• CIPR Chapter 3 CIPR Chapter 3 General obligations of all authorised firms

    • CIPR Part 3.1 CIPR Part 3.1 Preliminary

      • CIPR 3.1.1 Application of Chapter 3

        This Chapter applies to an authorised firm in its dealings with customers (other than eligible counterparties).

        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR Part 3.2 CIPR Part 3.2 Applying principles of fair treatment of customers

      • CIPR 3.2.1 Fair treatment of customers in practice

        (1) An authorised firm must ensure that fair dealing with its customers is an objective that is taken into account in its business strategy, product design and product performance.
        (2) The firm's governing body is responsible for ensuring that the firm's customers are treated fairly. The firm's governing body must design and implement policies, procedures and systems and controls aimed at ensuring that customers are treated fairly, and must monitor the firm's adherence to those policies, procedures and systems and controls.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.2.2 Systems and controls generally

        (1) An authorised firm must have the necessary systems and controls, in relation to every aspect of its operations, to ensure that the firm fully complies with these rules at all times.
        (2) The systems and controls must be documented, and must be reviewed periodically (at least annually) to ensure that they are fit for their purpose.

        Guidance

        The Regulatory Authority expects that the review would be carried out by an individual or individuals of appropriate seniority and authority in the firm — for example, an individual exercising the senior management function (within the meaning given by CTRL, rule 3.1.6) for the firm.
        (3) The outcome of each review of the systems and controls must be reported in a durable medium to the firm's governing body.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR Part 3.3 CIPR Part 3.3 Customer classification

      • CIPR 3.3.1 Customer classification — general obligation

        (1) Before conducting business with or for a customer, an authorised firm must take reasonable steps to establish whether the customer is:
        (a) a retail customer;
        (b) a business customer; or
        (c) an eligible counterparty;
        and must then classify the customer accordingly.
        (2) If the firm cannot be sure whether a particular customer is a retail customer or a business customer, the firm must classify the customer as a retail customer.
        (3) An individual who is a customer in relation to a contract of insurance that would cover the customer in both a private and a business capacity must be classified as a retail customer.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.3.2 Customer classification — opting-up

        (1) If a customer of an authorised firm would, apart from this rule, be classified as a retail customer, the firm may classify the customer as a business customer in accordance with this rule. The firm may do so in relation to all regulated activities and specified products or only in relation to 1 or more particular regulated activities and specified products.
        (2) However, in the case of a customer who is not a business customer under rule 1.2.7, the firm must not classify the customer as a business customer in relation to regulated activities referred to in rule 1.2.7 (a).
        (3) The firm must not classify a customer as a business customer unless:
        (a) the customer has asked to be classified as a business customer;
        (b) after a determination in accordance with rule 3.3.3, the firm is satisfied that the customer has at least QR 4 million in net assets (excluding the value of his or her primary family residence, but including assets in which he or she has a beneficial interest); and
        (c) after an assessment in accordance with rule 3.3.4, the firm is satisfied that the customer has sufficient knowledge, experience and understanding of the relevant financial markets, products and transactions and their associated risks to justify the firm's dealing with him or her without the benefit of the retail protections.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.3.3 Determination of customers' net assets

        (1) When an authorised firm is considering whether to classify a customer as a business customer, the firm must make reasonable efforts to obtain evidence showing that the customer meets the minimum asset requirement in rule 3.3.2 (3) (b).
        (2) If the firm cannot obtain such evidence despite making reasonable efforts to do so, the firm may rely on a signed statement by the customer confirming that the value of his or her net assets meets that requirement.
        (3) The statement must be in a form prepared by the firm. The form must include the following warning:
        If you misrepresent your financial position in this statement, you might receive unsuitable advice or buy a financial service or product that is not in your best interests.
        (4) The warning must be prominent and must be as close as practicable to the place for the customer's signature.
        (5) The form must also include the explanation required by rule 3.3.5 (a).
        (6) If there are reasonable grounds to doubt the accuracy of the statement, the firm must not classify the customer as a business customer.
        (7) The firm must obtain confirmation of the statement from the customer periodically (at least annually).
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.3.4 Assessing customers' relevant knowledge, experience and understanding

