In the much awaited post-Brexit budget and his first as Chancellor, Philip Hammond has announced that the government will shortly bring forward a green paper to examine consumer markets that are not working efficiently or fairly and will introduce new consumer protection measures, despite the Consumer Rights Act (“CRA”) only having come into force in 2015.

The CRA was presented by the Government as the biggest overhaul of consumer rights in a generation which had the purpose of consolidating existing law into one, consumer friendly, easy to read, Act.  Yet, less than two years later, and with many consumers still not exercising or even understanding their rights, the Government intends to adopt even further measures in a bid to adequately protect consumers. 

These include:

  • legislating at the earliest opportunity to allow consumer enforcement bodies, such as the Competition and Markets Authority (“CMA”), to ask the courts to order civil fines against firms that mislead or mistreat consumers;
  • developing proposals to protect consumers from facing unexpected payments when a subscription is renewed or when a free trial ends; and
  • considering how to make terms and conditions clearer, shorter and simpler for consumers This builds on the government’s “call for evidence” from March last year on terms and conditions, which addressed the issue of consumers facing overly lengthy and complex terms and conditions.

Currently, the CRA does not permit unfair terms, but it only grants the authorities limited enforcement powers, namely permitting authorities to go to court to impose a fine only if the company refused to cooperate and allowing enforcers to apply to the courts for an injunction.  Consumers themselves have been unwilling to enforce their rights through a court, meaning that many companies have continued to trade as they did pre-CRA.   Therefore, the CMA’s new powers to enforce the CRA should give existing consumer laws much greater impact.

Similarly, the proposals around renewals and free trials and more concise contracts are not covered by current law and are clearly aimed at addressing common complaints raised by consumers and consumer advocates.

Whilst the underlying policy reasoning is clear to see, we can only hope that the work done to simplify consumer law by consolidating and combining existing statutes will not now be slowly unravelled.

Only time will tell as to how these proposed changes will be implemented but in the meantime, it is a useful reminder to ensure that your Terms and Conditions and trade practices are CRA compliant.