(1) Where a payment order is initiated directly by a payer, the payer’s payment service provider shall, without prejudice to Regulations 95, 111(2), (3) and (4), and 116, be liable to the payer for correct execution of the payment transaction, unless the payer’s payment service provider can prove to the payer and, where relevant, to the payee’s payment service provider that the payee’s payment service provider received the amount of the payment transaction in accordance with Regulation 107(1) and (2).

(2) Where, in accordance with paragraph (1), the payer’s payment service provider can prove to the payer and, where relevant, to the payee’s payment service provider that the payee’s payment service provider received the amount of the payment transaction in accordance with Regulation 107(1) and (2), the payee’s payment service provider shall be liable to the payee for the correct execution of the payment transaction.

(3) Where a payer’s payment service provider is liable under paragraph (1), it shall, without undue delay, refund to the payer the amount of a non-executed or defective payment transaction, and, where applicable, restore the debited payment account to the state in which it would have been had the defective payment transaction not taken place.