Consumer Protection Code review

Legal basis and structure

The revised Code will be restructured as two new regulations. These regulations will include:

1. Standards for Business and Supporting Standards for Business: (Central Bank Reform Act 2010 (Section 17A) Regulations) set out requirements relating to governance, resources and risk management. Together, they will replace and enhance the General Principles (Chapter 2) of the existing Code and introduce some additional standards.
2. General Requirements (Section 48 Regulations): Central Bank (Supervision and Enforcement Act) 2013 (Section 48) (Consumer Protection) Regulations make up the body of the revised Code. The regulations will reflect existing, enhanced and new protections/requirements on a general, cross-sectoral (digitalisation, informing effectively, customers facing vulnerability, advertising and complaint resolution) and sector-specific (consumer banking, credit and arrears, insurance, investment, crowdfunding) basis.

The existing Code will be transposed and amended into the Standards for Business and General Requirements (the “revised Code”) and the existing Code will be repealed.

Consolidation

The revised Code will also consolidate a number of existing Central Bank codes:

• Code of Conduct on Mortgage Arrears (CCMA);
• Central Bank (Supervision and Enforcement) Act 2013 (Section 48) (Licensed Moneylenders) Regulations 2020 (known as “High Cost Credit Regulations”); and
• Central Bank (Supervision and Enforcement) Act 2013 (Section 48(1)) (Insurance Requirements) Regulations 2022 (“Insurance Regulations 2022”).

New guidance

The revised Code will be supported by guidance covering:

• Securing Customers Interests; and
• Protecting Consumers in Vulnerable Circumstances.

Further general guidance will be published with the final regulations. In addition, the CBI will provide guidance to support consumers and firms in accessing the information they need through new digital tools, explainers and guides.

Key themes

A key theme across Derville Rowland’s speech and the CBI’s press release was securing customers’ interests. CP158 proposes the introduction of new and enhanced requirements in the areas of consumer credit, SME protections, insurance, investments and pensions in seven key areas: digitalisation, informing effectively, mortgage credit and switching, unregulated activities, frauds and scams, vulnerability and climate risk. It also proposes:

• a definition of financial abuse, which is supported by further obligations on firms to mitigate the risks of customers of financial abuse;
• a new definition of “consumer in vulnerable circumstances” along with specific requirements in relation to training, recording information detailing vulnerability and staff reporting concerns; and
• a requirement for firms to facilitate customers who wish to do so, to provide the name and contact information of someone—a trusted contact—who a firm may communicate with where there is difficulty supporting a customer or where financial abuse, including fraud, is suspected.

Timelines

CP158 is the second of three steps. The third step will be finalisation of the Code, which is expected in early 2025. CP158 proposes a 12-month period for implementation, starting from the final date of publication of the revised Code. Therefore, it is likely that the new CPC will apply from early 2026.

The consultation paper is an opportunity to share your views on the revisions to the structure, scope and content of the Code.