OFT directs focus on internet shopping

Consumer protection regulator the Office of Fair Trading (OFT) has launched an investigation into consumer benefit from complex goods and services contracts, in particular online shopping.

The OFT will research whether consumers are fully aware of the typical contracts involved online and whether their understanding is impeded or heightened by face-to-face, online, or telephone transactions.

Heather Clayton, Senior Director of OFT's Consumer Market Group said:

“Today, consumers are offered a range of complex contractual arrangements, particularly for goods and services offered online. We often see situations in many different markets where people lose out as a result of not understanding contracts.”

The investigation’s findings, expected some time in the summer, will likely be used in conjunction with OFT’s current investigation into online business practices.

Constant consumer complaints over ‘drip pricing’, where fees are secretly levied on a product’s price, and the collection of private advertisement data based on shopping habits will potentially be eradicated by the OFT’s investigations.

According to the OFT, the investigations could create a code of practice of online retailers; make recommendations to Government; take action against particular companies; or ask the Competition Commission to conduct a full investigation into firms.

“We want to understand the cause of these problems and look for remedies that will not only protect consumers, but also help those businesses that are trying to provide clarity to their customers,” added Ms Clayton.

Andrea Curtis, in Birkett Long’s Commercial Team says, "Online retailers selling to consumers are subject to a raft of consumer protection legislation including the Consumer Protection (Distance Selling) Regulations 2000, the Unfair Terms in Consumer Contract Regulations 1999 and the Consumer Protection from Unfair Trading Regulations 2008. However, much of the legislation applies to all retailers selling to consumers and not just those selling online.

It is important that the terms and conditions used in a retailer's contracts with its customers comply with the various statutory requirements. Otherwise, the retailer faces the risk of a customer making a complaint to the OFT, which could lead to some of the terms being deemed as unfair and the retailer being unable to rely on them.

If you are a retailer and are concerned that your terms and conditions may not comply with the current statutory requirements please contact Andrea Curtis on 01245 453822 or andrea.curtis@birkettlong.co.uk."