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.

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).

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.

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)).

If a banking customer exercises his right to cancel he must, before the expiry of the cancellation period, notify this following the practical instructions given to him. The deadline shall be deemed to have been observed if the notification, if in a durable medium available and accessible to the recipient, is dispatched before the cancellation period expires.

The firm must make adequate records concerning the exercise of a right to cancel and retain them for at least three years.

By exercising a right to cancel, a banking customer withdraws from the contract and the contract is terminated.

1. (1)

   This rule applies in relation to a contract for a retail banking service that is not a cash deposit ISA or a cash deposit CTF.

2. (2)

   When a banking customer exercises the right to cancel he may only be required to pay, without any undue delay, for the service actually provided by the firm in accordance with the contract. The amount payable must not:

   1. (a)

      exceed an amount which is in proportion to the extent of the service already provided in comparison with the full coverage of the contract;

   2. (b)

      in any case be such that it could be construed as a penalty.

   [Note: article 7(1), (2) and (3) of the Distance Marketing Directive in relation to distance contracts]

3. (3)

   The firm may not require a banking customer to pay any amount on the basis of this rule unless it can prove that the banking customer was duly informed about the amount payable and, in the case of a contract which is a distance contract, in conformity with the distance marketing disclosure rules. However, in no case may the firm require such payment if it has commenced the performance of the contract before expiry of the cancellation period without the banking customer's prior request.

The firm must, without undue delay and within 30 calendar days, return to the banking customer any sums it has received from him except for any amount that the banking customer may be required to pay under BCOBS 6.3.2 R. This period begins from the day on which the firm receives the notification of cancellation.

The firm is entitled to receive from the banking customer any sums or property he has received from the firm without any undue delay and no later than within 30 calendar days. This period begins from the day on which the banking customer dispatches the notification of cancellation.

Any sums payable under this section on cancellation of a contract are owed as simple contract debts and may be set off against each other.

This chapter applies as modified to the extent necessary for it to be compatible with any enactment, including legislation relating to child trust funds.