CPC Information

Clear and Timely

The financial service provider must ensure that all information that is provided to consumers is clear, accurate and up-to-date and written in plain English.  The information must be brought to the consumer’s attention.  The presentation must not disguise to conceal or obscure important information.

Information must be supplied to each consumer on a timely basis.  The financial service provider must have regard to the urgency of the situation and the time necessary for the consumer to absorb and react. It must ensure that if it communicates to a consumer using electronic media, it has arrangements in place to ensure the security of information received from the consumer and secure transmission to the consumer.

The font size used in all printed information provided to consumers must be clearly legible and appropriate to the type of document and information.  A notice regarding a change in interest rates must state the old rate and the new rate and the dates when the change applies.  Where its interest rates are published on its information services including telephone helplines, it must update such information as soon as any interest rate change comes into effect.

Identity Disclosure

A regulated entity must only use a disclosure statement set out below in the following circumstances:

• on its  business stationery used in connection with regulated activities
• on the part of its website relating to regulated activities
• on  electronic communications with consumers which are in connection with regulated activities.

It may use only use the regulatory disclosure statement in communications with the consumer relating to a regulated activity only.  It must have separate sections on its website for regulated activities and other activities.

A regulated entity must use a regulatory disclosure statement in either of the following formats depending on which he states where it is authorised, registered or licensed:

• [full name] regulated by the Central Bank of Ireland or
• [full name]  authorised licensed registered by [EU authority] and is regulated by the Central Bank of Ireland for the conduct of business rules.

Additional text must not be inserted  into the regulatory disclosure.

The regulatory disclosure must not be presented in such a way as to imply that it is endorsed by the Central bank or other EU competent authority.

Terms of Business

Regulated entities must draw up terms of business and provide consumers with a copy prior to  providing the first service to that consumer.  The terms of business must set out the basis on which the entity provides its regulated activities.

It must ensure that it contains at least the following:

• name, address, trading address.
• group name.
• confirmation of authorisation.
• a statement that it is subject to the CBI code of conduct and that the code can be found on centralbank.ie,
• description of regulated activities which it provides.
• if it acts as an intermediary, a description of the level of service for each product type, whether a fair analysis of the market, limited analysis and explanation of the type of service in a way  that seeks to inform the consumer
• if it is tied in relation to its regulated activities, it must specify the name of each product and service for which it is tied on the name of the regulated entity to whom it is tied.
• a general statement of charges imposed directly by the entity.
• a summary of its policy in relation to the  use of personal data
• a summary of its policy in relation to conflicts of interest,
• an outline of actions and remedies which the regulated entity may take in the event of default by a consumer.
• a summary of the complaints procedure operated by it
• name of any statutory scheme and level of protection available
• effective date of the terms of business document.

The terms of business must be provided to a consumer  in a stand-alone document. A deposit agent must give the credit institutions terms of business which mush must set out its  relationship with the credit institution.

Where a regulated entity makes a change to its terms of business, it must provide any affected  consumer with the revised terms of business as soon as possible.  It must inform the consumer that he or she may request the statements set out below to be provided in paper and must so provide them.

Independence

The term independent may only be used by an intermediary in its name or description, where the principal regulated activities which it undertakes are provided on the basis of a fair analysis of the market and the consumer, has the option to pay in full for its services by a fee.

Where the regulated entity does not provide all its activities in an independent capacity it must explain the different nature of its services in a way that seeks to inform the consumer.  There must be no ambiguity about the range of services which it provides in an independent capacity.

The term broker may only be used for the principal regulated activities where the intermediary concerned provides them n the basis of a fair analysis of the market.  Where this is not the case it must clearly disclose to the consumer, the names of the product producers whose products and services it intends to consider as part of the analysis.

Where the intermediary does not so provide the services, it must disclose to the consumer the names of the product producer whose products and services are intended to consider as part of its analysis.  Where an intermediary is tied to a single product producer for a particular product and service, it must disclose this to the consumer in all communications in relation to that product or service with the consumer.

Information about Product

Prior to offering, recommending, arranging or providing a product, a regulated entity must provide information on paper or in another durable medium to the consumer about the main features and restrictions of the product to assist the consumer in understanding the product.  To the extent that the product is provided under a distance contract, the relevant regulations apply in place of the requirement set out.

