What is consumer protection?

The regulations apply to every business that deals with consumers.

If you treat your customers fairly and honestly you’ve nothing to worry about. But if you don’t comply with the law you can be investigated by the local trading standards service and by other official bodies.

These investigations can lead to prosecutions and fines, and of course damage to your reputation and loss of customers.

Be aware that even if you have specific terms and conditions for your business, these will be outranked by your consumers’ statutory rights. 

The consumer protection regulations ban three types of activities.

1. Conduct that is not ‘honest market practice’ or not in ‘good faith’
2. Misleading activity, such as giving false or deceptive messages or leaving out important information, e.g. having hidden fees or charges
3. Aggressive sales techniques that use ‘harassment, coercion or undue influence’.

In addition the regulations also ban 31 specific practices (see the next section for examples). 

My customers are other businesses so how much of this applies to me?

Selling to other businesses is not covered by consumer protection regulations, but there are rules about sales and marketing to other businesses:

• Misleading advertising is prohibited
• Providing misleading information during a sales negotiation is prohibited
• You should not make unsolicited sales calls to businesses who are registered on the Corporate Telephone Preference Service
• You must comply with Electronic Commerce Regulations.

Here are examples of banned practices:

• Having fake credentials, displaying a trust / quality mark without permission, or claiming an endorsement / authorisation that you don’t have. E.g a gas boiler servicing business claims its engineers are properly registered when in reality they are not
• Using ‘bait advertising’. E.g advertising products that you don’t have in order to entice customers in the hope that they will buy other products from you
• Trying to pressurise a customer into buying something by falsely saying that it’s only available at a certain price for a very limited time
• Using scare tactics, such as exaggerating the risk to customers if they don’t buy a product
• Faking goods. E.g deliberately packaging a product so that it closely resembles that of a market leading competitor in order to mislead customers into buying what they think is the leading product
• Pulling the wool over a customer’s eyes. E.g trying to get someone to make a purchase at a time when market conditions are less favourable than usual
• Claiming something is ‘free’ when in fact to claim it will cost the customer more than the unavoidable cost of the phone call, text, etc.

Details of the 31 practices specifically banned under consumer rights law.

You might provide services – for example car repair, plumbing, landscaping, hairdressing, architect services, accountancy, etc – as distinct from providing goods, or as well as providing goods. If you do provide services, according to law, for all jobs, from small repairs with no written details, to large projects with detailed specifications, you’ve entered into a ‘contract’, even if no written contract exists. You must perform the contract: 

• With reasonable care and skill
• Within a reasonable time
• At a reasonable price.

If you don’t do the above, or you fail to provide services that match what you’ve said you’ll do, your customer can ask you to perform the service again. If you don’t perform the service again within a reasonable time, or it’s not possible to repeat it, your customer can ask for a price reduction of up to 100%.

You will also need to be aware of the following:

• If your business uses telephone selling to consumers, ensure that the people you’re calling are not registered with the Telephone Preference Service. If they are, this means that they’ve opted out of receiving marketing telephone calls so you should not call them
• Be aware that it’s not just consumers who may be TPS registered. There’s also a Corporate TPS for businesses who don’t want to receive unsolicited calls, so make sure you don’t call these either
• If you do call people or businesses who are registered you could end up getting into hot water with the Information Commissioner
• If you’re selling online you need to thoroughly familiarise yourself with the E-Commerce Regulations. These have extensive provisions, ranging from the information you need to provide about your business – for example the types of contact details you need to show – through regulations on pricing policies, to rules about contracts, advertising, and email
• Be aware that if you’re selling internationally local laws may apply. For example, customers may be covered by their local consumer protection laws.