Evaluation: expansion of consumer protection provisions in the Dutch Financial Supervision Act to SMEs
On 1 September 2016, the Dutch Ministry of Finance has started a consultation to collect information regarding the effectiveness and the desired protection of self-employed workers without employees and SMEs in the provision of financial services to such parties. The background of this consultation are the problems that appeared regarding the financial services provided to small business clients (for instance, the sale of interest rate derivatives to SMEs). The following information is dealt with on a question basis in the document:
- How market parties experience the current protection of self-employed workers without employees and SMEs;
- Whether it is desirable to grant self-employed workers without employees and SMEs the same protection as consumers under the Dutch Financial Supervision Act;
- Which definition under the Dutch Financial Supervision Act can be used to create a higher level of protection for self-employed workers without employees and SMEs (for instance, the ‘retail cliënt’ under MiFID or the definition of micro enterprises (fewer than 10 employees and an annual turnover or balance sheet below € 2 million).
The consultation document presents a couple of measures to expand the protection of small business clients. For instance through the expansion of the duty of care for consumers in section 4:24a of the Financial Supervision Act to small business clients. Another measure is an expansion of the ban on inducements to products marketed to small business clients, as far as the ban on inducements is not already applicable to those products. Another example is to offer small business clients an alternative for court proceedings by making the Financial Services Complaints Tribunal (Klachteninstituut Financiële Dienstverlening – KiFiD) accessible for small business clients. These measures are only suggestions and market parties are invited to share their opinion on these measures and, if any, to come up with possible other desirable measures.
You can react to the consultation until 1 October 2016.