UK confirms plans for tougher consumer protection regime


The UK Government has confirmed that it plans to introduce significantly stronger powers for the Competition and Markets Authority (CMA) to enforce consumer law, including the ability to impose fines of up to 10% of global turnover.  This is a major change for consumer-facing businesses, although question marks remain over the exact timing.

This briefing was updated in November 2022.

What's been decided and what's the impact?

In 2021, the UK Government consulted on a number of possible changes to the UK's consumer regime as follows:

The Government has now confirmed that it plans to proceed with the majority of these changes (see below for more detail) and to publish a draft Bill, which is an important step towards passing the necessary legislation.

UPDATE NOVEMBER 2022:  The Government has now confirmed that it will be putting a Bill before Parliament (as opposed to merely publishing a draft Bill). The exact timing remains to be seen but some reports suggest that it is aiming to pass the legislation next year, with a view to bringing it into force in late 2023.

The likely impact

Our view is that the stronger enforcement powers represent by far the most significant change.  At present, when it comes to consumer law, the CMA is in a relatively weak position vis-à-vis businesses, because in most cases, it cannot force them to do anything without first going to court.  The current law also has limited deterrent effect because no penalties can be imposed for breaches (except where there is a failure to comply with a court order).  Under the proposed new regime, the CMA will itself be able to issue decisions ordering infringements to be brought to an end, together with fines for more serious breaches.  This will make it one of the most powerful regulators worldwide in relation to consumer protection.

The tightening up measures will be significant for some businesses, particularly those reliant on subscription models and online reviews – but unlike the enforcement measures, they do not represent a major shift in approach by the UK.

What are the new enforcement powers?

As explained above, the CMA will be able to decide for itself whether consumer law has been infringed, without the need to go to court.  It will be able to impose fines of up to 10% of global annual turnover on businesses;  in the sphere of competition law, this has resulted in the imposition of fines as high as £260 million.  The CMA will also be able to penalise businesses directly (again, without having to go to court) for:

  • failure to comply with information requests, provision of false or misleading information and/or concealment, falsification or destruction of evidence; and

  • breach of an undertaking given to the CMA (historically, voluntary undertakings have often been used to terminate CMA consumer investigations, but there has not been any meaningful sanction for failure to comply).

The fines in these cases will consist of a fixed monetary penalty together with a daily penalty while non-compliance continues.  The CMA has similar powers in relation to competition law and merger control, where fines of this type can be substantial – for example, in 2018, a leasing business was fined £100,000 for failure to comply with interim orders issued by the CMA and in 2021, Meta (formerly Facebook) was fined £50.5 million


Appeals from CMA decisions will be heard by the High Court in England and Wales (or the Court of Session in Scotland).  A recent case involving alleged breaches of consumer law by a care homes provider suggests that the High Court is likely to hold the CMA to a high standard in relation to any appeals.

UPDATE NOVEMBER 2022:  The Government has now confirmed that it will be putting a Bill before Parliament (as opposed to merely publishing a draft Bill). The exact timing remains to be seen but some reports suggest that it is aiming to pass the legislation next year, with a view to bringing it into force in late 2023.

Sectoral regulators

The Government has decided not to give sectoral regulators such as the Financial Conduct Authority, Ofcom, Ofwat and Ofgem the same powers as the CMA, although it plans to keep this issue under review. The rationale for this decision is not entirely clear  – after all, these regulators are already trusted to apply UK competition law on the same basis as the CMA. In our view, the lack of new powers is likely to mean that these regulators will continue to focus on using their sectoral powers to protect consumers, even though many of the practices which they are seeking to curb could be tackled under general UK consumer law.

Tightening up: subscription contracts and fake reviews

As regards subscription contracts, the Government plans to require businesses to provide more information to consumers before entering into the contract and to send reminders to consumers before a contract "rolls over" into a new term (auto-renewal).   However, it is not proceeding with a proposal to require a fixed term option to be offered in all cases (i.e. a contract which would simply expire, rather than auto-renew).

Fake reviews

As regards fake reviews, the Government plans to add the following to the existing list of "banned practices" which are regarded as automatically unfair (i.e. there is no need to prove that the practice would have influenced the decision-making process of the average consumer – regulators simply need to prove that the practice was engaged in):

  • commissioning or incentivising any person to write and/or submit a fake consumer review of goods or services;

  • hosting consumer reviews without taking reasonable and proportionate steps to check they are genuine; and

  • offering or advertising to submit, commission or facilitate fake reviews.

Online platforms are likely to be particularly concerned by the second bullet – but the Government has provided no details at this stage of what it considers to be "reasonable and proportionate steps".

What's not being pursued

The Government also consulted on the following but has decided to keep these issues under review for the time being:

The decision to do nothing on collective actions is in line with the Government's approach to other areas such as data protection, as explained in our briefing on the recent Supreme Court ruling in Lloyd v Google.  This means that competition law remains the only area where the UK Government has taken specific measures to encourage collective actions.

What's the timing?

All these changes will require legislation.  In the Queen's Speech (May 2022), the Government indicated that it would publish a draft Bill, which will bring the proposals a step closer to becoming law.  However, it has not committed to legislating in this Parliament.  As a result, it may be some years before the reforms are implemented.  As we have pointed out before, previous Governments have not always delivered on their promises in this area.  However, pressure has been building on the Government for some time to make these changes and a failure to do so would arguably result in the UK falling well behind the EU in this area (EU countries are required to give their national consumer regulators the power to impose fines of up to 4% of global turnover by the end of May 2022).  We therefore remain of the view that, on balance, the reforms are likely to proceed.

If these reforms are not coming in now, why worry?

Although the reforms do not appear to be imminent, it is worth keeping them in mind when taking major decisions affecting the longer term – because by the time those decisions have been implemented, we may already be in a "brave new world" of more muscular CMA enforcement of consumer law.  In the meantime, the CMA may be looking to take more cases to court with a view to creating more case law that it can rely on in its future decisions.


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