Consumer Protection from Unfair Trading Regulations 2008

The law governing false or misleading statements which may be made in respect of travel arrangements, holidays, accommodation, facilities, prices etc. in the UK was long contained in the Trade Descriptions Act 1968 and the Consumer Protection Act 1987 Most of the provisions of these two Acts have now bee replaced by these Regulations which represent the biggest change in consumer law in the UK in 40 yearsThe Regulations mainly cover advertising, marketing and sales matters. They provide a principle-based approach replacing the piecemeal legislation that existed (not only the 1968 and 1987 Acts but a plethora of other legislation and regulations). The Explanatory Memorandum states that the Regulations provide a “modern, simplified consumer protection framework”. They apply to the whole of the UK.They replace, amongst others:*Section 14 of the Trade Descriptions Act 1968;*Part 3 of the Consumer Protection Act 1987;*The Price Indication (Resale of Tickets) Regulations 1994.*The Tourism (Sleeping Accommodation Price Display) Order 1977*The Price Marking (Food and Drink) Services Order 2003.The Regulations prohibit unfair commercial practices. A “commercial practice” is defined as “any act or omission, course of conduct or representation, commercial communication, including advertising and marketing, by a trader, directly connected with the promotion, sale or supply of a product to consumers”. This, therefore, covers tour operators, travel agents, tourist offices and other tourism service suppliers advertising or marketing products to consumers.A “product” includes goods or services, including immovable property rights and obligations. Tour operators, travel agents and tourist offices provide services and timeshare companies deal with immovable property and so all are covered.The unfair commercial practice may relate to before, during or after the commercial transaction in relation to a product. So it covers, for example, representations made before the consumer selects the product including high-pressure selling techniques; during the transaction; and, for example, in relation to after sales service. It does not, however, cover matters of taste and decency or the health and safety of a product. These matters are left to existing legal provisions. However, if the trader makes misleading comments about the health and safety of a product, that is covered by the Regulations.There are four categories of “unfairness”:*general unfairness;*misleading practices;*aggressive practices;*banned practices.There is a general (“catch-all”) prohibition on unfair commercial practices; that is, those that treat consumers unfairly. These are practices which contravene the requirements of “professional diligence”. The Explanatory Memorandum accompanying the Regulations explains that this means honest market practice and acting in good faith. The trader may be compared to an honest, competent member of his/her profession or to a code of conduct applicable to that profession e.g. the Association of British Travel Agents’ Code of Practice. Likewise, falsely claiming to be a member of an organisation with a code of conduct would amount to an unfair commercial practice.The practice must have had, or likely to have had, an adverse affect on consumers. In determining this regard is had to the “average consumer”. An “average consumer” should be “reasonably well-informed, reasonably observant and circumspect”. If the product is directed at a particular category of consumers such as children, the elderly or the infirm, the test of “average” becomes the average member of that group.Regulation 4 prohibits the promotion of such practices by a trader or organisation responsible for a voluntary code of conduct. Where there is a code of conduct and the trader indicates that s/he is bound by it, for example by display of a logo on his/her promotional material, breach of that code may amount to an unfair commercial practice.Regulation 5 renders misleading advertisements, promotions or statements as unfair commercial practices. It is misleading if it contains false information or its overall presentation deceives, or is likely to deceive, the average consumer. It must have related to:*the existence or nature of the product – e.g. “travel in a deluxe, air conditioned coach”;*the main characteristics of the product;*the extent of the trader’s commitments – “a representative will be available every day at the resort to assist you”;*the motives for the commercial practice – “closing down sale”;*the nature of the sales process – “we are agents for Company X” when it is untrue;*any statement or symbol relating to direct or indirect sponsorship or approval of the trader or the product- “2 star Michelin graded restaurant”;*the price or the manner in which the price is calculated;*the existence of a specific price advantage;*the need for a service, part, replacement or repair;*the nature, attributes and rights of the trader;*the consumer’s rights or the risks s/he may face.The “main characteristics of the product” include:*availability of the product – “seats to Paphos for £2.99” when none are available at that price;*execution of the product – “accompanied by a licensed tourist guide”;*composition of the product – “all-inclusive”;*after-sale customer assistance concerning the product;*the handling of complaints about the product;*the method and date of provision of the product – “departing at…”;*fitness for purpose of the product – “ a tour for the wine connoisseur”;*quantity of the product – “includes 3 meals per day starting with the evening meal on…”;*geographical or commercial origin of the product;*results and material features of tests or checks carried out on the product -“ inspected by qualified heating engineers”.Statements do not have to be false to nonetheless amount to an unfair commercial practice if the overall effect of the statement, advertisement or promotion is to deceive.Regulation 6 deals with misleading omissions. Failure to give consumers sufficient information so as to enable them to make an informed choice about the product may amount to an unfair commercial practice. This includes:*omitting material information;*hiding material information;*providing material information in an unclear, unintelligible, ambiguous or untimely manner.“Material information” includes that required by the Package Travel Regulations and the Distance Selling Regulations. However, to amount to an unfair commercial practice the authorities would have to show that the average consumer would have taken a different decision had the omission not occurred.Regulation 7 prohibits “aggressive practices”. This occurs where the trader uses harassment, coercion or undue influences that significantly impair, or are likely to significantly impair, an average consumer’s freedom of choice.Schedule 1 sets out 31 banned practices. These are unfair in all circumstances, whether or not consumers would be adversely affected or not. “Bait” and “bait and switch” advertising are banned i.e. services advertised at very attractive terms on which the trader has no intention of doing business. Creating the impression that a consumer cannot leave the premises until a contract is formed is banned. The latter is a practice often associated with rogue timeshare dealers. Organisers for Timeshare in Europe estimated that approximately 8-10% of sales are lost to rogue traders in Spain out of a total revenue of €431m. There are loopholes in the Timeshare Directive which rogue traders exploit but which are now covered by these Regulations.The enforcement authorities include the Office of Fair Trading, local Trading Standards Services and the Department of Enterprise, Trade and Investment in Northern Ireland.The enforcement authorities may take action against those engaged in unfair commercial practices. In the least serious cases this may be no more than issuing guidance or a warning letter. It may involve a reference to the Advertising Standards Authority. Alternatively, the enforcement authority may obtain a court order under Part 8 of the Enterprises Act 2002 to prevent the practice continuing, breach of which would amount to contempt of court. The trader may also be prosecuted. Directors and other officers of the company or other body corporate may also be prosecuted.

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