        (1) In deciding whether a customer has sufficient knowledge, experience and understanding of relevant financial markets, products and transactions and the associated risks, an authorised firm must consider all of the following:
        (a) the customer's knowledge and understanding of those markets, products and transactions and their associated risks;
        (b) whether the customer has been active in those markets, products and transactions (and if so for how long);
        (c) the frequency of his or her dealings in those markets, products and transactions, and the extent to which he or she has relied on the firm's advice in those dealings;
        (d) whether the customer is employed in a professional capacity, or is otherwise professionally involved, in relation to those markets, products and transactions, and if so for how long;
        (e) the size and nature of transactions that have been undertaken by or for the customer in those markets;
        (f) whether the customer will rely on the independent advice or judgment of another authorised firm or regulated financial institution in relation to the relevant regulated activities.
        (2) The firm must document the assessment and must retain evidence of it.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.3.5 Agreement required before opting-up customer

        An authorised firm must not classify a customer as a business customer unless:

        (a) the firm has given the customer an explanation, in a durable medium, of:
        (i) the basis on which the firm proposes to classify the customer as a business customer; and
        (ii) the protections provided by the regulatory system in the QFC for retail customers that the customer will lose if classified as a business customer;
        Guidance

        The explanation should be simple and consumer-friendly. A short summary of the protections that the customer will lose as a business customer would suffice.
        (b) the firm has allowed the customer a reasonable period to consider the implications of being classified as a business customer; and
        (c) the customer has agreed, in a durable medium, to being classified as a business customer.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.3.6 Customer classification — systems and controls

        (1) An authorised firm's systems and controls must include appropriate checks to verify that a customer classification is appropriate.
        (2) The systems and controls must provide for such a classification to be reviewed regularly (at least annually) if the firm continues to conduct business for the customer.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR Part 3.4 CIPR Part 3.4 Authorised firms' reliance on others and exclusion or restriction of liability

      • CIPR 3.4.1 Reliance on information provided by others

        (1) If an authorised firm relies on information that was provided to it by another person, the firm is taken to comply with a provision of these rules that requires it to obtain information if the firm can show that it is reasonable for it to rely on the information.
        (2) For subrule (1), it is reasonable for the firm to rely on the information if:
        (a) the other person provided the information in a durable medium;
        (b) the firm believes on reasonable grounds that the person who provided the information was competent to provide it; and
        (c) the firm is not aware, and it is reasonable for the firm not to be aware, of anything that would give it reasonable grounds to question the accuracy of the information.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.4.2 Reliance on others to give information to customers

        If a provision of these rules requires an authorised firm to give information to a customer, the firm must give the information directly to the customer and not to another person, unless it has an instruction, in a durable medium, from the customer requiring or allowing it to give the information to the other person.

        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.4.3 Exclusion or restriction of liability

        (1) An authorised firm must not seek to exclude or restrict, or rely on any exclusion or restriction of, any duty or liability to a customer that arises under the regulatory system in the QFC.
        (2) An authorised firm must not seek to exclude or restrict, or rely on any exclusion or restriction of, any duty or liability to a retail customer that arises under a law applying in the QFC (otherwise than under the regulatory system in the QFC) unless it is reasonable for the firm to do so.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR Part 3.5 CIPR Part 3.5 Dealing with conflicts, material interests and inducements

      • CIPR 3.5.1 Meaning of material interest

        In these rules:

        material interest, in relation to a transaction, means any interest of a significant or substantial nature in the transaction other than disclosable commission.

        Guidance

        Part 3.5 of these rules should be read in conjunction with CTRL, rule 2.2.9.

