http://www.legislation.gov.uk/uksi/2015/910/2016-03-21The Mortgage Credit Directive Order 2015texttext/xmlenStatute Law DatabaseFINANCIAL SERVICES AND MARKETS2024-02-19Expert Participation2016-03-21 This Order transposes in part Directive 2014/17/EU of the European Parliament and of the Council of 4th February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010 (“the mortgages directive”) (OJ L 60, 28.2.2014, p.34). The Financial Conduct Authority (“FCA”) is responsible for transposing other parts of the mortgages directive. A transposition note setting out how the mortgages directive will be transposed into UK law will be available from Her Majesty's Treasury, 1 Horse Guards Road, London SW1A 2HQ or on HM Treasury's website (www.gov.uk/government/organisations/hm-treasury). The Mortgage Credit Directive Order 2015 2015 No. 910Financial Services And MarketsThe Mortgage Credit Directive Order 2015Made25th March 2015Coming into force in accordance with article 1The Treasury are a government department designated for the purposes of section 2(2) of the European Communities Act 1972 in relation to financial services.In the opinion of the Treasury, one of the effects of this Order is that an activity which is not a regulated activity, within the meaning of the Financial Services and Markets Act 2000 , will become a regulated activity.This Order contains a provision restricting an exemption provided by an earlier Order made under section 38 of the Financial Services and Markets Act 2000.A draft of this Order has been laid before and approved by a resolution of each House of Parliament in accordance with paragraphs 2 and 2A of Schedule 2 to the European Communities Act 1972 and section 429(3) of and paragraph 26(2) of Schedule 2 to the Financial Services and Markets Act 2000 .The Treasury make this Order in exercise of the powers conferred on them by section 2(2) of, and paragraph 1A of Schedule 2 to, the European Communities Act 1972 and sections 21(9) and (15), 22(1) and (5), 38, 409 and 428(3) of the Financial Services and Markets Act 2000 . PART 1 Introductory ProvisionsCitation and commencement11This Order may be cited as the Mortgage Credit Directive Order 2015.2Articles 2 (interpretation) and 32 (FCA power to direct timing of applications for permission and registration) come into force on 6th April 2015.3Article 3 (amendments to legislation) comes into force on 20th April 2015 in so far as it gives effect to paragraph 15 of Schedule 1 (amendments to the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013).4The following provisions come into force on 21st September 2015—aarticle 3 in so far as it gives effect to paragraph 1(4) of Schedule 1 (amendments to section 137R of the Act); andbarticle 31 (transitional provision: person subject to the Consumer Credit Act 1974 who chooses to adopt new rules before 21st March 2016).5The other provisions of this Order come into force—aon 20th April 2015 for the purposes of enabling the making and determination of applications for —ia Part 4A permission, or a variation of a Part 4A permission, in relation to an activity of the kind specified by article 36A (credit broking), 53A (advising on regulated mortgage contracts) or 60B (regulated credit agreements) of the Regulated Activities Order, article 25A (arranging regulated mortgage contracts) or 61 (entering into and administering regulated mortgage contracts) of the Regulated Activities Order as amended by this Order, or article 53DA (advising on regulated credit agreements for the acquisition of land) of the Regulated Activities Order as inserted by this Order; oriientry on the register of consumer buy-to-let mortgage firms under article 8 of this Order (register of consumer buy-to-let mortgage firms);bon 21st December 2015 for the purposes of—ienabling the appropriate regulator to treat a consent notice referred to in paragraph 13(1)(a) or a regulator's notice referred to in paragraph 14(1)(b) of Schedule 3 to the Act (as amended by this Order) given on or after that date by an EEA firm falling within paragraph 5(i) of Schedule 3 to the Act (as amended by this Order) as effective for the purposes of paragraph 13(1) or 14(1) (as the case may be) ; andiienabling the appropriate regulator to treat a notice of intention referred to in paragraph 19(2) or 20(1) of Schedule 3 to the Act (as amended by this Order) given on or after that date by a UK firm wishing to exercise an EEA right under the mortgages directive as effective for the purposes of paragraph 19(2) or 20(1) (as the case may be); andcfor all other purposes, on 21st March 2016.6Nothing in paragraph (5)(b) gives a person an EEA right to carry on, before 21st March 2016, any of the activities set out in sub-paragraphs (a) to (c) of Article 4(5) of the mortgages directive or to provide advisory services (as defined in Article 4(21) of that directive).Interpretation21In this Order—“the Act” means the Financial Services and Markets Act 2000;“appropriate regulator” means—in relation to a firm which is a PRA-authorised person, the PRA;in any other case, the FCA;“borrower” has the meaning given by article 61(3)(a)(i) of the Regulated Activities Order;“consumer credit back book mortgage contract” means a contract which—is entered into before 21st March 2016,immediately before 21st March 2016 is a regulated credit agreement within the meaning of article 60B(3) of the Regulated Activities Order, ... would not be an exempt agreement within the meaning of article 60B(3) of the Regulated Activities Order by virtue of article 60D of that Order (exempt agreements: exemption relating to the purchase of land for non-residential purposes) if it were entered into immediately before 21st March 2016, and ...would be a regulated mortgage contract if it were entered into on or after 21st March 2016; oris entered into on or after 21st March 2016 in the circumstances described in article 28,would be a regulated credit agreement within the meaning of article 60B(3) of the Regulated Activities Order if it had been entered into immediately before 21st March 2016, andis a regulated mortgage contract immediately after it is entered into.“the mortgages directive” means Directive 2014/17/EU of the European Parliament and of the Council of 4th February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010 ;“the Regulated Activities Order” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 .2Unless otherwise defined—aany expression used in this Order which is used in the mortgages directive has the same meaning as in that directive; andbany other expression used in this Order which is defined for the purposes of the Act has the meaning given by the Act. PART 2 Amendments to legislationAmendments to legislation3Schedule 1, which contains amendments to primary and secondary legislation, has effect.PART 3Consumer buy-to-let mortgages<Addition ChangeId="key-f1cfc8163d8304c5302b0a5211c522e6-1538661449114" CommentaryRef="key-f1cfc8163d8304c5302b0a5211c522e6">Application of this Part</Addition>3AThis Part does not apply in relation to any agreement entered into before 21st March 2016.Interpretation of this Part41In this Part—“advisory services” has the meaning given by article 6;“annual percentage rate of charge” has the meaning given by paragraph 9(6) of Schedule 2;“buy-to-let mortgage contract” means a contract that—at the time it is entered into—meets the conditions in paragraphs (i) to (iii) of article 61(3)(a) of the Regulated Activities Order (regulated mortgage contracts); andprovides that the land subject to the mortgage cannot at any time be occupied as a dwelling by the borrower or by a related person, and is to be occupied as a dwelling on the basis of a rental agreement; oris a regulated credit agreement within the meaning of article 60B of the Regulated Activities Order which—falls within Article 3(1)(b) of the mortgages directive; andprovides that the land, or existing or projected building, to which it relates cannot at any time be occupied as a dwelling by the borrower or by a related person, and is to be occupied as a dwelling on the basis of a rental agreement;“consumer” means a person acting for purposes which are outside that person's trade, business or profession;“consumer buy-to-let mortgage business” means one or more of the following activities—acting as a creditor;acting as a credit intermediary; orproviding advisory services;“consumer buy-to-let mortgage contract” means a buy-to-let mortgage contract which is not entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower;“consumer buy-to-let mortgage firm” means a person carrying on consumer buy-to-let mortgage business;“credit intermediary” has the meaning given by article 5;“creditor” means a person who, in the course of a trade, business or profession—enters into, or promises to enter into, a consumer buy-to-let mortgage contract under which the person is to provide credit, oradministers a consumer buy-to-let mortgage contract,and for the purposes of paragraph (b) a person administers a consumer buy-to-let mortgage contract if the person carries on the regulated activity specified by article 61(2) of the Regulated Activities Order (regulated mortgage contracts) in respect of the contract, or would carry on that regulated activity in respect of the contract but for the exclusion in article 72I of that Order (registered consumer buy-to-let mortgage firms) ;“decision notice” means a notice that complies with the requirements of section 388 of the Act (decision notices) ;“foreign currency loan” means a consumer buy-to-let mortgage contract where the credit is denominated in a currency other than that in which the borrower receives the income or holds the assets from which the credit is to be repaid;“register” means the register kept by the FCA under article 8(1);“registered consumer buy-to-let mortgage firm” means a person who is included in the register;“related person” has the meaning set out in article 61A of the Regulated Activities Order (mortgage contracts which are not regulated mortgage contracts) ; and“warning notice” means a notice that complies with the requirements of section 387 of the Act (warning notices) .2For the purposes of this Part, if an agreement includes a declaration which—ais made by the borrower, andbincludes—ia statement that the agreement is entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower;iia statement that the borrower understands that the borrower will not have the benefit of the protection and remedies that would be available to the borrower under this Order if the agreement were a consumer buy-to-let mortgage contract under this Order; andiiia statement that the borrower is aware that if the borrower is in any doubt as to the consequences of the agreement not being regulated by this Order, then the borrower should seek independent legal advice,the agreement is to be presumed to have been entered into by the borrower wholly or predominantly for the purposes specified in sub-paragraph (b)(i), unless paragraph (3) applies.3This paragraph applies if, when the agreement is entered into—athe creditor (or, if there is more than one creditor, any of the creditors), orbany person who has acted on behalf of the creditor (or, if there is more than one creditor, any of the creditors) in connection with the entering into of the agreement,knows or has reasonable cause to suspect that the agreement is not entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower.4For the purposes of this Part, a borrower is to be regarded as entering into an agreement for the purposes of a business carried on, or intended to be carried on, by the borrower if the agreement is a buy-to-let mortgage contract and—aithe borrower previously purchased, or is entering into the contract in order to finance the purchase by the borrower of, the land to which the agreement relates;iiat the time of the purchase the borrower intended that the land would be occupied as a dwelling on the basis of a rental agreement and would not at any time be occupied as a dwelling by the borrower or by a related person, or where the borrower has not yet purchased the land the borrower has such an intention at the time of entering into the contract; andiiiwhere the borrower has purchased the land, since the time of the purchase the land has not at any time been occupied as a dwelling by the borrower or by a related person; orbthe borrower is the owner of land, other than the land to which the agreement relates, which is—ioccupied as a dwelling on the basis of a rental agreement and is not occupied as a dwelling by the borrower or by a related person; oriisubject to a mortgage under a buy-to-let mortgage contract.Meaning of credit intermediary51A person acts as a credit intermediary if the person—ais not a creditor;bis not merely introducing, either directly or indirectly, a consumer to a creditor or credit intermediary;cis acting in the course of the person's trade, business or profession, for remuneration, which may take a pecuniary form or any other agreed form of financial consideration; anddmeets one or more of conditions A to C.2Condition A is that the person presents or offers consumer buy-to-let mortgage contracts to consumers.3Condition B is that the person assists consumers by undertaking preparatory work or other pre-contractual administration in respect of consumer buy-to-let mortgage contracts other than as referred to in Condition A.4Condition C is that the person concludes consumer buy-to-let mortgage contracts with consumers on behalf of the creditor.Meaning of advisory services61A person provides advisory services if, in the course of that person's trade, business or profession, the person provides personal recommendations to a consumer in respect of one or more transactions relating to consumer buy-to-let mortgage contracts.2A person who provides personal recommendations to a consumer in respect of one or more transactions relating to consumer buy-to-let mortgage contracts is not providing advisory services if the recommendations are provided—ain an incidental manner in the course of a professional activity and that activity is regulated by legal or regulatory provisions or a code of ethics governing the profession which do not exclude the making of those recommendations; orbin the context of managing existing debt as an insolvency practitioner where that activity is regulated by legal or regulatory provisions or as part of public or voluntary debt advisory services which do not operate on a commercial basis.Limitation on permission to carry on regulated activities7If a person has a Part 4A permission to carry on an activity of the kind specified by article 25A, 36A, 53A, 53DA, 60B or 61 of the Regulated Activities Order, that person's Part 4A permission is subject to a requirement that the person does not carry on any activity that would constitute consumer buy-to-let mortgage business unless the person is a registered consumer buy-to-let mortgage firm.Register of consumer buy-to-let mortgage firms81The FCA must keep a register of consumer buy-to-let mortgage firms and must enter a person on the register if the conditions in paragraph (2) or (3) are met.2The conditions in this paragraph are that—athe person carries on, or is seeking to carry on, consumer buy-to-let mortgage business;bthe person—ihas a Part 4A permission to carry on one or more regulated activities; oriiis treated as having an interim permission to carry on one or more regulated activities under article 56 of the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 ;cthe person applies to the FCA in a manner that complies with the requirements of, and any requirements imposed under, article 9 for entry on the register; anddthe FCA has not previously revoked the registration of the person under article 13.3The conditions in this paragraph are that—athe person carries on, or is seeking to carry on, consumer buy-to-let mortgage business;bthe person's head office, registered office or place of residence, as the case may be, is in the United Kingdom;cnone of the individuals responsible for the management or operation of the person's consumer buy-to-let mortgage business—ihas been convicted of any offence involving fraud or dishonesty, or any indictable offence, and for this purpose “offence” includes any act or omission which would have been an offence if it had taken place in the United Kingdom; oriiis subject to a prohibition order;dif the registration is to be of a partnership, an unincorporated association or a body corporate, the FCA is satisfied that any persons having a controlling interest over the partnership, unincorporated association or body corporate are fit and proper persons having regard to the need to ensure the sound and prudent conduct of the affairs of a consumer buy-to-let mortgage firm;ethe FCA is satisfied that—iwhere the registration is to be of a body corporate, the directors;iithe persons responsible for the management of the firm; andiiithe persons responsible for consumer buy-to-let mortgage business,are of good repute;fif the person is not a creditor but is a credit intermediary or provides advisory services for the purposes of this Part, the person holds professional indemnity insurance covering its consumer buy-to-let mortgage business in the United Kingdom, or some other comparable guarantee against liability arising from professional negligence, of at least the minimum monetary amount specified in Commission Delegated Regulation (EU) No. 1125/2014 of 19th September 2014 of the European Parliament and of the Council with regard to regulatory technical standards on the minimum monetary amount of the professional indemnity insurance or comparable guarantee to be held by credit intermediaries , as such Regulation may be amended from time to time;gthe individuals responsible for the management or operation of the person's consumer buy-to-let mortgage business possess an appropriate level of knowledge and competence in relation to consumer buy-to-let mortgage contracts; andhthe person applies to the FCA in a manner that complies with the requirements of, and any requirements imposed under, article 9 for entry on the register.4For the purposes of sub-paragraph (3)(d), a person (“C”) has a controlling interest over the firm (“F”) if—aC holds 10% or more of the shares in F or in a parent undertaking of F (“P”);bC holds 10% or more of the voting power in F or P; orcC holds shares or voting power in F or P as a result of which C is able to exercise significant influence over the management of F.5The FCA may—akeep the register in any form it thinks fit;binclude on the register such information as the FCA considers appropriate;cpublish the register, or any part of it; anddexploit commercially the information contained in the register, or any part of that information.6The FCA must—amake the register available for inspection by members of the public in a legible form at such times and in such place or places as the FCA may determine; andbprovide a certified copy of the register, or any part of it, to any person who asks for it—ion payment of the fee (if any) fixed by the FCA; andiiin a form (either written or electronic) in which it is legible to the person asking for it.7If a partnership or unincorporated association is entered on the register, its registration—ahas effect for activities carried on in the name of the partnership or unincorporated association;bis not affected by any change in the membership of the partnership or unincorporated association; andcif the partnership or unincorporated association is dissolved, continues to have effect in relation to any individual, partnership or unincorporated association which succeeds to the whole or substantially the whole of the business of the former partnership or unincorporated association.8In paragraph (7) “partnership” does not include a partnership which is constituted under the law of any place other than the United Kingdom and is a body corporate.Applications for entry on the register or variation of an existing entry on the register91An application for entry on the register may be made by an individual, a body corporate, a partnership or an unincorporated association.2An application for entry on the register or variation of an existing entry on the register must—abe made in such manner as the FCA may direct; andbcontain or be accompanied by such information as the FCA may reasonably require for the purpose of determining the application.3At any time after receiving an application and before determining it, the FCA may require the applicant to provide it with such further information as it considers necessary to enable it to determine the application.4Different directions may be given, and different requirements imposed, in relation to different applications or categories of applications.5The FCA may require an applicant to provide information which the applicant is required to give under this article in such form, or to verify it in such manner, as the FCA may specify.Determination of applications101The FCA must determine an application for entry on the register before the end of the period of six months beginning with the date on which it receives the completed application.2The FCA may determine an incomplete application, and it must in any event determine such an application within twelve months beginning with the date on which it first receives the application.3If the FCA enters a person on the register, it must give written notice of its determination to that person.Procedure when refusing an application111If the FCA proposes to refuse an application made under article 9(1) it must give the applicant a warning notice.2If the FCA refuses an application—ait must give the applicant a decision