6 April 2025 has now been confirmed as the "go live" date for most of the consumer law provisions of the Digital Markets, Competition and Consumers Act 2024 ("DMCCA"). These changes will give the UK one of the toughest enforcement regimes in the world, with the prospect of fines of up to 10% of global turnover on B2C businesses for infringing UK consumer law.
To date, regulators have had very limited scope to impose meaningful sanctions for past breaches of consumer law – and they also had to go to court to enforce it. From 6 April, the UK Competition and Markets Authority (CMA) will be able to enforce consumer laws directly, without taking businesses to court. B2C businesses will also face a much higher risk of significant financial penalties due to non-compliance with consumer law, including fines up to 10% of global turnover and redress orders requiring businesses to compensate consumers. Alongside this, important changes are also being made to UK law on pricing practices, fake or misleading reviews and subscription contracts. For more detail on all these changes, see our recent briefing.
On 13 February 2025, the Department of Business and Trade published its draft 'Strategic Steer' to the CMA, setting out the Government's expectations of how the regulator will use its powers in the short to medium term. Among other things, this document calls on the CMA to focus "on markets and harms that particularly impact UK-based consumers" and to "use its range of tools, including its forthcoming direct consumer enforcement powers under the DMCCA, to [….] grow the economy through promoting consumer trust and confidence, while deterring poor corporate practices."
Consumer law is one of the few areas where the CMA is being actively encouraged to use its powers in a more interventionist way. In other areas, such as merger control, the strategic steer puts more emphasis on streamlining regulation in support of the Government's growth agenda.
[C]onsumers deserve to know that the CMA has their back; and fair-dealing businesses deserve to know that their competitors are playing by the same rules and can’t gain a competitive advantage by breaking the law.
Recognising the burden of compliance with the new regime, the CMA has proposed a phased approach to enforcement, with early action likely to focus on "the most egregious breaches" such as:
It has also indicated that it will delay enforcement of the new rules on fake reviews until July 2025 and will provide more detailed guidance on its approach to "drip pricing". But that doesn't mean that B2C businesses can afford delay compliance measures:
Given the clear message from Government in the strategic steer, the CMA will want to take prompt action to demonstrate that it's making an impact on behalf of consumers.
Key questions to ask yourself include:
It's also worth understanding how you may be able to use the legislation to your commercial advantage in certain situations. For example, if you play by the rules but other competitors don’t, it may be worth considering a complaint to the CMA or Trading Standards (see further the comment by Sarah Cardell above about trying to ensure a level playing field for "fair dealing businesses").
In marked contrast to many of our competitors, our approach to consumer law draws on the combined expertise of two practice areas:
We can help you ensure your business is insulated from the most punitive aspects of the new regime, whilst equipping you with strategies for anticipating and managing CMA interventions. We can also help you understand how the consumer law aspects of the DMCC Act interact with its other provisions and other legislation – and how you can use the regulatory framework to gain competitive advantage. To find out more, please speak to any of the contacts listed below.
