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  2. Point in time
    2019-03-19

BCOBS 6.1 The right to cancel

Introduction

BCOBS 6.1.1R

1Except as provided for in BCOBS 6.1.2 R, a banking customer has a right to cancel a contract for a retail banking service (including a cash deposit ISA but excluding a cash-only lifetime ISA2) without penalty and without giving any reason, within 14 calendar days.

[Note: article 6(1) of the Distance Marketing Directive in relation to distance contracts]

BCOBS 6.1.2R

There is no right to cancel:

  1. (1)

    a contract (other than a cash deposit ISA) where the rate or rates of interest payable on the deposit are fixed for a period of time following conclusion of the contract;

  2. (2)

    a contract whose price depends on fluctuations in the financial market outside the firm's control that may occur during the cancellation period; or

  3. (3)

    a cash deposit CTF (other than a distance contract).

BCOBS 6.1.3G

A firm may provide longer or additional cancellation rights voluntarily but, if it does, these should be on terms at least as favourable to the banking customer as those in this chapter, unless the differences are clearly explained.

BCOBS 6.1.3AG

2Firms are reminded that the cancellation rules in COBS 15 apply to the cancellation by a banking customer of a cash-only lifetime ISA.

Beginning of cancellation period

BCOBS 6.1.4R

The cancellation period begins:

  1. (1)

    either from the day of the conclusion of the contract for the retail banking service; or

  2. (2)

    from the day on which the banking customer receives the contractual terms and conditions of the retail banking service and any other pre-contractual information required under this sourcebook, if that is later than the date referred to in (1) above.

[Note: article 6(1) of the Distance Marketing Directive in relation to distance contracts]

Disclosing the right to cancel

BCOBS 6.1.5R
  1. (1)

    The firm must disclose to a banking customer in good time or, if that is not possible, immediately after the banking customer is bound by a contract for a retail banking service, and in a durable medium, the existence of the right to cancel, its duration and the conditions for exercising it including information on the amount which the banking customer may be required to pay, the consequences of not exercising it and practical instructions for exercising it, indicating the address to which the notification of cancellation should be sent.

  2. (2)

    This rule applies only where a banking customer would not otherwise receive the information referred to in (1) under a rule in this sourcebook from the firm (such as under BCOBS 3.1.2 R to 3.1.5 R (the distance marketing disclosure rules)).