Part 8Enforcement of certain consumer legislation
F14Enforcement procedure: supplementary
218AF3Unfair commercial practices: substantiation of claims
1
This section applies where an application for F15an enforcement order, an interim enforcement order, an online interface order or an interim online interface order is made in respect of a F35Schedule 13 infringement involving a contravention of F36the Consumer Protection from Unfair Trading Regulations 2008.
2
For the purposes of considering the application the court may require F16the relevant person to provide evidence as to the accuracy of any factual claim made as part of a commercial practice of that person if, taking into account the legitimate interests of that person and any other party to the proceedings, it appears appropriate in the circumstances.
F172A
In subsection (2), “the relevant person”, in relation to an application, means—
a
where the application is for an enforcement order or an interim enforcement order, the person named in the application under section 215(1);
b
where the application is for an online interface order or an interim online interface order, the person alleged by the CMA to have engaged, be engaging or be likely to engage in conduct which constitutes the F37Schedule 13 infringement, provided that person is either the person against whom the order is sought or otherwise a party to the proceedings.
3
If, having been required under subsection (2) to provide evidence as to the accuracy of a factual claim, a person—
a
fails to provide such evidence, or
b
provides evidence as to the accuracy of the factual claim that the court considers inadequate,
the court may consider that the factual claim is inaccurate.
4
In this section “commercial practice” has the meaning given by regulation 2 of the Consumer Protection from Unfair Trading Regulations 2008.
219 Undertakings
1
This section applies if an enforcer has power to make an application F18for an enforcement order or an interim enforcement order under section 215 or for an online interface order or an interim online interface order under section 218ZA.
2
In such a case the enforcer may accept from a person to whom subsection (3) applies an undertaking that the person will comply with subsection (4).
3
This subsection applies to a person who the enforcer believes—
a
has engaged in conduct which constitutes an infringement;
b
is engaging in such conduct;
c
is likely to engage in conduct which constitutes a F38Schedule 13 infringement.
4
A person complies with this subsection if he—
a
does not continue or repeat the conduct;
b
does not engage in such conduct in the course of his business or another business;
c
does not consent to or connive in the carrying out of such conduct by a body corporate with which he has a special relationship (within the meaning of section 222(3)).
5
But subsection (4)(a) does not apply in the case of an undertaking given by a person in so far as subsection (3) applies to him by virtue of paragraph (c).
F85ZA
An undertaking under this section may include a further undertaking by the person—
a
to take enhanced consumer measures (defined in section 219A) within a period specified in the undertaking, and
b
where such measures are included, to provide information or documents to the enforcer in order that the enforcer may determine if the person is taking those measures.
5ZB
Subsection (5ZA) is subject to section 219C in a case where the enforcer is a designated enforcer which is not a public body.
F15A
A F39Schedule 13 enforcer who has accepted an undertaking under this section may—
a
accept a further undertaking from the person concerned to publish the terms of the undertaking; or
b
take steps itself to publish the undertaking.
5B
6
If an enforcer accepts an undertaking under this section it must notify the F5CMA—
a
of the terms of the undertaking;
b
of the identity of the person who gave it.
219AF7Definition of enhanced consumer measures
1
In this Part, enhanced consumer measures are measures (not excluded by subsection (5)) falling within—
a
the redress category described in subsection (2),
b
the compliance category described in subsection (3), or
c
the choice category described in subsection (4).
2
The measures in the redress category are—
F19a
measures offering compensation or other redress to consumers—
i
who have suffered loss as a result of the conduct which has given rise to the enforcement order or undertaking, or
ii
where that conduct constitutes a F42Schedule 13 infringement, who have been affected in any other way by that conduct.
F20b
where the conduct which has given rise to the enforcement order or undertaking relates to a contract, measures offering consumers falling within paragraph (a)(i) or (ii) the option to terminate (but not vary) that contract,
c
where F21consumers falling within paragraph (a)(i) or (ii) cannot be identified, or cannot be identified without disproportionate cost to the subject of the enforcement order or undertaking, measures intended to be in the collective interests of consumers.
