1. From April 2014, thus replacing the Office of Fair Trading (‘OFT’). The new institutional framework for the regulation and supervision of the financial services market consists of the Financial Policy Committee and the Prudential Regulation Authority (both part of the Bank of England) and the Financial Conduct Authority. The Financial Services Act was brought into force in April 2013.

2. HM Treasury A New Approach to Financial Regulation: Consultation on Reforming the Consumer Credit Regime (December 2010) ch 2.

3. For example, those relating to advertising, pre-contract information and the assessment of borrower creditworthiness.

4. S Brown ‘EU and UK consumer credit regulation: principles, conduct and consumer protection: divergence or convergence of approach?’ (2015) 26 Eur Bus L Rev 555 at 571–573.

5. ‘The purpose of CONC is to set out the detailed obligations that are specific to credit-related regulated activities and activities connected to those activities carried on by firms. These build on and add to the high-level obligations, for example, in PRIN, GEN and SYSC, and the requirements in or under the CCA.’ CONC 1.1.2 G.

6. To the extent, of course, that this is compatible with the Consumer Credit Directive 2008: HM Treasury A New Approach to Financial Regulation: Transferring Consumer Credit Regulation to the Financial Conduct Authority (March 2013) at [2.8]; HM Treasury, above n 2, at [2.11].

7. HM Treasury, above n 6, at [2.9].

8. Inserted into the CCA by ss 19–22 of the 2006 Act. The test was heralded as the answer to the seeming inefficiency of the extortionate credit test: DTI Fair, Clear and Competitive: A Consumer Credit Market for the 21st Century Cm 6030 December 2003, at [3.31].

9. Or any agreement related to it.

10. E Lomnicka ‘The future of consumer credit regulation: a chance to rationalise sanctions for breaches of financial services regulator regimes?’ (2013) 34(1) Company Law 13; Brown, above n 4.

11. C Willett ‘General clauses and the competing ethics of European consumer law in the UK’ (2012) 71(2) Camb L J 412.

12. Ibid.

13. By ‘general/open-textured’ is meant flexibility and breadth in terms of applicability and interpretation; for example, as demonstrated by Art 3(1) of the Unfair Terms in Consumer Contracts Directive, transposed into UK law by the Unfair Terms in Consumer Contracts Regulations 1999, SI 1999/2083, reg 5(1), Willett, above n 11, at 412.

14. By allowing the actions of third parties and agreements connected with the credit arrangement to be subject to review by the court under s 140B.

15. Willett expressly refers to the potential for these ethics to apply to general clauses relating to unfair practices as well as terms: Willett, above n 11, at 423–436. For a discussion of ‘open-textured’ rules and unfairness, see H Collins Regulating Contracts (Oxford: Oxford University Press, 1999) ch 11.

16. In particular, Professor Iain Ramsay, who has written extensively on this issue, and whose work in this area the author has found helpful. See, generally, references below. Also, for some recent publications, see eg I Ramsay ‘“Wannabe WAGS” and “credit binges”: the constructions of over-indebtedness in the UK’ in J Niemi, I Ramsay and W Whitford (eds) Consumer Credit, Debt and Bankruptcy: Comparative and International Perspectives (Oxford: Hart Publishing, 2009); I Ramsay Consumer Law and Policy, Text and Materials on Regulating Consumer Markets (Oxford: Hart Publishing, 3rd edn, 2012); I Ramsay ‘Changing policy paradigms of EU consumer credit and debt regulation’ in S Weatherill and D Leczykiewicz (eds) The Images of the Consumer in EU Law (Oxford: Hart Publishing, 2016).

17. [2014] UKSC 61.

18. This includes a business if a sole trader or a partnership of two or three (unless all the partners are bodies corporate – or unincorporated bodies – as long as not entirely consisting of bodies corporate: s 189(1) CCA). Those provisions that have been transferred to CONC have retained this scope of debtor protection.

19. As defined in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, S1 2001/544, reg 61; CCA, s 140A(5).

20. As such, a borrower is not an ‘individual’ for the purposes of the Act: see above, n 18.

21. For a discussion of small business protection under the CCA, see S Brown ‘Protection of the small business as a credit consumer: paying lip service to protection of the vulnerable or providing a real service to the struggling entrepreneur?’ (2012) 41(1) Common L World Rev 59–96.

22. In force from April 2014. This was the result of a detailed review of the market conducted by the FSA over a number of years (2009–2012), as a result of the financial crisis. Policy papers are available at http://www.fca.org.uk/firms/firm-types/mortgage-brokers-and-home-finance-lenders/mortgage-market-review (accessed 5 July 2015). See also FSA ‘Mortgage market review’, DP 09/3 (2009); available at http://www.fca.org.uk/your-fca/documents/discussion-papers/fsa-dp09-3-mortgage-market-review (accessed 18 December 2014).

