Wholesale financial businesses involved in retail markets will find it easier to comply with the Consumer Duty, following proposals from the FCA.
The changes are part of the FCA's plans to give wholesale firms the confidence to apply the Duty proportionately. Under the proposals, firms will benefit from:
- Removing business for genuinely non-UK customers from the Duty’s scope where there is no clear UK link or reasonable expectation of UK protection.
- Clearer boundaries around what is out of scope, so they can focus on running their business rather than having to show that the Duty does not apply.
- More clarity on firms’ responsibilities when they work together, including across distribution chains and in the design of complex products.
Simon Walls, executive director of markets, said:
'The Consumer Duty[2] is helping deliver good outcomes and build confidence for retail consumers, but it was never intended to become a Wholesale Duty imposing on deals between sophisticated parties. That's why we are refining its scope to provide greater clarity to wholesale markets, and keep the focus on the consumer outcomes it was created to improve.'
The FCA has today also published proposals to further simplify its insurance rules, while maintaining appropriate levels of consumer protection.
The FCA will continue to engage firms and other stakeholders to support effective implementation of the Consumer Duty and ensure it delivers good outcomes across markets.
Notes to editors
- The FCA’s wholesale Duty consultation[3].
- The FCA’s 4-point plan (PDF)[4] on addressing concerns about the Consumer Duty and wholesale markets.
- The FCA's insurance simplification consultation[5].