What do retailers need to know about compliance relating to unfair commercial practices following the enactment of the Digital Markets, Competition and Consumers Act 2024 this Black Friday? Kate Slater, group head of marketing and communications at the Furniture & Home Improvement Ombudsman, offers a summary …
What’s new?
1. A new consolidated regime for unfair commercial practices
The DMCC Act repeals and replaces the old Consumer Protection from Unfair Trading Regulations 2008. The new regime insofar as it relates to Unfair Commercial Practices came into force on 6th April 2025 and covers all aspects of a trader’s dealings with consumers – promotion, supply, after-sales. It doesn’t only apply at PoS.
2. What constitutes an unfair commercial practice
The new law retains the broad structure of the previous regime (misleading actions, misleading omissions, aggressive practices) but adds some important enhancements. A practice is unfair if it is likely to cause the average consumer to make a transactional decision they otherwise would not have taken, because the practice involves: a misleading action; a misleading omission; an aggressive practice; or a contravention of professional diligence.
Additionally, it’s unfair if: it omits 'material information' from an invitation to purchase; or it is specifically listed in schedule 20 as a practice that is always unfair otherwise known as 'Banned Practices'. The act now has 32 of these Banned Practices, adding a new banned practice relating to Fake Reviews. There is also the power to keep these under review as a future-proofing mechanism.
3. Some specifics
Invitation to Purchase: An invitation to purchase is a commercial practice involving provision of information to a consumer which indicates the characteristics of a product and its price, and enables, or purports to enable, the consumer to decide whether to purchase the product or take another transactional decision in relation to the product.
Consumers should be given the key information they need to make an informed decision once the price and main characteristics of a product are given.
Drip pricing: Where the headline price is shown, but mandatory additional costs are only revealed at a later stage, the act requires that if these costs are predictable they must be included upfront. This means the total price, including booking fees, delivery charges, etc, needs to be clear and given sufficient prominence.
Fake reviews: The act prohibits submission, commissioning or publishing of fake reviews, or failing to take reasonable and proportionate steps to prevent them.
4. Enhanced enforcement powers and penalties
The Competition and Markets Authority (CMA) now have direct enforcement powers. That means it can investigate and act under the consumer protection rules without first going to court.
The CMA can now directly fine businesses up to £300,000 or 10% of their global annual turnover, whichever is higher, for substantive infringements. In addition, the CMA may fine companies for administrative or procedural consumer law breaches and can apply a daily penalty for continued non-compliance.
Individuals who are an ‘accessory’ to substantive consumer law infringements by a company may personally face fines up to £300,000. This may include individuals such as directors or senior managers. Individuals may also be fined for procedural breaches in the context of consumer law investigations.
5. What this means for retailers
Retailers must treat these changes seriously because they increase both the scope of risk and the magnitude of consequences. Below we have provided some actions that retailers should be considering as the DMCC regime beds in:
1. Map out all your consumer-facing commercial practices (advertising, promotions, website, checkout, reviews, delivery/fees, subscriptions if relevant).
2. Review pricing display – ensure headline prices reflect all mandatory charges (or clearly disclose them) so as to avoid drip-pricing issues.
3. Review review-processes – ensure genuine customer reviews, processes to remove fake reviews, avoid incentivised reviews that are disguised.
4. Review advertising copy and promotions – check for misleading claims (availability, scarcity, timing), check for clarity of mandatory terms, and ensure you meet code provisions (for example, advertising codes as updated after DMCC).
5. Review contract terms and renewal practices – ensure transparency around auto-renewals, termination rights, trial periods, and communicate clearly pre-contract.
6. Identify vulnerable consumer groups among your customer base and evaluate whether any practices might disproportionately impact them (for example, aggressive upselling, hidden fees).
7. Update internal governance – assign responsibility for compliance, train staff (legal/compliance/marketing), update policies/controls.
8. Monitor and audit – establish periodic review of your website/offers/reviews/fees, keep records of decisions and justifications.
9. Respond promptly to guidance. The CMA has published guidance. Retailers should familiarise themselves.
10. Prepare for enforcement – understand potential penalties (up to 10% of global turnover, plus daily fines, personal liability). Ensure senior management is aware.
6. Why this matters for retailers
The retail sector is one where consumer trust is critical. Breaches of these rules not only lead to regulatory penalties but also reputational damage. The magnitude of penalties is significantly higher than under the old regime. Under the new regime the CMA is empowered to act more swiftly and decisively and has given every indication that it will.
As retailers prepare for the busy seasonal sales season, it is crucial therefore to remember that trust is paramount, and showcasing a commitment to responsible retail can be a key factor in building lasting customer relationships beyond a single sales event. This principle of consumer protection has been reaffirmed and strengthened by the DMCC regime.
The ombudsman offers various courses that have been designed to help businesses assess and respond to risk, ensuring compliance with a range of consumer protection laws and embedding the spirit of consumer confidence. The ombudsman has also relaunched its Pricing and Advertising Course, which is City & Guilds accredited, and which has been updated to take account of the changes. Click here for more information on training.
