Advisers' hopes for the re-introduction of a long-stop on client complaints have suffered a blow after Financial Conduct Authority (FCA) chief Martin Wheatley suggested the regulator's investigation into the matter may have hit a roadblock.
Speaking during the FCA's annual public meeting on Thursday, its chief executive said the regulator had come across a European directive which may have implications for its long-stop project.
The directive, on alternative dispute resolution (ADR) for consumer disputes and amending regulation, was passed by the European Parliament in 2013 and will be introduced next year.
It places a requirement on member states to "ensure ADR that meets certain quality criteria is available for every possible contractual dispute between consumers and business".
Wheatley said its long-stop project had "not been shelved", but that the issue had now become "complicated".
"It has become slightly more complicated because there is a European directive... which looks at the extent to which imposing a long-stop would be a legal constraint on consumers' rights," he said, responding to a question from Professional Adviser correspondent Carmen Reichman.
"Until we've resolved that we can't do a review on how that would work within the financial sector.
"It's not been shelved, we've just got to clarify the scope of that directive because, at the moment, that directive did not carve out financial services. It may be an oversight, so we are in the process of clarifying exactly where that directive should extent to."
In its 2014-2015 Business Plan, the regulator announced it would consider the case for re-introducing a 15-year time limit on complaints to the Financial Ombudsman Service "to review whether the current arrangements are delivering the best outcomes for consumers overall".
> Read: One campaigner's caution over FCA's long-stop promise <