A regulated entity must provide each consumer with the terms and conditions attaching to a product or service in paper or another durable medium before the contract is provided.  Where the distance marketing regulations apply that obligation is substituted.

Information on Charges

There are requirements that a consumer be advised of charges including third-party charges prior to a product or service or product being provided. Increases in charges must be advised thirty days in advance. A statement must be provided to consumers of all charges in a period. Where charges are accumulated and applied periodically to accounts, 10 days’ business notice must be given before deduction.

A regulated entity must notify consumers of increases in charges specifying the  old and new charge or the introduction of new charges within 30 days before the change takes  effect.  Where charges are accumulated and applied periodically, it must notify at least 10 days prior to deduction of charges and give each consumer a breakdown of charges except where the amount is €10 or less.

A regulated entity must notify on paper or other durable medium consumers who have been charged penalty charges including surcharge interest and the methods by which they may be mitigated.

Prior to providing a product or service to a consumer, a regulated entity must provide a consumer on paper in another durable information with the breakdown of charges including third-party charge as passed to the consumer.  Where such charges cannot be ascertained in advance, it must notify the consumer that the charges will be levied as part of the transaction.

Where a  charge is intended to be imposed in respect of the provision or arrangement of a loan to a personal consumer and it is   proposed the charge be incorporated into the amount advanced the regulated entity must prior to the personal consumer signing an application form for the loan inform the personal consumer on paper or other durable medium that he has the right to pay this charge separately and not in the loan and provide information in relation to the amount of the charge and the overall cost of paying to charge over the term of the loan.

A regulated entity must display in its public offices in a manner that is easily accessible to consumers a schedule of fees and charges imposed by it.  If it has a website its schedule of fees must be made publicly available on its website.

Before offering, recommending or arranging a product or service a mortgage intermediary and an investment intermediary must disclose on paper or another durable medium the existence and  nature of any fee commission or remuneration received or to be received from the product producer in relation to that product or services.  Where the amount cannot be ascertained the method of calculating the amount must be disclosed.  It must be disclosed in a manner which is comprehensive, accurate and understandable.  This does not apply to an insurance policy; is respect of which similar obligations otherwise apply.

Where  remuneration is to be received by the intermediary from a product producer on an ongoing basis, the intermediary must disclose to the consumer on paper or another durable medium prior to the provision of the product or service the nature of the service to be provided in respect of the remuneration.

Prior to the sale of a non-life insurance product, an insurance intermediary must disclose in general terms to the consumer that it has been paid for the service provided to the consumer by means of a remuneration agreement with the product producer.  It must inform the consumer of the amount of remuneration receivable in respect of the service or that the details of remuneration are available on request.

It must disclose in general terms to a consumer any remuneration arrangements with a  product producer which is not directly attributable to the service provided to an individual consumer, but which are based on the levels of business introduced by the intermediary to that provider or that may be perceived as having the potential to create a conflict of interest.

The above disclosure must be in the terms of business or through some other suitable mechanism and/or with renewal notices.

Where an intermediary allows the consumer the option to pay for its services by means of a fee,  the amount of the fee must be explained in advance to the consumer.  Where a fee is charged and the intermediary also receives a commission in respect of the product and service it must explain to the consumer whether or not the commission will be offset against the fee either in full or in part.

CPC Warnings

The CPC provides for a number of warnings, which must appear on the loan agreement and associated documents. Some of these are specific to particular types of financial products, such as lifetime mortgages. Others are in more general terms.

Prior to credit being approved, a financial institution must explain to a personal consumer the effect of missing any of the scheduled repayments. The implications and effects of missing the scheduled repayments must be highlighted in all credit agreement documentation provided to the personal consumer, and the following warning statement must also appear in the documentation:

Warning: If you do not meet the repayments on your credit agreement, your account will go into arrears. This may affect your credit rating, which may limit your ability to access credit in the future.

Warning: As a guarantor of this credit, you will have to pay off the debt amount, the interest and all associated charges up to the level of your guarantee if the borrower(s) do(es) not. Before you sign this guarantee, you should get independent legal advice.