PROD 2.4 Temporary product intervention rules

Normally the FCA must consult the public before making any rules. However, the Act allows a general exemption in section 138L where the FCA considers that the delay involved in complying with the requirement to consult would be prejudicial to the interests of consumers.

There is also a specific exemption to the consultation requirement in relation to making temporary product intervention rules (section 138M of the Act). The FCA may make temporary product intervention rules without consultation if it considers that it is necessary or expedient not to comply with such a requirement to advance:

1. (1)

   the consumer protection objective, or

2. (2)

   the competition objective, or

3. (3)

   the market integrity objective.

The FCA’s discretion to act under section 138M of the Act (including that section as applied by the Consumer Composite Investments Regulations) is therefore wider than under section 138L.

Decisions to make any rules, including temporary product intervention rules, will be taken by the FCA Board. In doing so, the FCA Board will have regard to all the available, relevant evidence, as well as the impact of the measure to be introduced by the rule.

The FCA Board will consider whether the evidence is sufficient to support the proposed measure and whether the measure is a proportionate response to the issue identified.

In publishing temporary product intervention rules the FCA will also publish the rationale for these rules.