notice; andbthe applicant may refer the matter to the Tribunal.Registered consumer buy-to-let mortgage firm ceasing to meet the requirements for registration12If a registered consumer buy-to-let mortgage firm ceases to meet a condition in article 8(2) or (3) that applies to it, the firm must inform the FCA immediately.Revocation of registration13The FCA may revoke the registration of a registered consumer buy-to-let mortgage firm if—athe firm does not meet a condition in article 8(2) or (3) that applies to it;bthe firm has contravened a requirement in Schedule 2 that applies to it;cthe firm applies for or consents to the revocation of the registration;dthe firm has ceased to engage in consumer buy-to-let mortgage business for more than twelve months;ea fee due in respect of the registration has not been paid; orfthe revocation is desirable in order to protect the interests of consumers.Procedure on revocation141If the FCA proposes to revoke the registration of a registered consumer buy-to-let mortgage firm other than at the firm's request or with the firm's consent, the FCA must give that firm a warning notice.2If the FCA decides to revoke the registration of a registered consumer buy-to-let mortgage firm other than at the firm's request or with the firm's consent—athe FCA must give that firm a decision notice, andbthat firm may refer the matter to the Tribunal.Suspension of registration151If it appears to the FCA that a registered consumer buy-to-let mortgage firm does not meet a condition in article 8(2) or (3) that applies to it, the FCA may suspend the registration of that firm for a specified period, until the occurrence of a specified event, or until specified conditions are complied with.2In this article “specified” means specified by the FCA in a notice given under article 16.Procedure on suspension161The suspension of the registration of a registered consumer buy-to-let mortgage firm takes effect—aimmediately, if the notice given under paragraph (4) states that that is the case;bon such date as may be specified in the notice; orcif no date is specified in the notice, when the matter to which it relates is no longer open to review.2A suspension may take effect immediately or on a specified date only if the FCA, having regard to the ground on which it is exercising its power under article 15, considers that it is necessary for the suspension to take effect immediately or on that date.3If the FCA proposes to suspend the registration of a registered consumer buy-to-let mortgage firm other than at the firm's request or with the firm's consent, the FCA must give that firm a warning notice.4If the FCA decides to suspend the registration of a registered consumer buy-to-let mortgage firm other than at the firm's request or with the firm's consent—athe FCA must give that firm a decision notice, andbthat firm may refer the matter to the Tribunal.Appointed representatives17Section 39 of the Act (exemption of appointed representatives) applies in respect of consumer buy-to-let mortgage business as if in subsection (4), the reference to provisions contained in the Act included reference to provisions contained in this Order.Obligations of registered consumer buy-to-let mortgage firms181A registered consumer buy-to-let mortgage firm must, in respect of its consumer buy-to-let mortgage business—acomply with the requirements set out in Schedule 2;bretain information relevant to demonstrating the firm's compliance or non-compliance with the requirements of that Schedule—iin retrievable and legible form; andiiso long as any sum remains outstanding, or any mortgage or charge remains in place, under the consumer buy-to-let mortgage contract to which the information relates;cprovide the FCA with such information in relation to the firm's consumer buy-to-let mortgage business and its compliance with the requirements of that Schedule as the FCA may direct, in order to enable the FCA to discharge its functions under this Part; andddeal with the FCA in an open and co-operative manner.2Information provided under paragraph (1)(c) must be given at such times and in such manner, and verified in such manner, as the FCA may direct.3Sections 348 , 349 and 352 of the Act (confidential information) and regulations made under section 349 of the Act apply in relation to information provided to the FCA under paragraph (1)(c) as they apply in relation to information received by the FCA in the discharge of its functions under the Act.Power to direct registered consumer buy-to-let mortgage firms to take appropriate action191The FCA may direct a registered consumer buy-to-let mortgage firm to take such steps as are necessary for the purposes of securing compliance with the requirements of Schedule 2 in respect of the firm's consumer buy-to-let mortgage business.2A direction under paragraph (1) may, in particular, require the firm to—atake specified action,brefrain from taking specified action,creview or take remedial action in respect of past conduct.3A direction under paragraph (1) may also be given to or apply to a person who was a registered consumer buy-to-let mortgage firm, in relation to conduct that occurred while the person was registered.4The FCA may direct registered consumer buy-to-let mortgage firms as to the steps to be taken where the FCA requires such a firm to appoint a person to make a report pursuant to section 166 of the Act (as applied by article 23(2)).5A person to whom a direction under paragraph (1) or (4) is given or to whom such a direction applies must comply with the direction.6Section 55Y (exercise of own-initiative power: procedure) and 55Z3(2) (right to refer matters to the Tribunal) of the Act apply to a direction to a person under paragraph (1) as they apply to a requirement imposed on an authorised person under section 55L(3) of the Act (imposition of requirements by the FCA) .Functions of the FCA in relation to this Part201The FCA is to have the functions conferred on it by this Part.2In discharging its function of determining the general policy and principles by reference to which it performs particular functions under this Part, the FCA must have regard to—athe need to use its resources in the most efficient and economic way;bthe responsibilities of those who manage the affairs of consumer buy-to-let mortgage firms;cthe principle that a burden or restriction which is imposed on a person, or on the carrying on of an activity, should be proportionate to the benefits, considered in general terms, which are expected to result from the imposition of that burden or restriction;dthe desirability of facilitating innovation in connection with consumer buy-to-let mortgage business;ethe need to minimise the adverse effects on competition that may arise from anything done in the discharging of those functions; andfthe desirability of facilitating competition in relation to consumer buy-to-let mortgage business.Monitoring and enforcement211The FCA must maintain arrangements designed to enable it to determine whether persons on whom requirements are imposed by or under this Part are complying with them.2The arrangements referred to in paragraph (1) may provide for functions to be performed on behalf of the FCA by any body or person who is, in the FCA's opinion, competent to perform them.3The FCA must also maintain arrangements for enforcing the provisions of this Part.4Paragraph (2) does not affect the FCA's duty under paragraph (1).Guidance221The FCA may give guidance consisting of such information and advice as it considers appropriate with respect to—athe operation of this Part;bany matters relating to the functions of the FCA under this Part;cany other matters about which it appears to the FCA to be desirable to give information or advice in connection with this Part.2The FCA may—apublish its guidance;boffer copies of its published guidance for sale at a reasonable price;cif it gives guidance in response to a request made by any person, make a reasonable charge for that guidance.Application of provisions of the Act to registered consumer-buy-to-let mortgage firms231For the purposes of the following provisions of the Act, a requirement imposed by or under this Part on a consumer buy-to-let mortgage firm in respect of its consumer buy-to-let mortgage business is to be treated as if it were a requirement imposed on an authorised person by or under the Act—asection 204A (meaning of “relevant requirements”);bsection 380 (injunctions);csection 382 (restitution orders);dsection 384 (power of FCA or PRA to require restitution); andesection 398 (misleading FCA or PRA: residual cases).2The following provisions of the Act apply in respect of the exercise by the FCA of its functions under this Part in relation to a registered consumer buy-to-let mortgage firm as they apply in respect of the exercise by the FCA of its functions under the Act in relation to an authorised person—asection 165 (regulators' power to require information: authorised persons etc.);bsection 166 (reports by skilled persons);csection 167 (appointment of persons to carry out general investigations);dsection 168(4) to (6) (appointment of persons to carry out investigations in particular cases);esection 169 (investigations etc. in support of overseas regulator);fsection 170 (investigations: general);gsection 171 (powers of persons appointed under section 167);hsection 172 (additional power of persons appointed as a result of section 168(1) or (4));isection 173 (powers of persons appointed as a result of section 168(2));jsection 174 (admissibility of statements made to investigators);ksection 175 (information and documents: supplemental provisions);lsection 176 (entry of premises under warrant);msection 176A (retention of documents taken under section 176);nsection 177 (offences);osection 205 (public censure); andpsection 206 (financial penalties).3Section 168 of the Act is to be read as if subsection (4) included a reference to circumstances suggesting that a person may have failed to comply with the obligations imposed by this Part.4Sections 207 to 211 (disciplinary measures: procedure and policy) of, and paragraph 20 (penalties) of Schedule 1ZA to, the Act apply in relation to the exercise of the FCA's powers under section 205 or 206 of the Act as applied by paragraph (2)(o) and (p) as they apply in relation to the exercise of such powers under section 205 or 206 of the Act in respect of authorised persons.5Registered consumer buy-to-let mortgage firms are to be treated as regulated persons for the purposes of paragraph 21 of Schedule 1ZA to the Act (financial penalty scheme) .Application of procedural provisions of the Act241Part 9 of the Act (hearings and appeals) applies in the case of a matter referred to the Tribunal under this Part as it applies in the case of a matter referred to the Tribunal under the Act.2Part 26 of the Act (notices) applies to warning notices and decision notices given under this Part as it applies to such notices given under the Act.Application of provisions of the Act to the FCA in respect of its supervision of consumer buy-to-let mortgage firms25The functions of the FCA under this Order are to be treated as functions conferred on the FCA under the Act for the purposes of—aparagraph 23 (fees) of Schedule 1ZA to the Act , andbparagraph 25 (exemption from liability in damages) of Schedule 1ZA to the Act .Extension of the compulsory jurisdiction of the Financial Ombudsman Scheme to registered consumer buy-to-let mortgage firms261Part 16 (the Ombudsman Scheme) of the 2000 Act applies in respect of a complaint relating to the act or omission of a registered consumer buy-to-let mortgage firm as if—ain section 226(2)(b) of that Act (compulsory jurisdiction) , after “Payment Services Regulations 2009,” there were inserted “ a registered consumer buy-to-let mortgage firm within the meaning of Part 3 of the Mortgage Credit Directive Order 2015, ”;bin section 232A of that Act (scheme operator's duty to provide information to FCA) , after “FCA's operational objectives” there were inserted “ , or which might otherwise be of assistance to the FCA for the purposes of discharging any of the FCA's functions under Part 3 of the Mortgage Credit Directive Order 2015, ”;cin section 234 of that Act (industry funding) , after “any electronic money issuer within the meaning of the Electronic Money Regulations 2011” there were inserted “ , any registered consumer buy-to-let mortgage firm within the meaning of Part 3 of the Mortgage Credit Directive Order 2015 ”;din paragraph 13(4) of Schedule 17 to that Act (FCA's procedural rules) , after “an electronic money issuer within the meaning of the Electronic Money Regulations 2011,” there were inserted “ a registered consumer buy-to-let mortgage firm within the meaning of the Mortgage Credit Directive Order 2015, ”.PART 4Transitional ProvisionsTransitional provision: person with Part 4A permission to carry on an activity in relation to a regulated mortgage contract before 21st March 2016271Any person who immediately before 21st March 2016 had permission under Part 4A of the Act to carry on an activity of the kind specified by article 25A, 36A, 53A, 60B or 61 of the Regulated Activities Order is, from 21st March 2016, to be treated as having a Part 4A permission to carry on an activity of the kind specified by that article of the Regulated Activities Order as amended by this Order.2Paragraph (1) does not affect the ability of the FCA or the PRA to vary or cancel a Part 4A permission under the Act.Transitional provision: agreements before 21st March 201628Where a credit agreement is entered into before 21st March 2016 and a further agreement relating to the same credit is to be entered into before the borrower is to be entitled to the credit, the following enactments do not apply to the agreements until immediately after the later agreement has been entered into—athis Order;bparagraphs (3) to (5) of article 2 of the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No.3) Order 2015; andcarticles 2(3), (4), (7), (8), (10)(b), (11), (12), (14) to (16) and (18) to (21), 3, 4 and 6(4) and (5) of the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016.Transitional provision: consumer credit back book mortgage contracts291This article applies to a consumer credit back book mortgage contract other than one in relation to which the Consumer Credit Act 1974 applies as described in article 31(2) .2If the contract would be enforceable against the borrower only on an order of the court as a result of the application of any provision of the Consumer Credit Act 1974 specified in paragraph (3), but for the amendments to legislation made by this Order, the contract is enforceable against the borrower only on an order of the court, and section 127 of the Consumer Credit Act 1974 (enforcement orders in cases of infringement) applies in respect of the contract.3The provisions of the Consumer Credit Act 1974 specified by this paragraph are—asection 55(2) (disclosure of information) ,bsection 61B(3) (duty to supply copy of overdraft agreement) ,csection 65(1) (improperly executed agreements),dsection 105(7)(a) or (b) (improperly executed security instruments),esection 111(2) (failure to serve copy of notice on surety).4If the contract would be void, or part of the contract would be void, as a result of the application of section 56(3) of the Consumer Credit Act 1974 (antecedent negotiations), but for the amendments to legislation made by this Order, the contract, or that part of the contract, is void.5If a creditor would not be entitled to enforce a contract as a result of a failure to comply with a provision of the Consumer Credit Act 1974 specified in paragraph (6) but for the amendments to legislation made by this Order, then for the purposes only of correcting the failure to comply with the relevant provision of the Consumer Credit Act 1974, the contract is treated as if it were a regulated agreement and the creditor may enforce the contract only if the creditor has corrected the failure to comply.6The provisions of the Consumer Credit Act 1974 specified in this paragraph are—asection 77(1) (duty to give information to debtor under fixed-sum credit agreement) ,bsection 77A(1) (statements to be provided in relation to fixed-sum credit agreements) ,csection 78(1) (duty to give information to debtor under running-account credit agreement) ,dsection 85(1) (duty on issue of new credit-tokens),esection 97(1) (duty to give information about early repayment) .7If a creditor would not be entitled to enforce a contract because a period of non-compliance applies to the contract under section 86D of the Consumer Credit Act 1974 (failure to give notice of sums in arrears) , but for the amendments to legislation made by this Order, then for the purposes only of bringing the period of non-compliance to an end, the contract is treated as if it were a regulated agreement and the creditor may enforce the contract only if the period of non-compliance has ended.8If a creditor would not be entitled to enforce a contract because section 86E(5) of the Consumer Credit Act 1974 (notice of default sums) applies, but for the amendments to legislation made by this Order, then the creditor may enforce the contract only if the creditor has given the notice required by section 86E to the borrower.9If a creditor would not be entitled to enforce the security provided in relation to a contract as a result of a failure to comply with a provision of the Consumer Credit Act 1974 specified in paragraph (10) but for the amendments to legislation made by this Order, then for the purposes only of correcting the failure to comply with the relevant provision of the Consumer Credit Act 1974, the contract is treated as if it were a regulated agreement and the creditor may enforce the security only if the creditor has corrected the failure to comply.10The provisions of the Consumer Credit Act 1974 specified in this paragraph are—asection 107(1) (duty to give information to surety under fixed-sum credit agreement) ,bsection 108(1) (duty to give information to surety under running-account credit agreement) ,csection 110(1) (duty to give information to debtor or hirer) .11The following provisions of the Consumer Credit Act 1974 and regulations made under those provisions apply in respect of the contract as if the contract were a regulated agreement—asection 93 (interest not to be increased on default) ,bsection 94 (right to complete payments ahead of time) ,csection 95 (rebate on early settlement) .12Sections 140A to 140C of the Consumer Credit Act 1974 (unfair relationships) apply to the contract as if section 140A(5) were omitted.13In this article “regulated agreement” means a regulated agreement within the meaning of section 8(3) of the Consumer Credit Act 1974 .Transitional provision: person engaged in consumer buy-to-let mortgage business before 20th March 2014301A creditor or credit intermediary who is engaged in consumer buy-to-let mortgage business before 20th March 2014 is not required to comply with paragraph 3 of Schedule 2 (knowledge and competence requirements for staff) until 21st March 2017.2In this article, the terms “creditor”, “credit intermediary” and “consumer buy-to-let mortgage business” have the meanings set out in article 4.Transitional provision: person subject to the Consumer Credit Act 1974 who chooses to adopt new rules before 21st March 2016311Paragraph (2) applies in relation to an agreement or proposed agreement where—aif made before 21st March 2016, the agreement would be a regulated consumer credit agreement;bif made on or after 21st March 2016, the agreement would not be a regulated consumer credit agreement;c neither the creditor nor any credit-broker has acted in compliance or in purported compliance with any provision of Part 5 of the Consumer Credit Act 1974, or regulations made under that Part, in relation to the agreement or proposed agreement; anddbefore 21st March 2016, the creditor or any credit-broker acts in compliance or in purported compliance with rules made by the FCA that would apply in relation to the agreement or proposed agreement from 21st March 2016.2From the date on which the creditor or any credit-broker first acts in compliance or purported compliance with such rules, the Consumer Credit Act 1974 applies in relation to the agreement or proposed agreement as if the amendments to legislation made by paragraphs 2 and 4 of Schedule 1 (amendments to the Consumer Credit Act 1974 and the Regulated Activities Order) had come into force.3In this article— “credit-broker” has the meaning given in section 189(1) of the Consumer Credit Act 1974; “creditor” means a creditor within the meaning of section 8(1) of the Consumer Credit Act 1974 ; and“regulated consumer credit agreement” means a regulated agreement within the meaning of section 8(3) of the Consumer Credit Act 1974.