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* Ruling could result in other firms making similar claims
* Firm suing for negligent implementation of FCA review
* Ruling may enable time limits on cases to be lifted
* Holiday park operator claimed compensation inadequate
By Matt Scuffham
LONDON, July 30 (Reuters) - A British court ruling couldpave the way for thousands of small firms mis-sold complexfinancial products by their banks and unhappy with an officialcompensation scheme to sue for redress.
The Financial Conduct Authority (FCA) had set up acompensation scheme in 2012 having reached agreement with banksincluding Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland for them to reviewthousands of cases for possible mis-selling.
But many firms unhappy with the FCA's scheme had been unableto appeal through the courts because they had passed a six-yeartime limit while taking part in the review.
The latest ruling involved a holiday park operator calledSuremime, which alleged it was mis-sold an interest rate hedgingproduct by Barclays in 2008. Barclays made an offer ofcompensation through the FCA's scheme which Suremime says isinadequate.
Products such as those bought by Suremine were meant toprotect smaller companies against rising interest rates, butwhen rates fell the companies had to pay extra charges,typically running to tens of thousands of pounds. They alsofaced hefty penalties to extricate themselves from the deals,which most said they were not aware of.
Thursday's High Court decision by Judge Havelock-Allanenables Suremime to amend its case to include allegations thatBarclays was negligent in its conduct of the review and in itsdecision to review redress and it is entitled to compensation asa result. Barclays declined to comment.
"The existence of a right to sue for the negligentimplementation of the review would be particularly important forthose customers," said Janine Alexander, a partner in CollyerBristow's Banking and Financial Disputes team.
Thursday's decision could leave banks, which have so farpaid out less than 2 billion pounds ($3.1 billion) to affectedcustomers, with a much higher compensation bill.
"It does give a new lease of life to a lot of small firmsseeking compensation. There's no shortage of businesses that areunhappy with the review process," said Abhishek Sachdev,managing director of Vedanta Hedging, which advises on hedging.
The FCA's compensation scheme was criticised by many smallfirms which complained that their compensation was inadequate orthat they were offered alternative hedging products they didn'twant or excluded from the process altogether on technicalities.
In a separate case, nursing home operator HolmcroftProperties was granted permission to apply for a judicial reviewof the scheme in April.
($1 = 0.6417 pounds) (Editing by David Holmes)
