The FCA has warned firms to be aware of new rules on complaint handling which come into force in July.
On 9 July the Alternative Dispute Resolution rules come into force and firms will have to begin complying with them.
The introduction of ADR, a European directive that aims to allow consumers and traders to solve their disputes without going to court, has meant changes to the FCA’s requirements for handling complaints, known as DISP.
In a regulatory update from the FCA, the City watchdog said: “We consulted on the basis that firms would be required to introduce some of the changes in mid-May.
“We have now changed that approach so that firms are only required to comply with the new rules from 9 July and only in relation to complaints received from that date onwards.
“Firms should familiarise themselves with the changes to DISP and take steps to ensure that they will comply with the rule changes from 9 July onwards.”
Among the changes being introduced is allowing the Financial Ombudsman Service to consider complaints where the firm has not itself investigated the complaint, but only if both the firm and the consumer consent.
The definition of ‘eligible complainant’ will be extended to cover professional clients and eligible counterparties, where the person is an individual acting for purposes outside his trade, business, craft or profession.
One of the controversial aspects of the ADR is that it has delayed the FCA’s inquiries into whether a long-stop for financial advice can be introduced.
Having initially stated it intended to review the case for a 15-year long-stop the FCA admitted in July it had put this on hold due to the directive’s looming implementation.
Since then the FCA, department for business, innovation and skills and HM Treasury have been discussing whether the directive has any impact on whether a long-stop can be introduced.
Chris Hannant, director general of Apfa, said: “By and large there will not be a large amount of change.
“The thing we were particularly interested in was whether it would have an impact on the ability to introduce a longstop.”
Adviser view
Ashley Clark, a financial-planner with London-based needanadviser.com, said: “The lack of a long-stop is killing financial advice, full stop.
“The fact that I am liable for the advice I give for the rest of my life leaves me wide open. It basically drives up the cost of advice and will continue to do so.”
