§ 1-8. Other definitions: distance selling, payer, business day and strong customer authentication

The Financial Contracts Act (Finansavtaleloven)·LOV-2020-12-18-146

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In brief

The text of the law (unofficial translation)

§ 1-8. Other definitions

(1) In this Act, an off-premises agreement means an agreement as referred to in the Right of Withdrawal Act § 5 letter d, cf. letter c.
(2) In this Act, distance selling means agreements concluded under an organised scheme for sales or provision of services without the service provider (tjenesteyter) and the customer (kunde) being physically present at the same time, and where the agreement is concluded exclusively by means of distance communication.
(3) In this Act, payer means a natural or legal person who fulfils an obligation by using funds, including the person who holds a payment account (betalingskonto) and allows a payment order (betalingsoppdrag) from that account, or, if there is no payment account, the person who gives a payment order.
(4) In this Act, payee means a natural or legal person who is the intended recipient of funds that are part of a payment transaction (betalingstransaksjon).
(5) In this Act, nominal interest rate means a percentage interest rate applied on an annual basis to the deposit balance in an account or to the amount of credit owed.
(6) In this Act, business day means a day on which the payer's or the payee's payment service provider (betalingstjenesteyter) involved in the execution of a payment transaction is open as required for such execution.
(7) In this Act, intermediation firm (oppdragsforetak) means a service provider that offers financial intermediation (finansoppdrag).
(8) In this Act, authentication (autentisering) means a procedure that makes it possible to confirm an event, a specified content or the validity of an electronic signature (elektronisk signatur) or an electronic seal, and a procedure that makes it possible for a payment service provider to verify the identity of a customer or the validity of a specific payment instrument (betalingsinstrument), including the use of the customer's personalised security credentials.
(9) In this Act, strong customer authentication means authentication based on the use of two or more elements categorised as knowledge (something only the user knows), possession (something only the user has) and inherence (something the user is), which are so independent of each other that a breach of one criterion does not entail a risk of breach of the others, and which are designed in such a way that the confidentiality of the authentication data is protected.
(10) In this Act, personalised security credentials (personlig sikkerhetsinformasjon) means personalised features provided by a service provider to a customer or other user for the purposes of authentication.
Source: Lovdata — Finansavtaleloven (the Financial Contracts Act) § 1-8

What does this mean?

This section brings together ten definitions that do not belong in the other definition sections.

The first two concern forms of sale. An off-premises agreement is defined by reference to the Right of Withdrawal Act § 5. There, the main case is that the consumer (forbruker) concludes the agreement or makes an offer in the presence of the trader at a place other than the trader's business premises. Agreements concluded on the premises or at a distance immediately after a personal and individual approach in such a situation are also included. Distance selling means agreements concluded under an organised scheme, without the parties being physically present at the same time, and where everything takes place by distance communication. In practice, the definition is the same as in the Right of Withdrawal Act § 5.

The payer is the person who fulfils an obligation using funds, that is, the account holder who allows a payment order from the account, or the person who gives the payment order when there is no account. The payee is the intended recipient of the money. The nominal interest rate is a percentage per year on deposits or on the amount of credit owed. A business day is a day on which the payer's or the payee's payment service provider is open to the extent needed to carry out the transaction. An intermediation firm is a service provider that offers financial intermediation.

The last three concern secure identification. Authentication is a procedure for confirming, for example, that an electronic signature is valid, or for allowing a payment service provider to verify the customer's identity or that a payment instrument is valid. Strong customer authentication requires at least two of three types of elements: something you know, something you have and something you are. The elements must be so independent of each other that a breach of one does not weaken the others, and the setup must protect the confidentiality of the data. Personalised security credentials are the personalised features the service provider gives the customer for use in authentication. The payment terms belong together with the definitions in § 1-5, and financial intermediation is defined in § 1-3.

Related sections
All sections of the Financial Contracts Act →