CP0010 - Customer Protection Code of Practice Change Proposal
| Date | 20 January 2022 |
January 2022
Customer Protection Code of Practice
Change Proposal – Ref CP0010
Customer Protection Code of Practice Change Proposal – Ref CP0010
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Customer Protection Code of Practice Change Proposal –
Ref CP0010
Modification
proposal
Customer Protection Code of Practice Change Proposal – CP0010 –
Proposal to make a change to the Customer Protection Code of
Practice
Decision
The Authority has decided to approve this amended Change
Proposal
Publication date
20 January 2022
Implementation
date
20 April 2022
We are agreeing these Change Proposals
We consider that the new requirements on Retailers will have a positive impact on
business customers, especially those who choose to pay-in-advance. The changes
being implemented will help to increase customer awareness of both the potential
benefits and risks of paying in advance and that there are alternative payment terms
available in the market. Customers will also benefit from being more aware of the
credit balances they are building up over time. The change should also have a positive
impact on business customers by ensuring that credit balances are repaid to them
upon the closure of their account.
After considering the feedback received to the consultation, we have made some
updates to our proposal. These updates are summarised below. Revised legal drafting
can be found in Appendix 1.
•We have extended the implementation date to three months following the
publication of this decision, reflecting the need for Retailers to update their
systems and processes.
•We have updated the "standard text" to strike a better balance between the
potential benefits and risks of customers entering into an advance payment
arrangement with a Retailer.
•Retailers will be required to communicate the standard text regarding advance
payment at the onboarding stage for new customers, and within three months of
implementation for all customers who are currently in contract. Retailers will then
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be required to communicate the standard text to all advance payment customers at
a minimum of once every 12 months
• Retailers are not limited to using bills to communicate credit balances to their
customers. Retailers can use other methods, but at a minimum will be required to
communicate this information in writing once every three months.
• The proposed change has been updated to acknowledge that a customer's ability to
change payment terms or switch to another Retailer will be subject to their terms
and conditions if they are on a fixed term contract.
• Retailers will be required to make a credit refund to customers within 60 calendar
days of issuing the final bill. Before doing so, Retailers are required to communicate
an estimation of the credit or debit against the account and confirm what
information they need in order to issue a credit refund (where applicable).
• We have included "Advance Payment" as a new defined term in the Customer
Protection Code of Practice.
• In our April 2021 call for information, we said we were not intending to introduce
some form of "insurance" to protect customer credit in the event of a Retailer
failure. After considering responses to the CFI and our consultation, this remains
our position.
• We plan to assess the impact of this change in 12-18 months' time. If we conclude
that this Change is not having the intended effect, then we will be open to exploring
alternative options.
Implementation timeframe
• 20 January 2022
Decision Published
• From 20 April 2022
Decision implemented
Retailers are required to:
• Communicate the "standard text" to all new
advance payment customers.
• Communicate the "information requirements"
(to customers with credit against their
accounts) in writing once every 3 months.
• Refund Credit to customers within 60 calendar
days of issuing a final bill.
• By 20 July 2022
Retailers are required to have:
• Communicated the "standard text" to all in
contract advance payment customers.
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