IFSCA circular · 02 Dec 2024
CIRCULAR F. No. IFSCA-LPRA/3/2024-Legal and Regulatory Affairs December 02, 2024 To, 1. All Regulated Entities in the IFSC Madam/Sir, Sub: Complaint Handling and Grievance Redressal by Regulated Entities in the IFSC One of the core objectives of a financial sector regulator is to protect the interests of the financial…
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F. No. IFSCA-LPRA/3/2024-Legal and Regulatory Affairs
December 02, 2024
To,
1. All Regulated Entities in the IFSC
Madam/Sir,
Sub: Complaint Handling and Grievance Redressal by Regulated Entities in the IFSC
One of the core objectives of a financial sector regulator is to protect the interests of the financial consumers. It is therefore necessary that the financial service providers in the IFSC have an efficient and effective mechanism for handling of complaints and redress of grievances of their consumers. Accordingly, it has been decided that all regulated entities in the IFSC shall follow the requirements contained herein:
a) "Ancillary Service Provider" shall mean an entity authorized by IFSCA for the purpose of providing ancillary services as defined under clause 1(B) of the circular titled "Framework for enabling Ancillary services at International Financial Services Centres" dated February 10, 2021 as amended from time to time;
b) "BATF Service Provider" shall have the same meaning as assigned to it under clause (h) of sub-regulation (1) of regulation 3 of the IFSCA (Book-keeping, Accounting, Taxation and Financial Crime Compliance Services) Regulations, 2024;
c) "Complaint Redressal Appellate Officer" or "CRAO" shall be a senior level person of the Regulated Entity designated for handling appeals of consumers against the decision taken by the Complaint Redressal Officer of the Regulated Entity;
d) "Complaint Redressal Officer" or "CRO" shall be an employee of the Regulated Entity responsible for handling of complaints received from its consumers;
e) "Consumer" shall have the same meaning as assigned to "Client" or "Customer" under clause 1.3.11 of the IFSCA (Anti Money Laundering, Counter-Terrorist Financing and Know Your Customer) Guidelines, 2022;
f) "Finance Company" shall have the same meaning as assigned to it under clause (e) of sub-regulation (1) of regulation 2 of the IFSCA (Finance Company) Regulations, 2021;
g) "Finance Unit" shall have the same meaning as assigned to it under clause (f) of sub-regulation (1) of regulation 2 of the IFSCA (Finance Company) Regulations, 2021;
h) "Foreign Educational Institution" shall have the same meaning as assigned to it under clause (iii) of sub-regulation (1) of regulation 3 of the IFSCA (Setting up and Operation of International Branch Campuses and Offshore Education Centres) Regulations, 2022;
i) "Foreign University" shall have the same meaning as assigned to it under clause (iv) of sub-regulation (1) of regulation 3 of the IFSCA (Setting up and Operation of International Branch Campuses and Offshore Education Centres) Regulations, 2022;
j) "Group Entity" means an entity of a business group that consists of a parent company or of any other type of legal person exercising control over the rest of the group, together with branches and/or subsidiaries;
k) "Non-retail" consumer means a person that is considered as a "non-retail" under the regulatory framework specified by the Authority:
Explanation I: Where the differentiation between "retail" vs. "non-retail" has not been specified in the regulations issued by the Authority for any specific business activity, the non-individual consumers shall be considered as "non-retail" consumers for the purpose of this circular:
Explanation II: All the investors participating in a scheme launched by a registered FME (Non-retail) or Authorised FME shall qualify as "non-retail" consumers;
l) "Professional Consumer" shall mean an accredited investor as covered under the circular titled 'Accredited Investors in IFSC' dated January 25, 2024, as amended; a professional client as covered under the IFSCA Banking Handbook, as amended; or a corporate policy holder;
m) "Regulated Entity" shall have the same meaning as assigned to it under clause 1.3.35 of the IFSCA (Anti Money Laundering, Counter-Terrorist Financing and Know Your Customer) Guidelines, 2022;
n) "Retail Consumer" for the purpose of this circular shall mean a consumer of a Regulated Entity other than Professional Consumer and non-retail consumer.
a) On receipt of a complaint, CRO of the Regulated Entity shall make an assessment on the merits of the complaint. Pursuant to assessment,
b) The Regulated Entity shall examine and process the complaint in a fair, transparent, professional and impartial manner.
c) The Regulated Entity shall ensure that the CRO has sufficient authority to resolve the complaint or has access to other officials with the necessary authority to be able to handle the complaint in a fair and impartial manner:
Provided that, where the CRO is or was involved in the conduct of the financial transaction which is the subject matter of the complaint, the complaint shall be handled by another officer designated by the Regulated Entity, in a fair and impartial manner.
d) The Regulated Entity may ask for additional information from the complainant while processing the complaint.
e) The Regulated Entity shall dispose of complaint preferably within 15 days but ordinarily not later than 30 days of acceptance of complaint. The Regulated Entity may either resolve the complaint or reject the complaint.
f) In case of rejection of a complaint, the Regulated Entity shall give reasons for rejection of the complaint, in writing.
