Office of Fair Trading
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OFT launches consultation on online consumer protection

Protecting UK consumers online is the focus of a long-term strategy launched for consultation by the OFT yesterday.

The strategy proposes three broad areas for action to protect consumers and drive competition and economic growth in online markets. The OFT suggests that it could, with other agencies, industry and consumers, work to:

  • Promote business compliance by improving the effectiveness of guidance, facilitating industry-led solutions to new problems, and sharing intelligence.
  • Develop effective enforcement through working with businesses and other enforcers, developing further enforcement capacity, and focusing on areas where enforcement has the most impact. 
  • Empower consumers by explaining their rights and the benefits of transacting online, helping them become more internet-savvy, and providing them with the tools to fix problems they may encounter.

The strategy identifies potential measures to promote protection including clarifying the levels of protection available for consumer-to-consumer sales, working with agencies to reduce spam, developing low-cost solutions for checking non-compliant websites, and possible strengthening of payments systems for online purchases.

Noah Curthoys, OFT Director of Strategy, said:

'This strategy will help drive competition and growth by using more focused methods to protect consumers and build trust. The OFT is seeking to facilitate industry-led solutions to emerging problems, respond effectively to rapid change, increase the capability and effectiveness of enforcement, and empower consumers. This will ensure the UK is one of the global leaders in online enforcement.'

The strategy also identifies five underlying principles in tackling online consumer protection:

  • ensuring consumers receive consistent levels of protection online and offline
  • intervening only when market-based solutions do not exist or are failing
  • enabling industry or voluntary organisations and consumers to participate in improving consumer protection 
  • supporting actions that build and maintain trust in online markets 
  • framing work within international initiatives (such as the EU Digital Strategy) and guidance (such as the OECD guidelines on e-commerce) given the global nature of the internet.

Submissions by anyone interested should be made to eprotection@oft.gsi.gov.uk or by post to:

E-consumer protection strategy
8C Strategy and Planning
Office of Fair Trading
Fleetbank House
2-6 Salisbury Square
London EC4Y 8JX

The final strategy will be published in December.

NOTES

  1. The e-consumer protection strategy has been developed in response to issues identified in the Government's Consumer White Paper last year. Download the document and annexes from the e-Consumer protection consultation webpage.
  2. The OFT has undertaken or is carrying out a range of online work such as facilitating internet innovation in home buying and selling, a market study into presentation of contracts bought through the internet, ensuring the UK's merger regime is flexible enough to address the digital media sector, and a market study into framing of prices online and targeted pricing. 
  3. The OFT report finds that the UK has a highly successful online economy with the largest number of e-retailers and shoppers in the EU and relatively high levels of confidence. However in a survey 'Attitudes to Online Markets' to be published in August the OFT has found that one in eight internet users have concerns about things that might go wrong online based on their own experiences.
  4. On the supply side, the UK has the highest percentage of retailers who use e-commerce/internet sales channels for retail (71 per cent), this compares against the EU27 median of 51 per cent, and the next highest retail penetration of 58 per cent, in Ireland The Consumer Markets Scoreboard, 3rd Edition, Directorate-General for Health and Consumers, European Commission, 2010. 
  5. In the UK, internet users spent £38 billion in 2009 or 9.5 per cent of UK retail trade, making them Europe's biggest online shoppers. Source: Centre for Retail Research and the Retail Sales Statistical Bulletin, Online Trends 2010 Source: Centre for Retail Research and the Retail Sales Statistical Bulletin, 'Online Trends 2010'.

 

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