Important sales and consumer-related legislation

In the UK, consumer and business transactions operate within a world of strict rules and regulations. The collective goal of these regulations is to protect consumers during business operations. 

As a business owner, it’s your responsibility to be aware of sales and consumer legislation so you can treat your customers fairly and protect your business against possible violations. 

In this article, we’ll cover some of the most important sales and consumer related legislation and regulations that every business owner should be aware of, including:

• Consumer Contract Regulations
• Consumer Protection from Unfair Trading Regulations 2008
• The Consumer Protections Act 1987
• The Data Protection Act 2018
• The Equality Act 2010
• The Misrepresentation Act 1967
• The Consumer Credit Act
• The Consumer Rights Act 2015

The Consumer Contracts Regulations came into effect in 2014. It protects consumers when they’re online shopping. 

Under the regulations, traders have to provide the following information on every sale:

• A description of the product, service, or digital service, and how long a consumer’s commitment will last. 
• The total price of the goods, service, or digital service, or how the price will be calculated.
• How consumers will pay and when they’ll be provided with the goods.
• Additional delivery charges and other costs.
• Information about who pays for the cost of returning items.
• Details of a consumer’s right to cancel a sale.  
• Information about the seller: Their address, contact details, and the address and identity of any other trader involved. 
• Information about the compatibility of digital content with hardware and other software.

The Consumer Protection from Unfair Trading Regulations protects consumers from unfair or misleading trading practices. It also prevents sellers from using aggressive sales tactics or intentionally leaving out product information. 

The Consumer Protection Act 1987 gives consumers the right to claim compensation if they’ve bought a product that has caused damage, injury, or death. 

Under the act, producers of a defective product are automatically liable for any damages caused by it.

The Data Protection Act 2018 governs personal data rights.

It mainly concerns the way companies handle personal data. Now, companies need to ask for permission before recording and using personal data, and they’ll have to pay compensation to anybody whose data they misuse. 

The Equality Act 2010 makes it unlawful to discriminate (directly or indirectly) against people based on protected characteristics. 

Under the act, it’s unlawful  to refuse, terminate, or change the terms of a service because of discrimination. It’s also unlawful for companies to harass or victimise people due to their protected characteristics. 

Protected characteristics include the following:

• Age 
• Disability 
• Race
• Religion or belief
• Sex
• Sexual orientation
• Trans 

The Misrepresentation Act protects consumers from misrepresentation that convinces them to buy something or enter into a contract. 

Under the act, misrepresentation falls into three categories:

• Fraudulent misrepresentation
• Negligent misrepresentation
• Innocent misrepresentation

Similar to the Consumer Protection from Unfair Trading Regulations 2008 that we mentioned earlier, but this act refers specifically to statements made by a seller. In other words, a trader can’t convince a consumer to buy a product by using statements that are false (fraudulent).

Misrepresentation is classed as fraudulent if a seller makes a statement that:

• They know is untrue.
• They don’t believe is true. 
• Is reckless (they don’t care if it’s true or not).

If a consumer enters a contract because of fraudulent misrepresentation, they can unwind the contract, claim damages, or both.

Misrepresentation is classed as negligent if a seller makes a statement that is made carelessly or without reasonable grounds.

If a consumer makes a claim based on negligent misrepresentation, it’s up to the trader to prove that it wasn’t negligent. In other words, the trader will need to prove that they had reasonable grounds to believe that the statement they made was true. 

Finally, misrepresentation is classed as innocent if a seller makes a statement that, while misleading, was not intentionally false. 

This happens when a seller had reasonable grounds for believing that their false statement was true, so it’s not entirely the seller’s fault. 

When innocent misrepresentation happens, courts can either cancel the contract or award damages to the consumer, not both. 

The Consumer Rights Act outlines the obligations that all businesses have to their customers when trading.

Specifically, the act says that any products you sell need to:

• Be of satisfactory quality.
• Be fit for purpose.
• Match the description.
• Be installed correctly (if you’ve agreed to install the product as part of the sale). 

If your business sells a product or service that breaks any of these rules, a consumer has the right to a refund, repair, or replacement. For example, if the product is broken, poorly made, or installed incorrectly (or not at all).

Similarly, if the customer was misled about the product from the way it was advertised, the customer can take legal action under the consumer rights act.