Council warns on-line buyers to beware!

Trading Standards Officers at The Highland Council are calling on consumers to be on their guard when buying on the internet after a survey highlighted that 40% of on-line business failed to fully comply with the Law.

A recent in-depth survey (Internet sales Report pdf)  has uncovered a variety of problems for consumers such as hidden costs and denial of cancellation rights.

Principal Trading Standards Officer Bob Jones explains: “We were receiving increasing numbers of complaints about problems with internet sales and we were also conscious that Highland consumers are particularly dependent on internet sales due to the remote geography of much of the Highlands.  We decided to take a systematic look at the internet market.”

The survey involved checking a total of a hundred websites, ten each of ten different product types, such as computer goods, toys, car parts and furniture.  With some sites that gave cause for concern, a “test purchase” was carried out to see how customers would be treated. 

The law requires delivery charges and other costs to be made clear to buyers. “Distance Selling” rules give consumers the right to cancel most internet purchases for up to seven days after delivery. Sellers must observe these rights and inform prospective purchasers.

The survey found that these laws are being widely flouted. Among the problems identified were:

• several of the test purchases involved hidden charges being added to the price;
• many websites did not inform consumers of their right to cancel; and
• a number of companies were found to be operating illegal returns policies and denying consumers the right to refunds.

Bob Jones continued: “The overall level of non-compliance was 40%.  This is very high, especially considering that we concentrated on the “legitimate” trade and avoided scammers and known problem traders.  Also, we felt that many of the businesses that were complying with the letter of the law were not following the spirit of the law by hiding away important consumer information such as cancellation rights in obscure parts of their sites.”

The survey has led to action being taken against businesses across the country by Highland Trading Standards and colleagues in other authorities.  This has resulted in formal warnings being issued and assurances and undertakings being given by the businesses that they will comply in future. 

Bob Jones said: “The companies we took action against have largely cleaned up their act and we welcome this. However, these are only a sample of the internet sellers out there and we have only really begun to scratch the surface of this issue.  Regulating internet sales continues to be a major priority for Highland Trading Standards.”

The detailed findings are being reported to the Office of Fair Trading in London which has recently been conducting a “market study” into internet sales.  Highland Trading Standards hope that consumers’ rights will be protected in future through a combination of raising awareness of their rights amongst consumers and firm action by Trading Standards against offending sellers. There may even be a case for strengthening the legislation.

Trading Standards advice to consumers is to be wary of misleading information and hidden charges when buying on-line. By law, consumers have seven days to cancel most internet purchases, regardless of any attempts by the seller to restrict this right.

Further advice and information on Distance Selling and other consumer rights is available from Trading Standards’ partner organisation Consumer Direct, on telephone 08454 040506 or website www.consumerdirect.gov.uk/ .  Information about businesses who may be flouting the rules can be reported to Consumer Direct, or directly to Highland Trading Standards on 01463 228700.

Notes to editors:

The Consumer Protection (Distance Selling) Regulations 2000 require internet sellers to provide detailed information to prospective buyers before they agree to buy on-line.  This includes informing of their right to cancel and the seller must honour this right if invoked by the consumer.  The vast majority of internet sales carry cancellation rights which last for seven days after delivery of the goods.

The Consumer Protection Act 1987 makes it an offence for a business to give a “misleading price indication” to consumers.  This includes situations where a “headline” price omits “hidden” charges, such as delivery or other compulsory charges.

Highland Council Trading Standards has a duty to enforce a range of consumer legislation, including that relating to Distance Selling and Misleading Prices.  Ultimate sanctions are to take cases to the civil or criminal courts, although most problems are dealt with by Trading Standards persuading companies to come into line with the legal requirements.

The Office of Fair Trading is the central government body responsible for promoting fair trading across the UK.  It has a variety of roles, one of which is monitoring patterns of trade through “market studies”.  These have a range of outcomes such as: proposals for extra consumer protection legislation; promotional campaigns to raise awareness of consumer protection issues; direct enforcement action against offenders.

“Test purchasing” is an important and recognised tool used by Trading Standards Officers as part of investigations.  It involves posing as a real customer and making purchases without declaring that the buyer is from Trading Standards.  The business assumes that they are dealing with a real customer and so the process gives an indication of how a real customer will be treated in terms of the goods supplied, prices charged, any relevant product information, and the terms and conditions of sale applied.

Further information and a copy of the Survey Report can be obtained from David MacKenzie at Highland Council Trading Standards on 01463 228716, or david.j.mackenzie@highland.gov.uk.

27 Jun 2007
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