The UK Consumer Law and the Consumer Contracts Regulations 2013 - Coursework Example

< Consumer Law, UK> by Abstract The paper pertaining to UK Consumer Law evaluates the Consumer Contracts Regulations 2013 (Information, Cancellation and Additional Charges) and analyses to what degree the new regulations have been succesful in improving the protection provided to consumers. Consumer Law, UK Introduction The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (the regulations) came to effect in the UK on June 13, 2014. The aim of formulating this law is to regulate the transaction and contracts made between a trader and a consumer. The regulations are made in such a way that that it can be applied to a wide range of contracts made between the solicitor that is the trader and the client that is the consumer (Drexl, 2014). However, the application of the particular law depends upon the circumstances in which the contract was done and also the nature of the consumer or client. According to the Consumer Contract Law 2013 any transaction made between the solicitor and the client will come under this law if the transaction is made on or after 13 June 2014. This overrides two earlier sets of regulations - The Consumer Protection (Distance Selling) Regulations 2000 and The Cancellation of Contracts made in a Consumers Home or Place of Work etc. Regulations 20081. Any contracts that are ending on or prior to June 13, 2014 would come under these two earlier regulations. One advantage of the new regulation is that earlier there were two separate regulations that were regulating contracts of distance trade and on- and off-premises trade but with the passing of the new regulation all the three situations come under one umbrella. This would ease out the regulatory bodies to keep everything in one place. The aim of this essay to assess how this regulation has improved the protection provided to the consumers. Along with that it will also cover the right time and circumstances in which this regulation would be applied to the contracts between a solicitor and the client (Stanley & Briscoe, 2010). Situations for Application of the Regulations The Consumer Contracts (Information Cancellation and Additional Charges) Regulations 2013 (Regulations) can be applied to the contracts that are made in one of the three situations, which are on-premises, off-premises and distance trader to consumer contracts2. However, these are also subject to certain exceptions. The sort of the contract gets changed depending on where the contract is being made (Hillmlan, 2006). The exceptions that come under the regulation are auctions, in which the consumer does not have any right of cancellation of public auction and the other one is contracts healthcare and social services since these are not covered by the Consumers Rights Directive (CRD). Regulation 5 of the Law clearly defines each type of contract. 1. On-premises contract An on-premises contract is a trading contract between the solicitor and the trader, which is neither an off-premises contract nor a distance contract. The scope of this definition is very wide in nature. As per this definition any contract that you carry out with your client, who happens to be an individual, in your place of business is regarded as on-premises contract. As per the Regulations the trader is bound to give the consumer all information mentioned in Schedule 1 of the regulation and the information should be given in a clear and comprehensive manner if the information is not already apparent from the context (9(1)). It is mandatory for the trader to provide the information before the consumer is bound by the on-premises contract. Regulation 9(2)3 states that this regulation does not apply to the day to day transactions that are to be performed immediately. 2. Off-premises Contract As per the Regulations a contract come under the off-premises category if any one of the below mentioned scenarios holds true during the formulation of the contract. a. the contract that is concluded between the trader and the client with the simultaneous physical presence of both the parties; however, the place of the contract is not the business premise of neither the trader nor the consumer. b. the contract for which an offer is made in the simultaneous physical presence of the trader and the consumer in a place that is not the business premise of neither the trader nor the consumer. c. the contract is made on the business premises of the trader or through any means of distance communication immediately after the consumer was individually and personally addressed in a place that is not the business premise of the trader and the contract should be done in the simultaneous physical presence of both the parties. d. the contract that is concluded in an excursion arranged by the trader outside the business premises of the trader in order to promote and sell goods or services that the trader offer. Though there are circumstances defined for a contract to be considered as off-premise but it is always recommended to make a subsequent agreement during a follow-up visit; this may be a new contract and caught by the definition (Hornle, 2004). In certain scenarios a contract may also fall under the off-premise category even if it is made in the trader’s office, when it is made after an offer of a relevant type made by the consumer. 3. Distance Contract From the name it is evident that this contract is the one that is concluded under and organized distance sales or service provision scheme where both the trader and the consumer and not physically present. Prior to bind the consumer in a distance contract it is necessary for the trader to provide the information mentioned in Schedule 2 of the Regulation and the information should be in clear and comprehensive manner in the form of a distance communication (Staudenmayer, 2004). If there is provision of cancellation of the contract the trader must provide as cancellation form that is mentioned in Schedule 3 (13). Though the terms “organised distance sales” and "service-provision scheme" are not mentioned and defined in the regulation they include the services like telesales, online sales, mail orders and the means of these sorts. As per the regulation the time of provision should within a reasonable time after the contract is concluded. As far as the cancellation of distance contract is concerned model cancellation instructions are available in Schedule 3; however, the trader is not obliged to do so. The Protection of the Consumer in the Regulation Since the off-premises and distance contracts can made through different means like through telephone and sometimes through many other electronic means it was necessary for the lawmakers to include clauses that help protecting the rights of the consumers after concluding the contract with the trader4. The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 offers three main protections to the consumers, they are as follows: 1. Right to Specified Information 2. Right to Cancel 3. Criminal Liability, which is valid only for off-premises contract The following discussion will be focused on these three specific protections that protect a consumer to fallen prey for wrong doing of a trader. This is the strongest part of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013. The continuation of this essay will discuss these three aspects of the protection in particular. 