The BBRS: a unique approach to business banking dispute resolution

Introduction

Some law firms may have acted on behalf of business clients seeking resolution of a dispute with their bank. Some law firms may themselves have had disputes with their own bank that needed resolution. Outcomes varied, and some businesses were too large to be covered by the Financial Ombudsman service. As an ex-banker I was interested to learn about the Business Banking Resolution Service (BBRS), which can address these situations independently, including historical cases, and make binding determinations.

This blog, from BBRS Chief Adjudicator Alexandra Marks, sets out how your business clients – and perhaps even your own firm – can benefit from engaging with them.

Chris Marston, CEO, LawNet

The Business Banking Resolution Service (BBRS) is a non-profit organisation set up to resolve disputes between Small and Medium-sized Enterprises (SMEs) and participating banks where, generally speaking, SMEs are too large for the Financial Ombudsman Service and have not had access to independent resolution. Additional information on eligibility can be found on the BBRS website.

The service, launched in February 2021, set out to ensure that complainants are at the heart of its operations. In doing so, BBRS includes several unique elements, setting it apart from other ombudsman style schemes.

Customer Champions

Each business going through the BBRS is assigned a Customer Champion, who acts as a single point of contact. They offer practical support throughout the business’ journey through the BBRS, such as helping to gather all relevant evidence on the complaint. Customer Champions can offer guidance to complainants, but not legal or other advice.

They also identify opportunities for more informal dispute resolution methods and can suggest potential courses of action to both the SME complainant and the relevant bank.

Alternative dispute resolution

When attempting to resolve issues between the parties, the BBRS employs a variety of alternative dispute resolution techniques. These include informal mediation (conciliation), formal mediation, and investigative adjudication.

The last of these – investigative adjudication – is our default method, and differs from the courts’ jurisdiction because we look at what would have been ‘fair and reasonable in the circumstances’ rather than identifying anything ‘unlawful’ which the complainant may allege its bank has done (or not done).

Where appropriate, the BBRS will encourage and support the parties to seek a fair and reasonable outcome without the need for investigative adjudication, but by agreement instead. For example, if the parties agree to undertake mediation, a trained neutral mediator will be appointed to facilitate negotiations for the dispute to be resolved. Evidence as well as experience shows that mediation often offers a more satisfactory outcome because the parties are involved in shaping it and can be creative about the solution to their dispute. An agreed outcome in which the parties have themselves participated can also help rebuild trust between them.

Moreover, agreeing to informal or formal mediation does not affect consideration of the complaint should settlement not be achieved and the case instead continues to adjudication.

Sharing information

An unusual feature of the BBRS is that we ensure mutual disclosure of evidence, thus providing a clear and transparent process.

The online portal developed by the BBRS allows each party to see any evidence the other has provided.

In cases seen by the BBRS so far, it has been clear that a dispute might have been resolved earlier if parties had seen and understood the evidence submitted by the other.

Draft decisions

In cases that go through the BBRS adjudication process, an independent Case Assessor will study all the evidence submitted and, taking account of relevant law, regulations, guidance and codes of practice etc., determine the dispute by reference to what is, in their opinion, fair and reasonable in the circumstances.

The Case Assessor will make a Provisional Determination, which both parties are able to comment on within 28 days. The Case Assessor will consider any such comments received before making a Determination.

This helps to ensure that both parties feel they have been heard, and offers them the opportunity to intervene if they believe something has been misinterpreted or missed by the Case Assessor.

Concessionary Cases

The BBRS is always able to review a case which meets the scheme’s eligibility conditions. However, in some circumstances the BBRS may be able to consider cases that are technically ineligible. Such a ‘Concessionary Case’ might include, for example, a business with a turnover slightly above the stated financial thresholds.

For these ‘Concessionary Cases’ to progress, the BBRS, the complainant, and the bank must all agree. The banks have agreed to act reasonably and in good faith when considering whether a Concessionary Case proposed by the BBRS can proceed.

If the bank disagrees with the BBRS’ request then they must provide both the BBRS and the customer with an explanation. This enables the BBRS to discuss the reasons with the customer, and to challenge the bank if necessary.

All customers who wonder whether their complaint falls within the BBRS’ eligibility criteria, or who consider they may qualify as a concessionary case, are recommended to contact the BBRS.

Historical cases

It is important to stress that unlike most ombudsman style schemes, the BBRS accepts historical cases for review.

The BBRS’ Historical Scheme covers complaints first registered with the bank in the period from 1 December 2001 to 31 March 2019. Businesses may qualify for our service if they had turnover between £1 million and £6.5 million per annum at the time of their complaint, and their case has not already been settled, subject to an independent review, or gone to court. This includes businesses which have since closed, merged or been sold.

Cases relating to incidents that took place on or after 1 April 2019 are covered by the BBRS’ Contemporary Scheme. This scheme is for businesses with turnover of up to £10m per annum, total assets up to £7.5m, and which are not eligible to take their complaint to the Financial Ombudsman Service.

Smaller SMEs may have a complaint that fits the eligibility criteria of the Financial Ombudsman Service and BBRS has a close working relationship with that service to ensure that complaints are dealt with by the appropriate organisation.

The BBRS is urging all SMEs with a historical complaint to register promptly, as the Historical Scheme will close for new complaints on 14 February 2023. You can view the full eligibility criteria, find out more about the BBRS, and register a business banking complaint directly by visiting the BBRS website.