        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.2 Conflicts of interest and material interests — policy

        (1) An authorised firm must have, and must operate in accordance with, a policy on conflicts of interest and material interests. The policy must be appropriate to the nature, scale and complexity of the firm's regulated activities.
        (2) The policy must have been approved by the firm's governing body and must be recorded in a durable medium. The policy:
        (a) must identify, with reference to the regulated activities carried out by or on behalf of the firm, the circumstances that constitute or may give rise to conflicts of interest or material interests that create a risk of damage to its customers' interests; and
        (b) must set out systems and controls to manage actual and potential conflicts of interest and material interests.
        Guidance

        An authorised firm should also consider whether there are circumstances in relation to licensed but unregulated activities that might give rise to conflicts of interest in carrying out regulated activities.
        (3) The systems and controls must ensure that the firm's customers are not adversely affected or treated unfairly because of a conflict of interest or material interest.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.3 Conflicts of interest and material interests — management

        (1) If a conflict of interest, or a material interest of the firm in a transaction, cannot reasonably be avoided, the firm must manage it in 1 or more of the following ways:
        (a) establishing and maintaining an effective Chinese wall;
        (b) requiring employees to disregard conflicts of interest and material interests when advising a customer or exercising a discretion;
        (c) separately supervising employees whose main functions involve carrying out activities for, or providing services to, customers whose interests may conflict with those of the firm;
        (d) establishing measures to prevent or limit any person from exercising inappropriate influence over how an employee carries out services or activities;
        (e) establishing measures to prevent or control the simultaneous or sequential involvement of an employee in separate services or activities if the involvement may impair the proper management of conflicts of interest;
        (f) taking any other steps that are necessary and appropriate to manage the conflict of interest or material interest.
        (2) If an authorised firm distributes its products to customers through an intermediary, the firm must not make the continuation of its business relationship with the intermediary solely dependent on the introduction of a specified level of business.
        (3) An authorised firm must ensure that the arrangements for remunerating its employees in relation to providing or recommending products or services to customers do not have the effect of impairing the firm's obligations:
        (a) to act in the best interests of its customers; and
        (b) to satisfy the requirements of these rules in relation to the suitability of products or services for each customer.
        Guidance

        Contracts of employment that provide for commission-only remuneration do not comply with this rule, nor do remuneration arrangements in which a basic salary is offset against commission earned.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.4 Conflicts of interest and material interests — "decline to act" or "disclose and notify"

        (1) An authorised firm must decline to act for a customer if it has a conflict of interest or a material interest, and cannot manage it in a way mentioned in rule 3.5.3 (1).
        (2) Before an authorised firm provides or offers to provide a customer with a product or service the provision of which constitutes a regulated activity, the firm:
        (a) must disclose any conflict of interest or material interest that it knows about;
        (b) must notify the customer of the steps it has taken to manage the conflict of interest or material interest; and
        (c) must take reasonable steps to ensure that the customer does not object to the firm's management of the conflict of interest or material interest.
        (3) For subrule (2), a disclosure and notification may be made either in the firm's initial disclosure document or in a separate document.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.5 Chinese walls

        (1) An authorised firm must ensure that there are effective Chinese walls between different business areas of the firm in relation to information that could give rise to a conflict of interest, or that could be open to abuse.
        (2) An authorised firm must ensure it has procedures, recorded in a durable medium, for maintaining the Chinese walls, setting out the consequences of a breach of the procedures. The firm must give a copy of the procedures to every member of the firm's governing body and every relevant employee.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.6 Contingent selling and bundling

        (1) An authorised firm must not make the sale of a product or service to a customer contingent on the purchase of another product or service from the firm.
        (2) Subrule (1) does not prevent the firm offering, to existing customers, additional products or services that are available only to existing customers.
        (3) An authorised firm is prohibited from bundling (that is, packaging 2 or more distinct products, each of which can be purchased separately from or through the firm, into a bundle) unless the firm can show that the bundling results in a cost saving for the customer.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.7 Inducements generally

        (1) An authorised firm must ensure that neither it, nor any of its employees:
        (a) offers, gives, solicits or accepts any gift or inducement; or
        (b) directs or refers any actual or potential business to another person on its own initiative or on the instructions of an associate;
        if doing so is likely to conflict to a significant extent with any duty that the firm owes to its customers.
        (2) An authorised firm's systems and controls must include policies and procedures to ensure that the firm complies with subrule (1).
        (3) An authorised firm must ensure that every member of the firm's governing body, and every employee, is provided with details of the firm's current policy and procedures about gifts, referrals and inducements.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.8 Inducements — packaged investment products

