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You are viewing the version of the document as on 2024-01-26.

Timeline guidance

BCOBS 1.1 General application

The general application rule

BCOBS 1.1.1 R

This sourcebook applies to a firm with respect to the activity of accepting deposits from banking customers carried on from an establishment maintained by it in the United Kingdom and activities connected with that activity.

Application to payment services and electronic money

BCOBS 1.1.1A R

15In addition to the general application rule, Chapter 2 of BCOBS applies to a firm (other than a credit union), an electronic money institution, a payment institution and a registered account information service provider16 with respect to the provision of payment services or issuance or redemption of electronic money carried on from an establishment maintained by it or its agent in the United Kingdom and activities connected with those activities. These persons are referred to collectively in Chapters 1 and 2 of BCOBS as “providers”.

Limitations on the general application rule and BCOBS 1.1.1AR

BCOBS 1.1.2 R

The general application rule is modified:9

  1. (1)

    in the chapters of this sourcebook for particular purposes; and9

  2. (2)

    in BCOBS 1 Annex 1 for certain types of firm in relation to the sale of structured deposits.9

BCOBS 1.1.3 R

Except as provided for in BCOBS 1.1.4R, this sourcebook does not apply to:

  1. (1)

    payment services where Parts 6 and 710 of the Payment Services Regulations apply2; or

  2. (2)

    a person or firm which has permission for accepting deposits but only for the purposes of, or in the course of, an activity other than accepting deposits.

BCOBS 1.1.4 R
  1. (1)

    Chapters 2, 2A,6 5 and 6 of BCOBS (except for BCOBS 5.1.10AR10 to BCOBS 5.1.19 R) and BCOBS 4.38 and 4.41213 apply to payment services where Parts 6 and 710 of the Payment Services Regulations apply2.

  2. (2)

    Chapter 3 of BCOBS applies to payment services where Parts 6 and 710 of the Payment Services Regulations apply 2with the modifications set out in BCOBS 3.1.2 R(2).

  3. (3)

    [deleted]14

    332
BCOBS 1.1.4A G

10Guidance on the application of the Payment Services Regulations can be found in PERG 15.

BCOBS 1.1.5 R

2 BCOBS 2.2A , BCOBS 2.2B,113BCOBS 4.1.2G(2A) to (2E), (3A), (6A) and (6B),7BCOBS 4.1.4AG(2)(a), BCOBS 4.4,113BCOBS 5.1.3AG, BCOBS 5.1.3BG, BCOBS 5.1.5AR, BCOBS 5.1.5BG, BCOBS 5.1.13R,1213BCOBS 7 (except as applied by BCOBS 7.1.4R)11 and BCOBS 81213 do not apply to a credit union.

7 4 4
BCOBS 1.1.5A R

15 BCOBS 2 (Communications and financial promotions) does not apply to the provision of payment services, the issuance of electronic money or activities connected to those activities by a credit union, except to the extent that the activity is connected to the activity of accepting deposits from banking customers.

Exclusion of liability

BCOBS 1.1.6 R

2A firm or a provider15 must not seek to exclude or restrict, or rely on any exclusion or restriction of, any duty or liability it may have to a banking customer, a payment service customer or an electronic money customer15 unless it is reasonable for it to do so and the duty or liability arises other than under the regulatory system.

BCOBS 1.1.7 G

2The general law, including the Unfair Terms Regulations (for contracts entered into before 1 October 2015) and the CRA, 5also limits the scope for a firm to exclude or restrict any duty or liability to a consumer.

Structured deposits

BCOBS 1.1.8 G

9A firm that carries on the activity of accepting deposits which are structured deposits should refer to BCOBS 1 Annex 1.

BCOBS 1 Annex 1 Structured deposit business

1Application of BCOBS to firms selling structured deposits

1.1

R

The BCOBS provisions shown below do not apply to a MiFID investment firm, a third country investment firm or a MiFID optional exemption firm in relation to the sale of structured deposits subject to the rules specified in COBS 1.1.1AR(2).

BCOBS provision

Description

BCOBS 2

Communications with banking customers and financial promotions

BCOBS 4 (other than BCOBS 4.1.4AG and BCOBS 4.3)

Information to be communicated to banking customers

1.2

G

A firm to which BCOBS 1 Annex 1 paragraph 1.1R applies should read and understand the reference to the appropriate information rule in BCOBS 4.1.4AG as referring to COBS 2.2A.2R.

1.3

G

A MiFID investment firm, a third country investment firm or a MiFID optional exemption firm that sells structured deposits should consider COBS 1.1.1AR to COBS 1.1.1ABR. These rules specify how certain provisions in COBS apply to a firm in relation to the sale of structured deposits.

Financial promotions relating to structured deposits

1.4

G

(1) BCOBS 2 contains rules which apply to a firm when it communicates a financial promotion that is not an excluded communication or when the firm approves a financial promotion.

(2) If a financial promotion relates to a structured deposit, rules relating to past, simulated past and future performance in COBS 4.5A or COBS 4.6 will also apply.

Structured deposits as PRIIPs

1.5

G

Firms are reminded that structured deposits are PRIIPs and that the provisions of the PRIIPs Regulation are also relevant to such products. The PRIIPs Regulation requires a person who advises on, or sells, a PRIIP to provide a retail investor (as defined in the PRIIPs Regulation) with the key information document for that PRIIP.

1.6

G

Where a firm is required to provide information in a key information document, it will not be required to provide the same information under BCOBS 4.1.

[Note:BCOBS 1.1.4R(3) and article 13 of the PRIIPs Regulation]