Avoiding unfair commercial practices

From April 2008, new commercial practices rules will clarify what traders can and cannot do in their dealings with customers. Simon Wicks finds out what you need to know about the Consumer Protection from Unfair Trading Regulations
Very few businesses set out to coerce or mislead people into buying something they don't really need, and unscrupulous, over-zealous and uninformed traders are held in check by a raft of consumer protection laws. From April 2008, however, most of these - including the Consumer Protection Act - will be replaced by a single piece of legislation.

"The new Consumer Protection from Unfair Commercial Practices Regulations will provide the basis for business conduct rules across the EU for the future," says David Sanders, Trading Standards Institute lead officer for law enforcement. "But the rules are not another stick with which to beat the trader," he adds. "They are about consumer confidence, and shouldn't provide any fears for legitimate businesses."

Unfair practices

"A trader has to act in a manner someone would expect for that business at that time," Sanders explains. "If they are not professionally competent or they impair the consumer's ability to make a buying decision, then they're in breach of their duty to trade fairly."

The regulations will ban 31 'aggressive' or 'misleading' sales practices, including:
  • 'bait and switch' - advertising something for sale, with the intention of trying to sell customers something else
  • advertising that encourages children to pester parents to buy products
  • exaggerating personal security risks in order to sell safety products
  • refusing to leave a customer's house until they sign something.
But businesses are also likely to run into trouble for doing things that some firms might consider fair game in a competitive environment - using a name or packaging that is similar to a rival product, for example.

"These aren't necessarily mainstream criminal practices, just tactics that confuse people or put false pressure on them to make an immediate decision," Sanders stresses. "These regulations are about ensuring the consumer is clear what you are doing. The intention is to stop traders saying things that are not true which affect the decision the consumer makes."

Enforcement and penalties

The new regulations will be enforced mainly through civil injunctions to stop the bad practice and fines of up to £5,000 for each offence. But serious or repeated breaches could bring a criminal prosecution.

"These are all strict liability offences," Sanders states. "The normal defence is taking reasonable precautions and exercising due diligence, including seeking guidance from Trading Standards. A trader would have to show they have not broken the rules knowingly or recklessly."

Avoiding problems

"These regulations are only to penalise people who try to take unfair advantage, and they make it easier for us to deal with the out-and-out rogues," Sanders emphasises.

"The best way to avoid difficulties is to develop a good relationship with your local trading standards officer," he advises. "We're here to help and we'll find out what regulations apply to you and how best to comply with them."