Motor finance commission disclosure

Commission disclosure

This page sets out DLL’s current position following the Supreme Court’s ruling on commission disclosure in motor finance transactions on 1st August 2025.

We have summarised the key points of the ruling and the potential impact on both consumers and businesses below. You can find a detailed summary of the Supreme Court's decision here.

 

Key points

Fiduciary duty

The Supreme Court ruled that car dealers arranging finance for customers do not owe a fiduciary duty to their customers. This means that dealers are not required to act with undivided loyalty or impartiality to the customer. The Supreme Court stated that dealers in the circumstances found in the cases presented have their commercial interests and do not undertake to act with "single-minded loyalty".

Lender liability

Where no fiduciary duty exists, lenders who pay commission to dealers are not liable for bribery or as accessories to any breach of fiduciary duty when paying commission.The Supreme Court rejected the submission that the common law tort of bribery should be abolished and clarified that it only applies if the commission is paid to a fiduciary, amounting to a bribe.

Disclosure

Whilst the Supreme Court considered it unnecessary to examine the level of disclosure in determining the issue of fiduciary duty before it, it did provide helpful context for any claim under s.140A of the Consumer Credit Act 1974 as to unfair relationships, explained below.

Unfair relationship

The Supreme Court found in the case of Mr. Johnson that the relationship was unfair for the purposes of s.140A of the Consumer Credit Act 1974. The basis of this finding was:

1. the size of the commission,

2. the failure to adequately disclose the commission, and

3. the concealment of the nature of the commercial tie between the dealer and lender.

The unfair relationship test requires a broad range of factors to be considered, including, in these circumstances, the size and nature of the commission, the characteristics of the customer, the extent and manner of disclosure and compliance with regulatory requirements.  This provides a helpful context in determining whether any circumstance in which commission is, or has been, paid could be considered an unfair relationship.

Implications

The ruling provides further context and understanding for consumers and businesses involved in motor finance transactions. Lenders and dealers will need to review practices against the findings of the Supreme Court and await further updates from the Financial Conduct Authority (FCA), as to the proposed redress scheme as detailed below.

 

Financial Conduct Authority

Following the Supreme Court judgment, the FCA confirmed its intention to carry out a consultation on an industry-wide redress scheme. The Supreme Court's judgment provided, to some extent, a framework to the requirements for commission disclosure, which should help the FCA ensure that compensation under the redress scheme is fair and consistent.

You can read the FCA’s statement here.

Key points

The consultation is expected to open by early October 2025 and will last for six weeks.

It will likely cover agreements dating back to 2007, and it is suggested that claimants might receive up to £950 per agreement (inclusive of interest), with total costs of the scheme currently estimated between £9 billion and £18 billion. These figures are subject to change.

The aim is to create a redress scheme that is straightforward for consumers to participate in, without needing to use claims management companies or law firms.

Impact on consumers and businesses

Consumers who believe they were not informed about commission and may have paid too much for their motor finance should consider making a complaint.

Motor finance providers will need to review their practices against the findings of the Supreme Court and the redress scheme once known.

 

DLL’s current position

With many questions still to be answered, we continue to monitor developments on this subject. For now, it is business as usual, including the use of the Commission Disclosure Consent Forms. We have a very small number of cases where customers have approached us, and we will continue to keep those customers informed of further developments.

We will, of course, keep you updated as more information becomes available on this subject.

 

How to use the Commission Disclosure Consent Forms

Download the relevant Commission Disclosure Consent Form from the section below.Complete the information in the table at the top of the form. The green text in the image below explains the information that is required.

The form should be sent to customers before or at the same time as the document package and it should be signed before the customer signs the finance agreement.

We will accept Commission Disclosure Consent Forms that have been e-signed or wet ink signed by the customer.
Please continue to use e-signature via the DLL portal for the document package where possible to avoid delays in the payout process.

Please return signed Commission Disclosure Consent Forms to DLL by email in the usual way. 

 

Accessing the Commission Disclosure Consent Forms

Please select a suitable form from the list below, depending on the type of commission and product. If you are unsure of which form to use, please contact your DLL Account Manager:

Upfront commission - If you will receive an upfront commission linked to the amount of finance, please select one of the following templates:

Document fee split – If you will receive a share of the document fee paid by the customer, please select one of the following templates:

 

Frequently asked questions

If you have any questions regarding Commission Disclosure or the Forms, please refer to our FAQ's or contact your usual DLL Account Manager.

 

Further information

Previous Market Updates

Motor Finance Commission Complaints

Court of Appeal decision on motor finance - Your questions answered