ⁴⁴ Further, Beausang notes an “overenthusiastic” and “precautionary” disapplication of domestic protections contained in the Consumer Protection Code 2012 and the CCA in respect of credit covered by the 2010 Regs.Footnote ⁴⁵ The key point raised is that the issue appears to be one of an insufficiently considered national approach, rather than actual constraints arising from the EU instrument.Footnote ⁴⁶ In other words, there was scope for Ireland to transpose the second directive in an integrative manner that aligned its requirements with existing national law, thereby enhancing rather than diminishing consumer protection.

The area of secured credit raises similar issues. The comparative strength of the pre-existing national regulation is substantiated by the author’s assertion that transposition of the EU’s Mortgage Credit directive by the EU (Consumer Mortgage Credit Agreements) Regulations 2016 (2016 Regulations) provided only a limited enhancement of the existing framework contained in the “Housing Loan” provisions of the CCA and the obligations imposed under the CPC.Footnote ⁴⁷ Further, the author highlights the lack of conceptual alignment between a “housing loan” in the CCA and “mortgage credit” in the 2016 regulationsFootnote ⁴⁸ and conflict between the respective substantive requirements, notwithstanding a purported disapplication of conflicting national provisions.Footnote ⁴⁹

Both examples highlight challenges posed by an approach which overlays EU law rather than integrating it more holistically within the regulatory ecosystem; they also raise the questions of (i) whether this reflects a conscious policy decision, a lack of awareness of the inherent capacity to retain national rules or a lack of awareness of the content of existing obligations, and (ii) whether transposition undertaken through an Act of the Oireachtas, thereby enabling parliamentary scrutiny, would definitively yield a more holistic and integrative output.

The fragmentation and complexity exposed in the profile of the normative frameworks could perhaps be juxtaposed with chapter 16’s consideration of the comparatively streamlined and holistic national remedial framework which has evolved in the post-crisis context. Redress through the Financial Services and Pensions Ombudsman (FSPO) has been supplemented with a redress power imbued in the Central Bank and a private right of action conferred on “customers” of financial services providers. All these remedial avenues incorporate the broad framework of conduct of business obligations and financial services user protected by the relevant regulatory provisions.Footnote ⁵⁰ The private right of action in particular has been a focus of prior academic commentaryFootnote ⁵¹ and Beausang contributes to the growing academic consensus as to the susceptibility of the CPC to an action under this provision but queries whether it is desirable that the general principles of the code should be capable of grounding a relevant action. She notes that more generally the action may be “too widely drawn, particularly when compared with the carefully calibrated development of common law principles governing recovery by persons who have suffered loss arising from breach of a providers duty of care”.Footnote ⁵² It is perhaps of note that since publication, transposition of the EU Representative Actions directive has been undertaken through an Act of the Oireachtas. Footnote ⁵³ Notwithstanding the form of transposition, it has resulted in a degree of remedial fragmentation, through its provision of a collective action applicable only to EU-derived components of the regulatory framework. The previously raised questions of whether this reflects inadvertence or a deliberate policy choice remain pertinent.Footnote ⁵⁴

A further issue of inherent significance raised in respect of the 2010 Regulations is the legal dynamic between its requirements and regulation of unfair commercial practices under the Consumer Protection Act 2007 (CPA 2007).Footnote ⁵⁵ The author notes that EU law mandates the applicability to financial services of the Unfair Commercial Practices Directive (UCPD), which the 2007 Act transposes. However, the Irish transposition is, she observes, contrary to the intended role of the respective measures from an EU perspective. This assertion is premised on the stipulation in the 2010 Regulations that the advertising-related requirements of the 2010 Regulations are without prejudice to the applicability to the requirements of the CPA 2007.Footnote ⁵⁶ As a result, the 2010 Regulations ostensibly give precedence to the requirements of the 2007 Act in the event of conflict, and this, the author notes, is “not necessarily consistent” with EU law.Footnote ⁵⁷ The assertion that compliance-related complexity arises from the varying content of requirements is supported by an examination of the implications of provisions in CPA 2007 requiring the inclusion of the price in an invitation to purchase.Footnote ⁵⁸ Whilst the author’s analysis of the inference of the legislative drafting is undoubtedly correct, an interesting question which is not explored, is the likely judicial response at national or EU level if this question of precedence were raised in proceedings.

