Last Updated on 6.6.24 by Paul Lupton
On the 3rd of June 2024, the Digital Markets Competition and Consumers Act 2024 was published.
It attempts to tackle several problem areas frequently faced by consumers when purchasing goods and services online.
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Subscriptions
The Act introduces an obligation on businesses to provide additional “key“ “information to the consumer before a subscription contract is entered into, including:
– full details of what happens when any introductory period comes to an end?
– the potential duration of the subscription contract including any minimum period
– the steps and notice period required to be given to bring the contract to an end
– details of monthly payments or a monthly equivalent for the subscription price, and the minimum sum payable under the contract.
Traders are also required to give detailed information to the consumer, including of the right to cancel, in a “reminder notice”, prior to the end of any introductory period and before any automatic renewal or extension of the contract.
Fake Reviews
The Act also introduces a ban on posting or commissioning fake reviews, or publishing reviews in a misleading way. It also imposes an obligation on businesses to take “reasonable and proportionate” steps to verify that reviews are genuine.
Drip Pricing
Drip pricing is the addition to the advertised price of non-optional fees and charges as the consumer goes through the purchasing process. Essentially the Act requires a trader to set out the “total price“ of the goods and services, including all fees, taxes, and charges as part of the pre-contract information.
What this means
Importantly, the Act gives the Competition and Markets Authority (CMA) greater scope to enforce consumer protection law directly, with the ability to fine businesses and to award compensation to consumers without having to take each case to court. This is likely to result in more action being taken against offending traders.
Secondary legislation is required to give effect to the above but if you are selling online to consumers, now is a good time to review your online terms and processes to ensure you are not falling foul of these new rules or of consumer protection law generally.
If you are a business trading online and need more information or assistance on complying with this new legislation, please contact Paul Lupton on 0161 930 5151, email enquiries@gorvins.com or complete the online contact form.