        An authorised firm must not enter into, and must take reasonable steps to ensure that no person acting on its behalf enters into, any of the following arrangements with another person in relation to a packaged investment product:

        (a) volume overrides (that is, the commission paid in relation to several transactions is more than a simple multiple of the commission payable in relation to a single transaction of the same kind);
        (b) an arrangement to pay more commission than the amount disclosed to the customer;
        (c) an agreement to indemnify the payment of commission on terms that would or might give an additional financial benefit to the recipient if the commission became repayable;
        (d) an arrangement to pay commission otherwise than to the authorised firm that was responsible for a sale, unless:
        (i) that firm has passed on its right to receive the commission to the recipient;
        (ii) the recipient is another authorised firm that has given advice on investments to the customer concerned after the sale; or
        (iii) the recipient is another authorised firm and the commission is paid after the sale of the packaged investment product by the first firm in response to a direct offer advertisement communicated by that firm to a customer of the recipient.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.9 Inducements — financial assistance by product providers

        (1) This rule applies in relation to an authorised firm that holds itself out as offering investment advice to retail customers in relation to 1 or more kinds of packaged investment product.
        (2) A product provider must not acquire a direct or indirect holding in the capital or voting power of an authorised firm in relation to which this rule applies, or provide credit to such a firm, unless:
        (a) the product provider and the firm are in the same corporate group;
        (b) in relation to the provision of credit — the credit provided is for commission owing from the firm to the product provider under an indemnity commission clawback arrangement; or
        (c) the holding is acquired, or the credit is provided, on objective commercial terms.
        (3) In subrule (2) (c), objective commercial terms means terms that are objectively comparable to terms on which a person that is not connected to the product provider would be willing to acquire the holding or provide credit, taking into account all the circumstances.
        (4) For this rule, any holding of, or credit provided by, a product provider's associate is taken to be held by, or provided by, the product provider.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.10 Soft commission agreements

        (1) An authorised firm must not enter into a soft commission agreement (that is, an agreement under which an authorised firm receives goods or services, in return for which it agrees to direct business through or in the way of another person) unless the agreement is recorded in a durable medium.
        (2) The following conditions apply to such an agreement:
        (a) any business transacted under it must not conflict with the best interests of customers;
        (b) if the firm considers that a customer may be affected by the agreement, the customer must be made aware of the agreement and of how it may affect him or her;
        (c) a copy of the agreement must be given to any customer who asks for it;
        (d) goods or services received by the firm under the agreement must be used to provide services to customers;
        (e) if the firm changes its policy on such agreements, the firm must give any affected customer details of the change promptly after the change takes effect.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.11 When may firms advise customers to replace products?

        (1) An authorised firm must not advise a retail customer to replace an existing insurance product or investment product with a new one unless the firm:
        (a) demonstrates to the customer that the advice is in the customer's best interests;
        (b) informs the customer of any additional charges or other expense, cost or financial detriment that the customer will incur from the replacement; and
        (c) informs the customer of any financial benefit that the firm will derive from the replacement.
        (2) The firm must give the demonstration and information required by subrule (1) to the customer in a durable medium.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.5.12 Firms' obligations in relation to trail commissions

        (1) If an authorised firm receives a trail commission arising from a regulated activity, the firm must provide an ongoing service to the customer concerned.
        (2) The firm must have systems and controls to ensure that the service is provided to every relevant customer.
        (3) The firm must document and retain evidence that it has provided the service.
        (4) The firm must not seek or receive additional remuneration for the service.
        (5) The obligations imposed by this rule apply in relation to a trail commission that the firm continues to receive that arose from a service that the firm provided before these rules commenced.

        Note These rules commenced on 1 January 2020 — see rule 1.1.2.

