Consumer Rights Act brings in new remedies

A range of new consumer rights come into force today (1 October), from refunds for defective goods to a new class action procedure against anti-competitive behaviour.

Under the Consumer Rights Act 2015, anyone who buys faulty goods will be able to claim a full refund of the purchase price for up to 30 days. The previous law only allowed a refund within a "reasonable time". Purchasers of services also have stronger rights, as providers who fail to use care will have a duty to take remedial action, or may have to give a partial refund.

Specific rules have been brought in entitling shoppers to a repair or replacement when digital products are faulty.

Also from today, certified alternative dispute resolution providers will be available to help when a dispute cannot be settled between the business and the consumer, offering a quicker and cheaper way of resolving disputes than going through the courts. A list of alternative dispute providers is available from the Chartered Trading Standards Institute.

For victims of anti-competitive behaviour, such as price fixing or market sharing, the Act gives extensive new powers to the Competition Appeal Tribunal (CAT), along with a fast track procedure intended to encourage smaller businesses to bring cases against large companies or groups abusing their market power. The CAT may place a cap on costs and can also restrict the amount of evidence and number of expert witnesses that can be presented in a case.

"Opt out" class actions for consumers will mean that everyone affected by an anti-competitive practice is automatically a member of the class which is suing. Claims approved by the Competition Appeal Tribunal can be brought by a suitable representative of the group affected, who will then advertise the claim in order to make other potential claimants aware of it and distribute the compensation awarded.

Commercial law firm Maclay Murray & Spens is advising businesses to ensure all relevant staff are aware of the law on collusion and the dangers of inadvertently entering into anti-competitive arrangements through casual contacts with competitors. 

Catriona Munro, a partner in MMS' EU competition and regulatory team, said: “Most companies know that anti-competitive agreements and abuse of dominant market positions are illegal, but it is possible to fall foul of the law through seemingly innocuous agreements made casually with competitors. It is, therefore, essential that managers also take a thorough overview of the situation and that suitable due-diligence is carried out across commercial operations.

“Raising awareness of competition law is often regarded as a necessary evil, to keep sales staff on the right side of the legal line and reduce the company’s exposure to fines. What is less often appreciated is that awareness of competition law can also identify breaches of the law by suppliers or customers, which may have operated to the company's detriment. If this is the case, today's changes to the law may make it easier to seek redress.”