§ 3-58. Duties of financial brokers and others who carry out financial intermediation

The section applies to financial intermediation, that is, arranging financial services between a customer and a service provider. The first paragraph concerns who the intermediary can receive payment from. A financial agent cannot receive remuneration from anyone other than the party that gave the assignment. Other intermediary firms can accept remuneration from the service provider only if they have looked at a majority of the services available in the market for the product category in question. Firms that provide independent advice can only be paid by their client, and must decline assignments where their own personal or financial interests may conflict with the client's.

The second paragraph places additional duties on the intermediary firm. The broker must arrange the documentation needed for the agreement to be concluded, and make sure the parties are told everything that is known and may affect whether the agreement is entered into. Information needed for the credit assessment and for calculating the effective interest rate (total cost of the loan as a percentage) must be passed on to the service provider. If it is doubtful whether the service provider or the customer will be able to fulfil their obligations, the broker must advise against going ahead with the agreement. The intermediary firm is also responsible for ensuring that the customer receives what the service provider owes, within the scope of the assignment, unless a service provider with a licence or a notification requirement has already done so.

The third paragraph brings in rules from other laws. Intermediary firms that do not fall under the Loan Intermediation Act follow that Act's rules on the duty to have insurance correspondingly, as far as they are suitable. The Loan Intermediation Act requires the firm to have insurance with a company that has its head office and licence in an EEA (EØS) state. The insurance company is liable to the injured party when the claim is made, and the insurance must cover claims made up to five years after the business has ended. Client funds, that is, money the intermediary holds on behalf of others, follow the rules in the Insurance Distribution Act correspondingly: they must immediately be deposited in a client account kept separate from the firm's own funds.

The section has limits. § 3-56 states that § 3-57 and this section do not apply to services covered by the Securities Trading Act (verdipapirhandelloven), the Securities Funds Act (verdipapirfondloven) or the Crowdfunding Act (folkefinansieringsloven). In addition, Chapter 3 applies to customers who are not consumers (forbrukere) only for services that require a licence or are subject to a notification requirement, cf. § 1-2 sixth paragraph, and the intermediation of such services. Furthermore, § 3-57 requires a financial broker (finansmegler) to safeguard the parties' interests in accordance with good brokerage practice and not to act in a way that creates doubt about its independence.

Example: a broker arranges a loan between a customer and a service provider and sees that the customer will hardly be able to service the loan. In that case, the client must be advised against using the service provider, or the service provider must be advised against entering into the agreement.