        Guidance

        A trail commission is a fee regularly paid to an authorised firm over the lifetime of a financial product such as a long-term insurance policy or a packaged investment product. The ongoing service that an authorised firm provides should be sufficient for the firm to be satisfied that the product or advice that it provided remains suitable for the customer.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR Part 3.6 CIPR Part 3.6 Personal account transactions

      • CIPR 3.6.1 Personal account transactions — systems and controls

        (1) This rule applies to transactions by an authorised firm for the account of a relevant person. In this rule, such a transaction is called a personal account transaction.
        (2) A member of the firm's governing body is a relevant person for this rule. Also, an employee or agent of the firm is a relevant person for this rule unless:
        (a) he or she is not involved to any significant extent in the firm's business and does not have access to information about that business; and
        (b) the firm has taken reasonable steps to be sure that he or she is not so involved and does not have access to such information.
        (3) An authorised firm must establish and maintain systems and controls to ensure that:
        (a) if a relevant person enters into a personal account transaction, the transaction does not conflict with the firm's duties to its customers; and
        (b) if a relevant person enters into such a transaction, the firm is promptly notified (or is otherwise able to identify the transaction) and makes a record of it.
        (4) The systems and controls must ensure that a relevant person who is not permitted under the firm's policies to enter into a personal account transaction does not (except in the proper course of his or her employment or authority) arrange for another person to enter into the transaction, nor communicate an opinion about it to another person, if he or she knows or reasonably ought to know that, as a result, the other person will be likely to enter into the transaction or arrange for another person to do so.
        (5) The systems and controls must include:
        (a) making relevant persons aware, by notice in a durable medium, of the restrictions on personal account transactions, and any general permissions to enter into such transactions;
        (b) making compliance with the systems and procedures a term of each relevant person's employment contract, contract for service, or other employment or appointment arrangement;
        (c) keeping a restricted list of relevant investments about which the firm may have inside information and ensuring that only relevant persons have access to the list;
        (d) ensuring that a relevant person may not enter into personal account transactions in relation to relevant investments on the restricted list unless:
        (i) the transaction is for the purpose of realising the cash value of a holding or position undertaken to meet an obligation of the person that is not related to the firm's business; and
        (ii) the firm has given its express permission, in a durable medium, for the transaction.
        (6) In subrule (5):

        inside information means:
        (a) information that:
        (i) relates to particular securities, a particular issuer of securities, a particular class of securities or a particular class of issuers;
        (ii) is specific or precise;
        (iii) has not been made public;
        (iv) would be likely, if it were made public, to have a significant effect on the price of any securities; and
        (v) is obtained from a source closely connected to the issuer of the securities or 1 or more issuers of a class of securities; or
        (b) information that is inside information under rules made under FSR, article 83 (Rules relating to market abuse).
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR Part 3.7 CIPR Part 3.7 Handling errors

      • CIPR 3.7.1 Handling of errors

        (1) An authorised firm must have procedures, recorded in a durable medium, for effectively handling errors that affect customers. The procedures must provide for at least the following:
        (a) identifying the cause of an error;
        (b) identifying all of the affected customers;
        (c) appropriately analysing the patterns of occurrence of the error, including investigating whether or not it was an isolated error;
        (d) proper control of the correction process;
        (e) the escalation of errors to the firm's compliance officer, the firm's risk management officer (if any), and to its senior management.
        (2) An authorised firm must resolve every error speedily and no later than 6 calendar months after the date on which the error was first discovered. The resolution of an error must include:
        (a) if appropriate, making a refund (with appropriate interest) to all the affected customers, so far as possible;
        (b) correcting any systems failures;
        (c) ensuring that effective controls are implemented to prevent the error recurring; and
        (d) notifying all affected customers, both current and former, in a timely manner, of any error that has negatively affected or may negatively affect the cost of the service, or the value of the product, provided.
        (3) If an error that affects customers has not been fully resolved within 40 business days after the date on which it was first discovered, the firm must inform the Regulatory Authority in a durable medium within 5 business days after the end of the 40-business-day period.
        (4) An authorised firm must maintain a record of every error that affects customers. The record must contain, for each such error:
        (a) details of the error;
        (b) the date on which it was discovered;
        (c) an explanation of how it was discovered;
        (d) the period over which it occurred;
        (e) the number of customers affected;
        (f) the amount of money involved;
        (g) whether the error has been resolved or not;
        (h) the date on which the error was resolved;
        (i) the number of customers to whom a refund was paid; and
        (j) the total amount refunded.
        (5) An authorised firm must maintain a record of all of the steps taken to resolve an error that affects 1 or more customers. The record must include details of the steps taken:
        (a) where any affected customer was dissatisfied with the outcome;
        (b) where there were difficulties contacting affected customers; and
        (c) where a refund could not be paid.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

