CMA Gets More Teeth on Consumer Protection law from 6th April
Key Contact: Declan Goodwin
From 6th April 2025, the Competition and Markets Authority will directly enforce consumer protection laws, similarly to how the Authority currently enforces competition laws. This will shake up the current mix of Trading Standard and Local Authorities enforcing consumer laws via the courts, or ombudsman reviewing complaints.
This means that the Competition and Markets Authority (CMA) can investigate and fine companies for breaches of consumer law, without a court process. Fines could reach up to 10% of a company’s global turnover.
“Fundamentally, businesses should not be misleading customers with false advertising or misleading sales tactics, selling unsafe or low-quality products, or giving unclear terms and conditions,” says Declan Goodwin, Commercial & Technology senior partner at Acuity Law.
“With this new direct enforcement power, the CMA has ramped up the risks of fines, legal action and, of course, reputational damage.”
What does CMA consumer protection law enforcement mean for businesses?
In essence, the law itself is not substantively changing. However, the risks of enforcement actions for breaches of consumer law are now higher and enforcement action is likely to be much quicker.
In particular, the CMA will at first look at what it calls “egregious breaches”, such as:
- aggressive sales practices that prey on vulnerability
- providing information to consumers that is objectively false
- contract terms that are very obviously imbalanced and unfair
- behaviour where the CMA has already put down a clear marker through its previous enforcement work
- where the law is clear that a practice is always unfair.
What businesses should do next
Look out for the CMA’s planned final guidance, business outreach programme and “accessible and interactive business explainers”, which will be published ahead of the 6th April deadline. The CMA advises that “drip pricing”, where additional fees are added later in the purchase process, will be an area of focus for specific guidance.
In the meantime, businesses should audit their consumer law compliance by reviewing policies, procedures and training.
In preparation for the Competition and Markets Authority’s directly enforcement of Consumer Protection laws and for pointers on refreshing your consumer law compliance, contact our Commercial & Technology team.
