© 2011 itsa Ltd on behalf of the Trading Standards Institute.
The Consumer Protection from Unfair Trading Regulations 2008 prohibit traders from misleading consumers about a product by giving false or deceptive information about a number of matters. To breach the majority of the Regulations, the misleading action or omission must cause, or be likely to cause, the average consumer to make a different transactional decision (for example, make a purchase which he would not otherwise have made).
Some practices are banned in all circumstances. The Business Protection from Misleading Marketing Regulations 2008 prohibit misleading business to business transactions.
In the guide
The legislation
What does the law require?
How can a misleading action or omission be given?
What are the specific breaches of the Regulations (relating to goods, services, rights and obligations)?
What descriptions are covered by the Regulations?
Who can commit an offence under the Regulations?
How can a trader avoid committing an offence?
Penalties
Business to business
The legislation
The way in which businesses can describe goods and services to consumers is covered by the Consumer Protection from Unfair Trading Regulations 2008. See also our leaflet 'A guide to the Consumer Protection from Unfair Trading Regulations' .
Business to business transactions (not covered here) are regulated by the Business Protection from Misleading Marketing Regulations 2008. They prohibit business to business misleading advertising, and impose further restrictions on how businesses compare their products to rival products from other companies. See our leaflet 'A guide to the Business Protection from Misleading Marketing Regulations '.
What does the law require?
The Regulations cover commercial practices, which includes any act, omission, course of conduct, representation or commercial communication (including advertising and marketing) by a trader that is directly connected with the promotion, sale or supply of a product to consumers. A trader must not mislead a consumer about a product (this is defined very broadly and includes goods, services, rights, and obligations) in any way by giving false or deceptive information about a number of specific matters. They must also not omit information about a product that a consumer would need in order to make an informed decision.
It should be noted that to breach the majority of the Regulations the misleading action or omission must cause, or be likely to cause, the average consumer to make a different transactional decision (such as making a purchase that they would not otherwise have made). The Regulations are not intended to cover insignificant inaccuracies, but ultimately only a court can decide whether the actions of a trader would affect the average consumer in an adverse way. However, there are some practices that are banned in all circumstances - these are listed in our leaflet 'A guide to the Consumer Protection from Unfair Trading Regulations'.
How can a misleading action or omission be given?
Misleading actions and omissions can be given:
- verbally
- in writing (for example, in an advert or brochure, or on an invoice or order form)
- by illustration (for example, in advertisements or on packaging) or by implication
In addition, if goods are supplied in response to a request that includes a specific description (for example, a customer specifies they want a granite worktop), it is possible that it would be held that the supplier of the goods has applied the description themselves.
What are the specific breaches of the Regulations (relating to goods, services, rights and obligations)?
It is a breach of the Regulations (and potentially a criminal offence) to engage in an 'unfair commercial practice'. A practice is unfair if it is either of the following:
- a 'misleading action' (it contains false or misleading information, and is therefore untruthful in relation to a list of specified matters, or if its overall presentation in any way deceives or is likely to deceive the average consumer)
- a 'misleading omission' (it omits information that the average consumer needs to take an informed transactional decision)
If the trader's actions would cause the average consumer to take a different transactional decision (which could be to buy as opposed to not buy, having work done or not, or paying a different amount for goods). The law also introduces a general duty not to trade unfairly.
Certain specific actions are prohibited in all circumstances and it is not necessary to show an effect, or a likely effect, on the average consumer - see our leaflet 'A guide to the Consumer Protection from Unfair Trading Regulations'. If it is decided to prosecute, the offences under the Regulations (other than the 'general duty not to trade unfairly') are strict liability offences, this means it is possible for a trader to commit an offence without intending to do so.
What descriptions are covered by the Regulations?
The following matters are specifically covered when looking at a misleading action:
- the existence or nature of the product
- the main characteristics of the product, which includes:
- availability
- benefits
- risks
- execution
- composition
- accessories
- after-sales service
- handling of complaints
- method and date of manufacture
- method and date of provision
- delivery
- fitness for purpose
- usage
- quantity
- specification
- geographical or commercial origin
- results to be expected
- results and material features of tests or checks carried out - the extent of the trader's commitments
- the motives for the commercial practice
- the nature of the sales process
- any statement or symbol relating to direct or indirect sponsorship or approval of the trader or product
- the price or the manner in which the price is calculated
- the existence of a specific price advantage
- the need for a service, part, replacement or repair
- the nature, attributes and rights of the trader, which include his:
- identity
- assets
- qualifications
- status
- approval
- affiliations or connections
- ownership of industrial, commercial or intellectual property rights
- awards and distinctions
Who can commit an offence under the Regulations?
A 'trader', which means any person who, in relation to a commercial practice, is acting for purposes relating to his business, and anyone acting in the name of or on behalf of a trader. This would include directors, managers and all levels of employees.
How can a trader avoid committing an offence?
The Regulations provide a trader with the defence that the commission of an offence was due to a mistake, or to reliance on information supplied to them, or the act or default of another person, an accident or some other cause beyond the trader's control - and that they took all reasonable precautions and exercised all due diligence to avoid the commission of such an offence by themselves or any person under their control.
In simple terms, this means that a process should exist to avoid unfair commercial practices, and that the process should be followed by all employees.
A further guidance leaflet is available on specific steps that can be taken, relating to odometer displays on used vehicles (see the leaflet 'Mileage of used vehicles').
Penalties
Failure to comply with the Consumer Protection from Unfair Trading Regulations 2008 is a criminal offence. The maximum penalty on conviction in the Magistrates' Court is a fine of £5,000 per offence. The maximum penalty on conviction in the Crown Court is an unlimited fine and/or two years' imprisonment.
Purchasers of misdescribed goods/services are likely to seek redress through the civil courts. Enforcers may also take civil enforcement action under the Enterprise Act 2002, which could include a court order to ensure a business complies with the legislation in the future.
Please note
This leaflet is not an authoritative interpretation of the law and is intended only for guidance. Any legislation referred to, while still current, may have been amended from the form in which it was originally enacted. Please contact us for further information.
Relevant legislation
Enterprise Act 2002
Business Protection from Misleading Marketing Regulations 2008
Consumer Protection from Unfair Trading Regulations 2008
Last reviewed/updated: November 2012
© 2013 itsa Ltd on behalf of the Trading Standards Institute.
