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Time to get ready for the Consumer Rights Bill

Groceries on shelves in a supermarket with aperson pushing a shopping trolley Print publication

30/03/2015

Background

The Consumer Rights Bill (the Bill), which was initially due to become law in June last year, is currently scheduled to come into force in October this year. This gives retailers a – diminishing – window of opportunity in which to get ready for the Bill.

The Bill consolidates existing consumer rights and remedies in respect of the supply of goods and services. But it also changes the existing regime. Retailers will need to review existing practices and documentation to ensure they do not fall foul of the Bill.

What you need to do

  • review stocking arrangements. There will be a default delivery period of 30 days (unless a longer period is agreed when the contract is formed)
  • review returns policies. Consumers will have a new “early” right to reject defective goods, limited to 30 days (shorter for perishable goods). Retailers will have one and only one opportunity to repair or replace defective goods, failing which the consumer will have the right to a full or partial refund
  • train customer-facing staff on the new rules on returns and on the consumer’s right to “tiered” remedies for defective goods
  • establish procedures to compute deductions for use, i.e. where the goods are rejected, account may be taken of the use derived by the consumer before rejection
  • review reverse logistics arrangements. It is very possible that there will be an increase in the number of returns, which mean effective reverse supply arrangements will, if anything, become even more important than they are already
  • train staff on the new rules regarding pre-contractual representations. Any public statement made in advertising or labelling of goods will become a factor relevant to the assessment of whether they are of satisfactory quality and anything spoken or written to the consumer by or on behalf of the retailer about services offered will generally form part of the contract
  • review contracts with subcontractors to ensure they reflect the new rights of consumers regarding defective service provision
  • train customer-facing staff on the new rules regarding remedies for a defective service. Potential remedies are the right to a repeat performance at no extra cost or, if this is not possible or cannot be done within a reasonable time, the right to a price reduction
  • ensure that marketing functions are aware of the new rules on pre-contractual statements and of the need to exercise greater care in making representations about goods or services offered
  • review returns policies for digital content. In contrast to physical goods, there will be no right of rejection (save where the digital content comes with physical goods, e.g. on a disk). Instead, there will be a right to repair or replacement or, if not possible to a full or partial refund. There are also new statutory standards applying to digital content (i.e. satisfactory quality, fitness for purpose, compliance with description and that the retailer has the right to provide the content)
  • train staff on when the new rules on digital content will apply and of the rights and remedies of consumers in respect of digital content
  • ensure any liability for damage caused to a device or other digital content is backed onto the supplier. Retailers will have to compensate for damage to a device or other digital content owned by a consumer where that damage would not have occurred had reasonable care and skill been exercised in the provision of the digital content
  • review the presentation of terms and conditions. There will be new requirements as to fairness, transparency and prominence. Transparency requires that terms are written in plain and intelligible language and the more unusual or onerous a term the more prominent it will need to be
  • review the content of terms and conditions as well. Additional terms that might have been acceptable before will be unfair and unenforceable. These include charging disproportionately high prices for cancellation of a contract. Consumer notices that exist outside of consumer contracts will become subject to the fairness requirement
  • implement a training programme for relevant staff on how to handle a regulatory investigation. Public enforcers, such as Trading Standards, will gain enhanced investigatory redress and compliance measures.

How we can help

We can:

  • review your existing terms and conditions and suggest amendments to ensure compliance with the new Act
  • review existing supply and reverse supply contracts
  • provide training for staff on new consumer rights and remedies
  • provide training for staff on how to deal with the regulators.

Contacts