Unfair Commercial Practices | Digital Markets, Competition & Consumers Act 2024
The key consumer protection provisions of Digital Markets, Competition and Consumers Act 2024 (the ‘Act’), came into force on 6th April 2025, and it affects those selling goods, services or digital content to consumers.
The Act focuses upon three main areas being the regulation of digital markets, the wider promotion of competition, and consumer protection by targeting unfair commercial practices.
It also provides substantially increased enforcement powers for the Competition & Markets Authority (CMA), enabling it to enforce consumer law directly, as opposed to proceeding through the courts and to impose massive financial penalties for certain breaches.
In this article John Veale of KANGS focuses upon aspects of the Act affecting consumer protection.
What is an Unfair Commercial Practice?
An unfair commercial practice is one designed to dupe consumers into spending, including subscription traps, drip-pricing, fake reviews, secondary ticketing and pressure selling.
The Act repeals the Consumer Protection from Unfair Trading Regulations 2008 and states:
S.225 Prohibition of unfair commercial practices
Unfair commercial practices are prohibited.
Commercial practice means an act or omission by a trader relating to the promotion or supply of:
- the trader’s product to a consumer,
- another trader’s product to a consumer, or
- a consumer’s product to the trader or another person.
By including ‘an act or omission’ the Act provides statutory support to the premise that a single act or omission can constitute an unlawful commercial practice as previously found in the decided cases of R v X Ltd [2013] and Warwickshire CC v Halfords Autocentres Ltd [2018].
S. 226 Misleading Actions
A commercial practice involves a misleading action if the practice involves:
- the provision of false or misleading information relating to a product, a trader or any other matter relevant to a transactional decision,
- an overall presentation which is likely to deceive the average consumer about a matter relating to a product, a trader or any other matter relevant to a transactional decision,
- any marketing of a product which creates confusion or is likely to create confusion, with any product, trade mark, trade name or other distinguishing mark of another trader or
- a failure to comply with a requirement in a code of conduct where the trader asserts that he has acted in accordance with that code.
Note:
Misleading information includes reference to information which, although true, is presented in a misleading way.
Overall presentation may be deceiving even if the information it contains is true.
This section provides statutory support to case law concerning misleading pricing strategies in circumstances where information provided is legally true but is deceptive in the way that it is presented.
S. 230 Omissions of material information from invitation to purchase
A commercial practice, which is an invitation to purchase, omits material information if, having regard to any relevant limitations, such as space or time and any attempts to resolve them and is not already apparent from the context, relates to the:
- main characteristics of the product,
- price, or how it can or will be calculated,
- identity and addresses of the trader or person on behalf of whom he is acting,
- relevant delivery, postal charges and taxes,
- existence, where appropriate, of withdrawal or cancellation rights,
- statutory information which the trader is obliged to give.
These provisions are directly aimed at practices such as ‘drip pricing,’ where initial prices appear attractive but are later inflated with subsequent unavoidable fees being added.
Invitation to ‘purchase’ applies not only to product pages but to, essentially, any communication intended to persuade a consumer to buy including general advertisements, digital banners, and promotional emails.
Subsections 230(8) & (9)
These further reinforce the importance of the nature of the context being: the clarity, visibility, and timing of the requisite information.
How Can We Help?
The effects of the Digital Markets, Competition and Consumers Act is extremely far reaching particularly as the CMA has the power to directly enforce breaches of consumer protection laws, including unfair commercial practices, without reference to the courts.
The level of fines which it can now impose could amount to 10% of a defaulting company’s annual global turnover with substantial fines being imposed upon directors and other company officers.
It is essential that all businesses ensure that they fully understand the requirements of this legislation and ensure that all relevant documentation, particularly consumer-facing materials and pricing information is sufficiently accurate, clearly visible, presented timely, and not disguised or capable of being misunderstood.
Failing to adhere to the requirements set out in the Digital Markets, Competition and Consumers Act may result in serious consequences for both corporate entities and individuals. In addition to the imposition of financial penalties mentioned above, other consequences may include, among other things, disqualification from acting as a company director.
We are here to assist individual clients and corporations facing investigation in relation to consumer and pricing practices. Please do not hesitate to contact the team at KANGS using the details below.
Tel: 0333 370 4333
Email: info@kangssolicitors.co.uk
We provide initial no obligation discussion at our three offices in London, Birmingham, and Manchester. Alternatively, discussions can be held through video conferencing or telephone.
Top ranked by leading legal directories Chambers UK and the Legal 500.
