Related provisions for CONC 4.3.1

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CONC 5A.4.1RRP
This section applies to a firm with respect to operating an electronic system in relation to lending in relation to a borrower or a prospective borrower under an agreement for high-cost short-term credit.
CONC 5A.4.2RRP
A firm must not facilitate an individual becoming a borrower under an agreement for high-cost short-term credit that provides for the payment by the borrower of one or more charges that, alone or in combination with any other charge under the agreement or a connected agreement, exceed or are capable of exceeding the amount of credit provided under the agreement.
CONC 5A.4.3RRP
A firm must not facilitate an individual becoming a borrower under an agreement for high-cost short-term credit that provides for the payment by the borrower of one or more charges that, alone or in combination with any other charge under the agreement or a connected agreement, exceed or are capable of exceeding 0.8% of the amount of credit provided under the agreement calculated per day from the date on which the borrower draws down the credit until the date on which repayment
CONC 5A.4.5GRP
(1) The initial cost cap is calculated on a daily basis. However, a charge or charges that may be provided for in an agreement in compliance with this cap can amount to 0.8% of the credit provided (determined in accordance with CONC 5A.4.7 R) multiplied by the number of days from the date on which the borrower draws down the credit until the date indicated in CONC 5A.4.3 R.(2) Where credit is drawn down in tranches or is repaid in instalments, the calculation of the initial cost
CONC 5A.4.9GRP
For the purposes of this chapter, where a lender allows a borrower to make a number of drawdowns of credit (which may be expressed to be possible up to a specified amount of credit) but only with the lender's consent to each respective drawdown, each drawdown is a separate agreement for high-cost short-term credit and, where applicable, each agreement needs to be documented as a separate regulated credit agreement in accordance with the CCA and with the rest of CONC. This chapter
COBS 6.1A.9RRP
If the firm or its associate is the retail investment product provider, platform service provider14 or operator of an electronic system in relation to lending12, the firm must ensure that the level of its adviser charges is at least reasonably representative of the cost of the14 services associated with making the personal recommendation (and related services).
COBS 6.1A.13GRP
In determining its charging structure and adviser charges a firm should have regard to its duties under the client's best interests rule. Practices which may indicate that a firm is not in compliance with this duty include:(1) varying its adviser charges inappropriately according to provider or, for substitutable and competing retail investment products, the type of retail investment product; or(2) allowing the availability or limitations of services offered by third parties
COBS 6.1A.14ARRP
9A firm must not make a personal recommendation to a retail client in relation to a retail investment product or P2P agreement12if it knows, or ought to know, that:(1) the product’s charges,12 the platform service provider's charges or the operator of the electronic system in relation to lending’s charges 12are presented in a way that offsets or may appear to offset any adviser charges or platform charges that are payable by that retail client; or(2) the product’s charges or other
COBS 6.1A.22RRP
A firm must not use an adviser charge which is structured to be payable by the retail client over a period of time unless (1) or (2) applies:(1) the adviser charge is in respect of an ongoing service for the provision of personal recommendations or related services and: (a) the firm has disclosed that service along with the adviser charge; and6(b) the retail client is provided with a right to cancel the ongoing service, which must be reasonable in all the circumstances, without
COBS 6.1A.24RRP
(1) A firm must agree with and disclose to a retail client the total adviser charge payable to it or any of its associates by a retail client.(2) A disclosure under (1) must:(a) be in cash terms (or convert non-cash terms into illustrative cash equivalents);(b) be as early as practicable;(c) be in a durable medium or through a website (if it does not constitute a durable medium) if the website conditions are satisfied; and(d) if there are payments over a period of time, include
PERG 2.7.7GGRP
15An activity is also not credit broking within PERG 2.7.7EG (1) to PERG 2.7.7EG (6) in so far as the activity is operating an electronic system in relation to lending, see PERG 2.7.7H G.