<Addition ChangeId="key-d60dc7424c4c593eb8a896dff342f821-1538661555273" CommentaryRef="key-d60dc7424c4c593eb8a896dff342f821">Transitional provision: first charge mortgages entered into before 31st October 2004 which are regulated credit agreements immediately before 21st March 2016</Addition>31A1This article applies to an agreement—aentered into before 31st October 2004,bwhich is a consumer credit back book mortgage contract, anddunder which the mortgage securing the borrower’s obligation to repay is a first charge mortgage.2Until the relevant date—athe agreement continues to be a regulated credit agreement within the meaning of article 60B(3) of the Regulated Activities Order,bmaking arrangements for a person to vary the terms of the agreement is not a regulated activity pursuant to article 25A(1) of the Regulated Activities Order,cadvising a person on the merits of varying the terms of the agreement is not a regulated activity pursuant to article 53A(1) of the Regulated Activities Order,dadministering the agreement is not a regulated activity pursuant to article 61(2)(b) of the Regulated Activities Order,ethe agreement continues to be a regulated agreement within the meaning of section 8(1) of the Consumer Credit Act 1974, andfarticle 29 (transitional provision: consumer credit back book mortgage contracts) does not apply to the agreement.3Article 60C(2)(c) of the Regulated Activities Order applies to the agreement as if the reference to 21st March 2016 were a reference to the relevant date.4In this article “the relevant date” means the earlier of—athe date on which the lender first acts in respect of the agreement in compliance or purported compliance with rules made by the FCA which apply to regulated mortgage contracts and which are different from rules made by the FCA which apply to regulated credit agreements;bthe date which the lender notifies in writing to the borrower as being the date from which the lender will act in respect of the agreement in compliance with rules made by the FCA which apply to regulated mortgage contracts; orc21st March 2017.FCA power to direct timing of applications for permission and registration321This article applies to an application made before 21st September 2015 for—aa Part 4A permission or a variation of a Part 4A permission in relation to an activity of the kind specified by—iarticle 53A of the Regulated Activities Order (advising on regulated mortgage contracts),iiarticle 25A (arranging regulated mortgage contracts) or 61 (entering into and administering regulated mortgage contracts) of the Regulated Activities Order as amended by this Order, oriiiarticle 53DA of the Regulated Activities Order (advising on regulated credit agreements for the acquisition of land) as inserted by this Order; orbentry on the register of consumer buy-to-let mortgage firms under article 8 of this Order (register of consumer buy-to-let mortgage firms).2The application may not be made before such date (“the opening date”) as the FCA may direct.3Directions given under paragraph (2) may—arelate to different categories of applications;bset different opening dates for different categories of applications;cbe amended by the FCA by further direction.4An application made before the opening date is to be treated as if it had not been made. PART 5 ReviewReview331The Treasury must from time to time—acarry out a review of this Order;bset out the conclusions of the review in a report; andcpublish the report.2In carrying out the review the Treasury must, so far as is reasonable, have regard to how the mortgages directive (which is implemented by means of this Order) is implemented in other EEA States.3The report must in particular—aset out the objectives intended to be achieved by the regulatory system established by this Order;bassess the extent to which those objectives are achieved; andcassess whether those objectives remain appropriate and, if so, the extent to which they could be achieved with a system that imposes less regulation.4The first report under this article must be published on or before 1st September 2018.5Reports under this article are afterwards to be published at intervals not exceeding five years.Mark LancasterGavin Barwell Two of the Lords Commissioners of Her Majesty's TreasurySCHEDULE 1Amendments to legislation Article 3 PART 1 Amendments to primary legislationThe Financial Services and Markets Act 200011The Act is amended as follows.2In section 39 (exemption of appointed representatives) —aafter subsection (1) insert—1ZABut a person is not exempt as a result of subsection (1) if subsection (1A) or (1BA) applies to the person.;bin subsection (1A) for “But a person is not exempt as a result of subsection (1)” substitute “ This subsection applies to a person ”; andcafter subsection (1B) insert—1BAThis subsection applies to a person (“A”)—aif A's principal is a mortgage intermediary, andbso far as the business for which A's principal has accepted responsibility is of a kind—ispecified in article 25A (arranging regulated mortgage contracts), article 36A (credit broking), article 53A (advising on regulated mortgage contracts) or article 53DA (advising on regulated credit agreements the purpose of which is to acquire land) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001; andiito which the mortgages directive applies,unless A meets the requirements of subsection (1BB).1BBThe requirements of this subsection are—athat A is entered on the record maintained by the FCA by virtue of section 347(1)(hb);bthat A's principal is a person who has a Part 4A permission to carry on one or more of the regulated activities mentioned in subsection (1BA)(b)(i); andcthat A's principal is not a tied mortgage intermediary..3In section 55J (variation or cancellation on initiative of regulator) , after subsection (6A) insert—6BWithout prejudice to the generality of subsections (1) to (3), the FCA may, in relation to an authorised person who is a mortgage intermediary and who has a Part 4A permission to carry on a relevant mortgage activity, exercise its power under this section to cancel the Part 4A permission or to vary the Part 4A permission by removing a relevant mortgage activity from the activities to which the permission relates, if it appears to the FCA that any of the following conditions is met—aduring a period of at least six months, the person has not carried on a relevant mortgage activity;bthe person obtained the Part 4A permission to carry on a relevant mortgage activity by making a false statement or by any other irregular means;cthe person no longer meets the conditions which the person was, in accordance with Chapter 11 of the mortgages directive, required to meet in order to be granted a Part 4A permission to carry on a relevant mortgage activity; ordthe person has seriously or systematically infringed any provision made by or under this Act which implements the operating conditions for mortgage intermediaries set out in the mortgages directive.6CIn subsection (6B) “relevant mortgage activity” means—aan activity of a kind specified in article 25A (arranging regulated mortgage contracts), article 53A (advising on regulated mortgage contracts) or article 53DA (advising on regulated credit agreements the purpose of which is to acquire land) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, orban activity of a kind specified in article 36A of that Order (credit broking) which is referred to in Article 33(1)(a) of the mortgages directive..4In section 137R (financial promotion rules) , in subsection (5)(b)—aat the end of sub-paragraph (ii), omit “or”, andbat the end of sub-paragraph (iii) insert—orivArticles 10 and 11 of the mortgages directive,.5After section 194B (contravention by relevant EEA firm of requirement in capital requirements directive or capital requirements regulation) insert—Contravention by relevant EEA firm with UK branch of requirement in mortgages directive: appropriate regulator primarily responsible for securing compliance194C1In this section “relevant EEA firm” means an EEA firm falling within paragraph 5(i) of Schedule 3 which is exercising in the United Kingdom an EEA right deriving from the mortgages directive.2This section applies if —aa relevant EEA firm has a branch in the United Kingdom; andbthe appropriate regulator ascertains that the firm has contravened, or is contravening, a requirement to which Article 34(2) of the mortgages directive applies.3The appropriate regulator must give the firm written notice which—arequires the relevant EEA firm to put an end to the contravention;bstates that the appropriate regulator's power of intervention will become exercisable in relation to the firm if the firm continues the contravention; andcindicates any requirements that the appropriate regulator proposes to impose on the firm in exercise of its power of intervention in the event of the power becoming exercisable.4The appropriate regulator may exercise its power of intervention in respect of the relevant EEA firm if—aa reasonable time has expired since the giving of the notice under subsection (3);bthe firm has failed to put an end to the contravention within that time; andcthe appropriate regulator has informed the firm's home state regulator of its intention to exercise its power of intervention in respect of the firm.5Subsection (4) applies whether or not the appropriate regulator's power of intervention is also exercisable as a result of section 194.6If the appropriate regulator exercises its power of intervention in respect of a relevant EEA firm by virtue of subsection (4), it must at the earliest opportunity inform the firm's home state regulator and the Commission of—athe fact that the appropriate regulator has exercised that power in respect of the firm; andbany requirements it has imposed on the firm in exercise of the power.7Subsection (3) is not to be regarded as requiring the PRA to take action in relation to the contravention of a requirement falling within subsection (2)(b) in a case where it is satisfied that the FCA is required to act, and is acting or has acted, under subsection (3) in relation to that requirement.8In this section “appropriate regulator” means—awhere the relevant EEA firm is a PRA-authorised person, the FCA or, subject to subsection (7), the PRA;bin any other case, the FCA..6After section 195A (contravention by relevant EEA firm, EEA UCITS or EEA AIFM of directive requirements: home state regulator primarily responsible for securing compliance) insert—Contravention by relevant EEA firm of requirement in mortgages directive: home state regulator primarily responsible for securing compliance195B1In this section “relevant EEA firm” means an EEA firm falling within paragraph 5(i) of Schedule 3 which is exercising in the United Kingdom an EEA right deriving from the mortgages directive.2This section applies if—aa relevant EEA firm has a branch, or is providing services, in the United Kingdom; andbthe appropriate regulator has clear and demonstrable grounds for concluding that the firm has contravened, or is contravening, a requirement to which Article 34(4) of the mortgages directive applies.3The appropriate regulator must notify the relevant EEA firm's home state regulator of the situation mentioned in subsection (2).4The notice under subsection (3) must—arequest that the home state regulator take all appropriate measures for the purpose of ensuring that the relevant EEA firm puts an end to the contravention;bstate that the appropriate regulator's powers of intervention are likely to become exercisable in relation to the relevant EEA firm if it continues the contravention; andcindicate any requirements that the appropriate regulator proposes to impose on the relevant EEA firm in exercise of its power of intervention in the event of the power becoming exercisable.5The appropriate regulator may exercise its power of intervention in respect of the relevant EEA firm if—aa period of one month beginning with the date on which it gave the notification referred to in subsection (3) has expired, andbconditions A to C are satisfied.6Condition A is that—athe home state regulator of the relevant EEA firm has failed or refused to take measures for the purpose mentioned in subsection (4)(a); orbany measures taken by the home state regulator have proved inadequate for that purpose.7Condition B is that the relevant EEA firm is acting in a manner which is clearly prejudicial to the interests of consumers in the United Kingdom or to the orderly functioning of the markets.8Condition C is that the appropriate regulator has informed the home state regulator of the relevant EEA firm of its intention to exercise its powers of intervention in respect of the firm.9Subsection (5) applies whether or not the appropriate regulator's power of intervention is also exercisable as a result of section 194 or 195.10If the appropriate regulator exercises its power of intervention in respect of the relevant EEA firm by virtue of subsection (5), it must inform the Commission and EBA, without undue delay, of—athe fact that the appropriate regulator has exercised that power in respect of that firm; andbany requirements it has imposed on the firm in exercise of the power.11If circumstances exist which enable the appropriate regulator to exercise its power of intervention under subsection (5), the appropriate regulator may refer the matter to EBA (and EBA may act in accordance with the powers conferred on it under Article 19 of Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24th November 2010 establishing a European Supervisory Authority (European Banking Authority) ).12Subsection (3) is not to be regarded as requiring the PRA to notify the home state regulator in relation to the situation mentioned in subsection (2) in a case where the PRA is satisfied that the FCA is required to act, and is acting, or has acted, under subsection (3) in relation to that situation.13In this section “appropriate regulator” means—awhere the relevant EEA firm is a PRA-authorised person, the FCA or, subject to subsection (12), the PRA;bin any other case, the FCA..7In section 347 (the record of authorised persons etc.) —ain subsection (1)—iat the end of paragraph (ha), omit “and”; andiiafter paragraph (ha) insert—hbappointed representative to whom subsection (2B) applies; and;bin subsection (2), after paragraph (h) insert—iin the case of a mortgage intermediary—ithe names of the persons within the management who are responsible for the activities specified by article 25A (arranging regulated mortgage contracts), article 36A (credit broking), article 53A (advising on regulated mortgage contracts) and article 53DA (advising on regulated credit agreements the purpose of which is to acquire land) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001; andiiwhether the mortgage intermediary is a tied mortgage intermediary or not;jin the case of an appointed representative to whom subsection (2B) applies, the name of the mortgage intermediary on whose behalf the appointed representative acts;;cafter subsection (2A) insert—2BThis subsection applies to an appointed representative to whom section 39(1BA) applies or to whom that subsection would apply if the requirements of section 39(1BB) were not met.;dafter subsection (4) insert—4AIf the FCA cancels or varies the Part 4A permission of a mortgage intermediary and as a result the person to whom the entry relates no longer has a Part 4A permission to carry on a relevant mortgage activity within the meaning of section 55J(6C), the FCA must delete mention of such permission from the record without undue delay..8In section 417(1) (definitions) in the appropriate places insert—“mortgage creditor” means a creditor as defined in Article 4(2) of the mortgages directive;“mortgage intermediary” means a credit intermediary as defined in Article 4(5) of the mortgages directive or a person providing advisory services as defined in Article 4(21) of the mortgages directive;“tied mortgage intermediary” means a tied credit intermediary as defined in Article 4(7) of the mortgages directive;.9In section 425(1)(a) (expressions relating to authorisation elsewhere in the single market) , after “ “markets in financial instruments directive”,” insert “ “mortgages directive”, ”.10In Schedule 3 to the Act (EEA passport rights)—ain paragraph 1 (the single market directives) —iat the end of paragraph (f) omit “and”; andiiafter paragraph (g) insert—; andhthe mortgages directive.;bafter paragraph 4E (definition of the alternative investment managers directive) insert—<Emphasis>The mortgages directive</Emphasis>4F“The mortgages directive” means Directive 2014/17/EU of the European Parliament and of the Council of 4th February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010.;cin paragraph 5 (EEA firm) —iat the end of paragraph (g) omit “or”; andiiafter paragraph (h) insert—; oria mortgage intermediary which is admitted (in accordance with Article 29(1) of the mortgages directive) by its home state regulator to carry out all or part of the credit intermediation activities set out in Article 4(5) of that directive or to provide advisory services (as defined in Article 4(21) of that directive).;din paragraph 5A(a) (definition of relevant office for EEA firm) after “sub-paragraph (e)” insert “ or (i) ”;ein paragraph 7A(a) (definition of relevant office for EEA right) after “insurance mediation directive” insert “ or the mortgages directive ”;fin paragraph 13 (establishment) —iin sub-paragraph (1)—aafor “(f) or (h)” substitute “ (f), (h) or (i) ”;bbin paragraph (c) omit “and”;ccafter paragraph (d) insert—; andein the case of a firm falling within paragraph 5(i)—iits home state regulator has informed it that the consent notice has been sent to the appropriate UK regulator, andiione month has elapsed beginning with the date on which the firm's home state regulator informed the firm that the consent notice has been sent to the appropriate UK regulator.;iiin sub-paragraph (2)(b) for “or (h)” substitute “ , (h) or (i) ”;iiiafter sub-paragraph (3) insert—3AIf the appropriate UK regulator has received a consent notice in respect of a firm that falls within paragraph 5(i), it must—anotify the firm of the applicable provisions (if any); andbuse the information received from the firm's home state regulator to enter the necessary information into the record maintained by the FCA by virtue of section 347(1).3BA notice under sub-paragraph (3A)(a) must be given before the end of the period of two months beginning with the day on which the appropriate UK regulator received the consent notice.;gin paragraph 14 (services) —iin sub-paragraphs (1)(b) and (1)(c) for “or (h)” substitute “ , (h) or (i) ”;iiin sub-paragraph (1)(d) after “paragraph 5(e)” insert “ or (i) ”;iiiafter sub-paragraph (3) insert—3ZAIf the appropriate UK regulator has received a relevant notice in respect of a firm that falls within paragraph 5(i), it must use the information received from the firm's home state regulator to enter the necessary information into the record maintained by the FCA by virtue of section 347(1).;hin paragraph 19 (establishment) —iin sub-paragraph (5)(a) after “the insurance mediation directive” insert “ or the mortgages directive ”;iiafter sub-paragraph (7BC) insert—7BDIf the firm's EEA right derives from the mortgages directive and the first condition is satisfied, the appropriate UK regulator must give a consent notice to the host state regulator within one month beginning with the date on which it received the firm's notice of intention.; andiiiafter sub-paragraph (11) insert—11AIf the firm's EEA right derives from the mortgages directive, the appropriate UK regulator must give the written notice referred to in sub-paragraph (11) at the same time as it gives the consent notice to the host state regulator in accordance with sub-paragraph (7BD).;iin paragraph 20 (services) —iin sub-paragraph (3) after “the markets in financial instruments directive” insert “ , the mortgages directive ”;iiafter sub-paragraph (4BA) insert—4BBIf the firm's EEA right derives from the mortgages directive it must not provide the services to which its notice of intention relates until one month, beginning with the date on which it receives the notice under sub-paragraph (4), has elapsed.;jin paragraph 20ZA (information for host state regulator) after sub-paragraph (3) insert—4The appropriate UK regulator must inform the host state regulator whenever it—awithdraws the authorisation of a UK firm that exercises an EEA right under the mortgages directive to establish a branch or provide services in an EEA State other than the United Kingdom; orbvaries the Part 4A permission of such a firm, so that the firm no longer has permission to carry on any activity to which the mortgages directive relates.5The appropriate UK regulator must provide the information referred to in sub-paragraph (4) as soon as possible and, at the latest, within 14 days of—athe date of the direction given in accordance with section 33(2) withdrawing the firm's status as an authorised person, orbthe date on which the variation of the Part 4A permission takes effect.;kin paragraph 21 (offence relating to exercise of passport rights) in sub-paragraph (1)(b) for “or (4B)” substitute “ , (4B) or (4BB) ”; andlin paragraph 25 (information to be included in the public record) after “insurance mediation directive” insert “ or the mortgages directive ”.The Consumer Credit Act 197421The Consumer Credit Act 1974 is amended as follows.2In section 8 (consumer credit agreements) for subsection (3) substitute—3A consumer credit agreement is a regulated credit agreement within the meaning of this Act if it—ais a regulated credit agreement for the purposes of Chapter 14A of Part 2 of the Regulated Activities Order; andbis not an agreement of the type described in Article 3(1)(b) of Directive 2014/17/EU of the European Parliament and of the Council of 4th February 2014 on credit agreements for consumers relating to residential immovable property..3In section 55C (copy of draft consumer credit agreement), in subsection (4)(c), after “£60,260” insert “ and which is not a residential renovation agreement ”.4In section 60 (form and content of agreements), in subsection (5)(c), after “£60,260” insert “ and which is not a residential renovation agreement ”.5In section 61A (duty to supply copy of executed consumer credit agreement), after subsection (6) insert—6AAn agreement is not an excluded agreement by virtue of subsection (6)(b)(ii) if it is a residential renovation agreement..6In section 66A (withdrawal from consumer credit agreement), in subsection (14)(a), after “£60,260” insert “ , other than a residential renovation agreement ”.7In section 75A (further provision for liability of creditor for breaches by supplier), in subsection (6)(b), after “£60,260” insert “ and is not a residential renovation agreement ”.8In section 77B (fixed-sum credit agreement: statement of account to be provided on request), in subsection (9)(c), after “£60,260” insert “ and which is not a residential renovation agreement ”.9In section 189 (definitions), in subsection (1), after the definition of “representation” insert—“residential renovation agreement” means a consumer credit agreement—which is unsecured; andthe purpose of which is the renovation of residential property, as described in Article 2(2a) of Directive 2008/48/EC of the European Parliament and of the Council of 23rd April 2008 on credit agreements for consumers .. PART 2 Amendments to secondary legislationThe Consumer Credit (Agreements) Regulations 19833. