Validation Order (VO) Application
Application for an Order to validate agreements:

i) under sections 40, 148 & 149 of the Consumer Credit Act 1974 (CCA) for agreements entered into before to 1 April 2014 (as these sections continue to apply from 1 April 2014); or

ii) entered into in the course of carrying on a credit-related regulated activity that are unenforceable under sections 26, 26A & 27 of the Financial Services and Markets Act 2000 (FSMA) for agreements entered into on or after 1 April 2014

Full name of applicant firm

If the firm is already authorised by the FCA enter Firm Registration Number (FRN) below

Does the firm have an Interim Permission (IP)?

No

Yes4 Enter your IP Number below

Is this VO application being submitted with:

·  Variation of Permission Application Yes No

·  Application for Authorisation Yes No

The completed form, and supporting information and fee is to be sent to:

Credit Authorisations
The Financial Conduct Authority
25 The North Colonnade
Canary Wharf
LONDON
E14 5HS

Contents of this form

1  Contact Details and information on agreements for validation

2  Agreements entered into before 1 April 2014 - information to support your application

3  Agreements entered into on or after 1 April 2014 - information to support your application

4  Fees

5  Declaration and signature

Note that if the application is to validate agreements entered into both before and after 1 April 2014 sections 2 and 3 will need to be completed

Important information you should read before completing this form

Purpose of this form

This form is to be used by firms wishing to validate certain agreements entered into before 1 April 2014, prior to the transfer of consumer credit regulation from the Office of Fair Trading to the FCA.

This form is also to be used by firms wishing to validate agreements that were entered into on or after 1 April 2014 in the course of carrying on a credit-related regulated activity and are unenforceable against the other party (for the purposes of this form, “consumers”). Additionally, for agreements made on or after 1 April 2014 the relevant firm can also apply for money paid or property transferred under them to be retained. We refer to an application to validate agreements, and to retain money or property transferred under them, as a VO application.

For the purpose of a VO, “credit-related regulated activity” means a regulated activity of a kind designated by the Treasury by order. The Treasury has designated these regulated activities by making the Financial Services and Markets Act 2000 (Consumer Credit) (Designated Activities) Order 2014 and they consist of:

·  an activity of the kind specified by article 39F(1) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001(the ‘Regulated Activities Order’), which is the taking of steps to procure the payment of a debt due under a credit agreement or a relevant article 36H agreement and

·  an activity of the kind specified by article 60B of the Regulated Activities Order, which consists of entering into a regulated credit agreement as lender and exercising, or having the right to exercise, the lender's rights and duties under a regulated credit agreement,


except in so far as the activity relates to an agreement under which the obligation of the borrower is secured on land.

The definition of ‘article 36H agreement’ is set out in article 36H(4) of the Regulated Activities Order.

Who can apply

For the validation of agreements that were entered into with consumers before 1 April 2014, you can apply if you were the:

• unlicensed consumer credit or hire business;

• unlicensed provider of an ancillary credit business – (for example an unlicensed credit broker);

• licensed consumer credit or hire business that has made agreements with consumers who were introduced by an unlicensed credit broker; or

·  the person who, disregarding the effect of section 40(1A), section, 148(1) or 149(1) of the CCA (as the case may be) would be entitled to enforce the agreements that require validation.

For the validation of agreements and/or to retain money paid or property transferred under agreements entered into with consumers on or after 1 April 2014 you can apply if:

·  the agreement was entered into in the course of carrying on a credit-related regulated activity;

·  the agreement is unenforceable because of section 26, 26A or 27 of FSMA; and

·  you are the “relevant firm”.

An agreement is unenforceable because of section 26, 26A or 27 of FSMA if, in summary, the agreement is made by:

·  a person while carrying out a regulated activity without authorisation (section 26 of FSMA)

·  an authorised person without the appropriate permission while carrying out a credit-related regulated activity that involved entering into a credit agreement (section 26A of FSMA); or

·  an authorised person with the appropriate permission, but as a consequence of something said or done by a third party (e.g. a credit-broker) while carrying out a regulated activity without authorisation or a credit-related regulated activity without the appropriate permission (section 27of FSMA).

A “relevant firm” in the context of making an application means the person who has entered into the agreements or, if entered into by another person, has the right to exercise rights under them.

References in this form to authorisation also include reference to interim permission and references to having the appropriate permission also include having an interim permission for the regulated activity in question.

For agreements that you are applying to be validated you will need to ensure that the agreements included in your application have not expired (if they are effectively concluded or otherwise paid up, there is nothing left to enforce, therefore nothing left to validate) unless you are applying for money paid or transferred under the agreement to be retained for an agreement made on or after 1 April 2014.

Effect of validation

The effect of a validation order is to allow an agreement, which is the subject of it, to be enforced against the consumer or, in the case of agreements entered into on or after 1 April 2014, money or property transferred under an agreement to be retained.

However, a validation order does not guarantee that agreements will be enforceable. There could be other legal reasons, unrelated to the fact that the person in question was unlicensed, unauthorised or did not have the appropriate permission, that the agreements may not be enforced. For example, even with a validation order it may still be necessary to obtain a court order to enforce the agreement.

Legal advice

Please seek legal advice if you are unsure about whether to apply or whether your agreements are eligible for validation. You must submit your own legal opinion establishing if the agreements conform to applicable consumer protection regulation.

The statutory test. The purpose of this form is to collect information about the agreements you wish to validate and the reasons behind, and your knowledge of, the period when the person in question was unlicensed, unauthorised or acting within the appropriate permission. We will use this and other relevant information to assess whether a validation order should be granted.