23. FCA ‘Implementation of the Mortgage Credit Directive and the new regime for second charge mortgages’ CP14/20 (September 2014) at [1.7]. The rule book will also be subject to further amendment as a result of this Directive: ibid, at [1.8]. The Directive was also prompted by the financial crisis, irresponsible lending being a particular target. European Commission ‘Summary of the impact assessment. Accompanying document to the proposal for a directive of the European Parliament and of the Council on credit agreements relating to residential property’, Commission Staff Working Paper SEC(2011) 355 final (Brussels, 31 March 2011) at 5. For a discussion of the comparison between EU and UK regulation in light of these latest developments, see Brown, above n 4.

24. Disclosure, MCOB 4–7; responsible lending, MCOB 11; action on default, MCOB 13.

25. HM Treasury ‘Implementation of the EU Mortgage Credit Directive’ (26 January 2015) at [2.2]; available at https://www.gov.uk/government/consultations/implementation-of-the-eu-mortgage-credit-directive/implementation-of-the-eu-mortgage-credit-directive (accessed 5 July 2015).

26. Brown, above n 4, at 574. Transitional provisions will be put in place for those agreements entered into before this date: HM Treasury, above n 25, at [2.3].

27. Section 140A(1)(c).

28. As recognised by Mr G Leggatt QC in Patel v Patel [2009] CTLC 249 (QB) at [63]. The section therefore casts the net wider than the protection provided by the Unfair Terms in Consumer Contracts Regulations 1999 – for further discussion, see text to nn 191–204 below.

29. G Howells ‘The consumer credit litigation explosion’ (2010) 126 Law Q Rev 617 at 638; for a discussion of the wide ambit and nature of the relationship, see S Brown ‘The unfair relationship test, consumer credit transactions and the long arm of the law’ (2009) 1(Feb) LMCLQ 90–112 at 95–97.

30. Section 140C defines related agreement as including consolidated agreements, linked transactions or security.

31. Brown, above n 29, at 96. The section's provisions, for instance, cover both the original agreement and subsequent agreements within refinancing arrangements. R Goode (ed) Consumer Credit Law and Practice (London: LexisNexis, 1999, looseleaf) at [47.128]. Patel (above n 28) and Barnes v Black Horse Ltd [2011] EWHC 1416 (QB) are good examples of cases in which there were a number of credit agreements with the same creditor, later agreements refinancing earlier ones, all of which were potentially subject to the sections’ provisions. In Patel, it was the relationship that arose out of the consolidating agreement that fell foul of the test. In Barnes, the contentious issues primarily arose from the PPI premium charged on the original and two subsequent rollover loans.

32. Brown, above n 29, at 96–97.

33. For further discussions of the test's ambit, see eg Howells, above n 29; D Collins ‘Payday loans: why one shouldn't ask for more …’ (2013) 28(2) J Int'l Bank L & Reg 55–60; E Lomnicka ‘Unfair credit relationships: five years on’ (2012) 8 J Bus L 713–730; L McMurtry ‘Consumer Credit Act mortgages: unfair terms, time orders and judicial discretion’ (2010) 2 J Bus L 107–125; S Gerlis ‘Credit where it is due’ (2010) 107(33) Law Soc'y Gazette 18.

34. The sections forbid enforcement of the agreement while the breach continues: ss 77(4)(a), 78(6)(a).

35. Carey v HSBC Bank [2010] Bus LR 1142; Lomnicka, above n 33, at 724.

36. In Yates v Nemo Personal Finance (Unrep) Manchester County Court (4 May 2010), it was found that there was not only no fiduciary relationship between the claimants and their broker, but that the creditor did not procure any breach of such a relationship. Similar conclusions about the lack of a fiduciary relationship of this kind between creditor and debtor were also reached in Khodari v Tamimi [2009] CTLC 288, Lawson v Black Horse Ltd (Unrep) Newcastle-upon-Tyne County Court (15 April 2011), Carson & Hazell v Black Horse Ltd (Unrep) Cambridge County Court (18 April 2011) and Barnes v Black Horse Ltd, above n 31, although HHJ Waksman QC left it open as to whether, even if there was no breach of such duty, there might be an unfair credit relationship: Lomnicka, above n 33, at 720.

37. Howells, above n 29, at 617; Lomnicka, above n 33, at 726.

38. Particularly the single premiums payable for fixed sum loans, where the borrower would often end up taking out further credit to pay for the premium. For a more detailed discussion, including FSA and FOS involvement in policing of PPI, see Howells, above n 29, at 631–635.

39. Many borrowers took out this insurance either unwittingly or when they did not really need it or understand its terms.

40. [2010] ECC 8.

41. And therefore recoverable by the borrower, as not only had the debtor never agreed to take out the insurance in the first place, but she had then paid for it on the basis of misinformation: [2010] ECC 8 at [19].

42. Cf the approach in Harrison v Black Horse Ltd, below n 45, where an intermediary represents him- or herself as only selling one product.

43. See above n 36.

44. It should be noted, however, that transparency has not just been an issue in relation to PPI. In Patel, which did not involve PPI at all, the relationship was found to be unfair due, in part, to the scant information given to the debtor, even though disclosure was not legally required, as the agreement was not regulated: Lomnicka, above n 33, at 725.

