On 27 July 2022, the FCA published its highly anticipated final rules and guidance on the new Consumer Duty, ushering in a fundamental cultural shift in the way that regulated firms will approach and serve customers, and starting the countdown clock for implementation plans across the industry.
In a welcome move, the FCA has now confirmed a phased approach to implementation. Firms will need to apply the Consumer Duty to new and existing products and services that are open to sale (or renewal) from 31 July 2023. Firms will have an additional 12 months, until 31 July 2024, to apply the Consumer Duty to products and services held in closed books. Despite this phased approach, boards are expected to have scrutinised and signed off firms’ implementation plans by the end of October 2022 so time is tight for firms to agree their approach to implementation.
On the whole, the final Consumer Duty package reflects the proposals set out in the FCA’s consultations, with some changes and clarifications made in response to feedback received. Going forward, The FCA expects to build on the guidance as the Consumer Duty is embedded across the industry, including more sector specific guidance over time. In this alert, we highlight some of the significant changes and clarifications that we consider to be most significant. For more detail on the proposals as consulted on, this alert should be read together with our previous alerts of June and December 2021.
Please read the full alert here.