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .The Financial Services and Markets (Regulated Activities) Order 200141The Regulated Activities Order is amended as follows.2In article 3(1) (interpretation) , in the definition of “home Member State”, after “capital requirements regulation” insert “ , and, in relation to a mortgage intermediary, has the meaning given by Article 4(19) of the mortgages directive ”.3In article 4 (specified activities: general) after paragraph (4A) insert—4BWhere—aa person is a mortgage creditor or a mortgage intermediary; andbin acting as a mortgage creditor or a mortgage intermediary, that person would be treated as carrying on an activity of a kind specified by article 25A (arranging regulated mortgage contracts), 36A (credit broking), 53A (advising on regulated mortgage contracts), 53DA (advising on regulated credit agreements for the acquisition of land), 60B (regulated credit agreements) or 61 (entering into and administering regulated mortgage contracts), but for an exclusion or exemption provided for by this Order,that exclusion or exemption is to be disregarded (and accordingly that person is to be treated as carrying on an activity of the kind specified by the provision in question) to the extent that such exclusion or exemption does not fall within Article 3(2) or (3) of the mortgages directive..4In article 25A (arranging regulated mortgage contracts) —aafter paragraph (2) insert—2AMaking arrangements to enter into a regulated mortgage contract with a borrower on behalf of a lender is also a specified kind of activity.; andbin paragraph (3) for “ “borrower” has the meaning” substitute “ “borrower” and “lender” have the meanings”.5In article 29 (arranging deals with or through authorised persons) —ain paragraph (1) for “25A(1) and (2)” substitute “ 25A(1), (2) and (2A) ”; andbin paragraph (3) after “article 4(4)” insert “ and (4B) ”.6In article 36 (other exclusions) , after paragraph (2) insert—2AArticle 25A is also subject to the exclusion in article 72I (registered consumer buy-to-let mortgage firms)..7For article 36E (activities in relation to certain agreements relating to land) substitute—Activities in relation to certain agreements relating to land36E1There are excluded from article 36A activities carried on with a view to an individual or a relevant recipient of credit entering into an investment property loan, as defined in article 61A(6) (mortgage contracts which are not regulated mortgage contracts).2There are excluded from article 36A activities of a kind specified by article 25A (arranging regulated mortgage contracts) or 25C (arranging regulated home purchase plans).3There are excluded from article 36A other activities not excluded by paragraph (1) or (2) which consist of effecting an introduction with a view to an individual or relevant recipient of credit entering into a relevant agreement, if the person to whom the introduction is made is an authorised person who has permission to—aenter into such an agreement as lender or home purchase provider (as the case may be), orbmake an introduction to an authorised person who has permission to enter into such an agreement as lender or home purchase provider (as the case may be).4In paragraph (3) “relevant agreement” means a regulated mortgage contract or a regulated home purchase plan..8In article 36G (other exclusions) for “the exclusion in article 72A (information society services) and the exclusion in article 72G (local authorities)” substitute “ the exclusions in articles 72A (information society services), 72G (local authorities) and 72I (registered consumer buy-to-let mortgage firms) ”.9After article 53D (advising on regulated sale and rent back agreements) insert—Advising on regulated credit agreements for the acquisition of land53DA1Advising a person (“P”) is a specified kind of activity if—athe advice is given to P in P's capacity as a recipient of credit, or potential recipient of credit, under a regulated credit agreement;bP intends to use the credit to acquire or retain property rights in land or in an existing or projected building; andcthe advice consists of the provision of personal recommendations to P in respect of one or more transactions relating to regulated credit agreements.2In this article “regulated credit agreement” has the meaning given by article 60B(3)..10In article 54 (advice given in newspapers etc.) —aafter “53D” each time that it appears insert “ , 53DA ”; andbafter paragraph (1)(b)(v) insert—vato enter as a recipient of credit into a regulated credit agreement the purpose of which is to acquire or retain property rights in land or in an existing or projected building,.11In article 54A (advice given in the course of administration by an authorised person) , after paragraph (4) insert—5A person who is not an authorised person (“A”) does not carry on an activity of the kind specified by article 53DA by reason of—aanything done by an authorised person (“B”) in relation to a regulated credit agreement which B is administering pursuant to arrangements of the kind mentioned in article 60I(a) (arranging administration by authorised person); orbanything A does in connection with the administration of a regulated credit agreement in circumstances falling within article 60I(b)..12In article 55 (other exclusions) , in paragraph (2)—afor “53C and 53D” substitute “ 53C, 53D and 53DA ”; andbfor “and 72G (local authorities)” substitute “ , 72G (local authorities) and 72I (registered consumer buy-to-let mortgage firms) ”.13In article 60C (exempt agreements: exemptions relating to the nature of the agreement) , in paragraph (2) for “a regulated home purchase plan” substitute “ if it is of a type described in article 61A(1) or (2) (mortgage contracts which are not regulated mortgage contracts) ”.14In article 60D (exempt agreements: exemption relating to the purchase of land for non-residential purposes), after paragraph (3) insert—4This article does not apply to an agreement of the type described in Article 3(1)(b) of the mortgages directive..15In article 60E (exempt agreements: exemptions relating to the nature of the lender)—ain paragraph (2) for “A relevant credit agreement” substitute “ Subject to article 60HA, a relevant credit agreement ”; andbin paragraph (5) for “A relevant credit agreement” substitute “ Subject to article 60HA, a relevant credit agreement ”.16In article 60F (exempt agreements: exemptions relating to the number of repayments to be made), in paragraph (4) for “A credit agreement” substitute “ Subject to article 60HA, a credit agreement ”.17In article 60G (exempt agreements: exemptions relating to the total charge for credit)—ain paragraph (2)—iafter sub-paragraph (a) omit “and”; andiiafter sub-paragraph (b) insert—, andcparagraph (2A) applies to the agreement.;bafter paragraph (2) insert—2AThis paragraph applies to the agreement if—athe agreement is not of a type described in Article 3(1) of the mortgages directive; orbthe agreement is of such a type and—ithe agreement is of a kind to which the mortgages directive does not apply by virtue of Article 3(2) of that directive,iithe agreement is a bridging loan within the meaning of Article 4(23) of the mortgages directive, oriiiin relation to the agreement—aathe borrower receives timely information on the main features, risks and costs of the agreement at the pre-contractual stage, andbbany advertising of the agreement is fair, clear and not misleading.;cin paragraph (3) for “A credit agreement” substitute “ Subject to paragraph (8), a credit agreement ”;din paragraph (4) for “A credit agreement” substitute “ Subject to paragraph (8), a credit agreement ”;ein paragraph (6) for “paragraph (5)” substitute “ paragraphs (5) and (8) ”;fafter paragraph (7) insert—8A credit agreement of a type described in Article 3(1) of the mortgages directive is an exempt agreement pursuant to paragraph (3) or (4) only if—athe agreement meets the general interest test;bthe borrower receives timely information on the main features, risks and costs of the agreement at the pre-contractual stage; andcany advertising of the agreement is fair, clear and not misleading..18In article 60H (exempt agreements: exemptions relating to the nature of the borrower)—athe existing text becomes paragraph (1);bin paragraph (1)—ifor “A credit agreement” substitute “ Subject to article 60HA, a credit agreement ”; andiifor sub-paragraph (b)(ii) substitute—iifor credit which exceeds £60,260 and is for a purpose other than—aathe renovation of residential property, orbbto acquire or retain property rights in land or in an existing or projected building,; andcafter paragraph (1) insert—2Where a credit agreement would be an exempt agreement pursuant to this article but for paragraph (1)(b)(ii)(bb) or article 60HA, the FCA may treat the agreement as an exempt agreement except for the purpose of the application of the requirements of the mortgages directive..19After article 60H insert—Exempt agreements: exemptions not permitted under the mortgages directive60HA1A credit agreement is not an exempt agreement pursuant to article 60E(2) or (5), 60F(4) or 60H(1) if—athe agreement is of a type described in Article 3(1) of the mortgages directive, andbparagraph (2) does not apply.2This paragraph applies if—athe agreement is of a kind to which the mortgages directive does not apply by virtue of Article 3(2) of that directive;bthe agreement is a bridging loan within the meaning of Article 4(23) of that directive; orcthe agreement is a restricted public loan in respect of which—ithe borrower receives timely information on the main features, risks and costs at the pre-contractual stage; andiiany advertising is fair, clear and not misleading.3In paragraph (2)(c) “restricted public loan” means a credit agreement that is—aoffered to a particular class of borrower and not offered to the public generally;boffered under an enactment with a general interest purpose; andcprovided on terms which are more favourable to the borrower than those prevailing on the market, because it meets one of the following conditions—iit is interest free;iithe rate of interest is lower than that prevailing on the market; oriiithe rate of interest is no higher than that prevailing on the market but the other terms on which credit is provided are more favourable to the borrower..20In article 60K (other exclusions) for “the exclusion in article 72A (information society services) and the exclusion in article 72G (local authorities)” substitute “ the exclusions in articles 72A (information society services), 72G (local authorities) and 72I (registered consumer buy-to-let mortgage firms) ”.21In article 61 (regulated mortgage contracts) —ain paragraph (3)(a)—ifor paragraphs (i) to (iii) substitute—ithe contract is one under which a person (“the lender”) provides credit to an individual or to trustees (“the borrower”);iithe contract provides for the obligation of the borrower to repay to be secured by a mortgage on land in the EEA;iiiat least 40% of that land is used, or is intended to be used—aain the case of credit provided to an individual, as or in connection with a dwelling; orbbin the case of credit provided to a trustee which is not an individual, as or in connection with a dwelling by an individual who is a beneficiary of the trust, or by a related person; andiiin the wording after paragraph (iii) for “is a regulated home purchase plan” substitute “ falls within article 61A(1) or (2) ”;bfor paragraph (4)(a) substitute—a“mortgage” includes a charge and (in Scotland) a heritable security;; andcin paragraph (4)—iafter sub-paragraph (c) omit “and”; andiiomit sub-paragraph (d).22After article 61 insert—Mortgage contracts which are not regulated mortgage contracts61A1A contract falls within this paragraph if it is—aa regulated home purchase plan;ba limited payment second charge bridging loan;ca second charge business loan;dan investment property loan; orean exempt consumer buy-to-let mortgage contract.2A contract falls within this paragraph if—ait is a limited interest second charge credit union loan;bthe borrower receives timely information on the main features, risks and costs of the contract at the pre-contractual stage; andcany advertising of the contract is fair, clear and not misleading.3For the purposes of this article, if an agreement includes a declaration which—ais made by the borrower, andbincludes—ia statement that the agreement is entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower,iia statement that the borrower understands that the borrower will not have the benefit of the protection and remedies that would be available to the borrower under the Act if the agreement were a regulated mortgage contract under the Act, andiiia statement that the borrower is aware that if the borrower is in any doubt as to the consequences of the agreement not being regulated by the Act, then the borrower should seek independent legal advice,the agreement is to be presumed to have been entered into by the borrower wholly or predominantly for the purposes specified in sub-paragraph (b)(i) unless paragraph (4) applies.4This paragraph applies if, when the agreement is entered into—athe lender (or, if there is more than one lender, any of the lenders), orbany person who has acted on behalf of the lender (or, if there is more than one lender, any of the lenders) in connection with the entering into of the agreement,knows or has reasonable cause to suspect that the agreement is not entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower.5For the purposes of this article a borrower is to be regarded as entering into an agreement for the purposes of a business carried on, or intended to be carried on, by the borrower if the agreement is a buy-to-let mortgage contract and—aithe borrower previously purchased, or is entering into the contract in order to finance the purchase by the borrower of, the land subject to the mortgage;iiat the time of the purchase the borrower intended that the land would be occupied as a dwelling on the basis of a rental agreement and would not at any time be occupied as a dwelling by the borrower or by a related person, or where the borrower has not yet purchased the land the borrower has such an intention at the time of entering into the contract; andiiiwhere the borrower has purchased the land, since the time of the purchase the land has not at any time been occupied as a dwelling by the borrower or by a related person; orbthe borrower is the owner of land, other than the land subject to the mortgage, which is—ioccupied as a dwelling on the basis of a rental agreement and is not occupied as a dwelling by the borrower or by a related person; oriisecured by a mortgage under a buy-to-let mortgage contract.6For the purposes of this article—“borrower” and “lender” have the meaning set out in article 61(3) (regulated mortgage contracts);“borrower-lender agreement”, “borrower-lender-supplier agreement”, “credit union” and “total charge for credit” have the meanings set out in article 60L (interpretation of Chapter 14A);“bridging loan” has the meaning given by Article 4(23) of the mortgages directive;“buy-to-let mortgage contract” has the meaning given in article 4 of the Mortgage Credit Directive Order 2015 (interpretation of Part 3);“exempt consumer buy-to-let mortgage contract” is a contract that, at the time it is entered into, is a consumer buy-to-let mortgage contract within the meaning of article 4 of the Mortgage Credit Directive Order 2015 and—is of a kind to which the mortgages directive does not apply by virtue of Article 3(2) of that directive; oris a bridging loan;“investment property loan” is a contract that, at the time it is entered into, meets the conditions in paragraphs (i) to (iii) of article 61(3)(a) and the following conditions—less than 40% of the land subject to the mortgage is used, or intended to be used, as or in connection with a dwelling by the borrower or (in the case of credit provided to trustees) by an individual who is a beneficiary of the trust, or by a related person; andthe agreement is entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower;“limited payment second charge bridging loan” is a contract that, at the time it is entered into, meets the conditions in paragraphs (i) to (iii) of article 61(3)(a) and the following conditions—it is a borrower-lender-supplier agreement financing the purchase of land;it is used by the borrower as a temporary financing solution while transitioning to another financial arrangement for the land subject to the mortgage;the mortgage ranks in priority behind one or more other mortgages affecting the land in question; andthe number of payments to be made by the borrower under the contract is not more than four;“limited interest second charge credit union loan” is a contract that, at the time it is entered into, meets the conditions in paragraphs (i) to (iii) of article 61(3)(a) and the following conditions—it is a borrower-lender agreement;the mortgage ranks in priority behind one or more other mortgages affecting the land in question;the lender is a credit union; andthe rate of the total charge for credit does not exceed 42.6 per cent;“payment” has the meaning set out in article 60F(8) (exempt agreement: exemptions relating to number of repayments to be made);“regulated home purchase plan” has the meaning set out in article 63F(3)(a) (entering into and administering regulated home purchase plans);“related person” in relation to the borrower or (in the case of credit provided to trustees) a beneficiary of the trust, means—that person's spouse or civil partner;a person (whether or not of the opposite sex) whose relationship with that person has the characteristics of the relationship between husband and wife; orthat person's parent, brother, sister, child, grandparent or grandchild;“second charge business loan” is a contract that, at the time it is entered into, meets the conditions in paragraphs (i) to (iii) of article 61(3)(a) and the following conditions—the lender provides the borrower with credit exceeding £25,000;the mortgage ranks in priority behind one or more other mortgages affecting the land in question; andthe agreement is entered into by the borrower wholly or predominantly for the purposes of a business carried on, or intended to be carried on, by the borrower..23In article 63A (other exclusions) for “and 72G (local authorities)” substitute “ , 72G (local authorities) and 72I (registered consumer buy-to-let mortgage firms) ”.24In article 66 (trustees, nominees and personal representatives) —ain paragraph (2) for “25A(1) and (2)” substitute “ 25A(1), (2) and (2A) ”;bin paragraph (6) for “53C and 53D” substitute “ 53C, 53D and 53DA ”; andcin paragraph (8) after “article 4(4A)” insert “ and (4B) ”.25In article 67 (activities carried on in the course of a profession or non-investment business) —ain paragraph (1) for “53C and 53D” substitute “ 53C, 53D and 53DA ”; andbin paragraph (3) for “4(4) and (4A)” substitute “ 4(4), (4A) and (4B) ”.26In article 72 (overseas persons) —ain paragraph (5A) after “25A(1)(a),” insert “ 25A(2A), ”; andbafter paragraph (9) insert—10Paragraphs (5A) and (5C) do not apply where the overseas person is a mortgage intermediary whose home Member State is the United Kingdom..27In article 72G (local authorities) —ain paragraph (3)—ifor “25A” substitute “ 25A(1)(b), 25A(2) ”; andiiomit “53A,” and “61,”;bafter paragraph (3) insert—3AThere is excluded from article 25A(1)(b) and (2) any activity which is carried on by a company which is a wholly-owned subsidiary of a local authority.3BThere is excluded from articles 25A(1)(a) and (2A), 53A, 53DA and 61 any activity which is carried on by a local authority, or a company which is a wholly-owned subsidiary of a local authority, in so far as the contract is—aof a kind to which the mortgages directive does not apply by virtue of Article 3(2) of that directive;ba bridging loan; orca restricted public loan in relation to which the requirements of paragraph (6) are met.;cfor paragraph (4) substitute—4There is excluded from article 60B—aany activity which is carried on by a local authority, the purpose of which is other than to acquire or retain property rights in land or in an existing or projected building, in so far as the credit agreement is of a kind to which the consumer credit directive does not apply by virtue of Article 2(2) of that directive;bany activity which is carried on by a local authority, the purpose of which is to acquire or retain property rights in land or in an existing or projected building, in so far as the credit agreement meets one of the following conditions—iit is of a kind to which the mortgages directive does not apply by virtue of Article 3(2) of that directive;iiit is a bridging loan; oriiiit is a restricted