[Code of Federal Regulations]
[Title 16, Volume 1]
[Revised as of January 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 16CFR433.3]

[Page 430]
 
                     TITLE 16--COMMERCIAL PRACTICES
 
                   CHAPTER I--FEDERAL TRADE COMMISSION
 
PART 433_PRESERVATION OF CONSUMERS' CLAIMS AND DEFENSES--Table of 
Contents
 
Sec. 433.3  Exemption of sellers taking or receiving open end consumer 
credit contracts before November 1, 1977 from requirements of Sec. 433.2(a).

    (a) Any seller who has taken or received an open end consumer credit 
contract before November 1, 1977, shall be exempt from the requirements 
of 16 CFR part 433 with respect to such contract provided the contract 
does not cut off consumers' claims and defenses.
    (b) Definitions. The following definitions apply to this exemption:
    (1) All pertinent definitions contained in 16 CFR 433.1.
    (2) Open end consumer credit contract: a consumer credit contract 
pursuant to which ``open end credit'' is extended.
    (3) ``Open end credit'': consumer credit extended on an account 
pursuant to a plan under which a creditor may permit an applicant to 
make purchases or make loans, from time to time, directly from the 
creditor or indirectly by use of a credit card, check, or other device, 
as the plan may provide. The term does not include negotiated advances 
under an open-end real estate mortgage or a letter of credit.
    (4) Contract which does not cut off consumers' claims and defenses: 
A consumer credit contract which does not constitute or contain a 
negotiable instrument, or contain any waiver, limitation, term, or 
condition which has the effect of limiting a consumer's right to assert 
against any holder of the contract all legally sufficient claims and 
defenses which the consumer could assert against the seller of goods or 
services purchased pursuant to the contract.

[42 FR 19490, Apr. 14, 1977, as amended at 42 FR 46510, Sept. 16, 1977]