S.L. 376.10 Art. 30Calculation of the annual percentage rate of charge.

(1) The annual percentage rate of charge shall be calculated in accordance with the mathematical formula provided in

Part I of the Third Schedule and it shall equate, on an annual basis, to the present value of all commitments (drawdowns, repayments and charges), future or existing, agreed by the creditor and the consumer.

(2) For the purpose of calculating the annual percentage rate of charge, the total cost of the credit to the consumer shall be determined, with the exception of any charges payable by the consumer for non-compliance with any of his commitments stipulated in the credit agreement and charges other than the purchase price which, for purchases of goods or services, he shall be obliged to pay whether the transaction is effected in cash or on credit:

Provided that the costs of maintaining an account recording both payment transactions and drawdowns, the costs of using a means of payment for both payment transactions and drawdowns, and other costs relating to payment transactions shall be included in the total cost of the credit to the consumer unless the opening of the account is optional and the costs of the account have been clearly and separately identified in the credit agreement, or in any other agreement concluded with the consumer.

(3) The calculation of the annual percentage rate of charge shall be based on the assumption that the credit agreement shall remain valid for the period agreed and that the creditor and the consumer shall fulfil their obligations under the terms and by the dates specified in the credit agreement.

(4) Where credit agreements contain clauses that allow variations in the borrowing rate or variations in certain charges contained in the annual percentage rate of charge which make them unquantifiable at the time of calculation, the annual percentage rate of charge shall be calculated on the assumption that the borrowing rate and other charges shall remain fixed in relation to the initial level and shall remain applicable until the end of the credit agreement.

(5) Where necessary, the additional assumption provided in Part II of the Third Schedule shall be used in calculating the annual percentage rate of charge.