Emma RadmoreFollowing the Court of Appeal’s decision to allow appeals to the Supreme Court in relation to three cases of non-disclosure of non-discretionary commission for motor finance (we covered this in FIN here), the FCA has announced its intention to allow firms an extension to the amount of time they have to respond to consumer complaints about motor finance involving non-discretionary commissions. The FCA says motor finance firms are likely to receive a lot of complaints in the light of the Court of Appeal judgment, and it wants to prevent the risk of disorderly, inconsistent and inefficient outcomes for consumers.
As the FCA had previously noted, the focus of the Court of Appeal decision is common law, rather than FCA rules.
The FCA understands the 2 lenders involved in the decision intend to appeal it, and it will ask the Supreme Court to decide quickly whether to allow the appeal and, if it does allow it, to consider it as soon as possible. The FCA will consider intervening to share its expertise in any appeal.
The FCA intends to consult on its proposals within the next couple of weeks and for the extension to be in place in mid-December. It plans for it to last at least until the Supreme Court decides whether to allow the appeal. It warns firms that they should be using the extra time they are likely to get both to make sure they have the resources to deal with complaints when the extension ends, and to consider whether they should be making any financial provisions.
Separately, the FCA is considering the potential impact of the Court of Appeal judgment on its review into historical discretionary commission arrangements.