The purpose of the cross-cutting rules is to provide guidance on the new Principle 12. The cross-cutting rules set out how firms should act (proactively and reactively) to deliver good outcomes for customers. As with the rest of the Consumer Duty, they can apply both at a target market level and an individual customer level, depending on the situation.[1] The specific application of the rules in any given situation will typically depend on whether or not the firm is interacting with an individual retail customer or providing a bespoke service.
The cross-cutting rules require firms to:
- act in good faith towards retail customers,
- avoid causing foreseeable harm to retail customers, and
- enable and support retail customer to pursue their financial objectives.[2]
The cross-cutting rules also inform (and are supported by) the four outcomes, which set out more detailed rules in key areas of the customer relationship.[3]
The cross-cutting rules apply at all stages of the customer journey and during the whole lifecycle of a product. Firms will therefore need to keep products under regular review and consider the impact of any changes they make to those products.[4]
[1] FG 22/5, 5.3; PRIN 2A.1.10G (see page 106); PRIN 2A.2.27G (see page 112); PRIN 2A.2.24G (see page 112)
[2] Policy Statement PS22/9, 1.15; Policy Statement PS22/9, 5.1
[3] FG22/5, 5.5
[4] PRIN 2A.2.23G (see page 111)
