Unfair Practices
The question
To ask the Secretary of State for Business and Trade, what assessment his Department has made of the effectiveness of the compliance advice published by the Competition and Markets Authority for trader recommendation platforms in protecting consumers from misleading claims and unfair practices.
Answered by Kate Dearden
The Competition and Markets Authority's (CMA) decision-making is independent of government. Each parliament the government issues a Strategic Steer to the CMA setting out its priorities for the CMA and the wider policy objectives to which it should have regard. Information about the CMA's enforcement activities is available on its website.
The Digital Markets Competition and Consumers Act 2024 (DMCCA) strengthens consumer law enforcement by giving the CMA new administrative powers, and they and the courts are able to impose significant monetary penalties of up to 10% of turnover. The CMA recently used the fining powers for the first time against a trader that failed to comply with a legal information notice.
Under the DMCCA, trader recommendation platforms must take reasonable steps to ensure consumer reviews on their sites are genuine. The CMA has published separate guidance for businesses that publish reviews to help meet their legal obligations.
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