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

1. (1)

   1Where it is compatible with the nature of the obligation imposed by a particular rule, including the customer’s best interests rule, and with the Principles, in particular Principles 1 (Integrity), 2 (Skill, care and diligence) and 3 (Management and control), firms may rely on third parties in order to comply with the rules in this sourcebook.

2. (2)

   For example, where a rule requires a firm to take reasonable steps to achieve an outcome, it will generally be reasonable for a firm to rely on information provided to it in writing by an unconnected authorised person or a professional firm, unless it is aware or ought reasonably to be aware of any fact that would give reasonable grounds to question the accuracy of that information. However, a firm cannot delegate its responsibility under the regulatory system. For example, where a rule imposes an absolute obligation (such as the requirement on a funeral plan provider in FPCOB 14.1.4R regarding the services required for a funeral plan contract) although a firm could use outsourcing arrangements to fulfil its obligation, it retains regulatory responsibility for achieving the outcome required.

1. (1)

   1This sourcebook, other than FPCOB 4, FPCOB 6.4.18R, FPCOB 152and FPCOB 162, does not generally have detailed record-keeping requirements: firms will need to decide what records they need to keep in line with the high-level record-keeping requirements and their own business needs.

2. (2)

   In order to deal with requests for information from the FCA, as well as queries and complaints from customers and covered individuals, firms may require evidence of matters such as:

   1. (a)

      the reasons for personal recommendations;

   2. (b)

      what documentation has been provided to a customer or covered individual; and

   3. (c)

      how redemptions have been settled and why.

3. (3)

   A firm may be subject to record-keeping requirements elsewhere in the FCA Handbook, including in:

   1. (a)

      the Training and Competence sourcebook (TC) (see TC 3.1.1R);

   2. (b)

      the Senior Management Arrangements, Systems and Controls sourcebook (SYSC) (see SYSC 9.1.1R, SYSC 10.1.6R and SYSC 28A.3.1R); and

   3. (c)

      chapter 7 of the Product Intervention and Product Governance sourcebook (PROD) when manufacturing or distributing a funeral plan product.

1. (1)

   1Principle 8 requires a firm to manage conflicts of interest fairly, both between itself and its customers and between a customer and another client. This principle extends to soliciting or accepting inducements where this would conflict with a firm’s duties to its customers. A firm that offers such inducements should consider whether doing so conflicts with its obligations under:

   1. (a)

      Principles 1 and 6 to act with integrity and treat customers fairly; and

   2. (b)

      the customer’s best interests rule.

2. (2)

   An inducement is a benefit offered to a firm, or any person acting on its behalf, with a view to that firm, or that person, adopting a particular course of action. This can include, but is not limited to, cash, cash equivalents, commission, goods, hospitality or training programmes.

3. (3)

   Firms should also refer to the rules on charging for funeral plan distribution and payments to funeral plan intermediaries (FPCOB 6.4 and FPCOB 6.5).

1In relation to a subsisting funeral plan, a funeral plan provider should deal with customers fairly and, as far as possible, in a manner that is compatible with the customer’s best interests rule.

1This section amplifies Principle 6 (Customers’ interests) in respect of the information and service that firms should provide to customers who have payment difficulties or shortfalls.