The Competition and Markets Authority (CMA), the UK body responsible for consumer protection, has increased its focus on tackling misleading online sales practices ahead of the introduction of new legislation, expected later this year.
The CMA has launched a new campaign to help consumers identify and report misleading online sales practices, including pressure selling, hidden charges, subscription traps and fake or misleading reviews.
The radio and social media campaign urges internet shoppers to report ‘sneaky online sales tactics’ by completing a form on its Rip-Off Tip-Off campaign website. The campaign features a series of short YouTube videos that imagine how some online sales practices might look like if they were turned into tactics in a real street market.
The CMA has also published an open letter to retailers, marketplaces and other businesses detailing its ‘online red lines’ on pressure selling. The letter warns businesses that they need to comply with consumer protection laws when making urgency claims and price reduction claims.
Urgency claims involve businesses presenting a scarcity (e.g. ‘Only 5 items left in stock’), popularity (e.g. ’10 people viewing this now’), ‘act fast’ (e.g. ‘Selling fast. Don’t miss out’) or time limited claim (e.g. ‘Offer ends in 12 hours’), while price reduction claims are discount or special offer prices that refer to a higher comparison price.
Urgency claims and price reduction claims that the letter calls out as being non-compliant include those that: contain information that is untrue or that is deceptive even if the words used are literally true; fail to state clearly any important information the consumer needs at that time to decide whether they wish to proceed; or falsely state that a product will only be available for a very limited time, or that it will only be available on particular terms for a very limited time, in order to elicit an immediate decision and deprive consumers of sufficient opportunity or time to make an informed choice.
The message from the CMA is clear: it is actively monitoring this area and urging businesses to ensure that they are compliant.
Businesses should review their online sales practices to ensure that they are not misleading and do not put unfair pressure on consumers. Those that do not do so are at risk of infringing the Consumer Protection from Unfair Trading Regulations 2008.
The CMA’s campaign and open letter follows UK government proposals for a range of reforms to increase consumer protection online.
These proposals, which are expected to form part of the Digital Markets, Competition and Consumer Bill, include giving the CMA the power to impose direct fines of up to 10% of global turnover for significant breaches of UK consumer laws. The Bill is expected to be published later this spring and brought into force later this year.
Increased watchdog scrutiny and raised consumer awareness of what online sales practice are acceptable mean that it’s more important than ever for businesses to check that their entire online customer journey is compliant with consumer protection laws.
