The 6th of April 2025 marks a significant shift in UK consumer law, as the Digital Markets, Competition and Consumers Act (DMCCA) enforcement regime comes into force. Molly Hackett and Georgina Hargreaves look at the new regulation and explain how businesses can prepare.
The DMCCA will bolster current legislation on unfair commercial and consumer trading practices, and most importantly, will grant the Competition and Markets Authority (CMA) with new rights to impose hefty fines on businesses who are in breach of the regulations.
Out with the old and in with the new
Although many provisions from the old regulations are being retained, there are several major changes coming into force, we have listed the key ones to note below:
- Fake and/or misleading reviews and advertising – this will now be one of the banned commercial practices which are deemed to be unfair in all circumstances. This will cover any reviews which are not based on a customer’s real and genuine experience, this includes asking a third party to produce a fake review. There will also be an expectation on businesses to monitor reviews and ensure that fake reviews are removed.
- Changes to ‘drip pricing’ law – this will ban the practice of advertising a price for goods or services and then introducing compulsory additional charges further along the transaction, this includes booking fees, delivery charges and taxes. These additional fees must now be included in the initially advertised price without any ‘nasty’ surprises at the checkout.
- Vulnerable persons – the concept of vulnerability has been extended to include consumers’ specific circumstances, and the CMA will be focussing on aggressive trading practices that take advantage of vulnerability. A non-exhaustive list has been provided by the CMA of the type of consumers that may fall into this category.
- Subscription contracts – the DMCCA has a particular focus on the nature and advertising of subscription contracts, though these changes are scheduled to be implemented in Spring 2026. Businesses with an offering of rolling subscription contracts (particularly targeting those in technology and digital services) will need to ensure that certain information is provided to the consumer before entering, as well as during, the subscription including cancellation and reminder notices.
Why is this important?
- Enhanced powers of enforcement
Previously, the CMA operated as a regulatory body which consumers could report infringing practices to, the CMA would then proceed to negotiate with the business in question to ensure compliance going forward.
While the CMA had some enforcement powers, it has been rare that they have been used in practice and any breach would have been particularly egregious. Under the new legislation, the CMA will now have the ability to enforce fines of up to 10% of global turnover. For groups of companies, it is important to note that there will need to be compliance across the brand’s group, given that the fine will account for the entire group turnover.
- Customer trust and brand reputation
Similar to businesses receiving ICO fines for personal data breaches or failure to comply with data protection law, it is likely there will be publicity around the issuing of fines pursuant to the DMCCA (particularly for well-known large outfits).
Undoubtedly this could have a significant impact on consumer trust in a brand and the businesses’ reputation in the market, particularly considering the shift in consumer attitudes towards corporate responsibility and the want for transparency in industries such as retail, technology and fashion.
How can businesses prepare?
The most valuable measures that business can take is to review current commercial practices (and its consumer contracts) in light of the incoming legislation to ensure that the business fully understands the position and any steps that need to be taken to comply with the DMCCA.
The CMA has advised that there will be an initial 3-month grace period, whereby they will be focussing on supporting businesses to adjust and understand the new regulations. From June 2025 onwards they will then shift their focus to the enforcement of the legislation, by which time businesses will need to ensure they are compliant to avoid falling foul of the DMCCA.
Given that the CMA has not historically been particularly aggressive in pursuing breaches of consumer law and regulations under the current legal framework, it will be interesting to see how its enforcement powers are used in practice as well as any areas of focus. We anticipate that the introduction of the DMCCA will lead to a new dawn in active enforcement of lawful consumer practices.
Our specialist commercial team regularly advises on the impact of consumer laws and regulations on business’ consumer trading practices, contracts and compliance. If you are a business that needs advice in this area and want to understand more about the impact of the DMCCA, please get in touch at [email protected].
