The House of Representatives meeting on July 16 unanimously passed the ‘Bill to amend some Nepal Acts related to the Civil Code, 2023’, which includes provisions for addressing unfair transactions (meter interest). Law, Justice, and Parliamentary Affairs Minister Dhanraj Gurung presented a proposal to amend the Nepal Civil Code Act during the meeting on June 31.
Fourteen Members of Parliament submitted amendment proposals to the original proposal. Minister Gurung assured the integration of these proposed amendments, leading to the unanimous passage of the bill after the withdrawal of the respective amendment proposals by the parliamentarians.
The bill amends certain provisions of the Civil Code, categorizing the act of lending money on meter interest as an unfair transaction. The bill criminalizes the preparation of documents falsely stating that money was transacted or that the amount is greater than the actual transaction. It also addresses the preparation of duplicate documents including interest, failure to reimburse the amount paid by the debtor, and failure to create proper documentation.
According to the bill, transactions conducted before the Civil Code of 2015 must be verified by both parties at the ward office within the next six months. In cases where one party is unable to attend due to illness or physical or mental disability, the right holder or guardian can verify the document. If a party is absent for verification, the relevant local level or ward office must ascertain the reality of the transaction and facilitate verification.
The bill stipulates that while preparing transaction documents, at least one witness from both the creditor and the debtor should be present. Depending on the severity of the offense, the bill provides for imprisonment of up to seven years and a fine of up to Rs. 70,000.
Additionally, the bill introduces a provision that requires the delinquent party involved in meter business transactions to repay the actual amount of the transaction and interest from the remaining amount or movable property, in accordance with the law.
In cases of investigations related to unfair transactions, if it is discovered that the creditor has provided an abnormally large loan, the bill recommends an investigation by the Asset Laundering Investigation Department.
After passing the House of Representatives, the bill will proceed to the National Assembly for approval and subsequently be signed into law by the President before coming into effect.