The Competition and Markets Authority (CMA) launched court action against sleep brand Emma last month, after it failed to address the regulator's concerns around advertising misleading practices.
The CMA first opened its investigation into Emma over concerns that some of its online sales practices, such as discounts and urgency claims, including countdown timers and high demand prompts, may mislead consumers. The CMA called on the business to make changes and agree to commitments – known as ‘undertakings’ – to ensure its compliance with consumer protection law and ensure shoppers get a fair deal.
Emma failed to take the necessary action to address all of the CMA’s concerns relating to the use of reference pricing, promoting the CMA to launch court action.
George Lusty, the CMA’s interim executive director for Consumer Protection and Markets, says: "We have given Emma sufficient opportunity to alter the way it does business to address our concerns. They have failed to make all the changes that we require, which is why we’ve progressed to court action.
"We are concerned that when sales tactics such as discounts and countdown clocks are used in a misleading way, they can pressure shoppers into making quick purchases and spending more than they otherwise would, for fear of missing out."
Emma can still agree to change its practices by consenting to an order or giving undertakings to the court ahead of the case being heard. It is for the court to determine a date for the hearing.
The CMA is monitoring sales practice across the sector, and this action is part of an ongoing programme of consumer enforcement work focused on so-called ‘Online Choice Architecture’. This aims to tackle potentially harmful online selling practices, including pressure-selling tactics such as urgent time-limited claims.
Under this programme, the CMA has secured formal changes to the business practices of Simba Sleep. These included ensuring that any ‘was’ price is genuine – in other words, that a sufficient volume of product was sold at that price before using it as a ‘was’ price.
From April 2025 the CMA expects to have the power to decide itself whether consumer law has been broken, and to fine companies up to 10% of their global turnover if appropriate. Firms will have the right to appeal the CMA’s decision to the courts.
John Hartley, partner and head of Business and Crime Regulation at Primas Law, highlights the broader implications for online consumer protection and business accountability: “The CMA is the Government agency that takes responsibility for overseeing both competition and consumer protection.
“One of the key pieces of legislation that is used for this is The Consumer Protection from Unfair Trading Regulations 2008. These regulations help to protect consumers from potentially misleading advertising – one area in particular is the focus on how ‘choices’ are presented to online customers in respect of urgency and price reductions. This is also known as 'Online Choice Architecture'.
“The CMA has issued guidance and open letters to businesses to ensure that urgency claims and price reductions are not misleading and do not place unfair pressure on the consumer.
“The scrutiny placed on these situations looks at the pressure that may be applied to the consumer at the time of viewing the product. Statements which pop up to indicate that the product has been sold many times in the last few minutes together with ‘last few remaining’ comments will often be considered as unfair and likely to affect the decisions made by the consumer."
John adds that while the current proceedings deal with a specific law enforcement, there could be more in store for company officers at Emma Group – or businesses who operate similar sales tactics: “Whilst the court proceedings against Emma Group seem to be for an Enforcement Order to remedy the highlighted breaches, there are other tools available to the CMA which include bringing a criminal prosecution for certain regulatory breaches.
“Company officers should also be aware that if it is demonstrated that a breach was committed with their consent, connivance or neglect, then they may be prosecuted in a personal capacity as well as the corporate. The punishment under the Regulations may be an unlimited fine and/or imprisonment for a maximum of two years.
“Whilst this case targets specific advertising practices, it should also be noted that the Regulations cover unfair commercial practices from all sectors, and investigations may be brought by a local Trading Standards team as well as the CMA.
“Businesses can learn that complying with consumer protection laws isn’t just about avoiding penalties. It's about fostering trust and clarity in customer interactions. Ensuring all discounts and urgency claims are genuine can prevent potential legal issues and contribute to long-term customer loyalty.”
