OFT and FSA concordat

Both the OFT and the Financial Services Authority have powers in relation to unfair contract terms under the UTCCRs, and co-ordinate enforcement action and co-operate to ensure the effective and consistent delivery of consumer protection in this area.

The revised framework for this co-ordination is set out in a new concordat  which came into effect on 31 July 2006.

Download concordat (pdf file 700 kb). 

The OFT and FSA will ensure that:

• any action they take is necessary and propotionate where there is evidence of a potential breach of the UTCCRs and of potentrial consumer harm stemming from the breach, and
• business, in normal circumstances, is given a reasonable opportunity to stop relying on unfair terms, removing or revising them as appropriate, before formal action is taken.

Under the concordat the OFT and and the FSA will consult and liaise to reduce duplication of effort and to promote appropriate action by the body best placed to lead on an issue.

The concordat provides that the FSA will consider the fairness under the UTCCRs of standard terms in financial services contracts issued by authorised firms or their appointed representatives for regulated activities. This will include contracts for mortgages and the selling of mortgages; insurance and the selling of insurance; bank, building society and credit union savings accounts; pensions; investments; and long term savings.

The concordat replaces the 2001 concordat between the OFT and the FSA.

In April 2006 the OFT and FSA published a joint action plan setting out how they would work together more closely and effectively on matters of mutual interest.

Download joint action plan (293 kb).

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