The Cross-cutting Rules are the three overarching obligations at the centre of the FCA’s Consumer Duty (PS22/9, in force July 2023). They apply across all four Consumer Duty outcomes and are the standard against which the FCA will assess whether a firm has met its duty to retail customers.
The three rules
1. Act in good faith. Firms must act honestly, openly and without hidden agendas in their dealings with retail customers. Good faith goes beyond technical compliance: it requires firms to consider whether their actions and communications serve the customer’s interests, not just the firm’s.
2. Avoid causing foreseeable harm. Firms must take reasonable steps to avoid creating a risk of harm to retail customers, where that harm is reasonably foreseeable given the firm’s conduct, products or communications. This includes harm that arises indirectly, for example through the actions of a distribution chain.
3. Enable customers to pursue their financial objectives. Firms must act in a way that supports retail customers in achieving what they came to the firm to achieve. This does not mean guaranteeing outcomes, but it does mean not creating barriers or friction that impede customers from exercising their rights and making informed decisions.
How the Cross-cutting Rules work with the Four Outcomes
The Cross-cutting Rules and the Four Outcomes operate together. The Cross-cutting Rules set the standard; the Four Outcomes define the areas (products and services, price and value, consumer understanding, and consumer support) where firms must meet that standard. A firm can be in breach of the Cross-cutting Rules even if its products and services individually appear compliant, if its overall conduct toward customers falls below the good faith and no-harm standards.
Training implications
Consumer Duty training must give staff a working understanding of the Cross-cutting Rules and how they apply to the firm’s specific products and customer relationships, going beyond a recitation of the three obligations. The Consumer Duty training requirements guide covers what the FCA expects.