45. Harrison v Black Horse Ltd [2011] EWCA Civ 1128.

46. Ibid, at [30]–[31].

47. An associate's commission must be disclosed to commercial customers upon request (ICOBS R.4.4.1). From 31 December 2012, the fact that a firm will receive commission must be disclosed to all retail customers where a pure protection contract is sold with a retail investment product: ICOBS R4.6.

48. Tomlinson LJ regarded as significant the fact that the OFT Guidance on unfair credit relationships regarded relevant FSA rules as a valid consideration: above n 21, at [40]–[41].

49. Harrison, above n 45, at [58]. Furthermore, non-disclosure of commission was not identified as one of the common failings in relation to the sale of PPI policies identified in the FSA's policy statement of August 2010: ibid, at [62].

50. Recent case-law has indeed gone as far as referring to the OFT Guidance and its importance in this respect. While, for instance, in Barnes it was rejected as irrelevant because the guidance related to a different type of borrower and a different type of lending, the principle of having regard to the Guidance itself was not expressly dismissed: Barnes, above n 31, at [23], [32].

51. Yates, above n 36, at [17].

52. Case C-453/10, Perenicova v SOS Financ Spol sro [2012] 2 CMLR 28.

53. Ibid, at [47]. D Collins ‘Misleading APRs in consumer credit agreements: a new influence?’ (2012) 7 J Bus L 629. For a brief summary of the case, see Case Comment (2012) 295 EU Focus 13.

54. Harrison, above n 45, at [58]. The borrower was given leave to appeal, but in the event the case was settled out of court. For commentary on this and the decision, see R Kelsall ‘End of the road for PPI claims? Borrower's appeal withdrawn’ (2012) 27(9) Butterworths J Int'l bank & Fin L 587.

55. Reflecting to some degree Adam Smith's assumption that ‘homo economicus’ will pursue self-interest – information, if adequate, will allow the consumer to do this: U Reifner et al Over-Indebtedness in European Consumer Law: Principles from 15 European States (Norderstedt: Books on Demand, 2010) pp 55–56.

56. I Ramsay ‘Consumer law, regulatory capitalism and the “new learning” in regulation’ (2006) 28 Sydney L Rev 9 at 12–13. Ramsay discusses, inter alia, the decentralisation agenda identified by scholars such as David Levi-Faur and Julia Black, in the context of consumer policy.

57. Willett, above n 11, at 412–415, 423.

58. Arguably reflecting a neo-liberalist approach, with its emphasis on individual responsibility and expansion of markets. For a detailed discussion of neo-liberalism and recent problems in relation to financial services and consumer credit, see I Ramsay and T Williams ‘The crash that launched a thousand fixes: regulation of consumer credit after the lending revolution and the credit crunch’ in A Kern and N Moloney (eds) Law Reform and Financial Markets (Cheltenham: Edward Elgar, 2011).

59. In terms of facilitating real consumer choice.

60. Willett, above n 11, at 414.

61. By allowing as sufficient the reconstitution of the copy from a number of sources, rather than from the original agreement itself: see the decision in Carey.

62. Here, the detriment was uninformed choice; the decision was biased due to imperfect knowledge of cost and alternatives: Yates, above n 36, at [40]–[41].

63. See Willett, above n 11, at 420.

64. Above n 28.

65. Willett, above n 11, at 436.

66. Harrison, above n 45, at [59]–[60].

67. See Willett, above n 11, at 431 in relation to the Supreme Court's approach to European fairness provisions.

68. DTI above n 8, at [3.32]–[3.37].

69. Willett, above n 11, at 430–431. A case in point is the decision of the Supreme Court in OFT v Abbey National [2010] 1 AC 696, where the self-interest/reliance ethic was clearly in evidence in the judicial decision making process.

70. Willett, above n 11, at 436.

71. DTI, above n 8, at [3.33].

72. Ibid, at [3.37].

73. Section 140A(1)(b).

74. As pointed out by Briggs LJ in Plevin [2013] EWCA Civ 1658 at [58].

75. Brown, above n 29, at 97.

76. DTI, above n 8, at [3.33], [3.37].

77. HL Deb Grand Committee vol 675 col GC160, 8 November 2005, per Lord Sainsbury of Turville (emphasis added).

78. DTI, above n 8, at [3.37].

79. [2014] UKSC 61 This is the first to reach the Supreme Court.

80. [2012] CTLC 193.

81. Plevin, above n 74, at [80], [81]–[82].

82. Ibid, at [26], [80], [82].

83. Ibid, at [83]. Aside from potential evidential differences, the essential question – whether an unfair credit relationship could be found where there was no breach of regulations – was the same.

84. LLP was an independent finance broker that arranged Mrs Plevin's loan (a consolidation of existing debt together with new borrowing) together with 5 years of PPI cover. Both it and Paragon were intermediaries for the purposes of ICOBS, although in this instance, in relation to the sale of the insurance, the ICOBS Rules only applied to LLP: see n 85 below.

