HomeInsightsDigital Markets, Competition and Consumers (DMCC) Bill due to be released today – consumer elements

The Government has announced that the Digital Markets, Competition and Consumers (DMCC) Bill will be released today

The Bill reinforces the key principles that underpin the Competition and Markets Authority (CMA)’s work, and has three areas of focus – consumer protection, digital markets, and competition. This update focuses on the consumer elements.

Whilst the full text of the Bill hasn’t yet been published (we expect it later today), the new consumer protection measures will include the following:

The practice of businesses making it difficult to exit a rolling contract will be stopped, and greater transparency will be required. Under the new laws, businesses must:

  • provide clearer information to consumers before they enter into a subscription contract;
  • issue a reminder to consumers that a free trial or low-cost introductory offer is coming to an end, and a reminder before a contract auto-renews onto a new term; and
  • ensure that consumers can exit a contract in a straightforward, cost-effective and timely way.

The enforcement of consumer protection law is being significantly strengthened. The CMA will be able to directly enforce consumer law rather than go through lengthy court processes, and will be able to award compensation to consumers and directly impose financial penalties for:

  • breaching consumer protection laws: up to 10% of global annual turnover for businesses or up to £300,000 in the case of an individual;
  • breaching undertakings given to the CMA: up to 5% of a business’ annual global turnover or up to £150,000 for an individual, and additional daily penalties for continued non-compliance; and
  • non-compliance with an information notice, concealing evidence, or providing false information: up to 1% of a business’ annual global turnover or up to £30,000 for an individual, and additional daily penalties for continued non-compliance.

The Bill will enable the Government to ban the practice of facilitating fake reviews or advertising consumer reviews without taking reasonable steps to check they are genuine.

We will be posting a series of summaries and commentary on the Bill over the coming days – you can bookmark our tracker page for updates.