European Commission

 

Enforcement fiche for United Kingdom



I. ADMINISTRATIVE ENFORCEMENT
Which administrative mechanisms are available to enforce the UCP Directive?

Implementing law:
In the UK, the Directive is implemented by the Consumer Protection from Unfair Trading Regulations 2008 ("CPRs") and the Business Protection from Misleading Marketing Regulations 2008 ("BPRs") (together the "Regulations"). The CPRs implement the majority of the UCP Directive, with a few provisions of the UCP Directive being implemented by the BPRs (largely Article 14, which deals with comparative advertising).

Enforcing bodies:
General enforcement of the Regulations in England, Scotland and Wales is handled by the Office of Fair Trading ("OFT") and each Local Authority Trading Standards Services ("TSS"). The Lord Advocate in Scotland is responsible for the prosecution of offences for breaches of the Regulations.

Separate enforcement powers exist in relation to Northern Ireland where the principle enforcement authority is the Department of Enterprise Trade and Investment ("DETI") (http://www.detini.gov.uk/).

In this document the OFT, TSS and GEMA are together referred to as the "Enforcement Authorities".

Additional enforcing bodies of the BCRs:
The Business Protection from Misleading Marketing (Amendment) Regulations 2013/2701 ("2013 Regulations") expanded the scope of the BPRs to give limited enforcement powers to the Gas and Electricity Markets Authority ("GEMA") in relation to the mis-selling of energy contracts to business customers. The new rights of the GEMA include a right to bring proceedings for an injunction, the power to accept an undertaking where GEMA considers that there has been or is likely to be a breach of certain regulations of the BPR (including those which implement Article 14 of the UCP Directive) and the power to obtain information for determining whether to bring injunction proceedings. The GEMA is not able to prosecute under the BCRs and is also not able to make test purchases, enter properties to investigate or enter premises with a warrant (all of which are powers set out in the BCRs).

"Powers" and "duties" to enforce:
Following reforms in March/ April 2013, responsibility for enforcement in England, Scotland and Wales generally sits with TSS (and DETI in Northern Ireland) each of which have a "duty" to enforce the Regulations.

Previously the OFT had a "duty" to enforce the Regulations but now it only has a power to do so. The OFT will use its "powers" where breaches of consumer protection law point to systemic failures in a market (so will take action against a number of firms in a market, rather than cases against individual firms), unless changing the behaviour of one firm would set a precedent or have other market-wide implications.

If more than one Authority in England, Scotland and Wales is contemplating bringing proceedings in any particular case, the OFT will direct which Authority is to bring the proceedings or may decide that the OFT alone should take action.

Websites for Enforcement Authorities:
The website for OFT can be found at www.oft.gov.uk. Each of the Local Authority Trading Standards Services bodies has its own website, which is specific to individual boroughs/counties/districts within the UK. General information on trading standards services can be found at www.tradingstandards.gov.uk.
 

Who can file administrative complaints?

Any person may make an administrative complaint about commercial practices to any of the Enforcement Authorities and request that body to investigate the complaint. The Enforcement Authorities are the only persons entitled to directly enforce the Regulations.

There is no private right of action under the Regulations against traders by consumers or businesses, although there are proposals, (set out in the draft Consumer Protection from Unfair Trading (Amendment) Regulations 2013), which would give consumers a direct right of action against a trader for misleading or aggressive practices pursuant to the CPRs. No equivalent right is proposed in respect of the BPRs.
 

Do any specific procedural requirements apply to filing administrative complaints?

No specific requirements or limitations apply to the filing of complaints.

However, the Enforcement Agencies must notify the OFT before taking court action against a trader under the CPRs. The Enforcement Authorities (or the GEMA as applicable) must also inform the business concerned if they intend to take action to stop a breach of the CPRs. This notice period must allow at least two weeks for the business to agree in writing to voluntarily stop its behaviour and comply with the law in future. If consumers' interests are so threatened that urgent action is required, the notice period may be shortened.
 

Do the administrative authorities have an obligation to investigate the complaint?

Enforcement Authorities are not under an obligation to investigate administrative complaints, but they can choose to do so.

