The new service encourages UK consumers to report exploitative sales and pricing practices.
On 4 April 2020, the Competition and Markets Authority (CMA) launched an online service called “Report a business behaving unfairly during the Coronavirus (COVID-19) outbreak” (the Online Service) to allow businesses and consumers to report unfair practices related to COVID-19.
The Online Service launch follows the CMA’s recent guidance warning businesses against exploitative sales and pricing practices. In particular, the CMA cautioned traders to behave responsibly and not charge inflated prices or make misleading claims, for example about the efficacy of protective equipment. The CMA noted that members of the public who resell goods, including on online marketplaces, may be subject to the same restrictions. In terms of enforcement, the CMA indicated that it will consider any evidence of breaches of competition and consumer protection law, take direct enforcement action in appropriate cases, and assess whether it should advise the UK government to take direct action to regulate prices.
The Online Service enables users to submit details about:
- Unfair prices for products or services, whether charged to businesses or end consumers. The Online Service lists the most commonly reported products, including food products (such as long-life milk, pasta, and eggs), hygiene and personal care products (such as hand sanitizer and toilet rolls), and medical products (such as paracetamol and ibuprofen). Users are then invited to detail the raised price and the original price of the relevant product.
- Misleading claims about products or services
- Problems with the cancellation, refund, or exchange of products or services
- Other unfair behaviour
Users are prompted to provide details of the relevant business, the date of the activity, the user’s details, and whether they can provide any supporting evidence, such as a receipt or screenshot. The website indicates that submitted information will be sent to the CMA, and that whilst the CMA will not respond to individual reports, it is monitoring all the information provided and will take action if appropriate.
The Online Service launch is part of the CMA’s multi-pronged response to the COVID-19 crisis. Whilst the CMA has announced a relaxation of competition law in certain areas (for instance, to allow grocers and supermarkets to coordinate their responses to supply issues during the crisis), it has, in parallel, made clear that it will use the full weight of its competition law and consumer protection powers to tackle unfair practices and non-essential collusion between businesses.
On 20 March 2020, the CMA launched a designated COVID-19 task force to deal with the evolving challenges posed by the pandemic. In particular, the task force will:
- Scrutinise market developments to identify harmful sales and pricing practices as they emerge
- Warn firms suspected of exploiting consumers through unjustifiable prices or misleading claims
- Take enforcement action if there is evidence that firms may have breached competition or consumer protection law and they fail to respond to warnings
- Equip the CMA to advise the government on emergency legislation if there are negative impacts for people that cannot be addressed through existing powers
- Enable the CMA to advise the government on how to ensure competition law does not stand in the way of legitimate measures that protect public health and support the supply of essential goods and services
The task force will also advise on further policy and legislative measures to ensure markets function as well as possible in the coming months.