When does FCA regulate?

KevCliff

Not sure this is the correct board, but here goes.

If I purchase a subscription to a company & it costs £3k, I have the opportunity to pay it up via direct debit over a number of months.

On first DD my subscription is active.

Does this constitute credit, would the company have to register with FCA & would the FCA be the regulator? 

Is there a difference if the company is ltd, or a plc, or even a charity?

DullGreyGuy

KevCliff said:

Not sure this is the correct board, but here goes.

If I purchase a subscription to a company & it costs £3k, I have the opportunity to pay it up via direct debit over a number of months.

On first DD my subscription is active.

Does this constitute credit, would the company have to register with FCA & would the FCA be the regulator? 

Is there a difference if the company is ltd, or a plc, or even a charity?

This is not a simple area of law but the fact you have called it a subscription certainly makes it sound like it isnt credit.  A sim only mobile phone contract would be a good example, its a monthly contract with a minimum of a 12 month commitment and so its not credit. You just pay for your line rental in advance and your calls in arrears. This is not credit. 

If you however get a £1,000 phone from your mobile provider and repay that over the 12 months in monthly intervals then that is credit. 

There is no difference on regulation of credit on if a company is a private limited company (LTD) or a Public Limited Company (PLC). Charities do have certain different rules in some spaces, I dont know of any on credit but its not my area of expertise. 

KevCliff

Ok, perhaps subscription isn't the best word. Fundamentally, if you are paying up the item, but you've already got it (as opposed to paying it up to then get it) then it does sound like credit. I might ask the FCA directly then. I've been somewhat let down by this non-registered company & just looking at my options of address. 

DullGreyGuy

KevCliff said:

Ok, perhaps subscription isn't the best word. Fundamentally, if you are paying up the item, but you've already got it (as opposed to paying it up to then get it) then it does sound like credit. I might ask the FCA directly then. I've been somewhat let down by this non-registered company & just looking at my options of address. 

It's always easier if you name names and say precisely what's going on else we talk about the hypotheticals of subscriptions when actually it's not a subscription at all. 

Interest free credit no more than 12 months in duration dont necessarily have to be registered. There is also limited registration for some. I believe for credit there is also something like Authorised Representative for some activities where another regulated firm appoints them as an AR and takes on the liability for any issues that arise 

Ergates

There are multiple different methods of "delayed payment" - some of which constitute credit, and some of which don't.    So we can't really say if this is such a case without more details.

Hoenir

What does your paperwork say? 

PHK

DullGreyGuy said:

KevCliff said:

Not sure this is the correct board, but here goes.

If I purchase a subscription to a company & it costs £3k, I have the opportunity to pay it up via direct debit over a number of months.

On first DD my subscription is active.

Does this constitute credit, would the company have to register with FCA & would the FCA be the regulator? 

Is there a difference if the company is ltd, or a plc, or even a charity?

This is not a simple area of law but the fact you have called it a subscription certainly makes it sound like it isnt credit.  A sim only mobile phone contract would be a good example, its a monthly contract with a minimum of a 12 month commitment and so its not credit. You just pay for your line rental in advance and your calls in arrears. This is not credit. 

If you however get a £1,000 phone from your mobile provider and repay that over the 12 months in monthly intervals then that is credit. 

There is no difference on regulation of credit on if a company is a private limited company (LTD) or a Public Limited Company (PLC). Charities do have certain different rules in some spaces, I dont know of any on credit but its not my area of expertise. 

As you say the issue is complicated. Some types of lending is regulated for some types of companies and not for others. For example credit unions are limited companies but have certain exemptions. The same goes for different types of charity. 

Only a thorough check of the FSMA2000 ( Regulated Activities Order) and the FCA Handbook will give a definitive answer in a specific case. 

So in this case we'll need more information. But even if the business is regulated and the OP contacts them the FSMA restricts what the FCA can tell the OP.

If the OP thinks the firm are regulated then they should approach the Financial Ombudsman Service who will happily investigate and an Ombudsman will give a jurisdiction decision. 

DullGreyGuy

PHK said:
So in this case we'll need more information. But even if the business is regulated and the OP contacts them the FSMA restricts what the FCA can tell the OP.

If the OP thinks the firm are regulated then they should approach the Financial Ombudsman Service who will happily investigate and an Ombudsman will give a jurisdiction decision. 

I think in this case the OP knows they arent regulated but thinks that maybe they should be. 

https://www.fca.org.uk/consumers/warning-list-unauthorised-firms is a list of companies the FCA is aware of that are operating without the necessary permissions for their activities and it also has a contact us link to report other companies.