Head of Banking & Lender Disputes | Dispute Resolution | Banking & Finance
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Following on from our recent article about the launch of the Business Banking Resolution Service ("BBRS" / the "Service") on 15 February 2021, in this article we look at how the BBRS will work in practice – for complainant and bank. We look at the eligibility criteria that businesses will generally have to meet in order to qualify, including relevant deadlines and financial criteria.
For those considering when they should use the BBRS to resolve a complaint, we have also looked at how it compares to other dispute forums such as the Financial Ombudsman Service and formal litigation through the court system.
The BBRS will only consider complaints which are made by customers of the participating banks. At present, the "Participating Banks" are:
The BBRS anticipates that more banks may choose to subscribe to the Service in due course.
The complaint must be about a banking service, such as lending or payment services, which was provided by one of the Participating Banks.
There are two schemes available for complaints, the Historical Scheme (for matters which took place between 1 December 2001 and 31 March 2019) and the Contemporary Scheme (for matters which took place on or after 1 April 2019).
The schemes are available to:
The Historical Scheme is also available to dissolved business entities that were, at the time of the matters alleged in the complaint, a business customer of the Participating Bank.
In order for the BBRS to consider the complaint, the complainant must also meet the financial criteria at the time of the complaint. The financial criteria vary depending on which scheme applies, Historical or Contemporary. UK businesses will have to meet the following criteria:
Under the Historical Scheme, the complainant must have made a complaint to the bank within the following timeframes:
(Scheme rule EL 2(1)(h)(i)).
The closing date for new complaints under the Historical Scheme is 14 February 2023 (Scheme rule EL 2(1)(f)).
Under the Contemporary Scheme, the complainant must refer the complaint to the BBRS either:
The typical process is as follows:
Provided that the relevant criteria are met, the BBRS may be a suitable alternative to court proceedings for businesses (and banks) looking to manage their legal spend. Court proceedings can often be lengthy and expensive, however, the BBRS has been set up so that complainants do not necessarily need legal advisers. Parties can still seek legal advice if they choose to (and will usually bear the cost).
Even if all of the criteria are not met, a complainant can still register their complaint and the BBRS may look at it if the complainant and bank agree that they can. Therefore, the BBRS may be viewed as a beneficial ADR forum, where the structure and tools available are valued to resolve otherwise unresolvable disputes. As such, our next article will look at the Service's future role in the landscape of banking disputes.
For more information on the BBRS, dispute resolution or related issues, please speak to your usual Foot Anstey contact or speak to a member of our Dispute Resolution team.