Central Bank consulting on proposals for a modernised Consumer Protection Code

• Important package of updated protections to support the financial system of today and into the future
• Enhanced clarity, predictability and accessibility on consumer protection obligations
• Obligation to secure customers’ interests key to delivering positive consumer outcomes

Today, Thursday 7 March 2024, the Central Bank of Ireland launched a Consultation Paper on the revision of the Consumer Protection Code.

The Consultation Paper is the second of three steps the Central Bank is taking to modernise, clarify and integrate the Code, as well as to enhance its accessibility.

At the launch of the consultation, Deputy Governor Derville Rowland said, “The Consumer Protection Code is the cornerstone of the Irish consumer protection framework. It has served consumers well, and the time has come to update the protections to support the financial system of today and into the future.

“We have listened to the views of the public and industry on our Discussion Paper. We are now bringing forward proposals for a modernised Code which is underpinned by firms’ obligation to secure their customers’ interests. These are combined with an important package of updated protections that reflects how consumers are accessing financial services today.

Securing Customers’ Interests

“One of our key goals in revising the Code is to assist firms to effectively incorporate customers’ interests into their overall business model and commercial decision making. This is addressed through an obligation on firms to secure their customers' interests. Guidance will support firms to effectively implement all their consumer protection obligations, in part by describing what firms need to consider and the actions they need to take to deliver positive consumer outcomes.”

Package of Updated Protections

“We are proposing a package of new and updated protections to deal with the transformation in financial services, including proposals related to: Digitalisation; Informing effectively; Mortgage credit and switching; Unregulated activities; Frauds and Scams; Vulnerability; and Climate risk.

“This package includes proposals around making digital platforms easier to use; making clear where regulated firms are providing unregulated services; a new definition of financial abuse; and beefing up fraud and scam monitoring and communications by firms.

“We are also proposing a new framework to support people in vulnerable circumstances. Firms must take reasonable steps to support such customers and to implement training, reporting, and the recognition of Trusted Contact Persons.

“I look forward to ongoing engagement with the public and industry on the new Code, and thank sincerely all those who have so positively contributed so far.”

The submission period for this consultation will remain open for three months, from Thursday 7 March 2024 until Friday 7 June 2024. Please see Chapter 5 for details on how to respond to this consultation.

Notes to Editors

1. The review of the Consumer Protection Code is being undertaken in 3 phases:

• Discussion Paper Phase (complete)
• Public Consultation Phase (commencing today)
• Finalisation of revised Consumer Protection Code (early 2025)

2. Our proposals focus on modernising, clarifying, and integrating consumer protections to ensure they are accessible for consumers and firms. The revised Code will be contained in two new Central Bank Regulations.

• The first will set out Standards for Business, complemented by Supporting Standards for Business, which will replace the existing General Principles of the Code.
• The second will set out General Requirements, which will include new protections, and existing requirements set out on a cross-sectoral and sector specific basis.

3. The revised Code will also consolidate a number of existing Central Bank codes and requirements. In addition, we will support consumers and firms in accessing the information they need through new digital tools, explainers and guides.

4. Trusted Contact Person - We are proposing to introduce 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.