Merger talks between the CEOs running dispute resolution schemes IFSO and FSCL are on hold following legal advice.
In a statement released by IFSO this week, it appears that because IFSO is an incorporated society, and FSCL is a limited liability company, joining the two organisations is problematic.
“Legally, it is complex to merge two differently structured entities,” states IFSO in a statement.
“It is also complicated because of the legislation which prevents the use of the name ‘Ombudsman’, except in extremely limited circumstances, with only the IFSO scheme having the right to ‘restructure’ under the statute and keep the name Insurance & Financial Services Ombudsman.”
IFSO must first incorporate as a limited liability company, prior to any merger being possible, “…in order to be simple, cost-effective, and of least disruption to our 3,500 participants”.
“We will now commence the work required to incorporate as IFSO Ltd, with merger discussions paused,” states IFSO. “We will provide further updates as matters progress.”
See our report: DSR Schemes in Merger Talks