Statutory Instruments
2002 No. 1775
FINANCIAL SERVICES AND MARKETS
ELECTRONIC COMMUNICATIONS
The Electronic Commerce Directive (Financial Services and Markets) Regulations 2002
Laid before Parliament
12th July 2002
in accordance with regulation 1
The Treasury, being a government department designated for the purposes of section 2(2) of the European Communities Act 1972 in relation to information society services, in exercise of the powers conferred by that section, and the powers conferred by sections 349(1), 414 and 428(3) of the Financial Services and Markets Act 2000, hereby make the following Regulations:
Modifications etc. (not altering text)
Marginal Citations
PART 1U.K. GENERAL
Citation and commencementU.K.
1. These Regulations may be cited as the Electronic Commerce Directive (Financial Services and Markets) Regulations 2002, and come into force—
(a)for the purpose of enabling the Authority to make rules, on 18th July 2002;
(b)otherwise, on 21st August 2002.
InterpretationU.K.
2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART 2U.K. MODIFICATION OF FUNCTIONS OF THE [FINANCIAL CONDUCT AUTHORITY]
Consumer contract requirements: modification of rule-making powerU.K.
3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consumer contract requirements: informationU.K.
4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Application of certain rulesU.K.
5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART 3U.K. ARTICLE 3.4 OF THE ELECTRONIC COMMERCE DIRECTIVE
Direction by AuthorityU.K.
6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Policy conditionsU.K.
7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Procedural conditionsU.K.
8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Urgent casesU.K.
9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Directions made under regulation 6U.K.
10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Referral to the [Upper Tribunal] U.K.
11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[PART 3AU.K.INCOMING PROVIDERS OF CREDIT-RELATED ACTIVITIES DIRECTING ALL OR MOST OF THEIR ACTIVITY TO THE UNITED KINGDOM
Scope of this PartU.K.
11A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Direction by AuthorityU.K.
11B. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Article 72A of the Regulated Activities OrderU.K.
11C. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART 4U.K. ENFORCEMENT
Application of certain provisions of the 2000 ActU.K.
12. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART 5U.K. AMENDMENT OF THE FINANCIAL SERVICES AND MARKETS ACT 2000
Amendment of sections 417 and 418 of the 2000 ActU.K.
13. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART 6U.K. MISCELLANEOUS AND CONSEQUENTIAL PROVISIONS
Disclosure of informationU.K.
14. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
NoticesU.K.
15. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amendment of the Financial Services and Markets Act 2000 (Disclosure of Confidential Information) Regulations 2001U.K.
16. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Functions of the AuthorityU.K.
17. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rights of actionU.K.
18. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[Exclusion of general regulationsU.K.
19.—(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[(2) Regulation 4(3) of the general regulations does not apply to the Authority or any enforcement authority in respect of its responsibility in relation to a requirement imposed by or under the 2000 Act or these Regulations.
(2A) Regulation 4(3) of the general regulations also does not apply to the Authority in respect of its responsibility in relation to a requirement imposed by or under regulations made by the Treasury under section 8 of the European Union (Withdrawal) Act 2018.]
(3) A rule that corresponds to a relevant regulation applies instead of that regulation.
(4) The reference in regulation 22(a) of the general regulations to regulation 6(1)(c) of those regulations is to be taken to include a reference to a provision in a rule that corresponds to regulation 6(1)(c) (and so applies in its stead by virtue of paragraph (3)).
(5) In this regulation—
[“the Authority” means the Financial Conduct Authority;]
“enforcement authority” has the same meaning as in the general regulations;
“general regulations” means the Electronic Commerce (EC Directive) Regulations 2002;
[“rule” means a rule made by the Authority under the 2000 Act.]
“relevant regulation” means regulation 6 to 9, 11 or 15 of the general regulations.]
Nick Ainger
Jim Fitzpatrick
Two of the Lords Commissioners of Her Majesty’s Treasury]
Explanatory Note
These Regulations give effect to the European Parliament and Council Directive of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Directive on electronic commerce) (No. 2000/31/EC) (“the Directive”), in respect of matters within the scope of regulation by the Financial Services Authority under the Financial Services and Markets Act 2000 (c. 8) (“the 2000 Act”).
