MCOB 3.2 Application: what?

1. (1)

   The rules in this chapter adopt various concepts from the restriction on financial promotion by unauthorised persons in section 21(1) of the Act (Restrictions on financial promotion). Guidance on that restriction is contained in PERG 81 (Financial promotion and related activities) and that guidance will be relevant to interpreting these rules. In particular, guidance on the meaning of:

   1
   1. (a)

      'communicate' is in PERG 8.61 (Communicate); and

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   2. (b)

      'invitation or inducement' and 'engage in investment activity' (two elements which, with 'communicate', make up the definition of 'financial promotion') is in PERG 8.41 (Invitation or inducement) and PERG 8.71 (Engage in investment activity).

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2. (2)

   Guidance on the approval of a qualifying credit promotion is in MCOB 3.11.1 G (Approval of qualifying credit promotions).

1. (1)

   There is no restriction on the media of communication to which this chapter applies. It applies to a qualifying credit promotioncommunicated by any means, including by way of printed advertising, radio and television broadcasts, a personal visit, a telephone call, an e-mail, the Internet and electronic media such as digital and other forms of interactive television or media. Both solicited and unsolicited communications are covered.

2. (2)

   Qualifying credit promotions may be communicated for example, by means of:

   1. (a)

      product brochures;

   2. (b)

      general advertising in magazines, newspapers, radio and television programmes and websites;

   3. (c)

      mailshots (whether distributed by post, facsimile, e-mail or other media);

   4. (d)

      telemarketing activities, such as telephone calls made by call centres;

   5. (e)

      written correspondence, telephone calls and face-to-face discussions with customers;

   6. (f)

      sales aids which themselves constitute a qualifying credit promotion;

   7. (g)

      presentations to groups of customers; and

   8. (h)

      other publications, which may contain non-personal recommendations as to obtaining qualifying credit.

Guidance on the use of the Internet for communicatingqualifying credit promotions is in PERG 8.221 (The Internet)

MCOB 3.2.5 R (2) exempts a qualifying credit promotion made by a firm or an appointed representative which refers to its activities only in general terms in image or brand advertising. The items identified in MCOB 3.2.5 R(2) do not enable detailed information to be given about the qualifying credit available from the firm. Thus firms should avoid the use of names, logos or addresses, for example, which attempt to convey additional mortgage or cost-related information.

Firms are reminded that qualifying credit promotions (including those which are exempt) may be subject to more general rules, including Principle 7 (Communications with clients), SYSC 3 to SYSC 103(Systems and controls) and MCOB 2.2.6 R (Clear, fair and not misleading communication).

Firms are reminded that if in the course of making a qualifying credit promotion of any kind an adviser gives specific advice on regulated mortgage contracts to a customer about the suitability of a product for that individual, the adviser in giving the advice is subject to the rules, as appropriate, on advising and selling in MCOB 4 (Advising and selling standards) and MCOB 8 (Lifetime mortgages: advising and selling standards).