The repercussions of the Brexit epoch continue to ripple through the legal landscape of the UK, particularly evident in the interpretation of the Commercial Agents (Council Directive) Regulations 1993. Concurrently, the spectre of undisclosed commissions, with echoes from the sub-prime loan crisis, has found renewed relevance in light of recent High Court rulings. This article explores the juncture of these two regulatory domains, their post-Brexit implications, and the pathway for individuals seeking redress for fraudulently obtained monies.
The Commercial Agents Regulations 1993 - A Post-Brexit Perspective:
The Commercial Agents (Council Directive) Regulations 1993 were instituted as a protective measure for commercial agents, defining their rights to remuneration, commission, and indemnity or compensation upon termination of agency contracts. These regulations originated from an EU Directive and were incorporated into UK law (https://www.legislation.gov.uk/uksi/1993/3053/contents/made).
The Brexit transition, however, raised questions about the continued applicability of these regulations. The UK government, in its pursuit of legislative independence, has retained these regulations for the time being, but their future remains uncertain.
The Menace of Undisclosed Commissions:
Parallel to this, the issue of undisclosed commissions has taken centre stage. This practice became infamous during the sub-prime mortgage crisis, where lenders and brokers were accused of surreptitiously receiving commissions without adequate disclosure to the borrower. This led to a series of lawsuits, culminating in significant decisions from the High Court and the Court of Appeal.
Recent Court Decisions and Pathway for Redress:
The High Court's recent landmark decision, wherein the court held that a broker must disclose any commission to a client, has given a glimmer of hope to those affected. Failure to do so could make the relationship "unfair," thereby entitling the borrower to recover the undisclosed commission. A key victory in this fight was the 2014 'Plevin ruling' (https://www.supremecourt.uk/cases/docs/uksc-2014-0037-judgment.pdf), which has opened the door for consumers to claim redress for undisclosed high commission on Payment Protection Insurance (PPI).
The process of claiming these monies involves approaching the Financial Ombudsman Service or filing a lawsuit. The route to follow would depend on individual circumstances, including the timing of the loan and the level of undisclosed commission.
Conclusion:
In this complex legal terrain, the Commercial Agents Regulations and the issue of undisclosed commissions represent two key regulatory issues with distinct implications for businesses and individuals alike. As the UK navigates its post-Brexit journey, and as courts continue to champion the cause of fair dealing, it's crucial for all parties to stay informed and prepared to adapt to a dynamic legal landscape.
If you would like to speak with one of our solicitors regarding The Commercial Agents (Council Directive) Regulations 1993, please email contact@oratto.co.uk.