PERG 2.7.7HGRP
(1) 15This activity is aimed at what are sometimes referred to as peer-to-peer lending platforms. A person ("A") will be operating an electronic system in relation to lending if he operates an electronic system which enables him to facilitate persons ("B" and "C") becoming the lender and borrower under an article 36H agreement. (2) To be caught, all of the following conditions must be met:(a) the electronic system operated by A must be capable of determining which agreements should
PERG 2.7.8DGRP
(1) 15Taking steps to procure the payment of a debt due under a credit agreement or a consumer hire agreement is a regulated activity.(2) Taking steps to procure the payment of a debt due under an article 36H agreement (see PERG 2.7.7HG (3)) which has been entered into with the facilitation of an operator of an electronic system in relation to lending is also a regulated activity.(3) The activity is not a regulated activity in so far as the activity is operating an electronic
PERG 2.7.8EGRP
(1) 15Taking steps to perform duties or to exercise or to enforce rights under a credit agreement or a consumer hire agreement on behalf of the lender or owner is a regulated activity.(2) Taking steps to perform duties or to exercise or to enforce rights under an article 36H agreement (see PERG 2.7.7HG (3)) which has been entered into with the facilitation of an operator of an electronic system in relation to lending is also a regulated activity.(3) In so far as the activity is
PERG 2.7.20KGRP
(1) 15Taking any of the steps in (2) on behalf of an individual is a regulated activity. (2) This activity catches steps taken with a view to: (a) ascertaining whether a credit information agency holds information relevant to the financial standing of an individual;(b) ascertaining the contents of such information;(c) securing the correction of, the omission of anything from, or the making of, any other kind of modification of, such information; or(d) securing that a credit information
PERG 2.7.20LGRP
(1) 15Furnishing of persons with information relevant to the financial standing of individuals is a regulated activity if the person has collected the information for that purpose.(2) A person requires authorisation for this activity only if its business primarily consists of the activities in (1). (3) This activity does not include an activity in so far as it is operating an electronic system in relation to lending.
CONC 4.3.3ARRP
(1) 3This rule applies if the lender, or the prospective lender, under a P2P agreement is, or would be, carrying on by way of business the regulated activity of entering into a regulated credit agreement as lender by entering into the agreement.(2) Any fee to be paid by the borrower to the operator of an electronic system in relation to lending must be agreed between the borrower and the operator, and that agreement must be recorded in writing or other durable medium before the
CONC 4.3.8RRP
(1) 1This rule applies if:(a) a firm with permission to carry on the activity of operating an electronic system in relation to lending is to facilitate the entry into a P2P agreement; (b) the prospective borrower is an individual; and(c) an individual other than the borrower (in this rule referred to as “the guarantor”) is to provide a guarantee or an indemnity (or both) in relation to the P2P agreement.(2) The firm must, before the P2P agreement is made, provide the guarantor
COBS 6.1B.2RRP
This section does not apply to a firm when a retail client receives basic advice in accordance with the basic advicerules.
COBS 6.1B.3GRP
This section applies to a firm when it makes a personal recommendation on a retail investment product or P2P agreement11and where a retail investment product for which it is the retail investment product provider or P2P agreement which it facilitates as the operator of an electronic system in relation to lending11is the subject of a personal recommendation made by another firm.
COBS 6.1B.7RRP
A firm must:(1) take reasonable steps to ensure that its retail investment product charges or its charges as an operator of an electronic system in relation to lending11are not structured so that they could mislead or conceal from a retail client the distinction between those charges and any adviser charges payable in respect of its retail investment products or investments in P2P agreements made through the system of which it is the operator of an electronic system in relation
SYSC 4.1.8ARRP
16An operator of an electronic system in relation to lending must take reasonable steps to ensure that arrangements are in place to ensure that P2P agreements facilitated by it will continue to be managed and administered, in accordance with the contract terms, if at any time it ceases to carry on the activity of operating an electronic system in relation to lending.