public loan in relation to which the requirements of paragraph (6) are met.; anddafter paragraph (5) insert—6The requirements of this paragraph are that—athe borrower receives timely information on the main features, risks and costs of the loan at the pre-contractual stage; andbany advertising of the loan is fair, clear and not misleading.7In this article—“bridging loan” has the meaning given by Article 4(23) of the mortgages directive;“borrower” means a person receiving credit;“consumer credit directive” means Directive 2008/48/EC of the European Parliament and of the Council of 23rd April 2008 on credit agreements for consumers and repealing Council Directive 87/102/EC ;“credit” includes a cash loan and any other form of financial accommodation;“restricted public loan” means credit that is—offered to a particular class of borrower and not offered to the public generally;offered under an enactment with a general interest purpose; andprovided on terms which are more favourable to the borrower than those prevailing on the market, because the credit meets one of the following conditions—it is interest free;the rate of interest is lower than that prevailing on the market; orthe rate of interest is no higher than that prevailing on the market but the other terms on which the credit is provided are more favourable to the borrower; and“wholly-owned subsidiary” has the same meaning as in section 1159 (meaning of “subsidiary” etc.) of the Companies Act 2006 and, for the purposes of this definition, a local authority is to be treated as a body corporate..28After article 72H (insolvency practitioners) insert—Registered consumer buy-to-let mortgage firms72I1There is excluded from articles 25A, 36A, 53A, 53DA, 60B and 61 any consumer buy-to-let mortgage business carried on by a registered consumer buy-to-let mortgage firm.2In this article “consumer buy-to-let mortgage business” and “registered consumer buy-to-let mortgage firm” have the meanings given in article 4 of the Mortgage Credit Directive Order 2015 (interpretation of Part 3)..The Financial Services and Markets Act 2000 (Exemption) Order 200151Paragraph 48 of the Schedule to the Financial Services and Markets Act 2000 (Exemption) Order 2001 is amended as follows.2For sub-paragraph (1)(b) substitute “ article 25A(1)(b) and (2) of that Order (arranging a regulated mortgage contract); ”.3After sub-paragraph (1) insert—1AA relevant housing body is exempt from the general prohibition in respect of any regulated activity of the kind specified by article 25A(1)(a) or (2A), 53A or 61 of that Order (arranging, advising on, entering into or administering a regulated mortgage contract) in so far as the contract—ais of a kind to which the mortgages directive does not apply by virtue of Article 3(2) of that directive;bis a bridging loan; orcis a restricted public loan in relation to which the requirements of sub-paragraph (1B) are met.1BThe requirements of this sub-paragraph are that—athe borrower receives timely information on the main features, risks and costs of the loan at the pre-contractual stage; andbany advertising of the loan is fair, clear and not misleading..4In sub-paragraph (2)—aomit paragraphs (d) (Scottish Homes) and (f) (Communities Scotland);bafter paragraph (g) insert—hexcept for the purposes of sub-paragraph (1)(a), the Scottish Ministers;iexcept for the purposes of sub-paragraph (1)(a), the Welsh Ministers..5After sub-paragraph (2) insert—3Except for the purposes of sub-paragraph (1)(a), “relevant housing body” also includes a wholly-owned subsidiary of a body listed in sub-paragraph (2)(a), (aa), (b), (ca), (h) or (i).4In this paragraph—“bridging loan” has the meaning given by Article 4(23) of the mortgages directive;“borrower” means a person receiving credit;“credit” includes a cash loan and any other form of financial accommodation;“restricted public loan” means credit that is—offered to a particular class of borrower and not offered to the public generally;offered under an enactment with a general interest purpose; andprovided on terms which are more favourable to the borrower than those prevailing on the market, because it meets one of the following conditions—it is interest free;the rate of interest is lower than that prevailing on the market; orthe rate of interest is no higher than that prevailing on the market but the other terms on which credit is provided are more favourable to the borrower; and“wholly-owned subsidiary” has the same meaning as in section 1159 (meaning of “subsidiary” etc.) of the Companies Act 2006 and, for the purposes of this definition, a relevant housing body is to be treated as a body corporate..The Financial Services and Markets Act 2000 (Compensation Scheme: Electing Participants) Regulations 200161The Financial Services and Markets Act 2000 (Compensation Scheme: Electing Participants) Regulations 2001 are amended as follows.2In regulation 1 (citation, commencement and interpretation) , after the definition of “relevant management company” insert—“relevant mortgage intermediary” means a mortgage intermediary falling within paragraph 5(i) of Schedule 3 to the Act which is providing all or part of the credit intermediation activities set out in Article 4(5) of the mortgages directive or which is providing advisory services (as defined in Article 4(21) of the mortgages directive) in the United Kingdom;.3In regulation 2 (persons not to be regarded as relevant persons) —aafter sub-paragraph (1)(d) omit “and”;bafter sub-paragraph (1)(e) insert—; andfany relevant mortgage intermediary.; andcin paragraph (2) for “(b) and (c)” substitute “ (b), (c) and (f) ”.4In regulation 3 (persons who may elect to participate) —aafter sub-paragraph (1)(c) omit “and”; andbafter sub-paragraph (1)(d) insert—; andeany relevant mortgage intermediary which has established a branch in the United Kingdom in exercise of an EEA right and which is not an investment firm, a credit institution or an insurance intermediary..5In regulation 4 (persons in respect of whom inspection under section 224 does not apply) —aafter paragraph (d) omit “and”; andbafter paragraph (e) insert—; andfany relevant mortgage intermediary..The Financial Services and Markets Act 2000 (Appointed Representatives) Regulations 200171The Financial Services and Markets Act 2000 (Appointed Representatives) Regulations 2001 are amended as follows.2In regulation 2(1) (descriptions of business for which appointed representatives are exempt) , after sub-paragraph (cc) insert—ccaan activity of the kind specified by article 53DA of that Order (advising on regulated credit agreements for the acquisition of land);.3In regulation 3(3) (requirements applying to contracts between authorised persons and appointed representatives) —aafter sub-paragraph (a)(ii) omit “or”;bin sub-paragraph (b)(ii) for “with other counterparties.” substitute—with other counterparties; orcgives advice (in circumstances constituting the carrying on of an activity of the kind specified by article 53DA of that Order) which consists of the provision of personal recommendations to a person in respect of one or more transactions with other counterparties..The Financial Services and Markets Act 2000 (Disclosure of Confidential Information) Regulations 200181The Financial Services and Markets Act 2000 (Disclosure of Confidential Information) Regulations 2001 are amended as follows.2In regulation 2 (interpretation) —aafter the definition of “markets in financial instruments directive information” insert—“mortgages directive information” means confidential information received by the FCA or the PRA in the course of discharging its functions as a competent authority under the mortgages directive;; andbin the definition of “single market restrictions”, after paragraph (ga) insert—gbArticles 5(2) and 36 of the mortgages directive;.3In regulation 9 (disclosure by regulators or regulator workers to certain other persons) —ain paragraph (1), after “(3E)” insert “ , (3F) ”; andbafter paragraph (3E) insert—3FParagraph (1) does not permit disclosure of mortgages directive information to a person specified in the first column of Schedule 1 in contravention of Articles 5(2) or 36 of the mortgages directive..The Financial Services and Markets Act 2000 (EEA Passport Rights) Regulations 200191The Financial Services and Markets Act 2000 (EEA Passport Rights) Regulations 2001 are amended as follows.2In regulation 1(2) (citation, commencement and interpretation) after the definition of “EEA activities” insert—“EEA mortgage intermediary” means a person falling within paragraph 5(i) of Schedule 3;.3In regulation 2 (establishment of a branch: contents of consent notice) after paragraph (7) insert—8In the case of an EEA mortgage intermediary, the prescribed information is—aa statement that the firm is an EEA mortgage intermediary;bthe requisite details of the branch;cwhether the EEA mortgage intermediary is a tied mortgage intermediary;dthe name and address of the mortgage creditors (if any) to which the EEA mortgage intermediary is tied; andewhether those mortgage creditors (if any) take full and unconditional responsibility for the activities of the EEA mortgage intermediary..4In regulation 3 (provision of services: contents of regulator's notice) after paragraph (5) insert—6In the case of an EEA mortgage intermediary, the prescribed information is—aa statement that the firm is an EEA mortgage intermediary;bparticulars of the services to be carried on in the United Kingdom;cwhether the EEA mortgage intermediary is a tied mortgage intermediary;dthe name and address of the mortgage creditors (if any) to which the EEA mortgage intermediary is tied; andewhether those mortgage creditors (if any) take full and unconditional responsibility for the activities of the EEA mortgage intermediary..5After regulation 7A (EEA AIFM: changes to branch details or services) insert—EEA mortgage intermediary: changes to branch details or services7B1An EEA mortgage intermediary which is exercising an EEA right in the United Kingdom deriving from the mortgages directive must not make a material change to any of the matters referred to in regulation 2(8)(b) to (e) or regulation 3(6)(b) to (e) unless the relevant requirements have been complied with.2Where the relevant requirements have been complied with, the mortgage intermediary's permission is to be treated as varied accordingly.3For the purposes of this regulation, the “relevant requirements” are those of paragraph (4) or (if the change is occasioned by circumstances beyond the mortgage intermediary's control) paragraph (5).4The requirements of this paragraph are that—athe mortgage intermediary has given a notice to the appropriate UK regulator and to its home state regulator stating the details of the proposed change; andbeither the appropriate UK regulator has informed the mortgage intermediary that it may make the change, or the period of one month beginning with the day on which the mortgage intermediary gave the appropriate UK regulator the notice mentioned in sub-paragraph (a) has elapsed.5The requirements of this paragraph are that the mortgage intermediary has as soon as practicable (whether before or after the change) given a notice to the appropriate UK regulator and to its home state regulator, stating the details of the change.6The appropriate UK regulator must, as soon as practicable after receiving a notice from a mortgage intermediary under this regulation, inform the mortgage intermediary of any consequential changes in the applicable provisions (within the meaning of paragraph 13 or, as the case may be, paragraph 14 of Schedule 3).7In this regulation “the appropriate UK regulator” has the same meaning as in paragraph 14 of Schedule 3..6After regulation 9 (financial institutions giving up right to authorisation) insert—EEA mortgage intermediaries giving up right to authorisation9A1The appropriate UK regulator may, where paragraph (2) or (3) applies, direct that the qualification for authorisation given to an EEA mortgage intermediary under Schedule 3 is cancelled from such date as may be specified in the direction.2This paragraph applies if the appropriate UK regulator receives notice (“a withdrawal notice”) from the EEA mortgage intermediary's home state regulator stating that the EEA mortgage intermediary's authorisation which gives rise to an EEA right under the mortgages directive has been withdrawn.3This paragraph applies if—adespite action taken by the appropriate regulator under section 194C of the Act, the EEA mortgage intermediary persists in contravening an obligation to which Article 34(2) of the mortgages directive applies; andbthe appropriate UK regulator has informed the home state regulator that it intends to direct that the qualification for authorisation given to the EEA mortgage intermediary under Schedule 3 is cancelled.4Where paragraph (3) applies and the appropriate UK regulator makes a direction under paragraph (1), the appropriate UK regulator must inform the European Commission of that direction without undue delay.5In this regulation “the appropriate UK regulator” has the same meaning as in paragraph 14 of Schedule 3..7After regulation 17A (full-scope UK AIFM: changes to branch details or services) insert—UK firm exercising an EEA right under the mortgages directive: changes to branch details or services17B1A mortgage intermediary which has exercised an EEA right deriving from the mortgages directive to establish a branch or provide services must not make any material change to the requisite details of the branch or to the services to be carried on in exercise of that EEA right unless the requirements of paragraph (2) have been complied with.2The requirements are that—athe mortgage intermediary has given a notice to the appropriate UK regulator stating the details of the proposed change, andbthe period of one month beginning with the day on which the mortgage intermediary gave the notice has elapsed.3The appropriate UK regulator must, as soon as reasonably practicable after receiving a notice under paragraph (2), inform the host state regulator of the proposed change.4Paragraph (1) does not apply to a change occasioned by circumstances beyond the mortgage intermediary's control..The Financial Services and Markets Act 2000 (Gibraltar) Order 2001101The Financial Services and Markets Act 2000 (Gibraltar) Order 2001 is amended as follows.2In article 2 (exercise of deemed passport rights by Gibraltar-based firms) —aafter paragraph (3D) insert—3EA Gibraltar-based firm falling within paragraph 5(i) of Schedule 3 is to be treated as having an entitlement, corresponding to its EEA right deriving from the mortgages directive, to establish a branch or provide services in the United Kingdom.;bin paragraph (4)—ifor “and (3D)” substitute “ , (3D) and (3E) ”;iifor “and (h)” substitute “ , (h) and (i) ”;cin paragraph (5) for “or (3D)” in both places that it appears substitute “ , (3D) or (3E) ”;din paragraph (7) for “or (3D)” substitute “ , (3D) or (3E) ”; andein paragraph (8)—iin sub-paragraph (a), for “section 194A(7) has” substitute “ sections 194A(7) and 194C(6) have ”;iiin sub-paragraph (b), for “section 195A(11) is” substitute “ sections 195A(11) and 195B(10) are ”.3In article 3 (EEA firms satisfying conditions under Gibraltar law) , in paragraph (3) for “(7A)” substitute “ (7B) ”.The Consumer Credit (Disclosure of Information) Regulations 200411In regulation 2 of the Consumer Credit (Disclosure of Information) Regulations 2004 (agreements to which these regulations apply), in sub-paragraph (1)(c) after “£60,260” insert “ other than residential renovation agreements ”.The Financial Services and Markets Act 2000 (Financial Promotion) Order 2005121Schedule 1 to the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 is amended as follows.2After paragraph 10BA (providing relevant consumer credit) insert—Advising on certain relevant consumer credit relating to land10BAAAdvising a person is a controlled activity if the advice—ais given to the person in the person's capacity as a recipient of credit, or potential recipient of credit; andbconsists of the provision of personal recommendations to the person in respect of one or more transactions relating to a relevant credit agreement where the person intends to use the credit to acquire or retain property rights in land or in an existing or projected building, other than an agreement under which qualifying credit within the meaning of paragraph 10 is provided..3In paragraph 28 (interpretation) for the definition of “relevant credit agreement” substitute—“relevant credit agreement” means a credit agreement (within the meaning given by article 60B of the Regulated Activities Order) other than—a regulated mortgage contract or a regulated home purchase plan (within the meaning of that Order); ora buy-to-let mortgage contract as defined in article 4 of the Mortgage Credit Directive Order 2015;.The Consumer Credit (Disclosure of Information) Regulations 201013In regulation 2 of the Consumer Credit (Disclosure of Information) Regulations 2010 (agreements to which these regulations apply), in sub-paragraphs (3)(a) and (4)(a) after “£60,260” insert “ unless it is a residential renovation agreement ”.The Consumer Credit (Agreements) Regulations 2010141The Consumer Credit (Agreements) Regulations 2010 are amended as follows.2In regulation 2 (agreements to which these regulations apply) , in sub-paragraph (3)(b) after “£60,260” insert “ other than a residential renovation agreement ”.3In Schedule 1 (information to be included in regulated consumer credit agreements) , in paragraph 25 in the second column after “£60,260” insert “ other than a residential renovation agreement ”.The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013151Article 58 (duration of interim permission) of the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 2) Order 2013 is amended as follows.2In paragraph (1), after “in so far as it relates to a particular regulated activity or class of activity”, insert “ other than an activity to which paragraph (1A) applies ”.3After paragraph (1) insert—1AParagraphs (1B) and (1C) apply to an activity—aof a kind specified by article 36A or 60B of the Regulated Activities Order (regulated credit agreements) as that Order is in force before 21st March 2016; andbwhich, if carried on on or after 21st March 2016, would be of a kind specified by article 25A, 53A or 61 of the Regulated Activities Order by virtue of the amendments made to that Order by the Mortgage Credit Directive Order 2015.1BP's interim permission ceases to have effect—aif P applies to the appropriate regulator before 21st March 2016 for Part 4A permission to carry on an activity of the kind specified by article 25A, 53A or 61 of the Regulated Activities Order or (as the case may be) to vary P's permission to add an activity of a kind specified by those articles to those to which the permission relates, on the date on which that application is determined; andbin any other case, on 21st March 2016;1CP's interim permission is to be treated as an interim permission to carry on the activity from 21st March 2016 until the interim permission ceases to have effect, if—aP's interim permission continues to have effect on 21st March 2016 by virtue of paragraph (1B)(a), andbP had permission to carry on the activity immediately before 21st March 2016 by virtue of the interim permission.1DIf P's interim permission continues to have effect on 21st March 2016 by virtue of paragraph (1B)(a), from 21st March 2016 until the interim permission ceases to have effect the interim permission is to be treated as giving permission to carry on an activity which—aif carried on immediately before 21st March 2016, would not have been a regulated activity, andbbecomes a regulated activity on 21st March 2016 by virtue of the amendments made to the Regulated Activities Order by the Mortgage Credit Directive Order 2015..4In paragraph (2) for “Paragraph (1) does” substitute “ Paragraphs (1) and (1B) to (1D) do ”.5In paragraph (3) for “paragraph (1)(a)” substitute “ paragraphs (1)(a) and (1B)(a) ”.6In paragraph (6) after “paragraph (1)” insert “ or (1B) ”.SCHEDULE 2Requirements for registered consumer buy-to-let mortgage firms Article 18<Emphasis>Conditions applicable to creditors and credit intermediaries</Emphasis>Conduct of business obligations when providing consumer buy-to-let mortgage products to consumers11When manufacturing consumer buy-to-let mortgage contracts or granting, intermediating or providing advisory services on consumer buy-to-let mortgage contracts and, where appropriate, ancillary services to consumers or when executing a consumer buy-to-let mortgage contract, the creditor or credit intermediary must act honestly, fairly, transparently and professionally, taking account of the rights and interests of the consumers.2The granting, intermediating or provision of advisory services on consumer buy-to-let mortgage contracts and, where appropriate, the provision of ancillary services must be based on—ainformation about the borrower's circumstances;bany specific requirement made known by the borrower;creasonable assumptions about risks to the borrower's situation over the term of the contract;dwhere the activity is the provision of advisory services, the information set out in paragraph 13(4)(a) and (b); andeinformation on the typical rental levels and rental demands within the property's locality and the impact of future interest rate rises, rental voids, rental arrears and typical letting costs.3The manner in which creditors remunerate their staff and credit intermediaries and the manner in which credit intermediaries remunerate their staff must not impede compliance with the obligation set out in sub-paragraph (1).4When establishing and applying remuneration policies for their staff responsible for the assessment of creditworthiness, creditors must comply with the following principles in a way and to the extent that is appropriate to their size, internal organisation and the nature, scope and complexity of their activities—athe remuneration policy must be consistent with and promote sound and effective risk management and must not encourage risk-taking that exceeds the level of tolerated risk of the creditor;bthe remuneration policy must be in line with the business strategy, objectives, values and long-term interests of the creditor, and must incorporate measures to avoid conflicts of interest, in particular by providing that remuneration is not contingent on the number or proportion of applications accepted.5Where a creditor or credit intermediary provides advisory services, the remuneration structure of the staff involved must not prejudice their ability to act in the consumer's best interest and in particular must not be contingent on sales targets.Obligation to provide information free of charge to consumers2Any information provided to consumers in compliance with the requirements set out in this Schedule must be provided free of charge.Knowledge and competence requirements for staff31Creditors and credit intermediaries must require their staff to possess and keep up-to-date an appropriate level of knowledge and competence in relation to—athe manufacturing, offering or granting of consumer buy-to-let mortgage contracts,bacting as a credit intermediary in relation to consumer buy-to-let mortgage contracts, orcthe provision of advisory services in respect of consumer buy-to-let mortgage contracts.2The appropriate level of knowledge and competence referred to in sub-paragraph (1) must include at least—aappropriate knowledge of consumer buy-to-let mortgage contracts and the ancillary services typically offered with them;bappropriate knowledge of the laws relating to consumer buy-to-let mortgage contracts, in particular consumer protection;cappropriate knowledge and understanding of the process for purchasing land;dappropriate knowledge of security valuation;eappropriate knowledge of the organisation and functioning of land registers;fappropriate knowledge of the market in the United Kingdom for consumer buy-to-let mortgage business;gappropriate knowledge of business ethics standards;happropriate knowledge of the consumer creditworthiness assessment process or, where applicable, competence in assessing consumers' creditworthiness; andian appropriate level of financial and economic competency.