The TSS and DETI have a "duty" to enforce the Regulations. Previously the OFT had a "duty" to enforce the Regulations, now it only has a power to do so. In exercising its rights the Enforcement Authorities must consider whether it can use "established means" (for example the Advertising Standards Authority's regimes on controlling misleading advertising).
 

Are there any specific requirements regarding the provision of evidence to the competent authorities?

No specific requirements or limitations apply to the provision of evidence to the competent authorities.

II. ENFORCEMENT THROUGH COURT ACTION
Which court actions are available to enforce the UCP Directive?

Where there has been a breach of the Regulations there are a range of available enforcement actions, some of which may be handled through a court.

These include:
- civil actions for an enforcement order (i.e. including an injunction to prevent actions which are in breach of the Regulations);
- criminal proceedings; and
- the issuing of warrants to allow the Enforcement Authority to enter domestic premises.

Who can start a court action?

Only Enforcement Authorities can take action for breaches of the Regulations.

There is no private right of action against traders by businesses or consumers under the current law, however there are proposals set out in the draft Consumer Protection from Unfair Trading (Amendment) Regulations 2013, which would give consumers a direct right of action against a trader for misleading or aggressive practices under the CPRs. There are no equivalent proposals in relation to actions under the BPRs.
 

Can court actions be initiated by competitors?

There is no right of action for competitors. There are no current proposals to create this right under the draft Consumer Protection from Unfair Trading (Amendment) Regulations 2013 or otherwise.

Can the case be handled through an accelerated procedure?

The Regulations do not contain any provisions on accelerated procedures. Consequently, the general rules on court actions in the UK will apply.

It is possible for expedited interim injunctions to be obtained where the circumstances are sufficient to require such an action, however there are specific rules which must be satisfied before an injunction will be granted.
 

Are there any specific requirements regarding the provision of evidence to the court?

The general rules on evidence as laid down by statute and/or regulation will apply, and will vary depending on whether criminal or civil proceedings are instigated.

Those rules will apply to the investigatory powers of the Enforcement Authorities in gathering evidence. For example, Enforcement Authorities are empowered to make test purchases for goods and services and this may involve officers concealing their identity so as to ascertain what the defendant's practice is in respect of the ordinary customer (i.e. an elderly person). This deception will be permissible provided it is not unfair, however if the defendant is induced to commit an offence that he would not otherwise have committed due to the officer's behaviour then the resulting evidence may not be admissible.
 

III. SANCTIONS
What are the possible civil sanctions and remedies for the infringement of the UCP provisions?

There a number of investigatory powers and civil remedies in relation to breaches of the Regulations.

The Enforcement Authorities may take civil actions for an enforcement order (i.e. including an injunction to prevent actions which are in breach of the Regulations).

The Regulations also give the Enforcement Authorities powers to:
- request undertakings from traders not to engage in or repeat the conduct constituting an infringement;
- carry out inspections of traders and issue warnings if they are in breach of the Regulations;
- make test purchases;
- enter premises (other than homes), investigate and seize goods;
- enter any premises with a warrant;
- seize and detain evidence; and
- require traders to provide documents and information.

What are the possible criminal sanctions for the infringement of the UCP provisions?

Penalties for a criminal conviction under the Regulations are:
- a fine of not more than the statutory maximum (at the moment this is £5,000) on summary judgment (i.e. a trial before a magistrate not a judge); or
- an unlimited fine and imprisonment for a term not exceeding two years on indictment (i.e. where there is a trial before a judge/ jury).
Whether a trial is conducted before a magistrate or a judge/ jury is determined under general criminal law legal principles.
 

What are the possible administrative sanctions for the infringement of the UCP provisions?

The OFT can issue warnings against a trader and refer complaints to self-regulatory bodies, who may choose to investigate applying their own codes of practice. There are a large number of self-regulatory bodies in the UK, a few examples are the Advertising Standards Authority (ASA) and Phonepay Plus (PPlus). The powers of those authorities and list of other authorities are detailed under IV (Other Types of Enforcement) below.

