MCOB TP 4 Other Transitional Provisions

1

MCOB 2.9.1R(1) to (3)

R

A firm need not comply with MCOB 2.9.1R(1) to (3) in relation to an automatic renewal of an agreement for an optional additional product which was entered into on or before 31 March 2016 provided:

From 1 April 2016

On 1 April 2016

(1)

the automatic renewal of the agreement is on substantially the same terms. The phrase “on substantially the same terms” is to be interpreted in the same way as in MCOB 2.9.1R(10)(b) and (c);

(2)

on the occasion of the first automatic renewal on or after 1 April 2016, the firm takes reasonable steps to ensure that the customer is informed:

(a)

that the renewal of the agreement is optional;

(b)

that the customer may elect not to renew the agreement; and

(c)

of the effect of the non-renewal of the agreement, if any, on the home finance transaction; and

(3)

the procedure to be used by customers for electing not to renew the agreement pays due regard to the interests of customers and treats them fairly.

22

MCOB 9.4, MCOB 9 Annex 1R

R

[expired]3

3

3

23

MCOB TP 4(2)

G

The Direction referred to in MCOB TP 4(2) modifies rules relating to lifetime mortgages which permit the consumer to switch from an interest-paying to an interest roll-up basis. TP 4 (2) allows a firm to which the Direction applied a transitional period during which to amend its pre-sale disclosure materials so that they comply with the rules relating to those disclosures as amended from 26 January 2017, rather than with the rules as modified under the Direction.