Chambers and Partners: Consumer law
It would be an understatement to say that over the last few years there has been change in the consumer law landscape. In the decades since the consumerism period of the 1970s there has been a fundamental shift away from domestic legislation in a European revolution in consumer and trading standards. Virtually all of the consumer laws protecting UK citizens currently have their origin in European Union measures.
Then, out of the red, white and blue, came Brexit.
The European Union (Withdrawal) Act 2018, ending the supremacy of EU law, seems to have turned the wheel full circle. It is perhaps now more than ever worth considering the ancient basis of ‘consumer’ law.
The origins of trading standards and consumer law in the United Kingdom can be traced to Magna Carta. Clause 35 reminds us of the importance of universal metrology, ‘Let there be one measure of wine throughout the whole kingdom, and one measure of ale; and one measure of corn; and one width of cloth.’
The first major statute to use the word was the Consumer Credit Act 1974. However, it has become a buzzword in European legislation and now defines the genre.
The laws protecting consumers are both public and private in nature and founded in the civil, criminal and tribunal systems. For example the Consumer Protection from Unfair Trading Regulations 2008 can be enforced by regulators in the criminal courts or by way of enforcement action in the civil courts pursuant to the Enterprise Act 2002. Further an individual now has the right to civil redress action for certain contraventions of those regulations. It is sometimes said that consumer law practitioners have to expect to deal with proceedings across the whole of our legal landscape. From a criminal regulatory trial before the magistrates to a commercial appeal in the Supreme Court, passing by the Commercial Court and Upper Tribunal. And sometimes taking on that, perhaps, endangered species, the package travel arrangement to Luxembourg.
Despite numerous investigations, since its inception in April 2014 the consumer protection part of the Competition and Markets Authority (‘CMA’) had never issued proceedings under its main regulatory enforcement tool, Part 8 of the Enterprise Act 2002. Even for a time that is defined by austerity, that is a surprising fact. But in September 2018 the CMA finally dipped its toe into the regulatory enforcement pool by issuing proceedings in the High Court against a Swiss based ticket re-seller, Viagogo. We look forward to the resolution of those proceedings in the near future.
There are very many areas of consumer law that regulate the relationship between business and natural persons. The Consumer Credit Act 1974, the 2008 Regulations mentioned above, the General Product Safety Regulations 2005, the Consumer Rights Act 2015, food safety and labelling legislation, age-restricted sales (alcohol, cigarettes, butane gas, knives and fireworks), timeshare and package travel are but just a few. Some of these require particular further mention because of their current topicality.
In October 2016 following the Shepherd’s Bush fire the Government set up the Working Group on Product Recalls and Safety. The terrible and tragic events at Grenfell reinforced the vital importance of product safety. Whilst the Grenfell Inquiry will report in due course the results of its findings, the Working Group was the creation of the Office for Product Safety and Standards in January 2018. This body is tasked with overseeing the identification of consumer risks and managing responses to large-scale product recalls and repairs. It will support local authorities and co-ordinate work across the country where action is needed on a national scale. It will cover general (non-food) consumer product safety but not construction product safety, which was the subject of a separate review by Dame Judith Hackitt that reported on May 17th 2018.
The prime enforcement pinch point in relation to food and drink has recently concerned the vexed question of use-by dates and food safety and hygiene. The question of whether the deeming provision that food sold beyond its use-by date is unsafe has raised a very important point to be determined. Does that provision raise an irrevocable status of ‘unsafe’ for an item of food sold beyond its use-by date but otherwise microbiologically fit for human consumption, or is it just a rebuttable presumption? In the food safety and hygiene field the coming into play of the Definitive Sentencing Guideline in February 2016 has led to a huge increase in the fines now imposed for breaches of the Food Safety and Hygiene (England) Regulations 2013. Turnover-based fines calculated on the basis of offence categories determined by culpability and harm factors and prescribed financial starting points are now often measured in six figures for larger organisations. This has been a real game changer. However, it is the area of allergen law that is currently under the most intense spotlight. The recent inquest into the very sad death of a fifteen-year-old girl resulting from eating a baguette containing sesame seeds purchased from Pret a Manger raised serious concerns over the sufficiency of current EU-derived labelling requirements for food prepared and packaged on food premises. Currently the list of ingredients does not have to appear on the packaging of such foods under the Food Information Regulations 2014 (invoking the European Food Information to Consumers Directive (EU) 1169/2011). Discovering whether a particular item of food contains an allergen currently involves asking the retailer. The coroner referred this issue to government.
Consumer lending is heavily regulated by the Consumer Credit Act 1974 and the Financial Services and Markets Act 2000 with numerous statutory instruments made under both Acts supplemented by the Financial Conduct Authority’s handbook, in particular the Consumer Credit Source Book (‘CONC’). This is a multibillion-pound sector and has generated much litigation over the years. The Financial Conduct Authority has recently published its preliminary views on the review in 2019 of the retained provisions of the 1974 Act. These are those parts of the Act which were not repealed when other parts were transferred to the FCA’s CONC. Irrespective of Brexit, this review was scheduled in 2014 in order to assess the issues after a five year period. Separately HM Treasury has published technical notices as part of preparation for a no-deal Brexit including one on financial services dealing with matters such as the temporary permission regime.
The future is not ours to see, but what consumer lawyers do know is that the European Union (Withdrawal) Act 2018 provides that on and after exit day from the European Union EU-derived domestic legislation will have the same effect in domestic law as immediately before exit day. The interesting question is what will happen in the years to come?