The Financial Services (Distance Marketing) Regulations 2004

Exceptions to the right to cancel

11.—(1) Subject to paragraphs (2) and (3), regulation 9 does not confer on a consumer a right to cancel a distance contract which is—

(a) a contract for a financial service where the price of that service depends on fluctuations in the financial market outside the supplier’s control, which may occur during the cancellation period, such as services related to—

(i) foreign exchange,

(ii) money market instruments,

(iii) transferable securities,

(iv) units in collective investment undertakings,

(v) financial-futures contracts, including equivalent cash-settled instruments,

(vi) forward interest-rate agreements,

(vii) interest-rate, currency and equity swaps,

(viii) options to acquire or dispose of any instruments referred to in sub-paragraphs (i) to (vii), including cash-settled instruments and options on currency and on interest rates;

(b) a contract whose performance has been fully completed by both parties at the consumer’s express request before the consumer gives notice of cancellation;

(c) a contract which—

(i) is a connected contract of insurance within the meaning of article 72B(1) of the Regulated Activities Order (activities carried on by a provider of relevant goods or services)(1),

(ii) covers travel risks within the meaning of article 72B(1)(d)(ii) of that Order, and

(iii) has a total duration of less than one month;

(d) a contract under which a supplier provides credit to a consumer and the consumer’s obligation to repay is secured by a legal mortgage on land;

(e) a credit agreement cancelled under regulation 15(1) of the Consumer Protection (Distance Selling) Regulations 2000 (automatic cancellation of a related credit agreement)(2);

(f) a credit agreement cancelled under section 6A of the Timeshare Act 1992 (automatic cancellation of timeshare credit agreement)(3); or

(g) a restricted-use credit agreement (within the meaning of the 1974 Act) to finance the purchase of land or an existing building, or an agreement for a bridging loan in connection with the purchase of land or an existing building.

(2) Paragraph (1) does not apply to a distance contract if the supplier has not complied with regulation 8(1), unless—

(a) the circumstances fall within regulation 8(1)(b); and

(b) the supplier has complied with regulation 7(1) and (2) or, if applicable, regulation 7(4)(b), and with regulation 7(5).

(3) Where—

(a) the conditions in sub-paragraphs (a) and (b) of paragraph (2) are satisfied in relation to a distance contract falling within paragraph (1),

(b) the supplier has not complied with regulation 8(1), and

(c) the consumer has not, by the end of the sixth day after the day on which the distance contract is concluded, received all the contractual terms and conditions and the information required under regulation 8(1),

the consumer may cancel the contract under regulation 9 during the period beginning on the seventh day after the day on which the distance contract is concluded and ending when he receives the last of the contractual terms and conditions and the information required under regulation 8(1).

(1)

Article 72B was inserted by article 11 of S.I. 2003/1476, and comes into force on 31st October 2004 for certain purposes and on 14th January 2005 for other purposes: see article 1(3) of S.I. 2003/1476.

(2)

S.I. 2000/2334.

(3)

1992 c. 35; section 6A was inserted by regulation 11(3) of S.I. 1997/1081.