Described by Which? as ‘the biggest shake up in consumer rights law in a generation’ the Consumer Rights Act (CRA) is an attempt to simplify UK consumer law, giving it a more contemporary footing.
Having come into effect on the 1st of October 2015, the CRA supersedes the Sale of Goods Act, the Unfair Terms in Consumer Contract Regulations and the Supply Of Goods and Services Act; bringing in several new features to improve clarity around consumer rights, working towards quicker and easier problem resolution for both consumers and retailers.
So, what’s new?
- The most important feature brought in by the CRA 2015 is the introduction of a 30 day ‘right to reject,’ outlining a specific timeframe within which an item can be rejected as faulty and fully refunded. Outside of the 30 day window consumers are entitled to have faulty goods repaired or replaced, and must give retailers one opportunity to do so before regaining entitlement to a refund.
- The creation of a tiered system also means it is more clear cut what you’re entitled to and when you’re entitled to it. The framework gives a clear indication of what you can expect, dependant on how long you’ve owned the product.
- Consumer rights relating to digital content (defined as data which are produced and supplied in digital form) have been included in legislation for the first time, giving purchasers similar legal standing to regular goods and services.
- The CRA has also sought to solidify how unfair contractual terms are handled, using a fairness test to review any significant imbalances at the consumer’s cost.
Has much really changed?
The CRA doesn’t bring with it a wholesale overhaul of the law as we know it, but it does bring some welcome change. The introduction of a timeframe paints a clearer picture of consumer entitlement, but the CRA still embodies the basic principles of the Sale of Goods Act: ‘goods must be of satisfactory quality, fit for purpose and as described.’ The grounds for a refund haven’t changed either, so just like before, if someone changes their mind and decides they no longer want a product, they aren’t legally entitled to a refund.
Plus the act only applies to purchases made on, or after the 1st of October. So if a customer is trying to enforce the CRA make sure they have proof of purchase – otherwise their window of time to reject the product is subject to different conditions. However, the inclusion of digital content in the CRA makes it easier to hold digital service providers to the same standards other retailers and distributors have become accustomed to.
What does this mean for businesses?
On the whole the CRA 2015 is good news for businesses. It clearly outlines what a customer is entitled to and gives sellers a solid framework of what they are expected to do if their goods or services are faulty. If you’ve already got Terms and Conditions (T&Cs) in place then check these sit within the new CRA guidelines. As mentioned above, there is only legal entitlement to a refund within 30 days if the goods are faulty, so you don’t necessarily need to amend your basic returns policy. The introduction of a ‘fairness test,’ for unfair contractual terms, also means you need to make sure any fees or charges are clearly outlined in contracts; and wherever possible, why not point them out to customers prior to engagement?
It’s important to brief your staff about these advancements too. Make sure they know what the changes to the law are, as well as how this may impact them in their day to day life as both a customer and an employee. Run your team through any changes you’ve made to your T&Cs and think of some practical situations staff may find themselves in.
If you’re selling goods or services to consumers (“Business to Consumer”) instead of other businesses (“Business to Business”) you will need to make sure your business is dealing with consumers legally. We can help your business comply with these recent changes which will help you maintain essential trust and confidence with your customers. Contact us today to arrange a free consultation.
The contents of this article are intended solely for information purposes only and should not be construed as legal advice or financial advice or opinion in any specific facts or circumstances.