Landmark new consumer protection provisions are now in force under the Digital Markets, Competition and Consumers Act 2024 (DMCCA), giving the Competition and Markets Authority (CMA) the ability to deliver more effective consumer protection.
The CMA will now be able to decide whether consumer protection laws have been infringed (rather than litigating through the courts) and to tackle any breaches directly and proportionately, including through consumer redress and fines.
The new regime will help the CMA to "safeguard consumer interests while also enhancing trust". The CMA also emphasises the importance of fostering a level playing field for fair-dealing businesses.
Sarah Cardell, chief executive of the CMA, says: "Consumers deserve to know that the CMA has their back – and fair-dealing businesses looking to grow and invest deserve to know that their competitors are playing by the same rules. We will use the new regime to strengthen the trust and confidence of consumers and businesses – supporting economic growth and incentivising good corporate practice.
"Most businesses work hard to serve their customers and do the right thing. We recognise the importance, particularly for small businesses, of any new rules being clear and proportionate to comply with – and that this is a period of change when they may need help to understand their legal obligations. We’re working hard to support them with that and keep burdens to a minimum – through accessible guidance and communications, as well as direct engagement – alongside listening and responding to feedback."
Justin Madders, Minister for Employment Rights, Competition and Markets, adds: "These measures mean consumers can confidently make purchases knowing they are protected against fake reviews and dripped pricing. These changes will give consumers more power and control over their hard-earned cash, as well as help to establish a level playing field by deterring bad actors that undercut compliant businesses, helping to deliver economic stability as part of our Plan for Change."
The DMCCA includes an explicit ban on the posting and commissioning of fake reviews, which has been added to the banned practices list. The CMA has previously taken action in this area and will be focused on ensuring compliance with the new provisions.
The DMCCA also updates the law on pricing information businesses must show to customers. This includes a ban on ‘drip pricing’, where shoppers are shown an initial price for a product, but more fees are added (‘dripped’) as they proceed with their purchase.
The CMA has also committed to focusing early action on more egregious practices, including aggressive sales tactics, hidden fees and unfair contract terms, and has issued guidance to ensure businesses understand how to comply with those aspects of the law which are already well established and largely unchanged. Before enforcing new provisions, and following clear feedback, the CMA has said it will consult further on newer aspects which have created some uncertainty – such as fixed-term periodic contracts – with the aim of publishing final guidance in the autumn.