<Emphasis>Information and practices preliminary to the conclusion of the consumer buy-to-let mortgage contract</Emphasis>Tying and bundling practices41Except in the circumstances described in sub-paragraphs (2) to (4), a creditor must not offer or sell a consumer buy-to-let mortgage contract in a package with other distinct financial products or services where that mortgage contract is not made available to the borrower separately.2A creditor may request the borrower or a related person to—aopen or maintain a payment or savings account where the only purpose of such an account is to accumulate capital to repay the credit, to service the credit, to pool resources to obtain the credit, or to provide additional security for the creditor in the event of default;bpurchase or keep an investment product or a private pension product, where such product which primarily offers the investor an income in retirement serves also to provide additional security for the creditor in the event of default or to accumulate capital to repay the credit, to service the credit or to pool resources to obtain the credit; orcconclude a separate credit agreement in conjunction with a shared-equity credit agreement to obtain the credit.3Notwithstanding sub-paragraph (1), a creditor may offer or sell a consumer buy-to-let mortgage contract where the creditor can demonstrate to the FCA that the tied products or categories of product offered, on terms and conditions similar to each other, which are not made available separately, result in a clear benefit to a borrower taking due account of the availability and the prices of the relevant products offered on the market.4A creditor may require the borrower to hold an insurance policy related to the consumer buy-to-let mortgage contract, provided that the creditor must accept an insurance policy from a supplier different to the creditor's preferred supplier where the policy has a level of guarantee equivalent to the level of guarantee in the insurance policy proposed by the creditor.General information51A creditor must make available clear and comprehensible general information about consumer buy-to-let mortgage contracts at all times on paper or on another durable medium or in electronic form.2The general information referred to in sub-paragraph (1) must include at least the following—athe name and address of the creditor;bthe purposes for which the credit provided under the consumer buy-to-let mortgage contract may be used;cthe form of any security, including, where applicable, the possibility for it to be located in another EEA State;dthe possible duration of the consumer buy-to-let mortgage contract;ethe types of available borrowing rate, indicating whether fixed or variable or both, with a short description of the characteristics of a fixed and variable rate, including related implications for the borrower;fwhere foreign currency loans are available, an indication of the foreign currency or currencies, including an explanation of the implications for the borrower where the consumer buy-to-let mortgage contract is denominated in a foreign currency;ga representative example of the total amount of credit, the total cost of the credit to the borrower, the total amount payable by the borrower and the annual percentage rate of charge;han indication of possible further costs not included in the total cost of the credit to the borrower, to be paid in connection with a consumer buy-to-let mortgage contract;ithe range of different options available for reimbursing the credit to the creditor, including te number, frequency and amount of the regular repayment instalments;jwhere applicable, a clear and concise statement that compliance with the terms and conditions of the consumer buy-to-let mortgage contract does not guarantee repayment of the total amount of credit under that contract;ka description of the conditions directly relating to early repayment;lwhether a valuation of the property is necessary and, where applicable, who is responsible for ensuring that the valuation is carried out, and whether any related costs arise for the borrower;man indication of any ancillary services the borrower is obliged to acquire in order to obtain the consumer buy-to-let mortgage contract or to obtain it on the terms and conditions marketed and, where applicable, a clarification that the ancillary services may be purchased from a provider that is not the creditor; andna general warning concerning possible consequences of non-compliance with the commitments linked to the consumer buy-to-let mortgage contract.Pre-contractual information61A creditor and, where applicable, a credit intermediary must provide a borrower with a lending illustration on paper or another durable medium—awithout undue delay after the borrower has given the necessary information on the borrower's needs, financial situation and preferences in accordance with paragraph 12; andbin good time before the borrower is bound by any credit agreement or offer.2The lending illustration must include at least the following—athe name of the borrower;bthe date of issue of the lending illustration;cthe date until which the lending illustration remains valid;dthe name, address and telephone number of the creditor;ewhere applicable, the name, address and telephone number of the credit intermediary;fthe amount of the loan required, including any charges added to the amount of the loan;gthe value of any property against which the loan is to be secured;hthe term of the consumer buy-to-let mortgage contract;ia description of whether the consumer buy-to-let mortgage contract is to be provided on an interest-only basis, a repayment basis or a combination of the two;jthe type of interest rate payable;kthe interest rate payable including, if applicable, the initial interest rate and any reversionary rate;lthe frequency and amount of each instalment and the number of instalments;mthe overall cost of the consumer buy-to-let mortgage contract;nthe annual percentage rate of charge;owhere the credit agreement allows for variations in the interest rate, either—ian illustration of how the annual percentage rate of charge might change in the event of an increase in the interest rate of 1%, and the resulting increase in the amount of each instalment; oriian additional annual percentage rate of charge which illustrates the possible risks for the borrower linked to a significant increase in the interest rate, including the possible increase in the amount of each instalment;pdetails of any early repayment charges;qa warning of the risk that interest rates may rise;ra warning of the risk that rental income may fall;swhere applicable, a warning of the risk that the property may be repossessed if the borrower does not keep up with mortgage repayments;twhere applicable, a warning of the risk of foreign currency loans; anduwhere it is an interest-only loan, a warning that the borrower will still owe the loan amount at the end of the term.3The creditor or, where applicable, the credit intermediary, must provide the borrower with a copy of the draft consumer buy-to-let mortgage contract at the time of the provision of an offer.4In this paragraph “lending illustration” means the personalised information needed by the borrower to compare the products available on the market, assess their implications and make an informed decision on whether to conclude a consumer buy-to-let mortgage contract.Information requirements concerning credit intermediaries71In good time before the carrying on of any of the credit intermediation activities described in article 5(2) to (4), a credit intermediary must provide the borrower with at least the following information on paper or another durable medium—athe name and address of the credit intermediary;bdetails of the register, the credit intermediary's registration number, where applicable, and the means for verifying such registration;cwhether the credit intermediary is tied to or works exclusively for one or more creditors;dif the credit intermediary is tied to or works exclusively for one or more creditors, the names of the creditors for which the credit intermediary is acting;eif the credit intermediary meets the criteria set out in paragraph 13(5), a statement that the credit intermediary is independent;fwhether the credit intermediary offers advisory services;gthe fee, where applicable, payable by the borrower to the credit intermediary for its services or, where this is not possible, the method for calculating the fee;hthe procedures allowing borrowers or other interested parties to register complaints internally about credit intermediaries and, where appropriate, the means by which recourse to out-of-court complaint and redress procedures can be sought;iwhere applicable, the existence of commissions or other inducements payable by the creditor or third parties to the credit intermediary for their services in relation to the contract; andjeither the amount of such commissions or other inducements or, where the amount is not known at the time of disclosure, a statement that the credit intermediary shall inform the borrower of the actual amount as part of the lending illustration referred to in paragraph 6.2Where the credit intermediary charges a fee to the borrower and additionally receives commission from the creditor or a third party, the credit intermediary must explain to the borrower whether or not the commission will be offset against the fee, either in part or in full.3The credit intermediary must inform the creditor of the fee, if any, payable by the borrower to the credit intermediary for its services.Adequate explanations81Creditors and, where applicable, credit intermediaries, must provide an adequate explanation to the borrower on a proposed consumer buy-to-let mortgage contract and any ancillary services, in order to place the borrower in a position enabling the borrower to assess whether the proposed agreement and ancillary services are adapted to the borrower's needs and financial situation.2The adequate explanation must, where applicable, include—ain the case of creditors, the information described in paragraph 6(2);bin the case of credit intermediaries, the information described in paragraphs 6(2) and 7(1); andcin all cases—ithe essential characteristics of the consumer buy-to-let mortgage contract proposed;iithe specific effect the contract proposed may have on the borrower, including the consequences of default in payment by the borrower; andiiiwhere ancillary services are bundled with a consumer buy-to-let mortgage contract, whether each component of the bundle can be terminated separately and the implications for the borrower of doing so.<Emphasis>Annual percentage rate of charge</Emphasis>Calculation of the annual percentage rate of charge91The annual percentage rate of charge must be calculated in accordance with the mathematical formula set out in paragraph 20.2The costs of opening and maintaining a specific account, the costs of using a means of payment for both transactions and drawdowns on that account and other costs relating to payment transactions shall be included in the total cost of credit to the borrower whenever the opening or maintaining of an account is obligatory in order to obtain the credit or to obtain it on the terms and conditions marketed.3The calculation of the annual percentage rate of charge must be based on the assumption that the consumer buy-to-let mortgage contract is to remain valid for the period agreed and that the creditor and the borrower will fulfil their obligations under the terms and by the dates specified in that contract.4If the consumer buy-to-let mortgage contract allows variations in the borrowing rate and, where applicable, in the charges contained in the annual percentage rate of charge but unquantifiable at the time of calculation, the annual percentage rate of charge must be calculated on the assumption that the borrowing rate and other charges will remain fixed in relation to the level set at the conclusion of the contract.5Where applicable, the additional assumptions set out in paragraph 21 must be used in calculating the annual percentage rate of charge.6In this paragraph—“annual percentage rate of charge” means the total cost of the credit to the borrower, expressed as an annual percentage of the total amount of credit, where applicable, including the costs referred to in sub-paragraph (2) and equates, on an annual basis, to the present value of all future or existing commitments (drawdowns, repayments and charges) agreed by the creditor and the borrower;“total amount of credit” means the ceiling or total sums made available under the consumer buy-to-let mortgage contract;“total cost of credit to the borrower” means all the costs which the borrower is required to pay in connection with the credit agreement and which are known to the creditor, including the costs referred to in sub-paragraph (7) but excluding the costs referred to in sub-paragraph (8).7The costs referred to in this sub-paragraph are—ainterest;bcommissions;ctaxes;dany other kind of fees;ethe cost of valuation of property where such valuation is necessary to obtain the consumer buy-to-let mortgage contract; andfcosts in respect of ancillary services, in particular insurance premiums, where the purchase of those ancillary services is compulsory in order to obtain the consumer buy-to-let mortgage contract or to obtain it on the terms and conditions marketed.8The costs referred to in this sub-paragraph are—anotarial costs;bregistration fees for the transfer of ownership of the property; andcany charges payable by the borrower for non-compliance with the commitments laid down in the consumer buy-to-let mortgage contract.<Emphasis>Creditworthiness assessment</Emphasis>Obligation to assess the creditworthiness of the borrower101Before concluding a consumer buy-to-let mortgage contract, the creditor must make a thorough assessment of the borrower's creditworthiness, taking appropriate account of factors relevant to verifying the prospect of the borrower meeting the borrower's obligations under that contract.2The creditor must establish, document and maintain procedures on which it bases a creditworthiness assessment in relation to a consumer buy-to-let mortgage contract.3The assessment of creditworthiness must not rely predominantly on the value of the property exceeding the amount of the credit or on the assumption that the property will increase in value unless the purpose of the consumer buy-to-let mortgage contract is to construct or renovate the property.4Where a creditor concludes a consumer buy-to-let mortgage contract with a borrower the creditor must not subsequently cancel or alter the contract to the detriment of the borrower on the grounds that the assessment of creditworthiness was incorrectly conducted, unless the borrower knowingly withheld or falsified information as described in paragraph 12.5The creditor must only enter into the consumer buy-to-let mortgage contract with the borrower where the result of the creditworthiness assessment indicates that the borrower is likely to meet the obligations resulting from that contract in the manner required under that contract.6Where the application is rejected, the creditor must inform the borrower without delay of the rejection and, where applicable, that the decision is based on automated processing of data.7Where the creditor consults a database as part of the creditworthiness assessment, the creditor must—ainform the borrower in advance that a database is to be consulted; andbwhere the application is rejected, and the rejection is based on the result of the database consultation, inform the borrower of the result of such consultation and of the particulars of the database consulted.8Before granting any significant increase in the total sums made available under the consumer buy-to-let mortgage contract after the conclusion of that contract, the creditor must re-assess the borrower's creditworthiness on the basis of updated information, unless such an increase was envisaged and included in the original creditworthiness assessment.Property valuation11A creditor must use reliable standards when carrying out a property valuation or take reasonable steps to ensure that reliable standards are applied where a valuation is conducted by a third party.Disclosure and verification of borrower information121A creditor must carry out the assessment of creditworthiness referred to in paragraph 10 on the basis of information which is necessary, sufficient and proportionate, including—aany values provided to the creditor as part of its assessment of the property;btypical rental levels and rental demands within the property's locality;cthe impact of future interest rate rises, rental voids and rental arrears and the ability of the borrower to meet payments should such pressures arise; anddtypical letting costs.2The information referred to in sub-paragraph (1) may include information obtained by the creditor from relevant internal or external sources, including one or more of the following—athe borrower;bany credit intermediary or appointed representative which obtained information during the credit application process; andca calculation developed by the creditor to demonstrate that the estimated rental income from the property will exceed the interest payments due by an amount sufficient to cover the estimated other costs associated with the property and its rental.3The information referred to in sub-paragraph (1) must be appropriately verified through reference to independently verifiable documentation when necessary.4A credit intermediary must accurately submit the necessary information obtained from the borrower to the creditor to enable the creditworthiness assessment to be carried out.5A creditor must specify in a clear and straightforward way at the pre-contractual phase the necessary information and independently verifiable evidence that the borrower needs to provide and the timeframe within which the borrower needs to provide the information.6A request for information referred to in sub-paragraph (5) must be proportionate and limited to what is necessary to conduct a proper creditworthiness assessment.7A creditor may seek clarification of the information received in response to a request for information referred to in sub-paragraph (5) where necessary to enable the assessment of creditworthiness.8A creditor must not terminate a consumer buy-to-let mortgage contract on the grounds that the information provided by the borrower before the conclusion of the contract was incomplete, unless the borrower knowingly withheld or falsified the information.9The creditor or credit intermediary must inform the borrower of the need to provide correct and complete information in response to a request referred to in sub-paragraph (5) and must warn the borrower that, where the creditor is unable to carry out an assessment of creditworthiness because the borrower chooses not to provide the information or verification necessary for an assessment of creditworthiness, the credit cannot be granted.