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ADVI SORY March 2014
Upcoming Changes To Consumer Contracting
Any UK business contracting with consumers should take note of the new Consumer Contracts
(Information, Cancellation and Additional Payments) Regulations 2013 (the Regulations).
These Regulations replace the current UK Consumer Protection (Distance Selling) Regulations
2000 and the Cancellation of Contracts made in a Consumer’s Home or Place of Work etc.
Regulations 2008 (also known as the Doorstep Selling Regulations) and will affect all relevant
consumer contracts entered on or after 13 June 2014.
Whilst some types of consumer contracts are excluded (e.g., contracts for financial services), the
Regulations cover most types of consumer contracts including “on-premises” contracts (e.g., in
store), “off-premises” contracts (e.g., doorstep selling) and “distance” contracts (e.g., mail order,
telesales or online sales (including contracts with consumers concluded via online auctions)).
This Advisory sets out details of the key changes for traders to be aware of1. Whilst US traders
contracting under US laws will not be affected by these changes, to the extent that US traders wish
to target UK consumers, the Regulations provide a useful indication of the types of information that
UK consumers will expect to be given and the cancellation/refund rights they will expect to enjoy.
Here are the highlights of the changes:
Clarification of what information must be provided to consumers and, importantly, when/
how that information is to be provided
The use of pre-ticked boxes on websites leading to additional charges is outlawed
During the online order process, the point when consumers become obliged to pay must
be crystal clear (e.g., by use of a clear “PAY NOW” button)
New cancellation instructions to be given to consumers and model cancellation forms to
be made available
The cancellation period for distance and doorstep sales is extended to 14 calendar days
after delivery of the goods. In the case of service contracts or contracts for the supply of
digital content, the cancellation period is 14 calendar days after the contract is entered into
Unless otherwise agreed, all goods must be delivered within 30 calendar days
When a contract for the sale of goods is cancelled:
—— the consumer is responsible for returning the goods within 14 calendar days
—— refunds must be paid within 14 calendar days after return of the goods (or evidence
that they were returned)
1 Note that further information is available from the UK government’s Department for Business, Innovation
and Skills who have published accompanying guidance with case studies and frequently asked questions,
which are available at https://www.gov.uk/government/uploads/system/uploads/attachment_data/
Upcoming Changes To Consumer Contracting| 2
Any telephone helpline for consumer contract queries can
only be charged at the basic rate
New requirements for contracts for the supply of digital
The content of this Advisory is specific to the UK Regulations.
However, since the Regulations originate from the EU
Consumer Rights Directive (2011/83/EU), similar regulations
are likely to apply in other EU Member States.
With the Regulations coming in to effect on 13 June 2014,
businesses only have a limited amount of time to ensure that
their processes are in line with the new requirements. The
Regulations are likely to affect online auctions and suppliers
of digital content the most, but any traders contracting with
consumers should take heed and should update their policies,
procedures and websites accordingly.
Traders should also note that this is not the end to the changes.
The Consumer Rights Bill, formally introduced to Parliament
on 23 January 2014, contains further amendments to the
contractual status of information to be provided to consumers
and delivery and risk in goods. These provisions will repeal
those included in the Consumer Contract Regulations if and
when they are adopted.
Information to be provided to consumers
The requirements for what information must be provided to
consumers before and after concluding distance and off-premises
contracts remain largely unchanged (see the text box below for
a summary of the requirements). Importantly, breaching these
information requirements will be a breach of contract as well as a
breach of the Regulations. Further, failing to provide the consumer
with the requisite information on their right to cancel means that
this right could be extended by up to 12 months2.
Requisite information to be provided in a “durable
For distance contracts and off-premises contracts the
information referred to above must be provided to consumers
in a “durable medium” (i.e., so that both parties have a record
about what was agreed). Following some uncertainty under the
previous law as to what this meant, a new definition has been
included in the Regulations:
“‘durable medium’ means paper or email, or any other medium
that: (a) allows information to be addressed personally to the
2 Regulation 31.
recipient; (b) enables the recipient to store the information in
a way accessible for future reference for a period that is long
enough for the purposes of the information; and (c) allows the
unchanged reproduction of the information stored;”3
In other words, it means a medium that can be retained
(unchanged) by the consumer. For example, simply putting the
information on the company’s website and sending consumers
an email with a link to the relevant page will not satisfy the
requirement. Although information should be personally
directed to the consumer (e.g., in an email, letter or personal
account), the information itself need not be exclusive or tailored
to the consumer. Examples given in the UK government’s
guidance include letter, CD/DVD, email, text message or
personal account (as long as it is in a format which will be left
unchanged and will remain accessible to the consumer for a
reasonable amount of time)4.