SYSC 4.1.8BRRP
16Any arrangements made under SYSC 4.1.8A R must be notified to lenders under P2P agreements:(1) when such arrangements are made; or(2) if later, when the lender first becomes a lender under a P2P agreement with that operator; or(3) if the arrangements are changed, when that change is made; and(4) if the arrangement involves another firm taking over the management and administration of P2P agreements if the operator ceases to operate the electronic system in relation to lending,
SYSC 4.1.8CGRP
16Arrangements to ensure P2P agreements facilitated by the firm continue to be managed and administered may include:(1) entering into an arrangement with another firm to take over the management and administration of P2P agreements if the operator ceases to operate the electronic system in relation to lending; or(2) holding sufficient collateral in a segregated account to cover the cost of management and administration while the loan book is wound down; or(3) entering into an
SYSC 4.1.8ERRP
16(1) An operator of an electronic system in relation to lending must not accept, take, or receive the transfer of full ownership of money relating to P2P agreements.18(2) If an operator of an electronic system in relation to lending has made a client money election under CASS 7.10.7AR, when it is operating an electronic system in relation to non-P2P agreements it must also not accept, take, or receive the transfer of full ownership of money relating to non-P2P agreements.18
PERG 8.17-A.6GRP
Operating an electronic system in relation to lending is a controlled activity. For the purposes of this controlled activity, the controlled investment of rights under a relevant credit agreement includes rights under an agreement within paragraph 4C(4) of Schedule 1 to the Financial Promotion Order (which is similar to an agreement within article 36H of the Regulated Activities Order, guidance on which is given in PERG 2.7.10 G).
PERG 8.17-A.8GRP
The controlled activities in PERG 8.17-A.6 G and PERG 8.17-A.7 G are substantially the same as the regulated activities of operating an electronic system in relation to lending, credit broking, debt adjusting and debt counselling (although 2an activity is not the controlled activity of credit broking to the extent that it constitutes the controlled activity of arranging qualifying credit). Guidance on these regulated activities is given in PERG 2.7.7E G (credit broking), PERG
PERG 8.17-A.10GRP
(1) Article 46A of the Financial Promotion Order exempts a communication which relates to the controlled activities of operating an electronic system in relation to lending, providing relevant consumer credit or providing consumer hire. (2) This exemption applies only if the communication: (a) indicates clearly that a person is willing to engage in the investment activity for the purposes of another person's business; and (b) does not indicate (by express words or otherwise) that
CASS 7.10.7ARRP
(1) 4If both the conditions in (a) and (b) below are met in respect of a firm, or the firm reasonably expects that they will all be met in the future, then the firm has the option to elect to comply with this chapter for all of the money described in those conditions: (a) the firm receives or holds money for one or more persons in the course of, or in connection with, the firm’s activity of operating an electronic system in relation to non-P2P agreements; and(b) those persons
CASS 7.10.7BRRP
(1) 4When a firm makes an election under CASS 7.10.7AR it must write to any customer (“C”) with whom it has agreed to provide relevant electronic lending services in C’s capacity as a lender or prospective lender, informing C at least one month before it will start to hold the money in accordance with the client money rules:(a) that all the money it holds in the course of, or in connection with, operating an electronic system in relation to non-P2P agreements for lenders and
CASS 7.10.7DRRP
4If a firm that has made an election under CASS 7.10.7AR subsequently decides to cancel that election:(1) it can only do so by writing to the FCA, at least one month before the date the election ceases to be effective; (2) it must write to any customer with whom, as at the time of the cancellation, it has agreed to operate an electronic system in relation to non-P2P agreements in their capacity as a lender or prospective lender, informing them at least one month before the date
CASS 7.10.7FGRP
(1) 4Where a firm has made an election under CASS 7.10.7AR: (a) it should treat money held for a client as client money both in the course of or in connection with: (i) operating an electronic system in relation to lending; and(ii) operating an electronic system in relation to non-P2P agreements;(b) (a) is regardless of whether, at the time the firm is holding the money, the client could or could not be a lender under a P2P agreement; and(c) under SYSC 4.1.8ER(2) it will be not
The financial resources requirement1 for a firm carrying on one or more regulated activities in addition to operating an electronic system in relation to lending, is the higher of: (1) the financial resources requirement1 which is applied by this chapter; and (2) the financial resources or own funds requirement which is applied by another rule or by directly applicable legislation of the EU to the firm.
The total value of loaned funds outstanding is the total amount of funds that are currently being provided to borrowers under P2P agreements through an operator of an electronic system in relation to lending.
