Jurisdiction(s):
United Kingdom

FCA maintains current SME thresholds for UK FOS access: reasons, sector impact, and interaction with the Consumer Duty

Published on: 01 February 2024

Published by a Law360 reporter

Legal News

Article summary

Any broadening of the definition would have enabled more SMEs to bring matters to the FOS. Here, we explore the implications of that step. In March 2023, the FCA issued a call for evidence to revisit the existing SME thresholds—fewer than 50 employees and an annual turnover under £6.5m, or a balance sheet below £5m—for acts and omissions, and to assess whether they still align with the FOS policy objective:

to ensure the FOS can be accessed by SMEs likely to lack the means to resolve or pursue disputes with financial services firms through the legal system, and
to reinforce firms’ incentives to settle matters swiftly and informally, or to prevent disputes arising altogether

The FOS

The service is free to use, so referring a complaint to it carries no charge for the complainant. As it operates as a no-cost forum, there is no costs order made against a complainant who does not succeed if the complaint is not upheld. Its jurisdiction also means it is not bound to apply the law...

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