We will only grant a validation order where we are satisfied that it would be just and equitable in the circumstances of the case to allow the agreement to be enforced or (in the case of agreements entered into on or after 1 April 2014) money or property transferred under the agreement to be retained.

For agreements entered into on or after 1 April 2014, in deciding whether to grant the order the FCA must have regard to, in summary, whether:

-  the relevant firm reasonably believed that it in making the agreement it was not contravening the requirement to be authorised or have the appropriate permission, or

- the provider knew that the third party was (in carrying on the credit-related regulated activity) contravening the requirement to be authorised or have the appropriate permission.

For agreements entered into before 1 April 2014, in deciding whether to grant the order the FCA must have regard to whether the firm reasonably believed that a CCA licence was not required, either by it, the credit-broker or the trader concerned (as the case may be).

It is important that you give accurate and complete information and disclose all relevant information. If you do not, you may be committing a criminal offence and it may increase the time taken to assess your application.

Warning: If you carry out or have carried out consumer credit activities without a licence or the appropriate permission you may be referred to our Unauthorised Business Department for possible enforcement action.

Contents of this form

1  Contact details and information on agreements for validation

2  Agreements entered into before 1 April 2014 - information to support your application

3  Agreements entered into on or after 1 April 2014 - information to support your application

4  Fees

5  Declaration and signature

Filling in the form

1.  If you are using your computer to complete the form:

·  use the TAB key to move from question to question and press SHIFT TAB to move back to the previous question; and

·  print out all the parts of the form you have completed and sign the declaration in section 5.

2.  If you are filling in the form by hand:

·  use black ink;

·  write clearly; and

·  once you have completed the relevant sections, sign the declaration in section 5

3.  If you think a question is not relevant to you, write ‘not applicable’ and explain why

4.  If you leave a question blank, do not sign the declaration or do not attach the required supporting documentation without telling us why, we will have to treat the application as incomplete. This will increase the time taken to assess your application

5.  If there is not enough space on the form, you may need to use separate sheets of paper. Clearly mark each separate sheet of paper with the relevant question number, your firm name and reference number or interim permission number (if applicable)

6.  Post the application consisting of:

·  this form

·  spreadsheet detailing agreements (we will also request this electronically when assessing your application)

·  copy of each agreement type requiring validation

·  your legal opinion, and

·  the application fee

to us at:

Credit Authorisations
The Financial Conduct Authority
25 The North Colonnade
Canary Wharf
LONDON
E14 5HS

FCA lConsumer Credit – Validation Order l Release 1 l April 2014 page 23

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1 / Contact details and information on agreements for validation
We need this information in case we need to contact you when we assess the application.

1.1 Contact Name

Title
First name(s)
Surname

1.2 Name of applicant firm

1.3 Does the applicant firm have a registered number at Companies House?

No4Continue to Question 1.4

Yes4give details below

1.4 Main place of business in the UK (and any previous addresses that were used within the unlicensed/unauthorised period)

Address
Postcode
Phone number (including STD code)
Mobile number (optional)
Email address
Business address
Postcode
Dates / From: (dd/mm/yyyy) to: (dd/mm/yyyy)
Business address
Postcode
Dates / From: (dd/mm/yyyy) to: (dd/mm/yyyy)

1.5 When is the period for which the order is sought? (the unlicensed/unauthorised period) (dd/mm/yyyy)
From

/ / /

to

/ / /

1.6 What is the number of different types of agreement and the total number of agreements that you wish to validate (we ask for more details about these in Section 2 and 3)?

Number of agreements: / Total number of consumers:

1.7 Please provide details of the trading names you used for the purposes of the agreements that you are seeking to validate.

2 / AGREEMENTS ENTERED INTO BEFORE 1 APRIL 2014
Confidential information to support your application for a validation order
We need the information we ask for in the following sections to help us decide whether or not to validate the agreements that you want us to consider. It will not be published and will not be available to members of the public. Please continue your answers on a separate sheet of paper where necessary.

Section A: Your business

2.1 Please give a description of your business

2.2 Which type(s) of licensable activity do the agreements you wish to validate relate to:

Consumer credit

Consumer hire

Ancillary credit business

Credit brokerage

Debt-adjusting

Debt-counselling

Debt-collecting

Debt administration

Provision of credit information services

Credit reference agency

2.3 Have you held a Consumer Credit Licence?

No 4 Continue to Question 2.4

Yes 4 You must provide details, including the name of the business licensed, number, categories held and the date the license was issued.


2.4 Do you intend to apply for authorisation or variation of permission?

No 4 You must explain below why you do not consider it necessary to apply for authorisation or a variation of permission.

Yes 4 please advise when your application for authorisation or variation of permission will be submitted.

If you intend to continue engaging in the type of activities relating to the agreements for which a validation order is sought, you are likely to require authorisation or a variation of permission.

2.5 Did the marketing of the agreements you have asked to be validated indicate that credit was available to people whose access to credit may be restricted (including sub-prime consumers)?

No

Yes

2.6 Did the marketing of the credit broker that you used indicate that credit was available to people whose access to credit may be restricted (including sub-prime consumers)?

No

Yes

Sub-prime (or credit adverse or credit impaired) consumers are those with an impaired or poor credit rating because they are subject to or have:

·  county court judgements

·  bankruptcy

·  individual voluntary arrangements

·  arrears or defaults

·  poor payment history

·  repossessions

2.7 Were the agreements offered or brokered in the home?

No

Yes

Section B: Reasons for the unlicensed period