85. As required by ICOBS, and by the FISA and FLA regulatory codes. The ICOBS requirement only applied to LLP, as it was the intermediary in direct contact with the customer in relation to the sale of the insurance, and was the one that had made the personal recommendation: ICOBS 4.3.1 R. The FISA and FLA codes are broader in that they do not seem to provide a hard allocation of responsibility and impose monitoring obligations on the lender in relation to their intermediaries. For the courts’ detailed discussion of these issues, see Plevin, above n 74, at [68]–[77] per Briggs LJ and in the Supreme Court Plevin, above n 79 per Lord Sumption at [35]–[39].

86. Plevin, above n 74, at [63] per Briggs LJ.

87. Ibid, at [64]

88. Plevin, above n 79.

89. Ibid, at [32]–[34] per Lord Sumption.

90. Ibid, at [34].

91. Ibid, at [17].

92. Plevin, above n 74, at [53]–[54].

93. Plevin, above, n 79 at [17].

94. Ibid, at [18].

95. Ibid, at [34].

96. Although, interestingly, Briggs LJ suggests that the ICOBS Rules operate without reference to motivation: Plevin, above n 74, at [24].

97. Plevin, above n 79, at [10], [17]. In the CA, Briggs LJ put this in terms of blameworthiness: Plevin, above n 74, at [53].

98. See eg SN Thal ‘The inequality of bargaining power doctrine: the problem of defining contractual unfairness’ (1988) 8 Oxford J Legal Stud 17; S Smith ‘In defence of substantive fairness’ (1996) 112(Jan) Law Q Rev 138; H Collins, above n 30, particularly ch 11; R Bigwood ‘Contracts by unfair advantage: from exploitation to transactional neglect’ (2005) 25(1) Oxford J Legal Stud 65–96; C Thomas ‘What role should substantive fairness have in the English law of contract? An overview of the law’ (2010) Camb Student L Rev 177. In terms of regulation, see eg S Bright ‘Winning the battle against unfair contract terms’ (2000) 20(3) Legal Stud 331; T Wilhelmssohn and C Willett ‘Unfair terms and standard form contracts’ in G Howells et al Handbook of Research on International Consumer Law (Cheltenham: Edward Elgar, 2010) ch 7. More specifically from a European perspective, see eg M Schillig ‘Inequality of bargaining power versus markets for lemons: legal paradigm change and the Court of Justice's jurisprudence on Directive 93/13 on unfair contract terms’ (2008) 33(3) Eur L Rev 336–358; C Pavillon ‘Private standards of fairness in European contract law’ (2014) 10(1) Eur Rev Cont L 85–117.

99. Wilhelmssohn and Willett, above n 98.

100. H Collins ‘Good faith in European contract law’ (1994) 14(2) Oxford J Legal Stud 229–254 at 246. For a detailed discussion of the development of consumer credit and questions of distribution, see I Ramsay ‘Consumer credit law, distributive justice and the welfare state’ (1995) 15(2) Oxford J Legal Stud 177–197.

101. This was specifically mentioned as a reason for replacing the extortionate credit bargain test: DTI, above n 8, at [3.31].

102. G Howells, H-W Micklitz and T Wilhelmsson ‘Towards a better understanding of unfair commercial practices’ (2009) 51(2) Int'l J Law & Mgmt 69–90 at 69.

103. But therefore necessarily less protective: Willett, above n 11, at 436.

104. Pressurised selling was referred to in Harrison, on the initial appeal from the Worcester County Court, only in terms of its absence. There had been no pressure to accept the PPI; this, together with the fact that the cost and extent of cover had been known, underlined the failure to successfully claim that the relationship was unfair: [2010] EWHC 3152(QB) at [53]–[54] per HHJ Waksman QC. See Willett's discussion of pressurised and aggressive selling in the context of the Unfair Commercial Practices Directive: Willett, above n 11, at 433–436.

105. An example being Thorius, where the customer was pursued around the store by a persistent sales person – this of itself was not enough to establish behaviour such that an unfair relationship would arise. Pressured selling was, however, identified as a ‘substantial flaw’ by the FSA: FSA ‘The assessment and redress of payment protection insurance complaints’, Policy Statement 10/12 (August 2010).

106. Patel, above n 28, at [75].

107. For a comparison of the equitable remedy of setting aside a mortgage for undue influence and s 140A, see S Brown ‘The Consumer Credit Act 2006; real additional mortgagor protection?’ (2007) Jul/Aug Conv & Prop L 316.

108. This dilemma has been labelled as ‘acoustic segregation by PS Abril. For a discussion of this, with particular reference to the Australian small business individual, see E Webb ‘Unconscionable conduct in Australian Competition and Consumer Commission v Dukemaster Pty Ltd – a recognition of “acoustic segregation” in retail leasing transactions?’ (2010) 18 Austral Prop L J 48.

