On 29 October 2019, the Financial Services Duty of Care Bill 2019-20 (the Bill) had its first reading in the House of Lords.
If the Bill becomes law it will amend the Financial Services and Markets Act 2000 (FSMA) by inserting a new section 137CA, “FCA general rules: duty of care”. This new section extends the FCA’s power to make general rules to include the power to introduce a duty of care owed by authorised persons to consumers in carrying out regulated activities under FSMA. The definition of “duty of care” in section 137CA is defined as “an obligation to exercise reasonable care and skill when providing a product or a service”. “Consumer” has the meaning given in section 2(3) of the Consumer Rights Act 2015.
The Bill also requires the FCA to make rules in accordance with section 137CA which come into force no later than six months after the day on which the Act comes into force.
The date for the Bill’s second reading has yet to be announced.