C1C2Part I Regulation of Investment Business
Pt. I (ss. 1–128): power to modify conferred (prosp.) by Courts and Legal Services Act 1990 (c. 41, SIF 76:1), ss. 89, 124(3), Sch. 14 para. 9(c)
C3Chapter V Conduct of Investment Business
Chapters III–XI (ss. 7–111): certain functions transferred by S.I. 1990/354, art. 5
56 Unsolicited calls. C4
1
Except so far as permitted by regulations made by the Secretary of State, no person shall in the course of or in consequence of an unsolicited call—
a
made on a person in the United Kingdom; or
b
made from the United Kingdom on a person elsewhere,
by way of business enter into an investment agreement with the person on whom the call is made or procure or endeavour to procure that person to enter into such an agreement.
2
A person shall not be guilty of an offence by reason only of contravening subsection (1) above, but subject to subsection (4) below—
a
any investment agreement which is entered into in the course of or in consequence of the unsolicited call shall not be enforceable against the person on whom the call was made; and
b
that person shall be entitled to recover any money or other property paid or transferred by him under the agreement, together with compensation for any loss sustained by him as a result of having parted with it.
3
The compensation recoverable under subsection (2) above shall be such as the parties may agree or as a court may, on the application of either party, determine.
4
A court may allow an agreement to which subsection (2) above applies to be enforced or money and property paid or transferred under it to be retained if it is satisfied—
a
that the person on whom the call was made was not influenced, or not influenced to any material extent, by anything said or done in the course of or in consequence of the call;
b
without prejudice to paragraph (a) above, that the person on whom the call was made entered into the agreement—
i
following discussions between the parties of such a nature and over such a period that his entering into the agreement can fairly be regarded as a consequence of those discussions rather than the call; and
ii
was aware of the nature of the agreement and any risks involved in entering into it; or
c
that the call was not made by—
i
the person seeking to enforce the agreement or to retain the money or property or a person acting on his behalf or an appointed representative whose principal he was; or
ii
a person who has received or is to receive, or in the case of an appointed representative whose principal has received or is to receive, any commission or other inducement in respect of the agreement from a person mentioned in sub-paragraph (i) above.
5
Where a person elects not to perform an agreement which by virtue of this section is unenforceable against him or by virtue of this section recovers money paid or other property transferred by him under an agreement he shall repay any money and return any other property received by him under the agreement.
6
Where any property transferred under an agreement to which this section applies has passed to a third party the references to that property in this section shall be construed as references to its value at the time of its transfer under the agreement.
F27
Section 63A below (application of designated regulations) has effect as regards the application of regulations under this section to members of recognised self-regulating organisations in respect of investment business in the carrying on of which they are subject to the rules of the organisation.
As it applies to such persons in respect of such business the reference in subsection (1) above to conduct permitted by regulations made by the Secretary of State shall be construed—
a
where or to the extent that the regulations do not apply, as a reference to conduct permitted by the rules of the organisation; and
b
where or to the extent that the regulations do apply but are expressed to have effect subject to the rules of the organisation, as a reference to conduct permitted by the regulations together with the rules of the organisation.
7A
In the application of this section to anything done by a person certified by a recognised professional body in carrying on investment business in the carrying on of which he is subject to the rules of the body, the reference in subsection (1) above to conduct permitted by regulations made by the Secretary of State shall be construed as a reference to conduct permitted by the rules of the body.
8
In this section “unsolicited call” means a personal visit or oral communication made without express invitation.
Pt. I (ss. 1-128) amended (S.) (22.5.2000) by S.I. 2000/121, regs. 1, 37, Sch. 2