3
The measures in the compliance category are measures intended to prevent or reduce the risk of the occurrence or repetition of the conduct to which the enforcement order or undertaking relates (including measures with that purpose which may have the effect of improving compliance with consumer law more generally).
4
The measures in the choice category are measures intended to enable consumers to choose more effectively between persons supplying or seeking to supply goods or services.
5
The following are not enhanced consumer measures—
a
a publication requirement included in an enforcement order as described in section 217(8),
b
a publication requirement included in an undertaking accepted by the court as described in section 217(10), or
c
a publication requirement included in an undertaking accepted by a F43Schedule 13 enforcer as described in section 219(5A)(a).
219BInclusion of enhanced consumer measures etc.
1
An enforcement order or undertaking may include only such enhanced consumer measures as the court or enforcer (as the case may be) considers to be just and reasonable.
2
For the purposes of subsection (1) the court or enforcer must in particular consider whether any proposed enhanced consumer measures are proportionate, taking into account—
a
the likely benefit of the measures to consumers,
b
the costs likely to be incurred by the subject of the enforcement order or undertaking, and
c
the likely cost to consumers of obtaining the benefit of the measures.
3
The costs referred to in subsection (2)(b) are—
a
the cost of the measures, and
b
the reasonable administrative costs associated with taking the measures.
4
F22Where the conduct which has given rise to an enforcement order or undertaking constitutes a domestic infringement and not a F44Schedule 13 infringement, the enforcement order or undertaking may include enhanced consumer measures in the redress category—
a
only in a loss case, and
b
only if the court or enforcer (as the case may be) is satisfied that the cost of such measures to the subject of the enforcement order or undertaking is unlikely to be more than the sum of the losses suffered by consumers as a result of the conduct which has given rise to the enforcement order or undertaking.
F234A
Where the conduct which has given rise to an enforcement order or undertaking constitutes a F45Schedule 13 infringement, the enforcement order or undertaking may include enhanced consumer measures in the redress category for the benefit of consumers who have been affected by that conduct.
5
The cost referred to in subsection (4)(b) does not include the administrative costs associated with taking the measures.
6
Subsection (7) applies if an enforcement order or undertaking includes enhanced consumer measures offering compensation and a settlement agreement is entered into in connection with the payment of compensation.
7
A waiver of a person's rights in the settlement agreement is not valid if it is a waiver of the right to bring civil proceedings in respect of conduct other than the conduct which has given rise to the enforcement order or undertaking.
8
The following definitions apply for the purposes of subsection (4)(a).
9
In the case of an enforcement order or undertaking under section 217, “a loss case” means a case in which—
a
subsection (1) of that section applies (a finding that a person has engaged in conduct which constitutes an infringement), and
b
consumers have suffered loss as a result of that conduct.
10
In the case of an undertaking under section 219, “a loss case” means a case in which—
a
subsection (3)(a) or (b) of that section applies (a belief that a person has engaged or is engaging in conduct which constitutes an infringement), and
b
consumers have suffered loss as a result of that conduct.
219CAvailability of enhanced consumer measures to private enforcers
1
An enforcement order made on the application of a designated enforcer which is not a public body may require a person to take enhanced consumer measures only if the following conditions are satisfied.
2
An undertaking given under section 217(9) following an application for an enforcement order made by a designated enforcer which is not a public body, or an undertaking given to such an enforcer under section 219, may include a further undertaking by a person to take enhanced consumer measures only if the following conditions are satisfied.
3
The first condition is that the enforcer is specified for the purposes of this section by order made by the Secretary of State.
4
The second condition is that the enhanced consumer measures do not directly benefit the enforcer or an associated undertaking.
5
Enhanced consumer measures which directly benefit an enforcer or an associated undertaking include, in particular, measures which—
a
require a person to pay money to the enforcer or associated undertaking,
b
require a person to participate in a scheme which is designed to recommend persons supplying or seeking to supply goods or services to consumers and which is administered by the the enforcer or associated undertaking, or
c
would give the enforcer or associated undertaking a commercial advantage over any of its competitors.