The Regulations require traders to obtain the consumer’s
express consent for any additional payments/charges5. For
example, if traders offer express delivery, spare parts or other
accessories during the ordering process, the consumer will
only be bound to pay for those optional extras if they expressly
requested them. A pre-ticked box on a website does not amount
to express consent. If the consumer’s express consent is not
obtained, the extra charges must be refunded by the trader
(and the consumer may keep the relevant goods or services).
Clear point of payment
For online contracts, the trader must ensure that it is absolutely
clear at what point the consumer is obliged to pay6, for example,
by using clear and unambiguous language such as “PRESS
HERE WITH AN OBLIGATION TO PAY” or by using a “PAY
NOW” button. Any traders using unclear language such as
“JOIN HERE” will need to amend their websites.
Cancellation period and model forms
The period during which a consumer can voluntarily withdraw
from a contract (the “cooling-off period”) will be extended to 14
calendar days after delivery for both distance and doorstep sales
(this is extended from the current position of 7 working/calendar
days for distance and doorstep sales respectively7).
3 Regulation 5.
4 Department for Business, Innovation and Skills, Consumer Contracts
(Information, Cancellation and Additional Charges) Regulations
Implementing Guidance (Dec. 2013).
5 Regulation 40.
6 Regulation 14.
7 Regulation 30.
Upcoming Changes To Consumer Contracting| 3
than the previous 30 days (including any standard delivery
charges). However, for online and other distance/off-premises
traders, this 14-day timeline will not start until the goods have
been received back or the consumer has supplied evidence
of their return12.
Any cancellation of a contract will automatically cancel any
ancillary contracts (such as guarantees or warranties)13.
Basic rate help lines
Where a trader offers a consumer helpline service for queries
about contracts they have concluded, they will be required to
provide a phone number charged at no more than the basic
rate14. This basic rate requirement means not charging more
than a geographic (numbers usually beginning with the prefix
01, 02 or 03 or free of charge numbers) or mobile rate (mobile
numbers beginning with the prefix 07)15. It should be noted that
this requirement does not apply to all numbers operated by a
business, and other lines (e.g., sales lines or technical support
lines) can remain unchanged.
Significantly, under the Regulations the provision of digital
content (e.g., a music download) will be treated as a new type
of supply, separate from the supply of goods and/or services.
When supplying digital content, the trader will have to provide
information on its functionality (such as region coding, restrictions
relating to digital rights management and other technical
restrictions) and compatibility with hardware and software16.
In addition, for downloadable content (content “not on a tangible
medium”), the trader must obtain (and provide confirmation
of this back to the consumer) consent of the consumer to
supply content within the 14-day cancellation period and an
acknowledgement from that consumer that by giving their
consent they will waive their right to cancel and get a refund17.
If this is not complied with in any way, or the trader has not
provided the required confirmation, the consumer will bear no
cost for the contract.
It should be noted that the right to cancel does not apply to
contracts for the supply of a newspaper, periodical or magazine
12 Regulation 34.
13 Regulation 38.
14 Regulation 41.
15 Department for Business, Innovation and Skills, Consumer Contracts
(Information, Cancellation and Additional Charges) Regulations
Implementing Guidance (Dec. 2013).
16 Schedule 2.
17 Regulation 37.
There are modifications for the start date of the cooling-off
period for contracts for the sale of multiple goods or goods in
multiple parts (which now starts from delivery of the last of the
goods or last of the parts).
The Regulations also include model cancellation instructions for
consumers and cancellation forms for both distance and doorstep
sales (currently only available for doorstep sales)8. Traders will
not be required to use the model instructions, but, where a right
to cancel exists, will have to provide consumers with a model
cancellation form or otherwise make this available to consumers
(for example, as a PDF download from the website).
Delivery and risk
The current position around how soon goods must be delivered
is unclear for on- and off-premises contracts, with the only
statutory requirement being for traders to deliver goods within
a “reasonable time, unless otherwise agreed”9.
The Regulations harmonise this position across all sales
contracts, imposing an obligation on traders to deliver goods
within 30 calendar days of the contract being entered in to unless
otherwise agreed, and also confirm that risk in the goods passes
from the trader to the consumer on delivery of the goods, unless
the consumer commissions a courier of their choice (in which
case risk passes when the goods are delivered to the courier)10.
In other words, any damage caused before delivery will generally
be the trader’s responsibility.
The Regulations reverse the responsibility for returning goods
and it will generally be the consumer’s responsibility to return
the goods to the trader following cancellation and bear the direct
costs of doing so, unless the trader has offered to collect them or
they cannot be posted. Importantly, the goods must be returned
within 14 calendar days of the cancelation11. If the consumer does
not return the goods, the trader may not be required to refund
any payment (see below).