These Regulations should be read with the Financial Services and Markets Act (Regulated Activities) (Amendment) (No. 2) Order 2002 (S.I. 2002/1776) (“the RAO Amendment Order”) and the Financial Services and Markets Act (Financial Promotion) (Amendment) (Electronic Commerce Directive) Order 2002 (S.I. 2002/2157), which make amendments to secondary legislation under the 2000 Act in consequence of the Directive. The Regulations should also be read with forthcoming regulations to be made by the Secretary of State for Trade and Industry, which will give effect to the Directive in other areas.
Article 3 of the Directive provides, inter alia, for the regulation of information society services (defined in Article 2(a)) (“ISS”) on a “country of origin” basis. Member States are required to ensure that providers of ISS established on their territories comply with national legal requirements falling within the “coordinated field”, as defined in Article 2(h) of the Directive. They are also prohibited from restricting, for reasons falling within the co-ordinated field, the freedom to provide information society services from other Member States. Article 3.3 of the Directive excludes certain matters (listed in the Annex to the Directive) from the “country of origin” approach, including the advertising of their units by collective investment undertakings falling within Council Directive 85/611/EEC (“the UCITS Directive”), contractual obligations concerning consumer contracts, and the permissibility of unsolicited commercial communications by electronic mail. Article 3.4 of the Directive creates a derogation from the country of origin approach in relation to individual information society services, to be exercised on a case-by-case basis on public policy grounds, and subject to certain procedures.
The RAO Amendment Order excludes from the scope of “regulated activities” under section 22 of the 2000 Act activities constituting the provision of an information society service from an establishment in a state in the European Economic Area other than the United Kingdom (termed “incoming electronic commerce activities” in these Regulations). Consequently, it is not necessary for persons to be “authorised persons” within the meaning of the 2000 Act before they can carry on such activities in the United Kingdom. Such persons will, however, need to be authorised in respect of regulated activities carried on in the United Kingdom that do not constitute the provision of an ISS.
Part 2 of these Regulations gives effect to certain of the exclusions in Article 3.3 of the Directive, by modifying the functions of the Financial Services Authority (“the Authority”) in relation to both authorised and unauthorised persons carrying on incoming electronic commerce activities (“incoming providers”). Regulation 3 modifies the Authority’s powers under section 138 (rules for the purpose of protecting the interests of consumers) of the 2000 Act, so that rules made under them may apply to incoming providers who are not authorised under the Act (“unauthorised incoming providers”). The area of application of rules made under those sections (in respect of all incoming providers, whether authorised or not) is then restricted to certain matters listed in the Annex to the Directive—the imposition of the information requirements specified in regulation 4 (“consumer contract requirements”), communications that constitute an advertisement of its units by a collective investment undertaking authorised in accordance with the UCITS Directive, and the permissibility of unsolicited commercial communications by electronic mail. Regulation 5 restricts the application of certain rules made by the Authority in connection with incoming providers.
Part 3 of the Regulations gives effect to the “case-by-case” derogation in Article 3.4 of the Directive. Regulation 6 permits the Authority, in cases where the policy and procedural conditions in Article 3.4 (set out in regulations 7 and 8) are met, to direct that particular incoming providers may no longer carry on a particular electronic commerce activity, or may only do so subject to specified requirements. Regulation 9 provides that the Authority may dispense with the need to satisfy the conditions in regulations 7 and 8 in urgent cases, and regulations 10 and 11 make procedural provisions in connection with directions, including the rights of parties to whom they apply to refer the matter to the Financial Services and Markets Tribunal.
Part 4 of the Regulations applies, with modifications, certain enforcement powers in the 2000 Act in respect of requirements imposed by the Authority under these Regulations.
Part 5 of the Regulations gives effect to Article 3.1 of the Directive in relation to matters falling within the 2000 Act, by amending section 418 of that Act so that the activity of providing ISS within the European Economic Area from an establishment in the United Kingdom is to be regarded as carried on in the United Kingdom, in all cases where it would not otherwise be so regarded.
Part 6 of the Regulations makes miscellaneous and consequential provisions with respect to the disclosure of information, the service of notices, the functions of the Authority and certain rights of action.