CMA’s new consumer enforcement regime comes into force in April 2025
New, directly enforceable consumer protection laws come into force on 6 April 2025, thanks to the much-anticipated Digital Markets, Competition and Consumers Act 2024 (DMCC)1. This marks a fundamental shift in the enforcement of the UK’s consumer protection regime.
As noted in our earlier article, this is the latest change introduced by the DMCC to digital regulation and the CMA’s merger control and competition enforcement powers, the first changes having come into force on 1 January 2025. See also our article on the UK Government’s implementation plan for the DMCC.
Consumer Protection: Increased Enforcement
The DMCC brings in significant reforms to consumer laws in the UK and increased enforcement powers for the CMA. The DMCC grants the CMA new powers to directly enforce consumer legislation and amends existing consumer protection laws in order to bring them into line with the online consumer environment.
Direct enforcement
The DMCC provides the CMA with direct consumer enforcement powers which will exist alongside court-based enforcement powers held by it and other enforcement agencies in the UK (such as the local Trading Standards Officers and sector regulators). The CMA’s ability to directly enforce consumer law will bring its consumer law enforcement powers in line with its current competition law powers.
In a significant change for the enforcement and scrutiny of consumer law compliance in the UK, the CMA will gain the same powers (for example information requests, dawn raids, etc) and enforcement options for consumer protection as it currently has for competition law enforcement. It will be able to impose financial penalties on businesses or individuals for failing to comply with mandatory information requestions (as it can for competition investigations where we have seen increasing willingness by the CMA to impose fines). Information requests can also be served on parties outside of the UK provided that there is some form of “UK connection” (this has been defined very broadly). Where the CMA concludes there has been a breach of the legislation it will, for the first time, be able to impose very significant financial penalties (10% of worldwide annual turnover of the companies involved).
The CMA published its final Guidance on Direct Consumer Enforcement on 14 March 2025. This sets out the CMA’s procedures and how it will generally conduct direct consumer enforcement investigations. Overall, the CMA’s procedure for a consumer enforcement investigation appears to be based on competition investigations and we would expect the process to be very familiar to those with experience of those investigations.
In terms of remedies, the CMA can impose:
- enhanced consumer measures (ECM): This will require a business to compensate consumers or otherwise remedy the breach, impose measures to improve compliance with consumer law and prevent further breaches and help consumers have the relevant information to enable them to make an informed choice; and
- issue online interface notices (OIN): Broad powers to impose obligations on businesses including third parties outside the UK to take certain actions (or refrain from taking actions) with respect to websites or any form of digital content which is used to promote goods or services to UK consumers.
Changes to consumer law
Some of the most notable amendments to consumer law include:
Unfair Commercial Practices (UCP): Commercial practices are considered unfair when a consumer makes a transaction based on misleading information or aggressive practices. For example, the CMA’s recent focus on misleading green claims – so-called “greenwashing” – is part of the CMA’s focus on unfair practices, along with the CMA’s efforts to protect consumers from harms in the digital sector. Building on the existing regulation to address a broader spectrum of unfair practices includes a focus on “dark patterns”, with a new banned practice relating to fake consumer reviews and a prohibition of the “drip pricing” of unavoidable fees regardless of the transactional impact of such practices.
The reformulated and broader test for a UCP states that a commercial practice is unfair if it:
- Is likely to cause the average consumer to take a transactional decision that the consumer would not have otherwise. The transaction decision will be based on a practice involving one or more of the following: (a) misleading action; (b) misleading omission; (c) aggressive practice (such as pressured selling); and/or (d) failing to follow requirements of professional diligence.
- Fails to include material information.
- Is a banned commercial practice (listed in Schedule 20, such as the new banned practices of fake reviews and drip pricing).
The CMA has published draft guidance on its approach to Unfair Commercial Practices which provides essential guidance on the extremely broad scope of these provisions. The final guidance will be published soon.
In relation to drip pricing, meaning the upfront presentation of a low price but then adding further price elements that raise the final price, the CMA has announced it will take a phased approach to guidance. The CMA has said in April it will provide clear framework for complying with the parts of the law which are well understood and unchanged (ie genuinely unexpected and untrailed mandatory charges added on at the end of a purchasing journey). For other elements of drip pricing which have caused uncertainty and some sector specific issues (including fixed-term periodic contracts) the CMA will run a further consultation on revised draft guidance in the summer.
The CMA has also said there will be no enforcement for fake reviews for the first three months.
Subscriptions: New protections for consumers in relation to subscription and saving scheme contracts. However, the new regime governing subscription contracts will not come into force until Spring 2026.
It is important to note that the CMA’s enforcement powers apply to a range of consumer law (such as the Consumer Rights Act 2015) not just the provisions in the DMCC itself. Based on the CMA’s recent consumer investigations we believe it is likely that the CMA’s initial focus will be on unfair commercial practices.
CMA CEO, Sarah Cardell, recently said that the new consumer protection powers will be used to promote growth by promoting consumer trust and confidence through deterring poor corporate practices, and allows the CMA to support those businesses that do the right thing, giving them a level playing field in which to compete fairly. She also said that early enforcement will focus on the most egregious consumer law offences, such as aggressive sales practices which take advantage of vulnerability (where the CMA already has a track record of using its competition law powers with market studies into funeral services, veterinary services and infant formula). Trading standards officers (who do not have the direct enforcement powers of the CMA) will be a significant source of information as to infringements, and the CMA will likely prioritise its resources for those cases it is best paced to take on, leaving others to the industry regulators or trading standards.
Impact of DMCC for businesses
In light of the above, it is important that all businesses are aware of the changes and assess which provisions apply to them, which practices across the customer journey are most likely to cause harm to consumers and ensure their own compliance procedures are updated to reflect these changes.
The overall impact of the DMCC will depend on the business and its consumer facing activities. We would expect the CMA to continue to focus on sectors and activities with an obvious consumer impact, for example the CMA’s investigation regarding infant formula which recommended changes around the way formula is marketed to parents, greenwashing and significant market-impacting digital practices. Given the CMA’s current steer from the Government to focus on growth, we expect the CMA to continue to focus on the more overt examples of unfair practices to test its new powers (such as fake claims of scarcity/timing or misleading advertising claims, which have already been under scrutiny).
Assuming the CMA is more active in enforcement in light of its new powers, this could also increase the risk of follow-on litigation for affected businesses. However, the opt-out collective action regime will not apply to consumer law claims. This means that consumer law arguments dressed as competition law claims are likely to continue for the foreseeable future.
To discuss this further, please get in touch with one of the authors.
1Digital Markets, Competition and Consumers Act 2024 (Commencement No. 2) Regulations 2025 (SI 2025/272).
