National Credit Regulator v National Consumer Tribunal and Others and Similar Matters (667/2023) [2025] ZASCA 132 (12 September 2025)

Case Note

Case Name: National Credit Regulator v National Consumer Tribunal and Others and Similar Matters
Citation: 667/2023 [2025] ZASCA 132
Date: 12 September 2025

Reportability

This case is reportable due to its significance in the interpretation of the National Credit Act 34 of 2005, particularly regarding the permissibility of 'on the road fees' that credit providers may levy on consumers. The decision contributes to the understanding of consumer rights and protections in the financial services sector, clarifying the boundaries within which charges must be applied in credit agreements. Additionally, the case serves as a reference for compliance enforcement by regulatory bodies and the applicable legal standards when interpreting fees associated with credit agreements.

The court's ruling reflects ongoing debates in consumer law regarding transparency and fairness in credit agreements. The implications of this case extend beyond the specific fees in question, shaping how credit providers can structure their financial products in compliance with statutory obligations to ensure consumer protection.

Cases Cited

1. Sebola and Another v Standard Bank of South Africa Ltd and Another [2012] ZACC 11; 2012 (5) SA 142 (CC).
2. Nedbank Ltd and Others v National Credit Regulator and Another [2011] ZASCA 35; 2011 (3) SA 581 (SCA).
3. National Credit Regulator v Southern African Fraud Prevention Services NPC [2019] ZASCA 92; [2019] 3 All SA 378 (SCA); 2019 (5) SA 103 (SCA).

Legislation Cited

1. National Credit Act 34 of 2005, sections 100, 101, and 102.
2. Consumer Protection Act 68 of 2008, sections 1 and related.

Rules of Court Cited

No specific rules of court were cited in the judgment.

HEADNOTE

Summary

The Supreme Court of Appeal dealt with three consolidated appeals concerning the legality of 'on the road fees' (OTR fees) charged by credit providers for motor vehicle financing. The National Credit Regulator (the appellant) challenged the determination of the National Consumer Tribunal, which had concluded that OTR fees did not violate the provisions of sections 100, 101, and 102 of the National Credit Act. The court reversed the Tribunal’s decisions in favor of the credit providers and clarified the interpretation of permissible charges under the Act.

Key Issues

The primary legal issues include whether OTR fees constitute charges permitted by the National Credit Act or whether their imposition contravenes the statutory prohibitions against unlawful charges in credit agreements. The court also considered the responsibilities of credit providers concerning transparency in their agreements and how these responsibilities intersect with the rights of consumers.

Held

The Supreme Court of Appeal upheld the appeal by the National Credit Regulator with respect to Volkswagen Financial Services, dismissing their assertions against the Regulator. The court clarified that OTR fees charged must comply with the stipulations of the National Credit Act and emphasized that credit providers cannot include these fees in the principal debt under the agreements with consumers.

THE FACTS

The case arose when consumers purchasing motor vehicles on credit incurred OTR fees, which included costs for services like pre-delivery inspections, registration, and licensing fees. The National Credit Regulator asserted that such fees were unlawful under the National Credit Act as they were not permitted charges. Following an investigation, the Regulator issued compliance notices against credit providers including Volkswagen, BMW, and Mercedes-Benz, asserting that they contravened sections of the Act by imposing these fees.

Credit providers maintained that they were merely financing contracts agreed upon between consumers and dealers, where these fees were included by the dealers. This led to conflicting legal determinations by the National Consumer Tribunal, which found some contracts lawful while others contravened the Act.

THE ISSUES

The main legal questions for the Supreme Court of Appeal included determining whether OTR fees are properly categorized as debatable charges under the National Credit Act, and if their inclusion in credit transactions breaches the Act's stipulations regarding prohibited charges. Additionally, the court explored the obligations of credit providers to ensure compliance with the Act when providing financing under agreements that may contain potentially unlawful fees.

ANALYSIS

In analyzing the case, the court examined the definitions and enumerations in the National Credit Act regarding allowable fees in credit agreements. The interpretation of sections 100, 101, and 102 was crucial, as these sections delineate various components of the credit provider's obligations, including what constitutes the principal debt and what permissible fees may be included within. The court found that the construction advanced by the credit providers, asserting that OTR fees were merely negotiated costs between consumers and dealers, misapprehended the protections intended by the National Credit Act.

The Supreme Court articulated that credit providers have a statutory responsibility to scrutinize such fees and ensure that they do not represent unlawful charges. The court articulated that transparency in contractual arrangements is essential to protect consumers and avoid misleading representations regarding the nature of the fees included in credit agreements.

REMEDY

The Supreme Court of Appeal ordered the dismissal of the appeals launched by the credit providers against the Regulator's compliance notices for Volkswagen, BMW, and Mercedes-Benz. Consequently, the compliance notices issued by the Regulator regarding OTR fees were upheld, clarifying their status as fees not permissible under the provisions of the National Credit Act.

LEGAL PRINCIPLES

The case established critical legal principles regarding: 1. The definition and permissible nature of fees under the National Credit Act. 2. The obligations of credit providers to ensure compliance with statutes governing consumer credit, particularly in relation to transparency and the prohibition of unlawful fees. 3. The interpretation of charges in credit agreements must align with consumer protection objectives, as laid out in the National Credit Act, ensuring that consumers are not subject to arbitrary fees that compromise their financial obligations.

This case significantly impacts the practice within the financial services sector concerning the enforcement of consumer rights and the scrutiny of fees levied on financing agreements.