109. For a discussion of consumers vulnerability from a situational perspective, see T Wilhelmssohn ‘The informed consumer v the vulnerable consumer in European unfair commercial practices law – a comment’ G Howells et al (eds) Yearbook of Consumer Law (Aldershot: Ashgate, 2007) ch 8.

110. Plevin, above n 79, at [17]–[18] per Lord Sumption.

111. Ibid, at [10].

112. Although Briggs LJ suggests that the creditor need not be ‘blameworthy’ as such: Plevin, above n 74, at [53]; see also T Wilson ‘The responsible lending regime’ in T Wilson (ed) International Responses to Issues of Credit and Over-Indebtedness in the Wake of Crisis (Farnham: Ashgate, 2013) p 123, who discusses blame in the context of irresponsible lending.

113. Bounded rationality, heuristics and biases; for example, information overload selective optimism and mental shortcuts (‘availability heuristic’). For a discussion of the extent to which behavioural law and economics should inform policy, see M Laure and H Luth ‘Behavioural economics in unfair contract terms cautions and considerations’ (2011) 34 J Consumer Pol'y 337–358.

114. Willett, above n 11, at 420.

115. For the FCA consultation on interest rate controls, introduced on 2 January 2015, see FCA ‘Proposals for a price cap on high-cost short-term credit’ CP14/10 (July 2014); available at http://www.fca.org.uk/news/cp14-10-proposals-for-a-price-cap-on-high-cost-short-term-credit (accessed 12 December 2014). The imposition of these rates is required by s 137(1A) FSMA 2000.

116. In the sense that lack of competition is a market failure, which, in neo-liberal terms, justifies regulation: J Black ‘Seeing, knowing, and regulating financial markets: moving the economic to the social’ LSE Legal Studies Working Paper No. 24/2013 at 9.

117. Reifner et al, above n 55, pp 55–57.

118. I Ramsay ‘Consumer credit regulation as ‘the third way?’ Keynote Address, Australian Credit at the Crossroads conference, Melbourne 2004. As Hugh Collins points out, reasons for regulating contracts more generally in the name of fairness are not necessarily harmonious: Collins, above n 100, at 246. For a discussion of the appropriate role of legal paternalism, see A Ogus ‘The paradoxes of legal paternalism and how to resolve them’ (2010) 30(1) Legal Stud 61–73.

119. Wilson, above n 112, p 109.

120. Ramsay, above n 56, at 13.

121. Ibid.

122. This has been highlighted by one of the trade associations, the Intermediary Mortgage Lenders Association: see http://www.imla.org.uk (accessed 5 July 2015). It has been claimed by some in the industry that as a result of this, certain borrowers, such as those over the age of 40 and the self-employed, are now being ‘frozen’ out of the market: see http://www.imla.org.uk/news/post.php?s=2014-11-24-fears-of-future-mis-selling-scandal-leave-older-mortgage-borrowers-out-in-the-cold-new-imla-report---the-changing-face-of-non-standard-mortgage-lending (accessed 2 December 2014).

123. As a result of the Mortgage Market Review. This was an initiative of the FSA, as a result of concern over the state of the market in 2009.

124. MCOB 11.6 R; see also FSA ‘Mortgage market review – responsible lending’ CP10/16 (July 2010), available at http://www.fca.org.uk/your-fca/documents/consultation-papers/fsa-cp10-16 (accessed 2 December 2014); and FSA ‘Mortgage market review: feedback on CP11/31 and final rules’ PS12/16 (October 2012), available at http://www.fca.org.uk/your-fca/documents/fsa-ps-12-16-mortgage-market-review (accessed 2 December 2014).

125. Wilson, above n 112, p 131.

126. Committee on Consumer Credit Consumer Credit: Report of the Committee Cmnd 4596, 1971. In the White Paper published in 1973, Reform of the Law on Consumer Credit Cmnd 5427, 1973 at [6], it was made clear that the ensuing legislation had a dual purpose: comprehensive protection for the consumer and the fostering of competition.

127. Vulnerability now seeming to encompass not only those who were destitute or under-privileged, but the general persona of the consumer when in a position of inequality. S Brown ‘European regulation of consumer credit: enhancing consumer confidence from a UK perspective?’ in J Devenney and M Kenny Consumer Credit Debt and Investment in Europe (Cambridge: Cambridge University Press, 2012) p 63.

128. S Brown Consumer Credit and Over-Indebtedness: The Parliamentary Response: Past Present and Future, PhD thesis, University of Leeds (2006) p 204.

129. See DTI, above n 8, p 4. This states that the major objective of the proposed change to the law is ‘an efficient, fair and free market where consumers are empowered to make fully informed decisions.’

130. Brown, above n 29, at 64.

131. Acknowledging that there was a need for a more focused control of unfairness per se: DTI, above n 8, at [3.28]–[3.31]; Wilson, above n 112, p 110.

132. DTI, above n 8, pp 4–5.

133. Brown, above n 29, at 216.

134. This was generally met with approbation: HM Treasury A New Approach to Financial Regulation: Securing Stability, Protecting Consumers Cm 8268 January 2012 at [4.19].

