The Financial Conduct Authority (FCA) has extended the time firms have to respond to complaints about motor finance agreements not involving a discretionary commission arrangement (DCA).
Firms now have until 4 December 2025 to provide a final response to non-DCA complaints, in line with the extension the regulator has already provided for complaints involving DCAs.
Court of Appeal case
The extension follows the judgment of the Court of Appeal on 25 October 2024 in three motor finance cases. In that case, the court decided it was unlawful for the car dealers to receive a commission from lenders providing motor finance without first telling the customer about the commission and getting their informed consent for the payment.
The focus of the Court of Appeal decision was common law, equitable principles and the Consumer Credit Act, rather than FCA rules.
High volume of complaints
The FCA said that firms who provide motor finance are likely to receive a high volume of complaints in response to the judgment. It has extended the time firms have to handle complaints “to help prevent disorderly, inconsistent and inefficient outcomes for consumers and firms”.
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On 11 December 2024, the Supreme Court confirmed it would hear an appeal against the Court of Appeal’s judgment. The FCA previously wrote to the court asking it to decide quickly whether it will give permission to appeal and, if it does, to determine the substantive appeal as soon as possible.
The regulator said it plans to apply to formally intervene in the case to share its expertise to assist the court.
The FCA has also confirmed that consumers will have until the later of 29 July 2026 or 15 months (instead of the usual six months) from the date of their final response letter from the firm to refer a non-DCA complaint to the Financial Ombudsman.
Following feedback received during its consultation, the FCA has confirmed the complaint-handling extension will cover motor leasing, as well as motor finance credit agreements.