    • CIPR Part 3.8 CIPR Part 3.8 Handling complaints and related matters

      • CIPR 3.8.1 Who can make a complaint?

        (1) In these rules:

        complaint means an expression of grievance or dissatisfaction, by a customer (other than an eligible counterparty), or one of the other persons mentioned in subrule (2), either orally or in a durable medium, in connection with an authorised firm's provision (or offer of the provision) of a product or service, if the provision of the product or service was or would be a regulated activity.
        (2) The other persons who may make a complaint to an authorised firm are the following:
        (a) an individual who is or was a beneficiary under a group policy issued by the firm;
        (b) an individual who is a surviving dependent of a deceased retail customer of the firm;
        (c) a legal personal representative of a deceased retail customer of the firm;
        (d) a widow or widower of a deceased retail customer of the firm;
        (e) an individual who is entitled to benefit from an insurance contract issued to a retail customer of the firm.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.8.2 Firms' internal complaints-handling procedures

        (1) An authorised firm must establish and operate appropriate and effective internal procedures, recorded in a durable medium, for handling complaints, to ensure that complaints, however made, in relation to its conduct of regulated activities are dealt with fairly, efficiently, and with due diligence and consideration.
        (2) The procedures must provide for all of the following:
        (a) receiving complaints;
        (b) responding to complaints;
        (c) meeting any applicable service standards in relation to complaints received (see rule 3.8.5);
        (d) referring complaints to other authorised firms;
        (e) the appropriate investigation of each complaint by a person of sufficient competence who was not directly involved in the act or omission that the complaint was about;
        (f) that responses to a complaint adequately address the subject-matter of the complaint and, if the complaint is upheld, offer appropriate redress;
        (g) the person responsible for responding to a complaint either being authorised to settle the complaint (including offering redress, if appropriate) or having access to someone who has the necessary authority;
        (h) identifying complainants who would be eligible, if dissatisfied with the firm's decision, to apply under the customer dispute resolution scheme, and informing them in a durable medium about their right to do so.
        (3) An authorised firm:
        (a) must publish details of its internal complaint-handling procedures;
        (b) must give a copy of the published details to any customer who asks for it;
        (c) must give a copy of the published details automatically to a complainant when it receives a complaint (unless the complaint is resolved by close of business on the next business day); and
        (d) must display, in each of its sales offices to which customers have access, a notice indicating that the firm is covered by the customer dispute resolution scheme.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.8.3 Customer redress

        (1) This rule applies if:
        (a) an authorised firm receives a complaint; and
        (b) having considered the complaint, the firm decides that redress is appropriate.
        (2) The firm:
        (a) must provide the complainant with fair compensation (financial or otherwise) for any acts or omissions for which the firm was responsible; and
        (b) must give effect to any offer of redress that the complainant accepts.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.8.4 Referring complaints to other firms