Notwithstanding the noted prevalence of issues where EU directives are transposed, an interesting lack of coherence between stated policy and its implementation in wholly national law is exposed in the analysis of the scope of “housing loan” provisions under the CCA. The author identifies an extension in the scope of protection through a revised definition of “housing loan” which encompassed commercial borrowing where the borrower’s home provided security for the loan. Commercial borrowing is outside the EU framework of mortgage credit regulation and the provision represents a longstanding and stated policy decision at national level to afford protection to the primary dwelling of the borrower; a theme noted at various points throughout the text. However, the subsequent failure of the legislature to amend the scope of what constitutes a credit agreement to expand beyond a “consumer” transaction rendered nugatory much of the purported benefit, as such transactions are framed to exclude commercial borrowing.Footnote ⁵⁹

A related point of law of both theoretical interest and practical importance examined in the analysis is the certainty of the outer parameters of “consumer” transactions under the CCA.Footnote ⁶⁰ Consumer was defined in the Act and the originating directive as a natural person acting outside trade, business or profession. In chapter 2, Beausang analyses national caselaw with reference both to CJEU jurisprudence and a comparative UK perspective, noting that there is a “grey area” between what is definitively a commercial or consumer transaction.Footnote ⁶¹ The Irish High Court, in a minority of cases, challenged the orthodoxy in its willingness to consider arguments that a borrower was a consumer where, for example, an investment for profit was asserted to be for personal consumption, eg, pension, etc. This thread of caselaw is broadly set within the context of summary proceedings challenging the enforceability of credit agreements for non-compliance with relevant provisions of the CCA.Footnote ⁶²

Notwithstanding that the preponderance of superior court caselaw adopts a strict approach, the author opines that an element of uncertainty persists regarding the viability of such argument in the absence of a definitive ruling by the Irish Supreme Court.Footnote ⁶³ The author queries whether EU caselaw could provide for a more expansive applicability, noting the latitude in classifying as “consumer contracts” sophisticated investment or complex financial instrument contracts entered into by individuals. Whilst this is set within the context of determination of jurisdiction under the recast Brussels Regulation and there is, as the author notes, a policy argument for a more restrictive approach in consumer law framework, she points to the lack of any indication that the CJEU would support differential applicability of the concept.Footnote ⁶⁴ The issue of any expansion or restriction in the scope of what is considered to be consumer activity under any framework premised on the EU definition is thus fundamentally in the hands of the national and, in particular perhaps, the EU courts pending any change in EU or national legislation. The author advocates for a narrower applicability noting that “exacting consumer protections should be faithfully safeguarded and, in turn applied to those most in need of them”,Footnote ⁶⁵ and accordingly investment for profit should be subject to less stringent protection regardless of its ultimate usage but cautions that the CJEU jurisprudence at least may be developing otherwise. Although the author does not directly address the point, any expansion in the scope of applicability of the statutory definition through national or EU caselaw would have significant compliance implications not just in respect of the CCA but any legislative framework with an equivalent definition.

From a regulatory compliance perspective, Consumer and SME credit law is state of the art in offering a deconstruction of all facets of the Irish regulatory framework and is, in particular, distinguishable for its forensic detail and holistic approach to the national regulatory regime. It is an indispensable addition to the bookshelves of the judiciary, practitioners, lenders and those in compliance-oriented roles interested in the Irish regime. However, this is not a book for light reading – literally or metaphorically. The sheer volume and detail of the content, in conjunction with the complexity or technicality of the regime may prove challenging for the non-specialist. However, this in effect substantiates the book’s main critique, that the national framework is complex, fragmented and inaccessible and in need of reform.

As Beausang notes, the complexity arises from a mix of factors, including the evolution of the (important) regulatory framework imposed by the Central Bank and the legislature’s approach to transposing EU measures. And more EU laws are in the pipeline such as a new Consumer Credit Directive (Directive (EU) 2023/2225 (“CCD2”).Footnote ⁶⁶ For an area where regulation is largely focused on protecting the consumer, it is ironically, and as noted by the author, becoming increasingly inaccessible.

Beausang’s consequent argument raised in favour of consolidation is entirely logical but the process, depending on the extent of consolidation envisaged, could be complex. The author highlights the area of consumer credit as a potential first step (and arguably “easy win”). The recent adoption of the CCD2 need not add further complexity, but instead it provides an opportunity for the Irish legislature to reflect on and ameliorate its current approach.Footnote ⁶⁷ This could provide the necessary impetus for Ireland to engage in a streamlining and consolidation exercise, including via legislation with proper parliamentary scrutiny.

Finally, while Beausang has focussed on Ireland, the text is a valuable resource for anyone considering the EU’s regime or approaches within EU Member States, as there are considerable lessons to be learnt from Ireland’s regime, both in the scope and content of regulation and the difficulties arising therein.