6
The Secretary of State may make an order under subsection (3) specifying an enforcer only if the Secretary of State is satisfied that to do so is likely to—
a
improve the availability to consumers of redress for infringements to which the enforcer's designation relates,
b
improve the availability to consumers of information which enables them to choose more effectively between persons supplying or seeking to supply goods or services, or
c
improve compliance with consumer law.
7
The Secretary of State may make an order under subsection (3) specifying an enforcer only if the functions of the enforcer under this Part have been specified under section 24 of the Legislative and Regulatory Reform Act 2006 (functions to which principles under section 21 and code of practice under section 22 apply), to the extent that they are capable of being so specified.
8
The power to make an order under subsection (3)—
a
is exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament;
b
includes power to make incidental, supplementary, consequential, transitional, transitory or saving provision.
9
Subsection (10) applies if—
a
an enforcer exercises a function in relation to a person by virtue of subsection (1) or (2),
b
that function is a relevant function for the purposes of Part 2 (co-ordination of regulatory enforcement) of the Regulatory Enforcement and Sanctions Act 2008, and
c
a primary authority (within the meaning of that Part) has given advice or guidance under section 27(1) of that Act—
i
to that person in relation to that function, or
ii
to other local authorities (within the meaning of that Part) with that function as to how they should exercise it in relation to that person.
10
The enforcer must, in exercising the function in relation to that person, act consistently with that advice or guidance.
11
In this section “associated undertaking”, in relation to a designated enforcer, means—
a
a parent undertaking or subsidiary undertaking of the enforcer, or
b
a subsidiary undertaking of a parent undertaking of the enforcer,
and for this purpose “parent undertaking” and “subsidiary undertaking” have the meanings given by section 1162 of the Companies Act 2006.
220 Further proceedings
1
This section applies if the court—
a
makes an enforcement order under section 217,
b
makes an interim enforcement order under section 218, F24...
F26d
makes an online interface order under section 218ZB or an interim online interface order under section 218ZC.
F91A
This section does not apply in the case of a failure to comply with an order or undertaking which consists only of a failure to provide information or documents required by the order or undertaking as described in section 217(10D).
2
3
An application to the court in respect of a failure to comply with an undertaking may include an application for F28an enforcement order, an interim enforcement order, an online interface order or an interim online interface order.
4
If the court finds that an undertaking is not being complied with it may make F29an enforcement order, an interim enforcement order, an online interface order or an interim online interface order (instead of making any other order it has power to make).
5
In the case of an application for an enforcement order or for an interim enforcement order as mentioned in subsection (3) sections 214 and 216 must be ignored and F11sections 215, 217 or 218 (as the case may be) and 219A, 219B and 219C apply subject to the following modifications—
a
section 215(1)(b) must be ignored;
b
section 215(5) must be ignored and the application must be made to the court which accepted the undertaking;
F12c
section 217(9), (10), (10B) and (11) must be ignored, and section 217(10C) and (10D) must be ignored to the extent that they relate to an undertaking under section 217(9);
d
section 218(10) must be ignored.
F13e
sections 219A, 219B and 219C must be ignored to the extent that they relate to an undertaking under section 217(9) or 219.
F305A
In the case of an application for an online interface order or an interim online interface order as mentioned in subsection (3), section 218ZA applies subject to the following modifications—
a
in section 218ZA(1), the words “or is likely to be” must be ignored;
b
in section 218ZA(2), the reference to the person the CMA thinks has engaged, is engaging or is likely to engage in conduct which constitutes the F47Schedule 13 infringement is to be read as a reference to the person the CMA thinks has engaged or is engaging in such conduct;
c
section 218ZA(3) must be ignored and the application must be made to the court which accepted the undertaking.
6
If an enforcer which is not the F6CMA makes an application in respect of the failure of a person to comply with an enforcement order, an interim enforcement order or an undertaking given under section 217 or 218 the enforcer must notify the F6CMA—
a
of the application;
b
of any order made by the court on the application.
F48221 Community infringements: proceedings
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222 Bodies corporate: accessories
1
This section applies if the person whose conduct constitutes a domestic infringement or a F49Schedule 13 infringement is a body corporate.
2
If the conduct takes place with the consent or connivance of a person (an accessory) who has a special relationship with the body corporate, the consent or connivance is also conduct which constitutes the infringement.