        (1) If an authorised firm (the receiving firm) is satisfied on reasonable grounds that another authorised firm may be solely, jointly or partly responsible for the act or omission alleged in a complaint, it may refer all or part of the complaint to the other firm.
        (2) However, the receiving firm:
        (a) must make any referral to the other firm promptly, but no later than 5 business days after the day on which it became satisfied that the other firm may be solely, jointly or partly responsible for the act or omission;
        (b) must make the referral in a durable medium; and
        (c) must inform the complainant in a durable medium about the referral and the other firm's contact details.
        (3) Unless the receiving firm is satisfied that the other firm may be solely responsible for the act or omission, the receiving firm must continue to comply with these rules in relation to the complaint.
        (4) If an authorised firm receives a complaint that was referred to it by the receiving firm under subrule (1), the complaint is taken, for these rules:
        (a) to have been made directly to the firm by the complainant; and
        (b) to have been received by it when it received the referral.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.8.5 Service standards

        (1) This rule applies if a complaint has not been resolved by close of business on the next business day after the day on which it is received.
        (2) If the firm has referred part of the complaint to another authorised firm, the firm must comply with this rule in relation to the part of the complaint that was not referred.
        (3) Within 5 business days after the day on which the complaint is received, the authorised firm concerned must give the complainant an acknowledgement in a durable medium. The acknowledgement:
        (a) must give the name and job title of the individual who is handling the complaint for the firm; and
        (b) must give details of the firm's internal complaint-handling procedures.
        (4) The acknowledgement may be combined with a final response if the firm can provide the response within 5 business days after the day the complaint is received.
        (5) A final response:
        (a) must be in a durable medium;
        (b) must do 1 of the following:
        (i) accept the complaint and, if appropriate, offer redress;
        (ii) offer redress without accepting the complaint;
        (iii) reject the complaint and give reasons for rejecting it; and
        (c) if the complainant is eligible to apply under the customer dispute resolution scheme:
        (i) must inform the complainant that, if the complainant is dissatisfied with the response, the complainant may apply under that scheme, but must do so within 4 calendar months after receiving the response; and
        (ii) must give the contact details for the scheme.
        (6) If the firm has not given the complainant a final response at the end of 4 weeks after the day on which the complaint is received, the firm must give the complainant a response, in a durable medium, explaining why it has not been able to resolve the complaint and indicating when it will contact the complainant again about the complaint.
        (7) If the firm has not given the complainant a final response at the end of 8 weeks after the day on which the complaint is received, the firm must give the complainant a response, in a durable medium, that:
        (a) explains that the firm has not been able to give a final response, gives reasons for the further delay and indicates when the firm expects to give a final response; and
        (b) if the complainant is eligible to apply under the customer dispute resolution scheme, informs the complainant that the complainant may apply under that scheme if dissatisfied with the delay.
        (8) For this rule, if the firm received the complaint on a day that is not a business day, or on a business day after close of business, the complaint is taken to have been received by the firm on the next business day.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).
        Amended by QFCRA RM/2020-1 (as from 15th August 2020)

      • CIPR 3.8.6 Analysis of complaints for systemic weaknesses

        (1) An authorised firm must regularly (at least annually) undertake an appropriate analysis of the patterns of complaints, including investigating whether the complaints indicate an isolated issue or a more widespread issue for customers.
        (2) The results of the analysis must be submitted to the firm's compliance officer, the firm's risk management officer (if any) and to the firm's senior management.
        (3) An authorised firm must analyse complaints that it receives against intermediaries (whether in the QFC or in another jurisdiction) in relation to products that the intermediaries have distributed on the firm's behalf, to enable the firm to assess the complete customer experience and identify any issues that need to be addressed.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.8.7 Quarterly reporting about complaints

        An authorised firm must make a quarterly report to the Regulatory Authority about complaints. The report must be in the format directed by the Regulatory Authority by notice from time to time.

        Derived from QFCRA RM/2019-2 (as from 1st January 2020).

      • CIPR 3.8.8 Restitution orders for contravention of relevant requirements

        (1) A person who is entitled to make a complaint to an authorised firm under rule 3.8.1 may apply to the Civil and Commercial Court of the QFC for a restitution order if the person has suffered loss or damage as a result of a contravention by the firm of a relevant requirement in relation to a regulated activity.
        (2) In this rule:

        contravention of a relevant requirement has the meaning given by FSR, articles 84 and 85.
        Derived from QFCRA RM/2019-2 (as from 1st January 2020).