Alarm bells should be ringing loud and clear for any business involved in distance selling!

23
Oct

The Office of Fair Trading (“OFT”) have taken the step of conducting a pre-Christmas review of 156 retailer websites and found that many of them were not fully complying with the Consumer (Distance Selling) Regulations and the Electronic Commerce (EC)Directive) Regulations.

These regulations comprise the law governing Distance Selling and, in particular, the rights of consumers to receive certain minimum information prior to ordering goods as well as their rights following ordering or receiving them. These regulations are compulsory and you cannot  effectively  exclude them.
It is important to remember that Distance Selling arises where you are not dealing with your customer “face to face” e.g through a website, by text or telephone.
Key areas of concern that the OFT raised with retailers included:

  • 33 per cent of sites that provided information on cancellation appeared to impose unreasonable restrictions on customers’ rights to a refund. Most common was requiring that the product must be in the original packaging or in the original condition, which can infringe on consumers’ rights to reasonably inspect/assess the product.
  • 60 per cent provided a web contact form rather than an email contact address, as required by the E-Commerce Regulations. Two per cent provided no electronic contact details at all.
  • While 60 per cent of sites indicated upfront that compulsory charges would be added to the first price shown, 24 per cent of these sites went on to add further unexpected charges at the check-out.

Following the review, the OFT took it upon themselves to contact 62 of the top online retailers and have stated that traders not complying with the law face enforcement action by the OFT or Local Trading Standards.

To support compliance with the regulations the OFT has created a web-based guidance tool for businesses, “the Distance Selling Hub”, which includes tips to resolve the key issues identified in the sweep. Top tips include being clear and open about cancellation rights and providing a full refund plus a refund of delivery charges when things go wrong.

Whilst a useful resource, each Distance Seller will have their own specific requirements for their business  and, subject to complying with the minimum standards laid down in the regulations, are free to use their own terms and conditions.

What is clear is that any business involved in distance selling cannot afford to sit back and wait for a knock on the door from the Local Trading Standards Officer as a precursor to Enforcement Proceedings which could involve the granting of an injunction against the business in question which, coupled with any adverse publicity, could have a devastating impact on the business.

Remember, it only takes one disgruntled customer!

Source: Brian Scott at Max Montague Limited
www.maxmontague.com

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