Malaysia legislation
Section 2
Section 2
The Hire-Purchase Act 1967 [Act 212], which is referred to as the “principal Act” in this Act, is amended in subsection 2(1)—
(a)
by deleting the definition of “base lending rate”;
(b)
by inserting after the definition of “dealer” the following definitions:
‘ “effective interest rate” refers to—
(a)
a rate that reflects the actual finance cost of a hire-purchase in the case of a hire-purchase agreement where the terms charges are at a fixed rate; or
(b)
a rate that reflects the actual finance cost of a hire-purchase which is determined by using the reference rate as a benchmark in the case of a hire-purchase agreement where the terms charges are at a variable rate;
“electronic” has the same meaning assigned to it in the Electronic Commerce Act 2006 [Act 658];’;
(c)
by inserting after the definition of “prescribed”
the following definition:
‘ “reference rate” refers to the benchmark interest rate that forms the basis for determining the pricing of variable rate financing facilities, whereby the benchmark rate is the published prevailing overnight policy rate;’; and
(d)
by deleting the definition of “statutory rebate”.
Amendment of section 4