<Emphasis>Advisory services</Emphasis>Standards for advisory services131A creditor or credit intermediary must explicitly inform the borrower, in the context of a given transaction, whether advisory services are being or can be provided to the borrower.2Before the provision of advisory services or, where applicable, the conclusion of a contract for the provision of advisory services, the creditor or credit intermediary must provide the borrower with the following information on paper or another durable medium—awhether the recommendation will be based on a consideration of only the creditor's or the credit intermediary's own product range or a consideration of a wide range of products from across the market; andbwhere applicable, the fee payable by the borrower for the advisory services or, where the amount cannot be ascertained at the time of disclosure, the method used for its calculation.3The information referred to in sub-paragraph (2) may be provided to the borrower as part of the lending illustration under paragraph 6.4Where a creditor or credit intermediary provides advisory services to a borrower, the creditor or credit intermediary must—aobtain the necessary information regarding the borrower's personal and financial situation, preferences and objectives so as to enable the recommendation of suitable consumer buy-to-let mortgage contracts;bbase its recommendation on information that is up-to-date and takes into account reasonable assumptions as to risks to the borrower's situation over the term of the proposed agreement, including information on the typical rental levels and rental demands within the property's locality, the impact of future interest rate rises, rental voids, and rental arrears and typical letting costs;cact in the best interests of the borrower by—iinforming itself about the borrower's needs and circumstances; andiirecommending suitable mortgages in accordance with paragraphs (a) and (b); anddgive the borrower a record on paper or another durable medium of the recommendation provided.5A creditor or credit intermediary must not use the term “independent advice” or “independent advisor” in the course of providing advisory services unless—athe creditor or credit intermediary considers a sufficiently large number of credit agreements available on the market; andbif the number of creditors considered is less than a majority of the market, the creditor or credit intermediary is not remunerated for those advisory services by one or more creditors.<Emphasis>Foreign currency loans and variable rate loans</Emphasis>Foreign currency loans141Where a borrower enters into a buy-to-let mortgage contract that is a foreign currency loan—aeither the borrower must have a right to convert the contract into an alternative currency if conditions specified by the creditor are met, or the creditor must put in place other arrangements to limit the exchange risk to which the borrower is exposed under the contract; andbif sub-paragraph (4) applies, the creditor must give the borrower, on a regular basis, foreign currency risk warnings.2The creditor may specify the alternative currency referred to in sub-paragraph (1)(a), but it must be either—athe currency in which the borrower primarily receives income or holds assets from which the credit is to be repaid, as indicated at the time the most recent creditworthiness assessment in relation to the contract was made; orbthe currency of the EEA State in which the borrower either was resident at the time the contract was concluded or is currently resident.3Where a borrower has a right to convert the contract into an alternative currency in accordance with sub-paragraph (1)(a), the exchange rate at which the conversion is carried out must be the market exchange rate applicable on the day of application for conversion, unless otherwise specified in the contract.4This sub-paragraph applies if the value of—athe total amount payable by the borrower which remains outstanding; orbthe regular instalments,varies by more than 20% from what it would be if the exchange rate between the currency of the contract and sterling applicable at the time of the conclusion of the contract were applied.5In this paragraph “foreign currency risk warning” means a warning, on paper or on another durable medium—ainforming the borrower of a rise in the total amount payable by the borrower;bsetting out, where applicable, the borrower's right to convert to an alternative currency and the conditions for doing so; andcexplaining any other applicable mechanism for limiting the exchange rate risk to which the borrower is exposed.Variable rate credits15Where the contract provides for variable rate credit, the creditor must—amake any indexes or reference rates used to calculate the borrowing rate clear, accessible, objective and verifiable by the borrower and the FCA; andbmaintain historical records of indexes used by the creditor for calculating the borrowing rates.<Emphasis>Sound execution of consumer buy-to-let mortgage contracts and related rights</Emphasis>Early repayment161Subject to sub-paragraph (3), the creditor must allow the borrower to discharge fully or partially the borrower's obligations under the consumer buy-to-let mortgage contract prior to the expiry of that contract.2Where the borrower discharges, fully or partially, the borrower's obligations prior to the expiry of the contract, the creditor must provide the borrower with a reduction in the total cost of credit to the borrower, consisting of the interest and costs for the remaining duration of the contract.3The creditor may provide that the exercise of the right referred to in sub-paragraph (1) is subject to one or more of the following conditions—atime limitations on the exercise of the right;bdifferent treatment depending on the type of borrowing rate or on the moment the borrower exercises the right;crestrictions with regard to the circumstances in which the right may be exercised; ordif the exercise of the right falls within a period for which the borrowing rate is fixed, the existence of a legitimate interest on the part of the borrower.4The creditor is entitled to fair and objective compensation, where justified, for possible costs directly linked to the early repayment but the creditor must not impose a sanction on the borrower and the amount of compensation must not exceed the financial loss of the creditor.5Where a borrower seeks to exercise the right referred to in sub-paragraph (1), the creditor must provide the borrower without delay after receipt of the borrower's request, on paper or on another durable medium, with the information necessary to consider whether to proceed with the exercise of the right.6The information referred to in sub-paragraph (5) must include—aa quantification of the implications for the borrower of exercising the right; andbany assumptions used by the creditor in making that quantification.7The assumptions referred to in sub-paragraph (6)(b) must be reasonable and justifiable.Flexible and reliable markets17The creditor must keep appropriate records concerning, where applicable, the types of property accepted by the creditor as security and the related mortgage underwriting policies used by the creditor in relation to its consumer buy-to-let mortgage business.Information concerning changes in the borrowing rate181Unless sub-paragraph (3) applies, the creditor must inform the borrower of any change in the borrowing rate, on paper or another durable medium, before the change takes effect.2The information referred to in sub-paragraph (1) must include—aa statement of the amount of the payments to be made after the new borrowing rate takes effect; andbin cases where the number or frequency of the payments changes, particulars of those changes.3This sub-paragraph applies if—athe change in the borrowing rate is correlated with a change in a reference rate;bthe new reference rate is made publicly available by appropriate means;cthe creditor agrees with the borrower in the contract that information about any change in borrowing rate may be given to the borrower periodically; anddthe information concerning the new reference rate is kept available in the premises of the creditor and communicated personally to the borrower together with the amount of new periodic instalments.Arrears and possession191A creditor must exercise reasonable forbearance before initiating possession proceedings.2Any charges that the creditor imposes on the borrower arising from the borrower's default must be no greater than is necessary to compensate the creditor for costs incurred by the creditor as a result of the default.3Where the price obtained for the secured property affects the amount owed by the borrower under the contract, the creditor must take all reasonable steps to obtain the best possible price for the secured property.4Where, after possession proceedings, outstanding debt remains, the creditor must put in place measures to facilitate repayment by the borrower.<Emphasis>Calculation of the annual percentage rate of charge</Emphasis>Basic equation expressing the equivalence of drawdowns on the one hand and repayments and charges on the other201The basic equation, which establishes the annual percentage rate of charge, equates, on an annual basis, the total present value of drawdowns on the one hand and the total present value of repayments and payments of charges on the other hand, expressed by means of the following formula— ∑ k = 1 m C k ( 1 + X ) − t k = ∑ l = 1 m ' D 1 ( 1 + X ) − S lwhere—X is the annual percentage rate of charge;m is the number of the last drawdown;k is the number of a drawdown thus, C k t km' is the number of the last repayment or payment of charges;l is the number of a repayment or payment of charges; D 1 s 1where—X is the annual percentage rate of charge;m is the number of the last drawdown;k is the number of a drawdown thus, C k t km' is the number of the last repayment or payment of charges;l is the number of a repayment or payment of charges; D 1 s 12The following remarks apply to the equation set out in sub-paragraph (1)—athe amounts paid by both parties at different times shall not necessarily be equal and shall not necessarily be paid at equal intervals;bthe starting date must be that of the first drawdown;cintervals between dates used in the calculation must be expressed in years or in fractions of a year, where—ia year is presumed to have 365 days (or 366 days for leap years), 52 weeks or 12 equal months; andiian equal month is presumed to have 30.41666 days regardless of whether or not it is a leap year;dwhere intervals between dates used in the calculations cannot be expressed as a whole number of weeks, months or years, the intervals must be expressed as a whole number of one of those periods in combination with a number of days;efor the purposes of paragraph (d), where using days—ievery day must be counted, including weekends and holidays;iiequal periods and then days must be counted backwards to the date of the initial drawdown; andiiithe length of the period of days must be—aaobtained excluding the first day and including the last day; andbbexpressed in years by dividing this period by the number of days (365 or 366 days) of the complete year counted backwards from the last day to the same day of the previous year;fthe result of the calculation must be expressed with an accuracy of at least one decimal place and if the figure at the following decimal place is greater than or equal to 5, the figure at the preceding decimal place must be increased by one;gthe equation may be rewritten using a single sum and the concept of flows ( s = ∑ k = 1 n A k ( 1 + X ) − t kwhere s is the present balance of flows;hfor the purposes of paragraph (g), if the aim is to maintain the equivalence of flows, the value of s will be zero.Additional assumptions for the calculation of the annual percentage rate of charge211The following additional assumptions apply for the purposes of calculating the annual percentage rate of charge.2If a consumer buy-to-let mortgage contract gives the borrower freedom of drawdown, the total amount of credit must be deemed to be drawn down immediately and in full.3If a consumer buy-to-let mortgage contract provides different ways of drawdown with different charges or borrowing rates, the total amount of credit must be deemed to be drawn down at the highest charge and borrowing rate applied to the most common drawdown mechanism for this type of contract.4If a consumer buy-to-let mortgage contract gives the borrower freedom of drawdown in general but imposes, amongst the different ways of drawdown, a limitation with regard to the amount of credit and period of time, the amount of credit must be deemed to be drawn down on the earliest date provided for in the contract and in accordance with those drawdown limits.5If different borrowing rates and charges are offered for a limited period or amount, the highest borrowing rate and charges must be deemed to be the borrowing rate and charges for the whole duration of the contract.6For consumer buy-to-let mortgage contracts for which a fixed rate borrowing rate is agreed in relation to the initial period, at the end of which a new borrowing rate is determined and subsequently periodically adjusted according to an agreed indicator or internal reference rate the calculation of the annual percentage rate of charge must be based on the assumption that, at the end of the fixed borrowing rate period, the borrowing rate is the same as at the time of calculation of the annual percentage rate of charge, based on the value of the agreed indicator or internal reference rate at that time, but is not less than the fixed borrowing rate.7If the ceiling applicable to the credit has not yet been agreed, that ceiling is assumed to be—ain the case of credit agreements, other than contingent liabilities or guarantees, the purpose of which is not to acquire or retain a right in immovable property or land, overdrafts, deferred debit cards or credit cards, EUR 1,500; andbin all other cases, EUR 170,000.8In the case of credit agreements other than overdrafts, bridging loans, shared equity credit agreements, contingent liabilities or guarantees and open-ended credit agreements as referred to in the assumptions set out in sub-paragraphs (10), (11), (12), (16) and (17)—aif the date or amount of a repayment of capital to be made by the borrower cannot be ascertained, it must be assumed that the repayment is made at the earliest date provided for in the credit agreement and is for the lowest amount for which the credit agreement provides; andbif the interval between the date of initial drawdown and the date of the first payment to be made by the borrower cannot be ascertained, it must be assumed to be the shortest interval.9Where the date or amount of a payment to be made by the borrower cannot be ascertained on the basis of the credit agreement or the assumptions set out in sub-paragraphs (8), (10), (11), (12), (16) and (17) it must be assumed that the payment is made in accordance with the dates and conditions required by the creditor and, when these are unknown—ainterest charges are paid together with the repayment of the capital;bnon-interest charges expressed as a single sum are paid at the date of the conclusion of the credit agreement;cnon-interest charges expressed as several payments are paid at regular intervals, commencing with the date of the first repayment of capital, and if the amount of such payments is not known they shall be assumed to be equal amounts; anddthe final payment clears the balance of capital, interest and other charges, if any.10In the case of an overdraft facility, the total amount of credit must be deemed to be drawn down in full and for the whole duration of the credit agreement and, if the duration of the overdraft facility is not known, the annual percentage rate of charge must be calculated on the assumption that the duration of the credit is three months.11In the case of a bridging loan, the total amount of credit must be deemed to be drawn down in full and for the whole duration of the credit agreement and, if the duration of the credit agreement is not known, the annual percentage rate of charge must be calculated on the assumption that the duration of the credit is 12 months.12In the case of an open-ended credit agreement, other than an overdraft facility and bridging loan, it must be assumed that—afor credit agreements the purpose of which is to acquire or retain rights in immovable property, the credit is provided for a period of 20 years starting from the date of the initial drawdown, and the final payment made by the borrower clears the balance of capital, interest and other charges, if any;bfor credit agreements the purpose of which is not to acquire or retain rights in immovable property or which are drawn down by deferred debit cards or credit cards, the credit is provided for a period of 1 year starting from the date of the initial drawdown;cunless sub-paragraph (13) applies, the capital is repaid by the borrower in equal monthly payments, commencing one month after the date of the initial drawdown.13This sub-paragraph applies in cases where the capital must be repaid only in full, in a single payment, within each payment period.14If sub-paragraph (13) applies—asuccessive drawdowns and repayments of the entire capital by the borrower must be assumed to occur over the period of one year; andbinterest and other charges must be applied in accordance with those drawdowns and repayments of capital and as provided for in the credit agreement.15For the purposes of sub-paragraph (12), an open-ended credit agreement is a credit agreement without fixed duration and includes credits which must be repaid in full within or after a period but, once repaid, become available to be drawn down again.16In the case of contingent liabilities or guarantees, the total amount of credit must be deemed to be drawn down in full as a single amount at the earlier of—athe latest draw down date permitted under the credit agreement being the potential source of the contingent liability or guarantee; orbin the case of a rolling credit agreement at the end of the initial period prior to the rollover of the agreement.17In the case of a shared equity credit agreement—athe payments by borrowers must be deemed to occur at the latest date or dates permitted under the credit agreement; andbpercentage increases in value of the immovable property which secures the shared equity credit agreement, and the rate of any inflation index referred to in the agreement, shall be assumed to be a percentage equal to the higher of the current central bank target inflation rate or the level of inflation rate in the EEA State where the property is located at the time of conclusion of the credit agreement or 0% if those percentages are negative.

(This note is not part of the Order)

This Order transposes in part Directive 2014/17/EU of the European Parliament and of the Council of 4th February 2014 on credit agreements for consumers relating to residential immovable property and amending Directives 2008/48/EC and 2013/36/EU and Regulation (EU) No 1093/2010 (“the mortgages directive”) (OJ L 60, 28.2.2014, p.34). The Financial Conduct Authority (“FCA”) is responsible for transposing other parts of the mortgages directive. A transposition note setting out how the mortgages directive will be transposed into UK law will be available from Her Majesty's Treasury, 1 Horse Guards Road, London SW1A 2HQ or on HM Treasury's website (www.gov.uk/government/organisations/hm-treasury).

Part 2 introduces Schedule 1, which contains amendments to legislation required to implement the mortgages directive. Part 1 of that Schedule sets out amendments to primary legislation, including the Financial Services and Markets Act 2000 (c. 8) and the Consumer Credit Act 1974 (c. 39). The amendments to the Financial Services and Markets Act 2000 include amendments to the regulatory regime for appointed representatives carrying out mortgage-related activities and amendments to the provisions about cross-border activities within the EEA.

Part 2 of Schedule 1 sets out amendments to secondary legislation, including amendments to the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544) to ensure that the mortgage-related activities regulated by the FCA include those activities required to be regulated by the mortgages directive, and that existing exemptions from regulation apply only where permitted by the mortgages directive. The definition of a “regulated mortgage contract” is amended to take second charge mortgage lending out of scope of the consumer credit regulatory regime and bring it into scope of the mortgages regime. That Part also sets out consequential changes to other orders and regulations.

Part 3, including Schedule 2, sets out a framework for regulating buy-to-let mortgage lending to consumers. The Part makes provision for a register of the firms involved in such lending, for the requirements with which such firms must comply, and for the FCA to monitor and enforce those requirements.

Part 4 makes provisions relating to the transition to the new regime for existing lenders, intermediaries and appointed representatives.

Part 5 requires the Treasury to review the operation and effect of this Order by 1st September 2018 and within every 5 years after that.

A full Impact Assessment of the effect that this Order will have on the costs of business and the voluntary sector is available from Her Majesty's Treasury, 1 Horse Guards Road, London SW1A 2HQ or on HM Treasury's website (www.gov.uk/government/organisations/hm-treasury) and is published with the Explanatory Memorandum alongside this Order on the legislation.gov.uk website.

