Digital Markets, Competition and Consumers Bill 2022-23: Consumers: Progress of the Bill

The Digital Markets, Competition and Consumers Bill (Bill 003 of 2023-24) is a Government Bill. It was first introduced during the 2022-23 session, on 25 April 2023, as Bill 294 of 2022-23. the Bill was carried over under standing order No. 80A. it was re-introduced during the 2023-24 session on 8 November 2023.

This briefing was published in the last session and refers to the Bill under its 2022-23 title. The remaining stages of the Bill are scheduled for 20 November 2023.

This is a large Bill, consisting of six parts and 26 schedules. It had its second reading in the House of Commons on 17 May 2023. It was considered by a Public Bill Committee over fourteen sittings between 13 June and 11 July 2023.

Two separate briefings have been published outlining changes made in Committee, one focusing on digital markets and competition (Parts 1 and 2 of the Bill) and this briefing which focuses on consumers (Parts 3, 4 and 5).

What do the Bill’s consumer provisions aim to do?

If enacted, Part 3 (and Schedules 3-17) would create two separate regimes for the civil enforcement of consumer law to protect the “collective interests” of consumers:

• A court-based regime which would simplify and enhance the court enforcement procedure currently provided by Part 8 of the Enterprise Act 2002 (EA 2022). It would empower the courts to impose monetary penalties on traders who breach consumer laws or do not comply with undertakings.
• A direct enforcement regime administered by the CMA. The CMA would be given significant new powers to investigate and take enforcement action, including imposing monetary penalties, in respect of infringements of certain consumer protection laws, breach of undertakings and non-compliance with CMA directions.

Together, the two legal procedures are referred to in the Bill as “the Part 3 enforcement regimes”.

Part 4 of the Bill (and Schedules 18-24) would:

• Revoke the Consumer Protection from Unfair Trading Regulations 2008 (CPRs) (retained EU law) and recreate their effect, with minor amendments, prohibiting unfair commercial practices in business to consumer relationships. The CPR contain a list of specific banned practices, which are automatically considered unfair. The Bill would largely replicate this list and, importantly, create a power to make regulations that could add to it. The Government has said that it would use this power to prohibit fake reviews online and plans to consult on this during the passage of the Bill.
• Tackle “subscription traps” by imposing new duties on traders. In particular, to give specific pre-contract information to consumers, send reminders to consumers before a contract rolls over or auto-renews into a new term, provide rights for consumers to cancel subscription contracts during cooling-off periods, and ensure that consumers have a straight-forward mechanism to terminate the subscription contract. Consumers would have new rights under Part 4 if traders breached these requirements.
• Give new protections to consumers who make advance payments to consumer saving scheme contracts (eg Christmas saving clubs). The Bill would require these businesses to protect payments via a trust arrangement or insurance and give prescribed information to consumers about how their payments are protected.
• Prohibit alternative dispute resolution (ADR) procedures for consumer contracts where the provider is not accredited nor exempt. The Bill makes provision for accreditation and exception, related requirements, and enforcement.

Part 5 of the Bill contains provisions which deal with investigative assistance to overseas regulators, disclosing information overseas, and a duty of expedition on the CMA and sectoral regulators. Part 6 sets out general provisions (eg interpretation, power to make consequential provision, extent and commencement).

The Bill’s consumer provisions would extend to the whole of the UK.

Policy background to Parts 3 to 6 of the Bill, as they were originally introduced, is set out in the Library briefing, Digital Markets, Competition and Consumers Bill 2022-23: Consumer provisions (PDF) (17 May 2023).