Trading advice from several sources is available to help businesses comply with the law.
The Health and Safety Executive website has advice on:
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In the guide
When dealing with consumers you must ensure that you act fairly; you must provide accurate information and avoid business practices that are unfair, misleading or aggressive
This guidance is for England, Scotland and Wales
The Consumer Protection from Unfair Trading Regulations 2008 (known as the CPRs) control unfair practices used by traders when dealing with consumers, and create criminal offences for traders that breach them.
The Regulations prohibit 31 specific practices that are always considered to be unfair, and create further offences for aggressive practices. They prohibit 'misleading actions' and 'misleading omissions' that cause, or are likely to cause, the average consumer to take a 'transactional decision' they would not have taken otherwise. They apply to commercial practices relating to products (which includes goods, services and digital content) before, during and after a contract is made.
They provide consumers with rights to redress in respect of misleading and aggressive commercial practices, and set out the remedies available to them.
What is prohibited?
Effectively the CPRs prohibit trading practices that are unfair to consumers. There are four different types of practices to consider:
For the last three practice types above it is necessary to show that the action of the trader has an effect (or is likely to have an effect) on the actions of the consumer. The test looks at the effect (or likely effect) on the average consumer, which mean there is no need for evidence about how any particular individual was affected.
The Regulations recognise that different types of consumers may react to a practice in different ways, and identify three different types of consumer:
Schedule 1 to the CPRs (see link in 'Key legislation' below) introduces 31 practices that are always considered to be unfair and therefore are prohibited in all circumstances. These include:
FALSE ENDORSEMENTS / AUTHORISATIONS
MISLEADING CONTEXT / EFFECT
Misleading actions and omissions
The CPRs prohibit 'misleading actions' and 'misleading omissions' that cause, or are likely to cause, the average consumer to take a different transactional decision - that is, any decision taken by the consumer concerning the purchasing of the product or whether to exercise a contractual right in relation to the product, including decisions not to act. This does not only relate to pre-shopping but includes after-sales and continues for the lifetime of the product.
Regulation 5 of the Consumer Protection from Unfair Trading Regulations 2008 prohibits giving false information to, or deceiving, consumers. A misleading action occurs when a practice misleads through the information it contains or its deceptive presentation (even if the information is factually correct) and causes, or is likely to cause, the average consumer to take a different transactional decision.
There are three different types of misleading actions:
The information that may be considered as misleading is very wide and is listed in the legislation itself; it includes such things as:
Regulation 6 prohibits giving insufficient information about a product. It is a breach of the CPRs to fail to give consumers the information they need to make an informed choice in relation to a product if this would cause, or be likely to cause, the average consumer to take a different transactional decision - for example, in order to make an informed decision about whether to buy or how much to pay, the average consumer buying a car needs to know whether the car has previously been an insurance write-off; the trader therefore has to disclose this information, whether or not the consumer asks for it.
Traders must give information to consumers in a timely manner. It should be provided to assist the consumer in making an informed choice. Supplying information too late could constitute an omission.
It is a breach of the CPRs to:
'Material information' means information that the consumer needs to make an informed transactional decision and generally any information required to be given by law.
Regulation 7 of the CPRs prohibits aggressive commercial practices that intimidate or exploit consumers, restricting their ability to make free or informed choices. In order for an aggressive practice to be unfair it must cause, or be likely to cause, the average consumer to take a different transactional decision.
A commercial practice is aggressive if it:
To decide whether a practice breaches this regulation, the following will be taken into account:
Note: 'coercion' includes the use of physical force, and 'undue influence' means exploiting a position of power in relation to the consumer so as to apply pressure - even without the use of (or threatening to use) physical force - in a way that significantly limits the consumer's ability to make an informed decision.
General duty not to trade unfairly
Regulation 3 is called "Prohibition of unfair commercial practices", which effectively means failing to act in accordance with reasonable expectations of acceptable trading practice.
The regulation prohibits practices that:
Consumers' rights to redress
In addition to the criminal offences created by a breach of the provisions described above, the Regulations also provide consumers with rights to redress enforceable through the civil courts. For a consumer to have these rights to redress certain conditions must be met.
The first condition is that the consumer does one of the following:
The second condition is that the trader has engaged in a prohibited practice. A prohibited practice means a misleading action or an aggressive practice (see above).
Furthermore, the trader will be liable for misleading actions or aggressive practices carried out by the producers of goods or digital content they supply if the trader could reasonably have known of the prohibited practice. An example of this would be where a manufacturer's television advertisements for a product are misleading.
The final condition is that the prohibited practice was a significant factor in the consumer's decision to enter into the contract.
WHAT REMEDIES ARE AVAILABLE TO A CONSUMER?
There are three main remedies available to a consumer: the right to unwind, the right to a discount, and the right to damages.
Right to unwind
The right to unwind allows the consumer to undo the contract and be put back into the position they were in before it was made. There are restrictions to this:
The consumer's right to a full refund is reduced in the case of continuous-supply products (such as utility contracts).
Right to a discount
This right applies where the right to unwind has been lost. This may be because of a delay in complaining or because the goods have been fully consumed. For goods and services costing less than £5,000 there is a fixed-percentage discount ranging from 25% for more than minor issues to 100% for very serious cases.
Above £5,000, if the misleading or aggressive practice led the consumer to pay more than the market price for the product, the price is reduced to the market price. Otherwise, the fixed-percentage discounts will still apply. A consumer may also claim a discount instead of unwinding a contract where the right to unwind still exists but the consumer does not wish to end the contract.
Consumers can claim damages if they have suffered reasonably foreseeable losses that exceed the price paid for goods, digital content and services. These damages can cover alarm, distress, physical inconvenience or discomfort as well as economic losses suffered as a result of the prohibited practice. Damages may be claimed in addition to unwinding the contract or claiming a discount. Damages are not payable if the trader can establish that the prohibited practice occurred due to a mistake, reliance on information supplied to the trader by another person, the act or default of another person, an accident or some other cause beyond the trader's control and the trader had taken all reasonable precautions and exercised all due diligence to avoid the prohibited practice occurring.
Guidance on the CPRs is available on the GOV.UK website.
Also, the Department for Business, Energy and Industrial Strategy (which was known as the Department for Business, Innovation and Skills at the time) has produced specific guidance on consumers' rights to redress under the Regulations: Misleading and Aggressive Commercial Practices: New Private Rights for Consumers.
Failure to comply with trading standards law can lead to enforcement action and to sanctions, which may include a fine and/or imprisonment. For more information please see 'Trading standards: powers, enforcement and penalties'.
Last reviewed / updated: November 2020
In this update
No major changes
This information is intended for guidance; only the courts can give an authoritative interpretation of the law.
The guide's 'Key legislation' links may only show the original version of the legislation, although some amending legislation is linked to separately where it is directly related to the content of a guide. Information on amendments to legislation can be found on each link's 'More Resources' tab.
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