S.I. 2012/1759.1972 c. 68. Section 2(2) was amended by section 27(1)(a) of the Legislative and Regulatory Reform Act 2006 (c. 51) and the European Union (Amendment) Act 2008 (c. 7), Schedule, Part 1. By virtue of the amendment of section 1(2) by section 1 of the European Economic Area Act 1993 (c. 51) legislation may be made under section 2(2) of the European Communities Act to implement obligations of the United Kingdom created or arising by or under the Agreement on the European Economic Area signed at Oporto on 2nd May 1992 (Cm 2073) and the Protocol adjusting the Agreement signed at Brussels on 17th March 1992 (Cm 2183).2000 c.8.S.I. 2001/1201, amended by S.I. 2003/1675, 2005/592, 2006/2383, 2008/2831, 2009/1342, 2010/671, 2011/1626 and 2012/641 and 700; there are other amending instruments but none is relevant to this Order.Paragraph 2 was amended by section 27 of the Legislative and Regulatory Reform Act 2006 (c. 51) and paragraph 2A was inserted by section 29 of that Act.Paragraph 26 of Schedule 2 was substituted by section 8 of the Financial Services Act 2012 (c. 21).Paragraph 1A of Schedule 2 was inserted by section 28 of the Legislative and Regulatory Reform Act 2006 and amended by Part 1 of the Schedule to the European Union (Amendment) Act 2008 and S.I. 2007/1388.Section 14A of the Interpretation Act 1978 (c. 30) (inserted by section 59 of the Enterprise and Regulatory Reform Act 2013 (c. 24)) provides that, where an Act provides a power to make subordinate legislation, that subordinate legislation may include a requirement to review the effectiveness of the legislation.Articles 36A and 60B were inserted by S.I. 2003/1881.Articles 25A and 53A were inserted by S.I. 2003/1475.Article 61 was amended by S.I. 2001/3544, 2005/2114, 2006/3283 and 2010/2960.Paragraphs 13(1) and 14(1) were previously amended by paragraph 2 of Schedule 4 to the Financial Services Act 2012 (c. 21) and by S.I. 2003/1473 and 2066, 2007/126 and 2013/1773.Paragraph 19(2) was previously amended by paragraph 10 of Schedule 4 to the Financial Services Act 2012.Paragraph 20(1) was previously amended by paragraph 11 of Schedule 4 to the Financial Services Act 2012 and by S.I. 2007/3253 and 2013/1773.OJ L 60, 28.2.2014, p.34.S.I. 2001/544.Article 61(2) was amended by S.I. 2001/3544.Article 72I is inserted by paragraph 4 of the Schedule to this Order.Section 388 was amended by paragraphs 1 and 27 of Schedule 9 to the Financial Services Act 2012 (c. 21) and by paragraph 13 of Schedule 3 to the Financial Services (Banking Reform) Act 2013 (c. 33).Article 61A is inserted by paragraph 4 of the Schedule to this Order.Section 387 was amended by paragraphs 1 and 26 of Schedule 9 to the Financial Services Act 2012 and paragraph 12 of Schedule 3 to the Financial Services (Banking Reform) Act 2013.S.I. 2013/1881. Article 56 was amended by S.I. 2014/366 and 376.OJ L 305, 24.10.2014, p.1Section 39 was amended by section 10 of, and paragraph 5 of Schedule 18 to, the Financial Services Act 2012 (c. 21) and by S.I. 2007/126 and 2013/3115.Section 348 was amended by paragraph 26 of Schedule 2 to the Financial Services Act 2010 (c. 28), paragraph 18 of Schedule 12 to the Financial Services Act 2012 (c. 21) and paragraph 5 of Schedule 8 to the Financial Services (Banking Reform) Act 2013 (c. 33).Section 349 was amended by section 964 of the Companies Act 2006 (c. 46), paragraph 19 of Schedule 12 to the Financial Services Act 2012 and S.I. 2006/1183.Section 352 was amended by paragraph 54 of Schedule 26 to the Criminal Justice Act 2003 (c. 44).Section 166 was substituted by paragraph 5 of Schedule 12 to the Financial Services Act 2012.Sections 55L, 55Y and 55Z3 were substituted, together with the rest of Part 4A of the Act, by section 11(2) of the Financial Services Act 2012.Section 204A was inserted by paragraphs 1 and 10 of Schedule 9 to the Financial Services Act 2012 (c. 21).Section 380 was amended by paragraph 19 of Schedule 9 to the Financial Services Act 2012 (c. 21), paragraph 3 of Schedule 10 to the Financial Services (Banking Reform) Act 2013 (c. 33) and S.I. 2013/1773.Section 382 was amended by paragraph 21 of Schedule 9 to the Financial Services Act 2012, paragraph 3 of Schedule 10 to the Financial Services (Banking Reform) Act 2013 and S.I. 2013/1773.Section 398 was amended by paragraph 36 of Schedule 9 to the Financial Services Act 2012 and by S.I. 2013/1773.Section 165 was amended by paragraph 15 of Schedule 2 to the Financial Services Act 2010 (c. 28), paragraph 1 of Schedule 12 to the Financial Services Act 2012 and S.I. 2013/1773.Section 166 was substituted by paragraph 5 of Schedule 12 to the Financial Services Act 2012.Section 167 was amended by paragraph 7 of Schedule 12 to the Financial Services Act 2012 and S.I. 2007/126.Section 168 was amended by paragraph 33 of Schedule 7 to the Counter-Terrorism Act 2008 (c. 28), paragraph 16 of Schedule 2 to the Financial Services Act 2010, paragraph 8 of Schedule 12 to the Financial Services Act 2012 and S.I. 2007/126, 2012/2554 and 2013/1773.Section 169 was amended by paragraph 9 of Schedule 12 to the Financial Services Act 2012.Section 170 was amended by paragraph 10 of Schedule 12 to the Financial Services Act 2012.Section 171 was amended by S.I. 2007/126.Section 174 was amended by paragraph 12 of Schedule 12 to the Financial Services Act 2012.Section 175 was amended by paragraph 13 of Schedule 12 to the Financial Services Act 2012.Section 176 was amended by paragraph 17 of Schedule 2 to the Financial Services Act 2010, paragraph 14 of Schedule 12 to the Financial Services Act 2012 and S.I. 2005/1433.Section 176A was inserted by paragraph 15 of Schedule 12 to the Financial Services Act 2012.Section 177 was amended by paragraph 8 of Schedule 8 to the Financial Services Act 2012 and S.I. 2001/1090.Section 205 was amended by paragraph 11 of Schedule 9 to the Financial Services Act 2012.Section 206 was amended by section 10 of the Financial Services Act 2010 and by paragraph 12 of Schedule 9 to the Financial Services Act 2012.Sections 207 to 211 were amended by paragraphs 18, 19 and 20 of Schedule 2 to the Financial Services Act 2010 (c. 28) and by paragraphs 14, 15, 16, 17 and 18 of Schedule 9 to the Financial Services Act 2012 (c. 21).Schedule 1ZA was substituted by Schedule 3 to the Financial Services Act 2012.Paragraph 23 was amended by paragraph 7 of Schedule 8 and paragraph 4 of Schedule 10 to the Financial Services (Banking Reform) Act 2013 (c. 33) and by S.I. 2013/1773.Paragraph 25 was amended by section 109 of the Financial Services (Banking Reform) Act 2013.Section 226 was amended by paragraph 1 of Schedule 11 to the Financial Services Act 2012 and by S.I. 2009/209 and 2011/99.Section 232A was inserted by paragraph 9 of Schedule 11 to the Financial Services Act 2012.Section 234 was amended by paragraph 10 of Schedule 11 to the Financial Services Act 2012 and by S.I. 2009/209 and 2011/99.Paragraph 13 was amended by paragraphs 13 and 24 of Schedule 11 to the Financial Services Act 2012 and by S.I. 2009/209 and 2011/99.1974 c.39.Section 127 was amended by Schedule 4 to the Consumer Credit Act 2006 (c. 14) and by S.I. 2010/1010.Section 55(2) was substituted by S.I. 2010/1010.Section 61B was inserted by S.I. 2010/1010.Section 77(1) was amended by S.I. 1998/997.Section 77A(1) was inserted by section 6 of the Consumer Credit Act 2006 (c. 14) and subsequently substituted by S.I. 2008/2826.Section 78(1) was amended by S.I. 1998/997.Section 97(1) was amended by S.I. 2010/1010.Section 86D was inserted by section 11 of the Consumer Credit Act 2006.Section 86E was inserted by section 12 of the Consumer Credit Act 2006.Section 107 was amended by S.I. 1998/997 and S.I. 2008/1277.Section 108 was amended by S.I. 1998/997 and S.I. 2008/1277.Section 110 was amended by S.I. 1998/997 and S.I. 2008/1277.Section 93 was amended by S.I. 2013/1881.Section 94 was amended by section 29 of the Energy Act 2011 (c. 16) and by S.I. 2010/1010.Section 95 was amended by S.I. 2010/1010.Sections 140A to 140C were inserted by sections 19 to 21 of the Consumer Credit Act 2006 (c. 14) and subsequently amended by S.I. 2013/1881.Section 8(3) was substituted by S.I. 2013/1881.Section 8(1) was amended by section 2 of the Consumer Credit Act 2006.Article 53A was inserted by S.I. 2003/1475.Article 25A was inserted by S.I. 2003/1475.Article 61 was amended by S.I. 2001/3544, 2005/2114, 2006/2383 and 2010/2960.Section 39 was amended by section 10 of, and paragraph 5 of Schedule 18 to, the Financial Services Act 2012 (c. 21) and by S.I. 2007/126 and 2013/3115.Section 55J was substituted, together with the rest of Part 4A, for the original Part IV, by section 11 of the Financial Services Act 2012 and was subsequently amended by S.I. 2013/1773 and 3115.Section 137R was substituted (together with the rest of Part 9A) for the original Part X by section 24 of the Financial Services Act 2012 (c. 21).Section 194B was inserted by S.I. 2013/3115.Section 195A was inserted by S.I. 2007/126, substituted by S.I. 2011/1613 and then subsequently amended by paragraph 35 of Schedule 4 to the Financial Services Act 2012 (c. 21) and by S.I. 2012/916 and 2013/1773 and 1797.OJ L 331 15.12.2010, p.12.Section 347 was amended by paragraph 16 of Schedule 12 to the Financial Services Act 2012 (c. 21), section 34 of, and paragraph 11 of Schedule 3 to, the Financial Services (Banking Reform) Act 2015 (c. 33) and S.I. 2007/126 and 2013/1388.Section 417(1) was amended by paragraph 16 of Schedule 2 to the Criminal Justice and Police Act 2001 (c. 16), section 964 of the Companies Act 2006 (c. 46), section 174 of the Banking Act 2009 (c. 1), paragraph 31 of Schedule 2 to the Financial Services Act 2010 (c. 28), section 48 of the Financial Services Act 2012 (c. 21), section 4 of the Financial Services (Banking Reform) Act 2013 (c. 33) and paragraph 71 of Schedule 4 to the Co-operative and Community Benefit Societies Act 2014 (c. 14), and by S.I. 2002/1775, 2005/1433, 2007/126, 2009/1941, 2010/22, 2012/916, 1809, 1906 and 2554, 2013/504, 1773 and 3115 and 2014/2879.Section 425(1) was amended by S.I. 2003/2066, 2004/3379, 2006/2975, 2007/126 and 3253, 2012/1906 and 2013/1773 and 3115.Paragraph 1 was amended by S.I. 2000/2952, 2003/1473 and 2066, 2007/126 and 3253, and 2013/1773 and 3115.Paragraph 4E was inserted by S.I. 2013/1773.Paragraph 5 was amended by S.I. 2003/1473 and 2066, 2004/3379, 2006/3221, 2007/126 and 3253, 2011/1613, 2012/1906, and 2013/1773, 1797 and 3115.Paragraph 5A was inserted by S.I. 2003/1473 and amended by S.I. 2013/1773.Paragraph 7A was inserted by S.I. 2003/1473 and amended by S.I. 2013/1773 and 1797.Paragraph 13 was amended by paragraph 2 of Schedule 4 to the Financial Services Act 2012 (c. 21) and by S.I. 2003/1473 and 2066, 2007/126, 2012/1906 and 2013/1773.Paragraph 14 was amended by paragraph 3 of Schedule 4 to the Financial Services Act 2012 and by S.I. 2003/1473 and 2066, 2007/126, 2012/1906, and 2013/1773 and 1797.Paragraph 19 is amended by paragraph 10 of Schedule 4 to the Financial Services Act 2012 (c. 21) and by S.I. 2003/1473 and 2066, 2007/126 and 3253, 2011/1613, 2012/916 and 1906, and 2013/1773, 1797 and 3115.Paragraph 20 is amended by paragraph 11 of Schedule 4 to the Financial Services Act 2012 and by S.I. 2001/1376, 2003/1473 and 2066, 2007/126 and 3253, 2011/1613, 2012/1906, and 2013/1773, 1797 and 3115.Paragraph 20ZA was inserted by S.I. 2011/1613 and was subsequently amended by paragraph 13 of Schedule 4 to the Financial Services Act 2012 and by S.I. 2013/3115.Paragraph 21 was amended by S.I. 2003/1473.Paragraph 25 was inserted by S.I. 2003/1473 and was subsequently amended by paragraph 18 of Schedule 4 to the Financial Services Act 2012.1974 c.39.Subsection (3) was substituted by S.I. 2013/1881.Section 55C was inserted by S.I. 2010/1010 and subsequently amended by S.I. 2013/1881.Section 60 was amended by paragraph 6 of Schedule 25 to the Enterprise Act 2002 (c. 40) and by S.I. 2010/1010 and 2013/1881 and 1882.Section 61A was inserted by S.I. 2010/1010 and subsequently amended by S.I. 2013/1881.Section 66A was inserted by S.I. 2010/1010.Section 75A was inserted by S.I. 2010/1010 and subsequently amended by S.I. 2013/1881.Section 77B was inserted by S.I. 2010/1010 and subsequently amended by section 27 of the Energy Act 2011 (c. 16) and by S.I. 2013/1881 and 2014/436.There are amendments to section 189 but none is relevant to this Order.OJ L 133, 22.5.2008, p. 66; Article 2(2a) was inserted by article 46 of Directive 2014/17/EU of the European Parliament and of the Council of 4 February 2014 on credit agreements for consumers relating to residential immovable property (OJ L 60, 28.2.2014, p.34).Article 3 was amended by S.I. 2006/3384 and 2013/3115; there are other amendments to article 3 but none is relevant to this Order.Article 4 was amended by S.I. 2003/1476, 2006/3384, 2009/1389, 2013/1773 and 1881 and 2014/1292.Article 25A was inserted by S.I. 2003/1475.Article 29 was amended by S.I. 2003/1476, 2006/2383 and 3384 and 2009/1342.Article 36 was amended by S.I. 2002/1776, 2003/1475 and 1476, 2006/2383 and 3384, 2009/1342, 2013/1773 and 2014/366.Article 36E was inserted by S.I. 2013/1881.Article 36G was amended by S.I. 2013/1881 and amended by S.I. 2014/366.Article 53D was inserted by S.I. 2009/1342.Article 54 was amended by S.I. 2003/1475 and 1476, 2006/2383, 2009/1342 and 2013/472.Article 54A was inserted by S.I. 2003/1475 and subsequently amended by S.I. 2006/2383 and 2009/1342.Article 55 was amended by S.I. 2002/1776, 2003/1475 and 1476, 2006/2383, 2009/1342, 2013/1773 and 2014/366.Chapter 14A (articles 60B to 60M) was inserted by S.I. 2013/1881. Articles 60C to 60G and 60K were subsequently amended by S.I. 2014/366.Article 61 was amended by S.I. 2001/3544, 2005/2114, 2006/2383 and 2010/2960.Article 63A was inserted by S.I. 2002/1776, substituted by S.I. 2003/1475 and subsequently amended by S.I. 2013/1773 and 2014/366.Article 66 was amended by S.I. 2003/1475 and 1476, 2005/593, 2006/2383 and 3384, 2009/1342.Article 67 was amended by S.I. 2001/3544, 2003/1475 and 1476, 2006/2383 and 3384 and 2009/1342.Article 72 was amended by S.I. 2003/1475 and 1476, 2006/2383 and 3384, 2009/1342 and 2013/504.Article 72G was inserted by S.I. 2014/366.OJ L 133 22.5.2008, p.66.2006 c. 46.Article 72H was inserted by S.I. 2014/366.S.I. 2001/1201. Paragraph 48 of the Schedule was substituted by S.I. 2003/1675 and subsequently amended by S.I. 2005/592, 2006/2383, 2008/2831, 2009/1342, 2010/671, 2011/1626 and 2012/641 and 700.S.I. 2001/1783.Regulation 1 was amended by S.I. 2003/1476 and 2066, 2011/1613 and 2013/1773 and 3115.Regulation 2 was amended by S.I. 2003/1476 and 2066, 2011/1613 and 2013/1773.Regulation 3 was amended by S.I. 2003/1476 and 2066 and 2013/1773.Regulation 4 was amended by S.I. 2003/1476 and 2066 and 2013/1773.S.I. 2001/1217.Regulation 2(1) was amended by S.I. 2001/2508, 2003/1475 and 1476, 2004/453 and 2737, 2006/2383, 2012/1906, 2013/1881 and 2014/206Regulation 3(3) was inserted by S.I. 2003/1475.S.I. 2001/2188.In regulation 2 the definition of “markets in financial instruments directive information” was inserted by S.I. 2006/3413 and was subsequently amended by S.I. 2010/2628 and 2013/472 and 3115. The definition of “single market restrictions” was inserted by S.I. 2012/916 and was subsequently amended by S.I. 2013/504, 1773 and 3115. There are other amendments to regulation 2 but none is relevant to this Order.Regulation 9 was amended by S.I. 2003/693, 2004/3379, 2006/3413, 2007/3255, 2010/2628, 2011/1613, 2012/916, 2013/472, 504, 1773 and 3115.S.I. 2001/2511.Regulation 1(2) was amended by S.I. 2002/765, 2003/1473 and 2066, 2006/3385, 2007/763, 2011/99 and 2013/642.Regulation 2 was amended by S.I. 2002/765, 2003/2066, 2004/1862, 2006/3385, 2011/99 and 2013/642, 1773, 1797 and 3115.Regulation 3 was amended by S.I. 2003/1473 and 2066, 2004/1862, 2006/3385 and 2013/642, and 1773.Regulation 7A was inserted by S.I. 2013/1773.Regulation 9 was amended by S.I. 2013/642.Regulation 17A was inserted by S.I. 2013/1773 and amended by S.I. 2013 1797.S.I. 2001/3084.Article 2 was amended by S.I. 2005/1, 2006/1805, 2007/2932 and 3254, 2012/2017, 2013/472 and 3115 and 2014/1292.Section 194C is inserted by this Order.Section 195B is inserted by this Order.Article 3 was amended by S.I. 2007/3254 and 2014/1292.S.I. 2004/1481. Regulation 2 was substituted by S.I. 2010/1010, as amended by S.I. 2011/1969.S.I. 2005/1529. Paragraph 10BA was inserted by S.I. 2013/1881 and amended by S.I. 2014/366. In paragraph 28 the definition of “relevant credit agreement was inserted by S.I. 2013/1881 and amended by S.I. 2014/366.S.I. 2010/1013. Regulation 2 was amended by S.I. 2013/1881.S.I. 2010/1014.Regulation 2 was amended by S.I. 2010/1969 and 2013/1881.Schedule 1 was amended by S.I. 2010/1969, 2012/2798, 2013/1881 and 2014/366.S.I. 2013/1881. Article 58 was amended by S.I. 2014/208, 366, 506 and 2632.Word in art. 2(1) omitted (20.9.2015) by virtue of The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(2)(a)Words in art. 2(1) inserted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(2)(b)Word in art. 27(1) inserted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(3)Words in art. 31(2) inserted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(4)(b)Words in art. 31(1)(c) substituted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(4)(a)(i)Words in art. 31(1)(c) substituted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(4)(a)(ii)Words in art. 31(1)(d) inserted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(4)(b)Words in art. 31(3) inserted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(4)(c)Sch. 1 para. 3 omitted (20.9.2015) by virtue of The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(5)Sch. 2 para. 14(1) substituted (20.9.2015) by The Mortgage Credit Directive (Amendment) Order 2015 (S.I. 2015/1557), arts. 1(2), 2(6)Art. 2(1): text amended (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 8(2)(a)(i) (with Pt. 5)Words in art. 2(1) omitted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by virtue of The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 8(2)(a)(ii) (with Pt. 5)Words in art. 2(1) substituted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 8(2)(b) (with Pt. 5)Art. 3A inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 8(3) (with Pt. 5)Art. 28 substituted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 8(4) (with Pt. 5)Words in art. 29(1) inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 8(5) (with Pt. 5)Art. 31A inserted (17.3.2016 for specified purposes, 21.3.2016 in so far as not already in force) by The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2016 (S.I. 2016/392), art. 1(2)(3)(c), 8(6) (with Pt. 5)