NOTE these Regulations do not affect consumer’s rights under
the Sale of Goods Act 1979 where goods are faulty, not of
satisfactory quality or do not meet the description given.
Payment of refunds
Where consumers exercise the cancellation right, traders will be
required to refund amounts paid within 14 calendar days rather
8 Schedule 3.
9 Section 29(3), Sale of Goods Act 1979.
10 Regulations 42 and 43.
11 Regulation 35.
Upcoming Changes To Consumer Contracting| 4
(unless the contract is for a subscription for the supply of such
publications), which is also likely to apply to digital forms of
18 Regulation 28.
For digital content supplied on a tangible medium (e.g., CD/
DVD), the cancellation rights apply as normal, but there is
an exception (i.e., the cancellation right is lost) in the case of
“sealed audio or sealed video recordings or sealed computer
software” if the goods become unsealed after delivery19.
19 Regulation 28.
What information do I need to provide1?
The information below must be provided before a consumer is bound by a distance/off-premises contract and when confirming
the contract (unless already provided):
Main characteristics of the goods/services.
Identity of the trader, address (registered and place of business), telephone number, fax number and email address.
If acting on behalf of another trader, the identity and address for that trader.
Total price of the goods/services inclusive of taxes (if not possible, how the price is to be calculated).
All additional delivery charges and any other costs.
Total costs per billing period for contracts of indeterminate duration or subscriptions.
Cost of using the means of distance communication for the conclusion of the contract if not calculated at basic rate.
Arrangements for payment, delivery, performance and time for delivery.
Details of the trader’s complaint handling policy.
Full details of how a consumer can exercise their right to cancel, including any conditions, time limits and procedures,
when a right to cancel might not exist or might be lost and any costs associated with cancelling.
Requirements for and costs of returning goods.
In the case of a sales contract, a reminder that the trader is under a legal duty to supply goods that are in conformity
with the contract.
Existence and conditions of after-sale customer assistance, after-sales services and commercial guarantees.
Existence of relevant codes of conduct and how copies of them can be obtained.
Duration of the contract or details of how to terminate for indeterminate or automatically extending contracts.
Minimum duration of the consumer’s obligations under the contract.
Existence and the conditions of deposits or other financial guarantees to be paid or provided by the consumer at the
request of the trader.
Functionality, including applicable technical protection measures, of digital content.
Any relevant compatibility of digital content with hardware and software that the trader is aware of or can reasonably
be expected to have been aware of.
The possibility of having recourse to an out-of-court complaint and redress mechanism, to which the trader is subject,
and the methods for having access to it.
In addition, where a right to cancel exists, the trader must provide or make available to the consumer the model cancellation
form prescribed in the Regulations.
1 NOTE this is a summary of the information provision requirements. Full details are set out in Schedule 2 of the Regulations. Also, these
requirements for the provision of information are in addition to those required by the Electronic Commerce (EC Directive) Regulations 2002
and the Companies (Trading Disclosures) Regulations 2008 (as amended).
© 2014 Arnold & Porter LLP. This Advisory is intended to be a
general summary of the law and does not constitute legal advice.
You should consult with counsel to determine applicable legal
requirements in a specific fact situation.
Upcoming Changes To Consumer Contracting| 5
What do I need to do to comply? Onpremises
Information Provide or make available model cancellation forms 3 3
Ensure absolutely clear when there is an obligation to pay 3
Cancellation Cancellation period now 14 calendar days 3 3
Provide details of consumer’s right to cancel to avoid
extending the cancellation period to 12 months 3 3
Cancellation period runs from delivery of last good or part
when order for multiple goods or goods in multiple parts 3 3
Consumer’s responsibility to return goods unless agreed
otherwise 3 3
Refund within 14 calendar days 3 3
Cancellation of order will automatically cancel any ancillary
contracts (e.g., guarantees or warrantees) 3 3
Delivery Deliver goods within 30 calendar days unless agreed
otherwise 3 3 3
Risk generally passes to consumer on delivery 3 3 3
Obtain express consent of consumer for any additional
payments. No “pre-ticked” boxes for any additional service
where additional payment required.
3 3 3
Basic rate help
Provide phone number charging no more than basic rate for
any helpline services. 3 3 3
Digital content Provide additional information on functionality and
compatibility 3 3
If supplying digital content not on a tangible medium, must
not supply the content before the end of the cancellation
period unless the consumer has given express consent and
acknowledged the loss of their right to cancel.
If you have any questions about any of the topics discussed in
this advisory, please contact your Arnold & Porter attorney or
any of the following attorneys:
+44 (0)20 7786 6213
+44 (0)20 7786 6219