What information is a trader obliged to share with its customers?

Some businesses that sell products and services must provide essential information and a no-quibble money-back guarantee and cancellation rights to its customers. Jessica Casson-Grave and Sophie Holt-Rogers from our corporate and commercial team explore the requirements under the government’s current legislation and to which businesses they apply.

What are the Consumer Contracts Regulations?

The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 require traders to provide certain information before entering into a consumer contract, including details of cancellation rights.

The requirements are different depending on whether the contract is made on-site (at the business premises), off-site or off-premises (for example at the customer’s home) or at a distance (for example online or by phone) and may require that traders to provide consumers with more than 24 separate pieces of information.

Who do the Regulations apply to?

The Regulations apply to all consumer contracts made after 2014 between a trader and a consumer.

Its description reads:

• A ‘consumer’ means an individual acting for purposes which are wholly or mainly outside that individual’s trade, business, craft or profession
• A ‘trader’ means a person acting for purposes relating to that person’s trade, business, craft or profession, whether acting personally or through another person acting in the trader’s name or on the trader’s behalf.

Some exceptions do apply, for example contracts in relation to financial services, construction, land and property, selling by rounds (for example milk deliveries) or by vending machine.

Information requirements for on-premises contracts

On-premises contracts are contracts made in person at the trader’s business premises. The information requirements are set out in Schedule 1 of the Regulations.

These include information about:

• The goods or services being purchased
• The price of the goods, delivery and any additional charges
• Payment arrangements, delivery times and arrangements
• The trader, including their geographical address and contact details
• The complaint-handling policy
• After-sales services and guarantees
• Compatibility of digital content

Information requirements for distance and off-premises contracts

Online and phone sales, where the consumer and trader are not physically together, are distance contracts. Contracts concluded where both are present but not at the trader’s place of business, for example at the consumer’s place of work or at their home, are off-premises or off-site contracts.

Before the consumer is bound by a distance or off-premises contract, the trader must give or make available to the consumer information including all the above, plus details of the consumer’s right to cancel under the Regulations.

Failure to provide the required information

It is an implied term of all such contracts that the trader has complied with the requirements to give information. If a trader fails to give the required information, it is treated as a breach of the contract which might entitle customers to damages including financial compensation or to cancel the contract.

If a trader enters an off-premises contract with a consumer but fails to give the consumer the required information about their cancellation rights, the trader may be guilty of a criminal offence.

The Regulations also impose an extended cancellation period of up to 54 weeks, meaning that consumers who were not provided with the required information about their cancellation rights may be entitled to a full, no-quibble refund over a year after purchase.

Can a trader avoid the Regulations?

It is not possible to exclude the application of the Regulations from consumer contracts. To avoid breaching contracts or giving rise to the extended cancellation periods, the best way to protect your business is to ensure the information provided to customers complies with the Regulations.

For specialist advice on whether the Regulations apply to your business and customers, or for comprehensive standard policies and documentation tailored to your business needs, please contact Harrison Drury’s corporate and commercial team on 01772 258321.