135. See FCA ‘Detailed proposals for the FCA regime for consumer credit’ CP 13/10; available at https://www.fca.org.uk/static/documents/consultation-papers/cp13-10.pdf (accessed 5 July 2015).

136. The MCD governs all secured lending to consumers where the security is in residential property, or where the credit is given to facilitate the acquisition of rights in an ‘existing project or building’: Art 3 (1).

137. For example, credit-broking and debt counselling.

138. See eg ss 77–79 CCA, which deal with the provision of copy agreements and statements.

139. Lomnicka, above n 10, at 15.

140. There are some exceptions. The FSMA provisions allow unenforceability in respect of agreements/arrangements entered into as a result of very specific instances – for example, contravention of specific rules relating to credit charges and rollover loans or agreements entered into by unauthorised persons: FSMA 2000, s 137C.

141. Lomnicka, above n 10, at 20.

142. Ibid, at 17. This is available where the creditor is an authorised person: if unauthorised, the creditor will commit a criminal offence and the agreement will be void: ss 26–27, 30 FSMA.

143. Note that this does not include breach of the High Level Principles, although breach of these can attract disciplinary sanctions: R. (on the application of British Bankers Association) v Financial Services Authority [2011] EWHC 999 (Admin). While not available to the consumer as a ’remedy’, the FCA can also impose disciplinary action (eg fines) and criminal sanctions for unauthorised activity. For a comparison of the CCA and FSA in relation to sanctions, see generally Lomnicka, above n 10.

144. Ibid, at 19–20.

145. HM Treasury, above n 6, at [1.18].

146. Willett, above n 11, at 414.

147. Brown, above n 29, at 92.

148. Article 7.

149. BIS (Department for Business Innovation & Skills) ‘Consumer credit and personal insolvency review: formal response on consumer credit’ (November 2011) Ministerial Foreword. Ramsay also discusses this statement, identifying it as reminiscent of the Crowther approach: I Ramsay ‘Culture or politics? Models of consumer credit regulations in France and the UK’ in Wilson (ed), above n 112, p 87.

150. The FCA, above n 115, recently consulted on this and a cap was introduced on 15 January 2015.

151. For example, in relation to home credit and payday industry: BIS, above n 149, at 13.

152. For example, the banning of sales commission and retail incentives at the point of sale for store cards: ibid, at 4.

153. HM Treasury, above n 2.

154. Ibid, at [1.18].

155. HM Treasury, above n 6. There is a stated recognition of the particular detriments suffered by vulnerable consumers in the Impact Assessment Annex D.

156. Ibid, at [5.11].

157. Prompted by concerns over payday lending. Controls include giving the FCA powers of market intervention, with the ability to cap interest rates or ban individual products: ibid, at [2.22]–[2.23]. See also the Financial Services (Banking Reform) Act 2013.

158. Compared to the position in France: I Ramsay ‘To heap distress upon distress? Comparative reflections on interest-rate ceilings’ (2010) 60(2) U Toronto L J 707–730 at 714. Ramsay's paper gives insight into UK policy approach to interest rate caps, discussing the role of culture and political interests.

159. Principle 6.

160. Principle 7.

161. Through, for example, the expectation that firms would demonstrate fair treatment of customers and the embedding of TCF into their core supervisory work: FSA ‘Update on treating customers fairly initiative and the December deadline’; available at http://www.fsa.gov.uk/pubs/other/tcf_deadline.pdf (accessed 12 December 2014).

162. Although not entirely successful in achieving its aims: D Campbell and J Loughrey ‘The regulation of self-interest in financial markets’ in J O'Brien and G. Gilligan (eds) Integrity, Risk and Accountability in Capital Markets (Oxford: Hart Publishing, 2013) pp 71–73.

163. FSA ‘Journey to the FCA’ at 8, available at http://www.fsa.gov.uk/pubs/other/journey-to-the-fca-standard.pdf (accessed 5 July 2015); see also http://www.fca.org.uk/firms/being-regulated/meeting-your-obligations/fair-treatment-of-customers (accessed 5 July 2015).

164. In the FSA's ‘Treating customers fairly after the point of sale’, DP7 (June 2001), exploitation of customers and taking advantage of the ‘poor, needy and ignorant’ are recognised as unfair behaviour: at [3.4], Annex A [A.12]. Lack of financial capability is also recognised as a potential problem: FSA ‘Treating customers fairly – towards fair outcomes for consumers’ (July 2006). However, TCF ‘outcomes’ refer to products being designed and targeted according to customers’ needs, and that advice should take account of consumers’ circumstances. This seems to be more about appropriate tailored behaviour than active protection for the vulnerable (see also at [1.2]).

165. CONC 2.2.2 G.

166. CONC 5.2.3.G – something missing from the original requirements in the CCD, and provided with little more in the way of guidance in the MCD; see Art 18.

