1. CLAIRE ANDREWS AND IAIN MACDONALD GOUGH SQUARE CHAMBERS

2.  Enforcement options ◦ Informal resolution  Warning letters, meetings etc ◦ Formal resolution  Caution  Prosecution

3.  Civil route ◦ CPRs/ EA 2002  Undertakings  Enforcement order  Criminal route ◦ Caution ◦ Prosecution ◦ Confiscation

4.  The Consumer Protection (Amendment) Regulations 2014 ◦ Coming into force on 1 October 2014 ◦ Amendment of the CPRs by adding new Part 4A ◦ Gives a right to redress for consumers in relation to  Misleading actions under reg. 5  Aggressive commercial practices under reg. 7

5.  Consumer Rights Bill ◦ Third reading in the House of Commons on 16 June ◦ Committee stage in the Lords in October ◦ Coming into force October 2015?  Schedule 7 ◦ Enhanced consumer measures  Redress  Compliance  Choice

6.  Not a TSD enforcement power as such, but consumers may well want to know their rights ◦ First requirement – either:  A B2C contract;  A C2B contract; or  A payment by C to B ◦ Second requirement:  A prohibited practice by the trader; or  A prohibited practice by the producer of the goods/ digital content of which the trader is or could reasonably be expected to be aware ◦ Third requirement  The prohibited practice is a significant factor in C’s decision to buy the product or make the payment

7.  The right to unwind ◦ A 90 day period to reject  Unless goods/services fully consumed or performed ◦ Trader has to provide a full refund  May be reduced in certain limited circumstances ◦ Consumer has to make rejected goods available for collection ◦ In the case of a demand for payment, the consumer is entitled to return of that payment

8.  A discount ◦ A sliding scale, depending on the seriousness of the prohibited practice, from 25% up to 100% ◦ How do we determine how serious the practice was?  Behaviour of the trader  Impact of the practice on the consumer  Passage of time

9.  Damages ◦ Financial loss from the prohibited practice ◦ Alarm, distress, physical inconvenience or discomfort  Limited to loss which was reasonably foreseeable  No right to damages if trader has a due diligence defence

10.  How many consumers will feel able to bring such a claim? ◦ All likely to be small claims ◦ Legal representation unlikely to be available  Will such claims be parasitic on TS action? ◦ Much easier for consumer to prove the case if trader has been prosecuted or had an enforcement order made against them ◦ Is there a risk of pressure on prosecuting authorities?

11.  An additional element to EA 2002 and enforcement orders ◦ Will apply to orders, court undertakings and undertakings given under s.219 to the enforcer ◦ Directed at:  Redress  Compliance  Choice ◦ Only such measures as are “just and reasonable” may be included ◦ Enforceable by the Court as part of an order or court undertaking

12.  Only available in a “loss” case, i.e. where consumers have suffered a loss  Types of order which may be made: ◦ measures offering compensation or other redress to consumers who have suffered loss as a result of the conduct ◦ where the conduct referred to relates to a contract, measures offering such consumers the option to terminate (but not vary) that contract, ◦ where such consumers cannot be identified, or cannot be identified without disproportionate cost to the trader, measures intended to be in the collective interests of consumers

13.  Measures intended to prevent or reduce the risk of the occurrence or repetition of the conduct to which the enforcement order or undertaking relates (including measures with that purpose which may have the effect of improving compliance with consumer law more generally).  Such as? ◦ appointing a compliance officer; ◦ introducing a complaints handling process; ◦ improving their record keeping; ◦ signing up to an established customer review / feedback site; or ◦ publicising details of the breach or potential breach, and what they have done to put the situation right in the local or national press or on social media.  Could it go as far as telling the trader to sack an employee (or a director)?

14.  Measures intended to enable consumers to choose more effectively between persons supplying or seeking to supply goods or services  Same examples given in the Explanatory Notes as with compliance category

15.  Consider a certain payday lender recently in the news ◦ £2.6m compensation payable to affected borrowers  But what if they do it again in 2015? ◦ Prosecution plus confiscation? ◦ EA 2002 order plus redress and compliance measures? ◦ Claims by individual consumers (for more than £50)?