More change to consumer law to extend and streamline enforcement powers

More change to consumer law to extend and streamline enforcement powers

Reselling branded, luxury goods in lower quality packaging can constitute trade mark infringement

The Consumer Protection (Enforcement) (amendment etc.) Regulations 2020

On 17 January the Consumer Protection Co-Operation Regulation (EU) 2017/2394 (CPC Regulation) came into force in the UK (as it was still a member of the European Union at this time). The main aim of the CPC Regulation was to improve the EU-wide co-operation for consumer protection by giving national authorities more power to enforce consumer rights. The objective is to provide a quicker more efficient enforcement process to help minimise consumer detriment and help increase certainty for businesses.

However the investigation and enforcement process contained in the CPC Regulation (which is directly applicable in the UK) needed amending to ensure its implementation is effective. These changes are contained in the Consumer Protection (Enforcement) (Amendment etc.) Regulations 2020 (‘the Regulations’) which came into force on 2 June 2020 (they do not have retrospective effect). Given Brexit, the Government is keen to take a proportionate approach and to rely upon existing infrastructure and domestic legislation where possible. This is reflected in the Regulations.

Key changes to be aware of:

  • The enhancement of enforcement capability in the digital environment

The CPC Regulation allowed for member states to grant competent authorities the express power to facilitate the removal of online content or to restrict access to websites where there is a risk of serious harm to consumers and no alternative measures would be wholly effective. Importantly these powers can be exercised against intermediaries and third parties, not just infringing traders.

  • Who can enforce

In the UK, the Competition and Markets Authority (CMA) is the only competent authority designated with these express powers and even then it is not able to exercise them directly. Instead the CMA must apply to the courts for an online interface order requiring content to be removed from or access restricted to an interface such as a website. To obtain such an order, the CMA has to show that there has been or is likely to be a ‘community infringement’ – an infringement of consumer protection law in any EEA member state. After the transition period, ‘community infringement’ references will be replaced by references to UK domestic law derived from the EU legislation.

  • More consumers can benefit from remedies

The Regulations have extended the remedies contained in Part 8 of the Enterprise Act 2002. Part 8 details how enforcers can remedy breaches of consumer protection law, including requiring the offender to impose measures that achieve redress for consumers who have suffered a loss as a result of the offender’s conduct. The Regulations have extended these remedies so that they can be used to benefit all consumers who have been affected by the conduct, not just those who have suffered a loss. Failure to comply with an enforcement order can result in fines or even imprisonment.

  • Extension of the power to purchase

Schedule 5 of the CRA (investigatory powers etc.) will be amended so that the power to purchase a product may be applied to obtain that product and use it as evidence in proceedings.

  • Additional competent authorities

The list of national competent authorities able to investigate and enforce powers under Part 8 of the EA 2002 and Schedule 5 of the CRA has been updated and added to.

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