The main way in which we would act on our own initiative is to undertake a review of contracts in a particular area of business. This might involve looking at the contract terms used by several firms in a particular sector.
We will, for example, consider launching such a review if multiple consumer contract complaints or other intelligence lead us to believe that under the Regulations there may be a contractual issue of wider significance to firms and consumers.
In some cases, it might be appropriate for us to use other powers to deal with issues identified under the Regulations. The powers available to the FSA under the Act may vary depending on the regulated activities which the firm carries out. For example, the use of the unfair term might involve a breach of a Principle or a rule in COBS, MCOB or ICOBS1. If so, the FSA might also address the issue as a rule breach.1
We may, in some circumstances, consider treating the matter under our powers in the Act itself and also under the Regulations.
However, the use of our powers under the Act will not be possible in all cases where a firm has used an unfair term. If we consider using an enforcement power under the Act, we will do so in accordance with the policy relating to that power as set out in EG.