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Consumer Rights Bill to be scrutinised by Parliamentary committee


A Parliamentary committee is to scrutinise proposed new UK consumer rights laws.

The Business, Innovation and Skills (BIS) Committee announced that it will "conduct pre-legislative scrutiny" of the draft Consumer Rights Bill. The Bill was published by the Government last month following a previous consultation with industry, consumer rights groups and other stakeholders. The Bill, if introduced, would consolidate a number of existing consumer rights laws into one single legal framework.

The BIS Committee said that it would review the Government's proposals around goods, services, digital content, unfair contract terms, enforcement powers, civil remedies and private actions in competition law, among other aspects of the reforms. It said it would consider submissions from businesses on the proposals until 19 August.

Technology law expert Luke Scanlon of Pinsent Masons, the law firm behind Out-Law.com, said that the proposals seek to address existing uncertainties over whether core consumer protections for good and services apply in the context of digital content rather than information generally provided on business websites.

"The draft Consumer Rights Bill introduces the concept of a 'contract to provide digital content' and sets out new consumer rights and remedies that are to be implied into such contracts," Scanlon said. "The Bill is limited in its application to 'paid for' digital content and 'free add on' content supplied with other paid for content or goods or services. This means that, generally, the statutory rights and remedies set out in the Bill will not apply simply where a business makes information available, for example, to the public at large, via its websites or digital applications."

Scanlon said, though, that an exception to this general rule means that producers of digital content could be pursued by consumers where their content damages their computer, mobile phone or other device.

"In those circumstances, even if the content is 'free content', the consumer will be entitled to a remedy - a replacement or repair of what has been damaged," he said.

Scanlon also said that businesses charging consumers for accessing digital content would need to review the terms and conditions and disclaimers they have applied to ensure they are consistent with the new regime. He also said businesses should conduct a risk assessment where they intend to develop free apps and other digital content in order to determine whether or not the provisions will have application in those instances.

Businesses should consider whether staff need to be trained specifically on the reforms relating to digital content and assess the extent to which their complaint handling costs will be affected as a result of the changes to the law. He said businesses may also need to adjust their current approach to consumer redress to account for the new provisions.

The expert said that companies should also take note of some of the implications the requirements will in relation to digital content.

"Consumers will need to be made aware of any updates to be subsequently made to delivered content," Scanlon said. "Content is deemed to have been delivered to the consumer when it reaches his or her device or chosen destination, for example a cloud storage provider, meaning that consumers will have a right to a remedy – likely a refund – where a third party transmission failure renders delivery impossible."

"Businesses are also prohibited from excluding or limiting their liability where the content they provide infringes a third party's intellectual property and action is taken against consumers," he added.

Commenting generally on the legislative process, regulatory expert Pauline Munro of Pinsent Masons, the law firm behind Out-Law.com added: "It is clear not only from the appointment of a Parliamentary Committee to scrutinise the Bill, but also the amount of press comment that it has generated, that there are still a number of knotty issues to resolve before the new Consumer Rights Bill reaches its final form."

"There is much concern across the various sectors of business which have interface with consumers that the Bill is overly consumer-focused, and introduces new powers for enforcers with insufficient checks and balances in place. The Parliamentary Committee will provide the opportunity for those concerns to be expressed," she said.

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