New laws aim for fairer trading

By Rod Addy

- Last updated on GMT

Related tags: Trading standards, Consumer protection

Processors, retailers and local authorities will have greater powers to combat false or misleading product claims or counterfeit goods under...

Processors, retailers and local authorities will have greater powers to combat false or misleading product claims or counterfeit goods under legislation scheduled to be enacted next month.

The Consumer Protection from Unfair Trading Regulations (CPR) and the Business Protection From Misleading Marketing Regulations (BPR) are due to pass into law on May 26. They supersede many parts of familiar and long-standing trading standards laws such as the Trade Descriptions Act, the Consumer Protection Act, the Consumer Credit Act and the Fair Trading Act.

The new rules would give offences a much higher profile by obliging the Office of Fair Trading to ‘name and shame’ those convicted. And they give local Trading Standards authorities powers to pursue injunctions and prosecutions against those named in complaints.

“This is good news for small manufacturers,” said Hugh Smith, head of litigation and dispute resolution at law firm Andrew Jackson. “It means they can make a complaint and they will get protection. They won’t have to pay, because it will be the prosecuting authorities that will take action.”

The changes would add to areas covered by previous laws. The CPR would ban firms from misleading omissions regarding products, such as failure to communicate that they are made using genetically modified crops. “This would expand the ways the Trading Standards department could get you,” said Smith.

Other offences would include falsely claiming to be signatories of the Trading Standards Code of Conduct, falsely displaying trust or quality marks or wrongly claiming endorsements. Firms would also be caught out if they tried to convince consumers that their product was made by somebody else or made unsubstantiated product claims, for example, related to health.

“If somebody passes off a product as yours, it’s actually going to be an offence,” says Smith. “And if you make claims, you have got to be able to justify everything you have said. If you can’t, your competitors could report you.”

The BPR bans misleading advertising and marketing that creates confusion between advertisers or competitors, denigrates or discredits rival products or takes advantage of trademarks owned by competitors. It also clamps down on promoting products as competitors to other products.

Prosecution targets could be directors, secretaries or other similar officers, including those acting as directors, even if not named as such. As with previous rules, any breach carries a maximum penalty of an unlimited fine in Crown Court and two years’ imprisonment.

Processors that believe they may have a case for prosecution under the new laws should seek legal advice. Solicitors pursuing matters will contact Trading Standards officials in the first instance.