Consumer rights enforcement – a new era for the Competition and Markets Authority
The Competition and Markets Authority (CMA) has had a busy start to the year utilising the new consumer rights enforcement powers it has been granted by the Digital Markets, Competition and Consumers Act (DMCC).
What changed and when?
Most of the consumer law provisions of the DMCC, which affect most businesses providing goods and services to consumers in the UK, came into force on 6 April 2025. This included:
1. The potential for fines of up to 10% of global turnover, which can be imposed by the CMA rather than a court process being required (although a court route is still available).
2. The ability for the CMA to issue redress orders requiring non-compliant businesses to compensate consumers.
3. Changes to UK consumer law (updating and replacing the Consumer Protection from Unfair Trading Regulations 2008) on pricing practices and fake or misleading reviews.
Note: The changes in relation to subscription contracts still aren’t effective.
What investigations have been launched?
In March the CMA announced the 9th business it is investigating under its new direct consumer enforcement powers.
The messaging from the CMA is clear, businesses must be upfront, transparent and fair with their customers about pricing and fees.
This time the CMA are investigating whether Adobe’s early cancellation fees on membership plans for certain products are unfair and whether customers are given clear and timely information upfront about the early cancellation fees. Customers who cancel membership plans for certain Adobe products more than 14 days after signing up to an ‘annual billed monthly’ plan must pay 50% of the remaining yearly cost but only have access to the product until the end of that month’s billing period.
It’s interesting that this investigation has been launched before the DMCC rules relating to subscription contracts have come into effect. On this subject, there was a government press release on 2 April which confirmed at a high level what the government expects these rules to require of businesses. The press release also confirmed that these rules are not expected to come into effect until 2027.
Have there been any fines?
The CMA announced in February it has now used its new fining powers for the first time. The CMA issued Euro Car Parks Ltd (ECP) with a fine of £473,000 for failing to comply (without reasonable excuse) on time with a formal CMA information notice.
The CMA initially served the information notice by tracked post and hand delivery. When no acknowledgement or response was received, the CMA followed up with further copies of the notice by tracked post, hand delivery and multiple emails to different ECP email addresses.
ECP argued the information notice was incorrectly addressed to a particular director who had little day to day involvement with the business and that it thought the emails received from the CMA were fraudulent.
So this is a fine for procedural non-compliance (which ECP have appealed) rather than a breach of the underlying consumer protection law. However, the CMA has now received the requested information from ECP which it says it is analysing.
The lesson from this fine – make sure your organisation identifies and appropriately deals with all communications from regulators!
Want to read more?
- CMA fines Euro Car Parks £473k for failure to comply with legal information notice
- CMA investigates Adobe over concerns about cancellation fees
_________________________________________________________________________________________
Disclaimer
This information is intended for general informational purposes only and does not constitute legal advice. We recommend seeking professional advice before taking any action on the information provided. If you would like to discuss your specific circumstances, please feel free to contact us on 0800 2800 421.
