Latest update from CMA COVID-19 taskforce

3 Jul 2020 10:55 AM

The CMA has published a third update from its COVID-19 taskforce, which monitors and responds to competition and consumer problems arising from the pandemic.

As part of the taskforce’s work, it has been asking the public for information about businesses behaving unfairly, for example regarding cancellations and refunds or retailers charging unjustifiably high prices.

Some of the highlights in this update include:

• From 10 March to 28 June 2020, the CMA has been contacted more than 80,000 times about coronavirus-related issues. The rate at which consumers contacted the CMA in June (around 3,500 per week) has fallen back from levels seen in May (almost 7,000 per week).
• Since mid-April, 70 – 80% of complaints received by the CMA have been about unfair practices in relation to cancellations and refunds. Consumers continue to raise concerns about firms refusing to provide refunds; introducing unnecessary complexity into the process of obtaining refunds; charging high administration or cancellation fees; and pressuring consumers into accepting vouchers instead of cash refunds.
• The volume of complaints about high prices remains at low levels: an average of 11 per day in June, down from 76 in April. The CMA judges that this problem is now less widespread. But it remains vigilant to the risks of unjustifiable price rises.
• In relation to cancellations and refunds, the CMA has prioritised four sectors for further investigation (holiday accommodation, wedding and events, nurseries and package holidays). Across all cancellation and refund complaints, the average (median) amount at stake is £800. For cancelled weddings, the average is £3,200, and for holidays it is £1,000.
• The CMA has secured undertakings from 2 major firms in the holiday lettings sector – Vacation Rentals and Sykes Cottages – to offer full refunds to customers. These two firms account for the majority of the complaints about refunds and cancellations for holiday accommodation.
• The CMA has now written to 277 firms about price rises for essential products, accounting for over 4,600 complaints: over 40% of the total number of actionable complaints received about price rises. It has also opened investigations into suspected breaches of competition law by four pharmacies and convenience stores related to suspected charging of excessive and unfair prices for hand sanitiser. Additionally, the CMA has released a joint statement with several trade associations condemning price gouging.

The vast majority of businesses are behaving in a reasonable way, but the CMA will not hesitate to take further enforcement action if there is evidence that businesses have breached competition or consumer protection law.

For more information on the CMA’s work on COVID-19 visit the CMA Coronavirus (COVID-19) response page.

Further updates on the taskforce’s work will be published in due course.

For media queries, contact the CMA press office on 020 3738 6460 or press@cma.gov.uk