CONC 5A.6.1RRP
In this chapter: (1) "ancillary service" is a service in connection with the provision of credit under the agreement for high-cost short-term credit and includes, but not limited to, an insurance or payment protection policy;(2) "borrower" is an individual and includes: (a) any person providing a guarantee or indemnity under the regulated credit agreement; and (b) a person to whom the rights and duties of the borrower under the regulated credit agreement or of a person falling
CONC 5A.6.2GRP
The meaning of the expression "impose one or more charges on a borrower under an agreement for high-cost short-term credit" is set out in CONC 5A.6.1 R (5). The meaning of "impose" in relation to a charge in this chapter is broad and includes, but is not limited to, situations including where a firm:(1) enters into an agreement containing a clause obliging the borrower to pay a charge;(2) varies or supplements an agreement and this has the result that there is:(a) an increase
CONC 7.1.1RRP
1This chapter applies, unless otherwise stated in or in relation to a rule, to:(1) a firm with respect to consumer credit lending;(2) a firm with respect to consumer hiring;(3) a firm with respect to operating an electronic system in relation to lending, in relation to a borrower under a P2P agreement;(4) a firm with respect to debt collecting.
CONC 7.1.2GRP
The following sections provide otherwise for application:(1) CONC 7.12 (lenders' responsibilities in relation to debt) applies only to firms in respect of consumer credit lending;(2) CONC 7.17 to CONC 7.19 apply only to firms operating electronic systems in relation to lending in relation to borrowers under P2P agreements as set out in those sections.
COBS 14.3.7AGRP
4Examples of information a firm should provide to explain the specific nature and risks of a P2P agreement include:(1) expected and actual default rates in line with the requirements in COBS 4.6 on past and future performance;(2) a summary of the assumptions used in determining expected future default rates;(3) a description of how loan risk is assessed, including a description of the criteria that must be met by the borrower before the operator of the electronic system in relation
COBS 14.3.7BGRP
6The guidance in COBS 14.3.7AG is relevant both to firms which are operators of electronic systems in relation to lending and firmsadvising on P2P agreements.
This chapter applies to an operator of an electronic system in relation to lending.
CONC 8.1.2GRP
CONC 8.10 (Conduct of business: providing credit information services) sets out that that section applies to every firm with respect to providing credit information services and with respect to operating an electronic system in relation to lending in relation to activities specified in article 36H(3)(e) to (h) of the Regulated Activities Order which are similar to providing credit information services.2
CONC 3.7A.1RRP
1This section applies to a firm with respect to operating an electronic system in relation to lending.
CONC 3.11.1RRP
This section applies to a financial promotion in relation to a credit agreement, credit broking, debt counselling, debt adjusting and operating an electronic system in relation to lending in relation to prospective borrowers or borrowers under P2P agreements.
CONC 6.1.2GRP
(1) 2CONC 6.5 and CONC 6.7 apply to firms with respect to consumer credit lending.(2) CONC 6.3 applies to current account agreements that would be regulated credit agreements if the customer overdraws on the account.(3) CONC 6.4 and CONC 6.6 apply to firms which carry on consumer credit lending in relation to regulated credit agreements and firms which carry on consumer hiring in relation to regulated consumer hire agreements.(4) CONC 6.7.17 R to CONC 6.7.26 R also apply to firms
CONC 8.10.1RRP
This section applies to: (1) a firm with respect to providing credit information services in relation to information relevant to the financial standing of an individual;(2) a firm with respect to the activities set out in article 36H(3)(e) to (h) of the Regulated Activities Order (Operating an electronic system in relation to lending) in relation to a borrower under a P2P agreement.
DISP 1.10.1RRP
616(1) Unless (2) applies, twice a year a firm must provide the FCA with a complete report concerning complaints received from eligible complainants.10616(2) If a firm:13(a) has permission to carry on only credit-related regulated activities or operating an electronic system in relation to lending and has revenue arising from those activities that is less than or equal to £5,000,000 a year; or13(b) has permission to carry on only regulated claims management activities;13the firm
DISP 1.10.4ARRP
If a firm is one to which DISP 1.10.1R(2) applies,13 the relevant reporting period is the year immediately following the firm'saccounting reference date.10