167. See FSA, above n 164, at 8–9; and HM Treasury's consultation paper, above n 6, at [1.17].

168. A view underpinned by behavioural economics: Willett, above n 11, at 414. There are a number of biases that can affect consumer decisions, such as short-termism, heuristics or emotional factors: J Minor ‘Consumer protection in the EU: searching for the real consumer’ (2012) 13(2) Eur Bus Org L Rev 163 at 164. Transparency struggles to address these issues: Ramsay and Williams, above n 58, p 237. Indeed, it appears that the role of information as a protective tool is beginning to be questioned in European policy in terms of the investor: N Moloney ‘The investor model underlying the EU's investor protection regime: consumers or investors?’ (2012) 13(2) Eur Bus Org L Rev 169 at 184. See also C Porras and W Van Boom ‘Information disclosure in the EU Consumer Credit Directive: opportunities and limitations’ in Devenney and Kenny, above n 127, pp 21–55.

169. At this point, the OFT.

170. Section 25 2(B) CCA. This has now been replaced with the requirement for authorisation by the FCA under FSMA.

171. Ramsay, above n 118, at 16.

172. See http://www.fca.org.uk/about/what/enhancing-market-integrity (accessed 5 July 2015); FCA Business Plan 2014/15 pp 12, 17, available at http://www.fca.org.uk/static/documents/corporate/business-plan-2014-2015.pdf (accessed 30 October 2015); FCA Business Plan 2015 ch 3, available at http://www.fca.org.uk/static/channel-page/business-plan/business-plan-2015-16.html (accessed 22 April 2015).

173. FCA Business Plan 2014/15, above n 172, at p 36.

174. Evidenced, for example, by the proportionality principle: FSMA 2000 s 3B(b).

175. FSA, above n 163, Foreword, 8.

176. FSMA s 1C(1).

177. Section 1C(2).

178. Ibid, and illustrates what Ramsay terms the ‘responsibilisation of the consumer’: see above, text to n 120.

179. Certainly, a tension is recognised by the FSA between the objectives of consumer protection and competition, but there is no real indication yet of how this will be resolved – ‘both competition and consumer outcomes can be at odds with one another’, but at this stage no further clarification is given: FSA, above n 164, at 11. The FCA do not go much further, stating that this will be approached on ‘a case by case basis’: FCA ‘The FCA's approach to advancing its objectives’ (July 2013) at 10; see also Ramsay, above n 149, pp 88–89.

180. See https://www.fca.org.uk/static/documents/fsa-journey-to-the-fca.pdf (accessed 5 July 2015).

181. While the FCA have robustly defended their approach to setting the price cap on payday lending as being compatible with their objectives, some respondents to the consultation were less convinced: FCA ‘Detailed Rules for the price cap on high cost-short term credit’ Policy Statement PS14/16 at 19–20, 158–160; available at http://www.fca.org.uk/static/documents/policy-statements/ps14-16.pdf (accessed 12 December 2014).

182. For ‘rational economic action’ (desirable) is grounded in self-interest. What is not desirable is blatant advocation of the pursuit of self-interest by the financial services providers. The employment of principles-based regulation was seen as a means of controlling such behaviour: Campbell and Loughrey, above n 162.

183. See https://www.fca.org.uk/news/statement-on-payment-protection-insurance-ppi (accessed 20 November 2015)

184. ‘The high level principle to be clear, fair and not misleading in financial promotions is the backbone to our approach’: FCA ‘Detailed Proposals for the FCA Regime for Consumer Credit’ CP 13/10 at [1.12]; available at http://www.fca.org.uk/news/cp13-10-consumer-credit-detailed-proposals (accessed 12 December 2014).

185. FCA ‘Business Plan 2014–15’, above n 172, at 5–6; FCA ‘Detailed Rules for the FCA regime for consumer credit: including feedback on CP14/10 and final rules’ PS14/3 (February 2014) see eg at 34, 69, 134; available at http://www.fca.org.uk/your-fca/documents/policy-statements/ps14-03 (accessed 5 July 2015). Rules only refer to, for example, targeting customers who may be vulnerable, and specifically refers only to high-pressure selling, aggressive/oppressive behaviour or unfair coercion.

186. FCA Detailed Rules, above n 185, at 7.

187. Demonstrated in the consultation and subsequent rules on price caps for high-cost, short-term credit: FCA, above n 185. It confirms how its proposals were amended to reflect creditors’ concerns, in its statement on the new rules.

188. Which, as shown by R. (on the application of British Bankers Association) v Financial Services Authority [2011] EWHC 999 (Admin), will extend to the Principles themselves.

189. Wilson, above n 112, p 111.

190. In terms of how the FCA uses its powers. Ramsay explores how such groups have influenced the contrasting direction of regulation of consumer credit in the UK and France in Ramsay, above n 149.

191. Although Lomnicka, above n 10, at 21, argues that this may not be significant.

192. The Act received Royal Assent in March 2015. The majority of its provisions came into force in October 2015.

193. The CPUTR transpose into UK law the Unfair Commercial Practices Directive, and relate to practices in relation to all consumers, rather than an individual consumer. The OFT have acknowledged the potential overlap between the CPUTR and the unfair credit relationship test: BERR ‘OFT guidance on the UK Regulations (May 2008) implementing the Unfair Commercial Practices Directive’ (2008) at [11.21].

