On May 1, UK PSR proposed guidance on extensions and exemptions.
CP24/6 securing compliance: proposed extensions and exemptions guidance proposes a high bar for granting extensions and exemptions to secure compliance with its rules.
Follows UK PSR Apr. 2024 issued plan and budget for activities in 2024/25, #207903.
Context
Specific directions and requirements are important tools PSR uses to require firms to implement changes which improve payments for people and businesses across the UK.
The PSR recognises that there may be circumstances when an extension or exemption may be appropriate; the proposed guidance provides firms with clarity on how and when to engage with the PSR to find an effective way forward in these situations.
The proposal is that the bar for granting an extension or exemption is a high one.
Crucial that all firms are incentivised to comply with the regulator’s directions so that everyone who uses payment systems sees improved outcomes as quickly as possible.
Proposal Summary
PSR expects to grant extensions, exemptions in very limited circumstances; guidance proposes 4 key factors for PSR to use as a starting point when considering requests.
1) Whether granting an exemption or extension would adversely impact payment systems users, undermine any of the PSR's statutory objectives, undermine priorities set out in the PSR's five-year strategy, or adversely impact the improvements it seeks.
If granting the request undermined these objectives, PSR would be unlikely to grant it.
2) The context in which the specific direction arose, including the underlying policy aims and the key factors set by the specific direction or requirement.
3) The burden that not granting the request would place on the regulated party, as well as any impact of granting the request on businesses and consumers more widely.
4) Re extension requests, steps the regulated party has taken to ensure it will comply with rules in a timely manner and risks to service users/markets have been mitigated.
Effectiveness
The consultation is open until 5pm on Jun. 3, 2024.
