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Changes to distance selling rules

Print publication

01/04/2014

The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (the Regulations) come into effect from 13 June 2014. Unlike the much broader Consumer Rights Bill, which is still working its way through Parliament although also timetabled to come into effect on 13 June 2014, the Regulations have already been made. So businesses can start preparing now, in the knowledge that there shouldn’t be any last minute changes. Two existing sets of regulations will be replaced – the Distance Selling Regulations and the Doorstep Selling Regulations.

The Regulations will apply to contracts between “consumers” and “traders” concluded on or after 13 June 2014, subject to certain exempt categories of contract, such as for gambling, health care or banking and insurance.

The principal points to note from the Regulations are:

  • new provisions regarding information requirements will come into force. These are largely in line with the existing requirements. If, however, an online trader fails to provide a consumer with the requisite statutory information, the consumer’s right to cancel is extended for up to one year. This is potentially important. The requirement is to send confirmation of the contract which sets out the necessary information via a “durable medium” – this will usually be done by email. Failure to do this could lead to a situation where the consumer holds onto the goods for up to a year before then exercising their right to cancel
  • the “cooling-off” period during which a consumer can cancel a contract entered “at a distance”, including over a website, is to increase to 14 days – it is currently seven working days
    in sales of goods contracts, the 14-day cooling off period begins from the date the goods came into the possession of the consumer (or someone appointed to receive them on his or her behalf)
    distance sellers will have to make available a (non-compulsory) model cancellation form for consumers
  • there will be a prohibition on payments made without the express consent of the consumer. In other words, it will not be possible for online traders to use pre-ticked boxes to facilitate the purchase of additional items
  • there will be a requirement that order buttons are labelled with “unambiguous wording” confirming that, when clicked, the consumer will have an obligation to pay
  • delivery must be within 30 days unless otherwise agreed
    consumers will generally be required to return goods (or otherwise evidence such return) in order to be entitled to a refund. Traders must refund within 14 days of cancellation of a service contract or receipt of goods (or of evidence of the consumer returning them)
    consumers will not be liable for costs that they have not been informed about pre-contract. There is an express stipulation that the trader must make clear that the consumer will bear the cost of returning the goods, if such is to be the case
  • consumers will have to make an express request before the trader can commence the provision of services during the cooling-off period.

Online traders should review the content, and possibly structure of existing websites and, if necessary, update these to reflect the requirements of the Regulations. Systems for processing orders will need to be checked to ensure that all the requisite statutory information is included with the confirmatory email.

Processes should also be checked to ensure that goods are in stock to meet orders given the 30-day delivery requirement.

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