What are the contractual consequences of an administrative order or a judgement relating to an unfair commercial practice on an individual transaction?

A court will not hold an agreement void or unenforceable due to it being in breach of the Regulations. This is set out in Regulation 29 of each of the respective Regulations.

How can consumers get redress/compensation (e.g. through collective actions)?

The Regulations do not enable consumers or businesses to take action directly against traders, either as individuals or collectively so are unable to claim for compensation.

Consumers may be entitled to redress/compensation through other UK consumer legislation (e.g. the Sale of Goods Act, Unfair Contract Terms Act, or Consumer Protection (Distance Selling Regulations)).
 

Can the administrative authorities or the courts require the publication of their decisions?

Except where a case involves particularly sensitive matters, or the judge directs otherwise, UK courts are open to the public as are the judgments/decisions of the courts. Whether a decision is actually published will depend on the facts and/or importance of the case, and whether judge directs that the decision should be published. Even where a decision is not "published" it is generally possible to obtain a copy of a decision from the court where the decision was made. Enforcement Authorities do publish details of their findings and reports on their websites, but not necessarily specific decisions in relation to unfair practices.

IV. OTHER TYPES OF ENFORCEMENT
Are there any self-regulatory enforcement systems in your jurisdiction that deal with aspects of the UCP Directive?

The OFT can issue warnings against a trader and refer complaints to self-regulatory bodies for investigation. There are a large number of self-regulatory enforcement systems in the UK which could deal with aspects of the UCP Directive. The OFT may refer claims to those self-regulatory bodies and may also work with trade associations. The OFT published guidance on its collaborative working approach, which is publicly available here on the following link:  http://www.oft.gov.uk/shared_oft/consultations/oft1043con.pdf.
Examples of self-regulatory bodies: these include:

Advertising Standards Agency ("ASA"):
ASA is a self-regulatory body whose role is to ensure advertisements are legal, decent, honest and truthful by applying the advertising codes of practice. Broadcasters are obliged by a condition of their broadcast licences to enforce ASA rulings and if they persistently run advertisements that breach the Codes, broadcasters risk being referred by the ASA to Ofcom, which can impose fines and even withdraw their licence to broadcast.

Phone Plus ("PPlus"):
PPlus regulates phone-paid services through its codes of conduct and investigates complaints. PPlus can fine a company for breach of its codes, bar access to its services and bar individuals behind the company from running other services under a different company name.

Other examples of self-regulatory bodies include (this is not an exhaustive list): Civil Aviation Authority, Committee of Advertising Practice, Information Commissioner's Office (data protection (including direct marketing) regulator), Ofcom (regulator of media and communications), Ofgem (regulator of gas and electricity) and Ofwat (regulator of water and sewage).

Role of the Financial Conduct Authority in relation to regulated financial services firms:
In addition the Financial Conduct Authority ("FCA") (one of dual-regulators replacing the Financial Services Authority), regulates the financial services sectors and has responsibilities in relation to the CPRs. The OFT recently entered into a Memorandum of Understanding with the FCA (publicly available here: http://www.oft.gov.uk/shared_oft/MoUs/FCA_MOU.pdf), Annex C sets out the allocation of responsibility between the FCA and the OFT in relation to complaints handling and enforcement of the CPRs. The FCA has many powers, which include issuing significant fines and revoking regulatory authorisations.
 

Are there any mediating services that deal with aspects of the UCP Directive (e.g., an ombudsman)?

There has been no mediating service, or ombudsman created as a result of the Regulations to specifically monitor and deal with unfair commercial practices. There are a number of ombudsman services which existed prior to the implementation of the Regulations and which cover a number of industries (e.g. financial services) who can investigate and mediate on consumer complaints. These may relate to unfair commercial practices and/or other commercial legislation, but only Enforcement Authorities are able to commence action (whether civil, criminal or administrative) for breach of the Regulations. The options of redress available for Ombudsman are usually designed to place the consumer in the position they would have been had the action complained of not occurred. Decisions of some ombudsmen can be final and binding (for example the Financial Services Ombudsman) provided they are accepted by the consumer, as they derive their powers from statute.