1. Right to Specific Information As per Regulation 15, when a trader makes a telephone call to conclude a distance contract it is necessary to furnish the right information to the consumer at the start of the call itself5. The mandatory information that the trader must disclose are identification of the caller and the commercial purpose of the call (Schulte-Nölke & Tichy, 2010). There are certain distance contracts that are concluded through various electronic means. When distance contract is concluded through electronic means the trader must furnish certain information mentioned in Schedule 2. As per Regulation 14(2) these mandatory information is to be provided directly before the order is placed and the information should be in clear and prominent manner. The mandatory information as per Schedule 2 are as follows: Main characteristics of the service or goods offered Total price of the goods or service or the method of calculating the price Delivery charges (if any) The total cost per period if the contract has billing period mentioned in it Duration of contract or if its terminated what are the conditions of termination Minimum duration of obligations of consumers where applicable. According to Regulation 14(3) it is necessary for the trader to ensure that the consumer explicitly acknowledges the obligations of pay. As per Regulation 14(4) if the obligation of pay is to be done through a click of a button the button should have that written on it in such a way that it can be read clearly. Otherwise if the trader fails to comply with these regulations the consumer will not bound to pay (14(5)). It is necessary for the trading website to indicate it clearly at the beginning of the ordering process if there is any restriction in the delivery process and the consumer needs to pay for the delivery (14(6)). If the trader fails to comply with the information requirements it will be regarded as the fineable offence in relation to the off-premises contracts. The trader also must furnish the information to the consumer about their right to cancel the contract, if there is any cost implication for the cancellation and returning of the goods or services during the cancellation period (19(1) and Schedule 2 paras l-n). 2. Right to Cancel This part of the regulation applies to the off-premises and distance contracts between the trader and the consumer. The right to cancellation is subject to paragraphs (2) and (3) and regulations 6 and 28. However, this right is not applicable to certain aspects like supply of medical products by administration, supply of healthcare goods and for passenger transport services. As per Regulation 29(1) a consumer has the right to cancel an off-premise or a distance contract at any time in the cancellation period. The consumer needs not to furnish any reason for the cancellation and neither will incur any liability, if the situations of cancellation do come under Regulations 34(3), 34(9), 35(5) and 36(4)6. The period of cancellation starts when the contract the entry and end of the contract occur according to Regulation 30 or 31. Regulation 30 states that the cancellation periods as per this regulation until there is a breach in the information requirement regulation, in which circumstances the cancellation period will get extended. It is necessary for the consumer to comply with the requirements so that the cancellation of the contract is valid (32). In the effect of cancellation of the contract the trader is bound to return all payments made by the consumer; however, the exceptions are listed in Regulation 34(9). As per Regulation 34(5) and 34(6) the reimbursement of the amount to the consumer is to be done in not more than 14 days after the cancellation of the contract. 3. Criminal Liability As per Regulation 19 it will be considered as an offense if the trader fails to inform the consumer about the right to cancel the off-premises contracts. If the trader is found guilty of this offense it will be punishable on summary conviction by a fine, which can go up to level 5 on the standard scale. Regulation 20 provides the defense or due diligence to the parties if they can prove one of the reasons for the occurrence of the offense (Staudenmayer, 2005). Those reasons are the default or act of another and reliability of the information provided by another. It is necessary for the consumer to take the necessary precautions and exercise the required due diligence in order to prevent the commission of the offense. As per Regulation 25 states that it will be considered as a criminal offense if there is any obstruction provided to the investigating officer during the investigation and also producing false statement to the investigating officer. However, the regulation does not authorize the commissioned officer to inspect or take possession of the privileged material. It is not necessary for the party to produce any such material asked by the officer and it is not required by the regulation as well (24)7. The officer of the corporate body is also considered guilty if the offense of committed by the officer and any one of the following statements holds true – if the officer is consented or conspired to commit the offense or if the offense is attributable to any kind of neglect on their part. Conclusion With the effect of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 the consumers feel protected from any wrong doings of the traders. In the recent times it is observed that many consumers have been fallen prey to the ill mentality of doing business by the traders. The Consumer Protection (Distance Selling) Regulations 2000 and The Cancellation of Contracts made in a Consumers Home or Place of Work etc. Regulations 2008 were the earlier two regulations in the UK that was meant for protecting the rights of the consumers (Kauffman et al., 2011). However, due to many loop holes and inability to address all the grievances of the consumers made these two regulations weaker, which led to the commissioning of the new regulation that is strong and have the ability to protect the consumers. The amount of protection for the consumers furnished in the new regulation of 2013 has given confidence to the consumers and they can understand their right to know the mandatory information before concluding a contract – especially distance and off-premises contracts. The new regulation offers the consumers to know more about the contracts and also help them in understanding the requirement that they need to know while binding them in a contract with the trader. The more they understand the regulations better they can protect themselves. References Drexl, J. (2014). Competition Law in Media Markets and its Contribution to Democracy–A Global Perspective. Max Planck Institute for Innovation & Competition Research Paper, (14-16). Stanley, J., & Briscoe, G. (2010). The ABC of digital business ecosystems. arXiv preprint arXiv:1005.1899. Hillmlan, A. P. (2006). Public Policy versus Choice of Law-Is the Best Enemy of the Good. Franchise LJ, 26, 180. Hornle, J. (2004). UK Perspective on the Country of Origin Rule in the E-Commerce Directive-A Rule of Administrative Law Applicable to Private Law Disputes, The. Intl JL & Info. Tech., 12, 333. Staudenmayer, D. (2004). The place of consumer contract law within the process on European contract law. Journal of Consumer Policy, 27(3), 269-287 Schulte-Nölke, H., & Tichy, L. (Eds.). (2010). Perspectives for European consumer law: Towards a Directive on consumer rights and beyond. Walter de Gruyter. 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