DWF partner, Dominic Watkins, recently spoke to Lexis Nexis along with The Competition and Markets Authority to highlight the key developments in 2015 in the area of consumer protection enforcement.  Download the interview as PDF »

A view from the regulator

What were the key developments and trends highlighted by the CMA's work during 2015?

CMA: The CMA is a combined consumer and competition agency, where the focus of our consumer enforcement work is to tackle markets where unfair trading practices or terms could undermine consumers' ability to make informed choices and decisions. Well-informed consumers drive competition by making decisions that reward firms that best satisfy their needs and drive businesses to comply with the law.

We have been working in a wide range of sectors to tackle such issues--for example, the higher education sector where we have given advice to the sector to ensure that students get the information they need to make informed choices and are treated fairly when they get to university. As a result, we have secured assurances from University College London that students will not be prevented from graduating or re-enrolling because they owe non-academic debts, such as for their accommodation. In response to a super-complaint from Which? about pricing practices in the groceries sector, we carried out a wide-ranging investigation of the market and announced a series of measures to bring greater clarity to shoppers, improve compliance and simplify the regulations.

When consumers engage in fast-moving online transactions they can be pressured into making important decisions quickly. Much of our work has been in digital markets, such as our call for information into online reviews and endorsements--such reviews are increasingly important tools that can help consumers make decisions, and it's important that consumers can trust that they are getting full and accurate information to inform their purchasing decisions. We've also recently opened a consumer law compliance review into the cloud storage sector to ensure that cloud storage providers are complying with consumer law and that consumers get the information they need and are treated fairly when they sign up to contracts.

With the increase in cross-border trade, we are increasingly working in an international environment, and often work with enforcers from across the globe to take action, as we did in our Europe-wide review of the car hire sector that led to five leading EU car rental companies committing to improving the way they deal with consumers. In July the CMA took up the Presidency of the International Consumer Protection and Enforcement Network (ICPEN), a network of over 50 consumer enforcement agencies from across the globe. We are working together with the other members of ICPEN to achieve better outcomes for consumers with a current focus on misleading pricing practices and online reviews and endorsements.

Legal developments and practical impact

What legal developments have had the biggest impact on your practice in 2015?

Dominic Watkins: The biggest change of 2015 has been the Consumer Rights Act 2015 coming into force. As this only occurred a couple of months ago it is a little early to say that it is having the biggest impact, but any time the sale of goods legislation is recast this is pretty fundamental for consumer protection.

This year has also seen some big changes in food labelling law as the Food Information to Consumers regime has had a year in force although in terms of enforcement it has been very light touch as people get used to the new situation.

Towards the end of the year we saw the revised sentencing guidelines for health and safety, food safety and corporate manslaughter being released. When they come into force next year it will see a seismic change in sentences.

In terms of enforcement, it is actually a non-legal factor that has loomed largest. That is the ongoing budget restrictions facing local authorities. Most consumer protection legislation is enforced locally by officers of the local council.

The budgets of local councils have been massively cut and these enforcement services have been a shadow of their former selves. This has been to such an extent that one council, Liverpool City Council, was subject to judicial review proceedings in relation to its decision not to have any officers at all.

The impact of this decision is that there are far fewer enforcers than ever before and far less enforcement action. Perhaps this is consistent with the government's red tape reduction agenda and giving business earned autonomy, but by any measure there are far fewer prosecutions and those that are progressed are generally cases without any credible defence.

Finally, the extension of Primary Authority in terms of take-up and late this year the proposals for the scheme's extension and simplification announced in the Enterprise Bill also have the potential to change the way in which local regulation operates.

How have these affected your ongoing cases and working life? How have you dealt with these on a practical level?

Dominic Watkins: The other consequence has been the rise in power of some other regulators. For example in relation to the enforcement of claims on foods it has been the advertising regulator the Advertising Standards Authority (ASA) which has taken the lead and determined where the boundaries are. This is problematic given that the ASA has deemed itself outside of the Regulators Code and therefore not bound by its principles. This has led to continued complaints about its behaviour, in particular that it, currently, does not consider itself bound by Primary Authority advice. In November the ASA published its Prioritisation Principles which is its attempts to better regulation and at least is a step in the right direction.

We have seen the importance of Primary Authority grow considerably. We have been advocates for the scheme, as over the years it has provided our clients with protection and considerable benefits and certainty of assured advice. It also helps to try and reduce the amount of inconsistent enforcement which for multi-site businesses had become a considerable problem.

Have all of the expected developments of 2015 come to pass?

Dominic Watkins: The big ticket legislative changes have, yes. On an EU stage or global stage the potential for the Transatlantic Trade and Investment Partnership (TTIP) to be agreed for instance did not come to fruition.

Clients and business developments

How has your business developed in 2015? Has this been a good year for work in your area?

Dominic Watkins: This has been an evolving year where more than ever the European origin of most regulation has meant that the focus has needed to be less on Westminster and more on the changes proposed by the EU and has seen much more of my work with that sole focus. We have also seen budget issues drive both regulation and regulatory behaviour.

This year also saw one of the biggest changes in safety sentencing being mooted and that gave me a chance to appear before the Justice Select Committee, which on a personal level was a high point.

How has the profile of your clients developed? Can you identify any trends in your clients or types of cases?Dominic Watkins: It hasn't really, I still act for national and international household names that have regulatory challenges and need practical solutions.

Interviewed by Kate Beaumont for Lexis Nexis