Unfair Commercial Practices Directive
by Sandy Nicol
The Unfair Commercial Practices Directive (UCPD) was adopted on 11 May 2005 with regulations implementing the Directive in the UK coming into force by April 2008.
The Directive:
- harmonises unfair trading laws in all EU Member States;
- introduces a general prohibition on traders not to treat consumers unfairly.
In particular, the Directive will oblige businesses not to mislead consumers through acts or omissions; or subject them to aggressive commercial practices such as high pressure selling techniques. The Directive also provides additional protections for vulnerable consumers who are often the target of unscrupulous traders.
The Directive’s wide scope – it applies to all business sectors – and flexible provisions means that it will plug the gaps in existing EU and UK consumer protection legislation; and set standards against which new practices will automatically be judged. Implementation of this Directive should help ensure the UK has a consumer protection regime amongst the best in the world.
In addition, the Directive overlaps with existing UK legislation, such as the Trade Descriptions Act 1968 and Part III of the Consumer Protection Act 1987, which covers misleading pricing. This legislation will have to be amended or repealed to conform with the principles contained in the Directive.
Overall, the Government’s stated objective is to simplify the UK consumer protection framework.
Draft Consumer Protection from Unfair Trading Regulations 2007
These Regulations will implement the UCPD within the UK. Part 2 sets out the prohibitions on unfair commercial practices.
The commercial practices prohibited are:
- Those that breach the requirements of professional diligence (the general prohibition)
- Misleading actions
- Misleading omissions
- Aggressive practices and
- Those listed in Schedule 1 (the UCPD Annex prohibitions).
These prohibitions will be enforceable through Part 8 of the Enterprise Act 2002.
In addition, Part 3 sets out criminal offences for breaches of the majority of the prohibitions. (The exceptions are certain provisions relating to self-regulation.)
The general prohibition will be a mens rea offence (no offence can be established unless the prosecution can prove that the trader has knowingly or recklessly breached the requirements of professional diligence). The other offences are strict liability offences (where no specific state of mind needs to be proven).
Part 3 also provides defences, for the strict liability offences, of due diligence, innocent publication of advertisements and publication of commercial practices which are not advertisements.
Further information on the implementation of the Unfair Commercial Practices Directive can be found on the Office of Fair Trading and DTI websites.
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