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Status: You are viewing the version of the handbook as on 2005-06-30.

MCOB 3.9 Confirmation of compliance

MCOB 3.9.1R
  1. (1)

    Before a firm communicates or approves a non-real time qualifying credit promotion it must confirm that the qualifying credit promotion complies with the rules in this chapter.

  2. (2)

    A firm must arrange for the confirmation exercise in (1) to be carried out by an individual or individuals with appropriate expertise.

MCOB 3.9.2G
  1. (1)

    In MCOB 3.9.1 R(2) 'appropriate expertise' will vary depending on the complexity of the qualifying credit promotion and the qualifying credit to which it relates. The individuals engaged by a firm to confirm the compliance of its qualifying credit promotions with this chapter may themselves have different levels of expertise and therefore a different level of authority for confirmation depending on the type of promotion and the qualifying credit involved.

  2. (2)

    A firm may arrange for a third party with appropriate expertise to carry out the confirmation exercise on the firm's behalf, but the responsibility for the qualifying credit promotion remains with the firm.

Withdrawing confirmation

MCOB 3.9.3R

If, at any time after it has completed a confirmation exercise in MCOB 3.9.1 R(1), a firm becomes aware that a qualifying credit promotion no longer complies with the rules in this chapter, it must ensure that the qualifying credit promotion is withdrawn as soon as is reasonably practicable by:

  1. (1)

    ceasing to communicate it;

  2. (2)

    withdrawing its approval (if applicable); and

  3. (3)

    notifying any person that the firm knows to be relying on its approval (if applicable) or confirmation (under MCOB 3.9.5 R).

MCOB 3.9.4G
  1. (1)

    MCOB 3.9.3 R is of particular importance to a qualifying credit promotion, such as a product brochure, that a firm uses over a period of time. It has little application to a qualifying credit promotion which is of its nature ephemeral, for example a mobile phone text message. Further, a qualifying credit promotion which clearly speaks as at a particular date will not cease to comply with the rules in this chapter merely because the passage of time has rendered it out-of-date. This does not mean, however, that a qualifying credit promotion can include information (such as price information) which is likely to become outdated during the currency of the qualifying credit promotion without the firm having regard to the need for any qualifying credit promotion to be clear, fair and not misleading. See further MCOB 3.6.5 G (2).

  2. (2)

    For compliance with MCOB 3.9.3 R, the FSA will expect a firm to monitor its relevant qualifying credit promotions as part of the firm's routine compliance monitoring procedures. A firm may find it helpful to designate a relevant qualifying credit promotion with a 'review date', a date at which the qualifying credit promotion should be checked once more against the rules in this chapter. If it is found no longer to meet these requirements it should be withdrawn as soon as is reasonably practicable.

  3. (3)

    If at any time a firm becomes aware that customers may have been misled by a qualifying credit promotion it should consider whether customers who have responded to the qualifying credit promotion should be contacted with a view to explaining the position and offering any appropriate form of redress to those who have suffered financial loss.

Communicating a qualifying credit promotion where another firm has confirmed compliance

MCOB 3.9.5R

A firm will not contravene any of the rules in this chapter in circumstances where it (firm 'A') communicates a non-real time qualifying credit promotion which has been produced by another person provided that:

  1. (1)

    A takes reasonable care to establish that another firm (firm 'B') has already confirmed the compliance of the qualifying credit promotion in accordance with MCOB 3.9.1 R;

  2. (2)

    A takes reasonable care to establish that A communicates the qualifying credit promotion only to recipients of the type for whom it was intended at the time B carried out the confirmation exercise; and

  3. (3)

    so far as A is, or ought reasonably to be, aware:

    1. (a)

      the qualifying credit promotion has not ceased to be clear, fair and not misleading since that time; and

    2. (b)

      B has not withdrawn the qualifying credit promotion.