WIREDGOV

Government cracking down on unfair selling

DEPARTMENT OF TRADE AND INDUSTRY News Release (P/2007/105) issued by The Government News Network on 29 May 2007

Millions of people are set to benefit from a government crack down on aggressive and unfair trading and selling practices.

Consumer Minister, Ian McCartney today published a consultation that will implement the Unfair Commercial Practices Directive (UCPD).

The new law will protect consumers by outlawing a host of deceptive and intimidating sales practices that are unfair but not currently illegal. It will also benefit honest businesses, by simplifying consumer protection legislation and clamping down on rogue traders.

Among the 31 types of unfair practices it will outlaw are:
* prize draw scams, such as those that con people into calling premium-rate phone numbers;
* bogus 'closing down' sales;
* refusing to leave a customer's home when asked to do so;
* making persistent and unwanted telephone calls encouraging consumers to buy products such as double glazing; and
* preying on elderly peoples' fears about their personal security to sell them burglar alarms

The new law will dramatically improve consumer protection and will establish a safety net to catch unfair practices that fall between existing rules.

Ian McCartney said:
"This law will give the cowboys nowhere to hide. It will crack down on underhand sales practices that are all too often used to back consumers into a corner. Traders who use bully-boy tactics have no right to pressure people into buying goods, often at rip-off prices.

"Elderly and vulnerable consumers will be given greater protection against rogue traders who use the hard sell to get what they want or prey on their fears and worries about living alone.

"Whether shopping on the high street or online, consumers have a right to be sold to honestly and fairly. This new protection will make life a lot tougher for the rogues and easier for legitimate businesses to operate."

John Fingleton, Chief Executive of the Office of Fair Trading said:
"This is a great step forward for everyone who wants to see markets where businesses compete fairly and consumers choose what to buy on the basis of clear, honest information with no harassment. It will allow the OFT and other enforcers to focus our efforts on the worst practices, such as scams and the intimidation of consumers least able to protect themselves.

"We think the joint Guidance, drawn up with stakeholders, will help understanding of the law and make compliance easier. We look forward to improving it further through this consultation."

The UCPD will replace and improve on provisions in 22 pieces of existing legislation. It will simplify consumer protection legislation and establish a modern framework fit for the 21st Century that is easy for consumers and businesses to understand.

This law introduces a general prohibition on unfair trading (mainly unfair marketing and selling practices), and will standardise the level of consumer protection across the EU, allowing consumers to shop with more confidence at home or abroad.

NOTES TO EDITORS

* The DTI is seeking views on draft regulations before they become UK law in April 2008. The OFT, working with the DTI, is also consulting on draft Guidance on the law. Both consultations will close on 21 August.
* The consultation on the regulations can be found at: http://www.gnn.gov.uk/environment/dti
* The consultation on the guidance can be found at: http://www.oft.gov.uk/advice_and_resources/resource_base/consultations/ucpd

* The EC Unfair Commercial Practices Directive (UCPD) was adopted on 11 May 2005.

* The Consumer Protection from Unfair Trading Regulations, which will implement the Directive in the UK, will come into force in April 2008.

* The Directive has two main objectives:

1. to achieve a high level of consumer protection by introducing safety net EU consumer protection legislation prohibiting traders from dealing with consumers unfairly (a "general duty" not to trade unfairly); and
2. to harmonise Member States' existing national rules to encourage more cross border sales.

* The Government supported this key Directive, believing it will strengthen the UK's consumer protection regime and improve cross-border trade. DTI research has shown that a general duty strengthens consumer protection in other OECD countries. Implementing the Directive will mark an important step towards achieving our PSA target to have a consumer protection regime that is amongst the best in the world by 2008.

* The Directive sets out rules that determine when commercial practices are unfair. These rules fall into three distinct parts:

1. the general prohibition;
2. specific rules on how practices may mislead through acts or omissions; or which through the use of harassment, coercion or undue influence are aggressive;
3. an Annex of 31 practices which are deemed to be unfair and therefore prohibited under all circumstances.

* Many of these provisions (notably the 'general duty' and the prohibition on aggressive practices) are new, but others replicate protections contained in 22 existing laws. The Directive therefore provides a real opportunity to simplify and rationalise these laws, thereby simplifying the existing consumer protection framework. The Government's stated objective was to simplify the UK consumer framework wherever it is appropriate and sensible to do so.
* The UCPD will complement powers to combat unscrupulous doorstep sellers announced recently in the Government's response to the public consultation on doorstep selling and cold calling.

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