194. Although see Willett's argument as to possible interpretations of the general clauses in the Unfair Commercial Practices Directive: Willett, above n 11, at 432–436.

195. And UTCCR.

196. Section 2(3). The CRA applies to an individual acting for purposes that are wholly or mainly outside that individual's trade, business, craft or profession; and the UTCCR to any natural person who, in contracts covered by these Regulations, is acting for purposes that are outside his trade, business or profession.

197. The provisions now apply to negotiated as well as non-negotiated terms, unlike the UTCCR, which only applies to standard terms.

198. In comparison to the goods/services being supplied.

199. Section 64 CRA, adopting the UTCCR's definition of plain and intelligible language under reg 6(2).

200. This is a list of terms contained in Sch 2 of the CRA, which may be regarded as unfair.

201. Continuing the approach of the UTCCR and the Unfair Contract Terms Act 1977 (including blacklisted terms), which the CRA also amends. Blacklisted terms relate only to certain exclusions of liability.

202. Reflecting UTCCR protection. The contract will continue if practicable: s 67 CRA.

203. Where a term is found to be unfair, the CRA envisages that the remainder of the contract will continue if practicable; that is, the whole contract being set aside is not a purpose of the protection.

204. Lomnicka, above n 33, at 718.

205. Ibid, although Lomnicka has explained that behaviour pre-contract may be relevant to the issue of whether the term is contrary to good faith, as required by reg 5(1) of the UTCCR. This requirement is continued in the CRA, which also makes it clear that the circumstances at the time the offending term is agreed are relevant.

206. The regulations provide for civil enforcement by the regulator and criminal sanctions: Lomnicka, above n 33, at 728. Private redress for aggressive and commercial practices has been allowed since October 2014 as a result of the Consumer Protection (Amendment) Regulations 2014 SI 2014/870 but this is only applicable to restricted use credit agreements (credit restricted to a particular transaction). The issue of private redress is something that has been examined by the Law Commission Consumer Redress for Misleading and Aggressive Practices Law Com Report, Cm 8323 March 2012. For comment, see C Ervine ‘Consumer redress for misleading and aggressive practices’ (2011) 15(3) Edin L Rev 448.

207. While the regulations do provide for the vulnerable consumer, this is restricted to the average consumer within a vulnerable group – the problem with this is that vulnerability is based on fairly restrictive concepts (infirmity/age/credulity): Brown, above n 127, p 71. For a discussion of the meaning of vulnerability and the consumer, and the dangers of ‘grouping’ vulnerability, see Wilhelmssohn, above n 109.

208. Although interestingly, there has been success in sanctioning creditor behaviour via the Protection from Harrassment Act 1997, Roberts v Bank of Scotland plc [2013] EWCA Civ 882 demonstrating that borrowers are willing to use court process rather than rely on the regulator.

209. Ramsay argues that business is able to use private law to better effect than consumers, in that case-law can inform the business future procedures or approach; for example, to contract terms: Ramsay, above n 56, at 33.

210. And, as Ramsay also argues, private law can influence ‘values and ideologies’ and the direction of both consumer credit law and public perception: Ramsay, above n 149, pp 92–93.

211. Plevin, above n 79, at [17].

212. In that, for example, in relation to interest rate controls, the decision to implement such controls is sidestepped by leaving it to the courts to decide that a price is unfair, something that is unlikely to happen: Ramsay, above n 149, p 92.

213. Plevin, above n 79, at [10] per Lord Sumption.

214. Willett, above n 11, at 430.

215. And adds weight to Willett's prediction that such an approach has the potential to be a ‘huge threat’ to consumer protection: ibid, at 415.

216. Howells, above n 29, at 618; Lomnicka, above n 10, at 19.

217. Cf Willett, above n 11, at 430–431.

218. For example, the Financial Ombudsman Service and the ability to make claims direct to the provider.

219. Where, in the lower courts, behaviour/terms have clearly led to detriment, there has been no appeal: eg Morrison v Betterpace (Unrep) 30 September 2009 (Lowestoft County Court); Barons Finance v Olubusi (Unrep) 26 April 2010 (Mayor's and City of London Court).

220. Plevin, above n 79, at [17] per Lord Sumption.

221. Also reflected in the new rules on mortgage transactions.

222. The supplier having to act with these in mind: see CONC 2.2.2 G.

223. P Jenkins ‘Regulators in dock as mood on banking turns full circle’ Financial Times 7 April 2014; available at http://www.ft.com/cms/s/0/a1bf7db8-bc12-11e3-a31c-00144feabdc0.html#axzz2yqoOmrNe (accessed 14 April 2014); M Arnold and S Fleming ‘Lloyds investors threaten to boycott offerings over FCA's bungled briefing’ FT Weekend 12 April 2014.