3
A person has a special relationship with a body corporate if he is—
a
a controller of the body corporate, or
b
a director, manager, secretary or other similar officer of the body corporate or a person purporting to act in such a capacity.
4
A person is a controller of a body corporate if—
a
the directors of the body corporate or of another body corporate which is its controller are accustomed to act in accordance with the person’s directions or instructions, or
b
either alone or with an associate or associates he is entitled to exercise or control the exercise of one third or more of the voting power at any general meeting of the body corporate or of another body corporate which is its controller.
5
F32An enforcement order, an interim enforcement order, an online interface order or an interim online interface order may be made against an accessory in respect of an infringement whether or not such an order is made against the body corporate.
6
The court may accept an undertaking under section 217(9) or 218(10) from an accessory in respect of an infringement whether or not it accepts such an undertaking from the body corporate.
7
An enforcer may accept an undertaking under section 219 from an accessory in respect of an infringement whether or not it accepts such an undertaking from the body corporate.
8
Subsection (9) applies if—
a
F33an enforcement order or an interim enforcement order is made as mentioned in subsection (5), or
b
an undertaking is accepted as mentioned in subsection (6) or (7).
9
In such a case for subsection (6) of section 217, subsection (3) of section 218 or subsection (4) of section 219 (as the case may be) there is substituted the following subsection—
0
A person complies with this subsection if he—
a
does not continue or repeat the conduct;
b
does not in the course of any business carried on by him engage in conduct such as that which constitutes the infringement committed by the body corporate mentioned in section 222(1);
c
does not consent to or connive in the carrying out of such conduct by another body corporate with which he has a special relationship (within the meaning of section 222(3)).
10
A person is an associate of an individual if—
a
he is the spouse F2or civil partner of the individual;
b
he is a relative of the individual;
c
he is a relative of the individual’s spouse F2or civil partner;
d
he is the spouse F2or civil partner of a relative of the individual;
f
he lives in the same household as the individual otherwise than merely because he or the individual is the other’s employer, tenant, lodger or boarder;
g
he is a relative of a person who is an associate of the individual by virtue of paragraph (f);
h
he has at some time in the past fallen within any of paragraphs (a) to (g).
11
A person is also an associate of—
a
an individual with whom he is in partnership;
b
an individual who is an associate of the individual mentioned in paragraph (a);
c
a body corporate if he is a controller of it or he is an associate of a person who is a controller of the body corporate.
12
A body corporate is an associate of another body corporate if—
a
the same person is a controller of both;
b
a person is a controller of one and persons who are his associates are controllers of the other;
c
a person is a controller of one and he and persons who are his associates are controllers of the other;
d
a group of two or more persons is a controller of each company and the groups consist of the same persons;
e
a group of two or more persons is a controller of each company and the groups may be regarded as consisting of the same persons by treating (in one or more cases) a member of either group as replaced by a person of whom he is an associate.
13
A relative is a brother, sister, uncle, aunt, nephew, niece, lineal ancestor or lineal descendant.
223 Bodies corporate: orders
1
This section applies if a court makes F34an enforcement order, an interim enforcement order, an online interface order or an interim online interface order against a body corporate and—
a
at the time the order is made the body corporate is a member of a group of interconnected bodies corporate,
b
at any time when the order is in force the body corporate becomes a member of a group of interconnected bodies corporate, or
c
at any time when the order is in force a group of interconnected bodies corporate of which the body corporate is a member is increased by the addition of one or more further members.
2
The court may direct that the order is binding upon all of the members of the group as if each of them were the body corporate against which the order is made.
3
A group of interconnected bodies corporate is a group consisting of two or more bodies corporate all of whom are interconnected with each other.
4
Any two bodies corporate are interconnected—
a
if one of them is a subsidiary of the other, or
b
if both of them are subsidiaries of the same body corporate.
F45
In this section “subsidiary” has the meaning given by section 1159 of the Companies Act 2006.
S. 218A crossheading inserted (2.6.2020) by The Consumer Protection (Enforcement) (Amendment etc.) Regulations 2020 (S.I. 2020/484), regs. 1(2), 2(6) (with reg. 8)