131/10    9 December 2010

The OFT today set out a long-term strategy to protect consumers shopping online in the UK.

The national e-consumer protection strategy says online shopping, worth around £50bn, is key to driving innovation and competition and has delivered huge benefits for consumers. However it warns that continuing online innovation must be met with strategic enforcement to tackle new and complex forms of unfair trading that harm both consumers and markets.

The OFT found that only around one in five firms are fully complying with consumer law for online shopping, with common breaches including unfair restrictions on cancellations of orders for products. Research undertaken by the OFT as part of its consultation on the strategy also found that despite UK consumers being the biggest online shoppers in Europe, one in four people worry more about online shopping than offline. Overall, one in seven consumers has experienced a problem when buying online, of whom 37 per cent have since been reluctant to buy online again.

The strategy sets out key priorities to help prevent misleading selling, deceptive online advertising and malicious practices. These measures include:

• Providing clarity on consumer law in relation to online shopping - the OFT is prioritising investigations that will either have a high deterrence or lead to significant behaviour change across online markets, or that will provide clarity on emerging issues. This includes work on novel marketing practices, cross-border enforcement with overseas consumer agencies, consumer-to-consumer transactions, liability, redress, and the legal status of digital products such as downloads. 
• More effective enforcement - the strategy sets out that the OFT, police and Trading Standards Services (TSS), must close gaps to improve sharing of intelligence and co-ordination and continue to build on successes in mounting investigations affecting large numbers of online consumers. 
•  Business compliance - The strategy outlines continuing work with businesses to raise awareness of consumers' online rights. This includes working with website designers to ensure compliance is built into new sites, and maintaining dialogue with industry.
• Empowering consumers - People need clear information about their rights when things go wrong. The strategy reinforces the need to ensure relevant consumer messages are consistent across organisations and avoid duplication, as well the importance of creating a national online reporting system.

Barney Wyld, OFT Senior Director, Strategy and Communications, said:

'The UK has a vibrant internet economy, with strong online participation and generally high levels of trust. However the way we shop online is constantly changing and organisations protecting consumers need to be highly responsive to emerging or complex online shopping problems. We hope this strategy will lead to greater understanding by all concerned of consumer rights online, to enable further innovation and growth, whilst ensuring fair competition.'

NOTES

1. The full strategy (pdf 658kb) was developed in consultation with major online brands, consumer and business groups and non-profit organisations. 
2. Recent announcements by the Secretary of State for Business, Innovation and Skills outlined suggested changes to the competition and consumer landscape. While the recommendations for e-consumer protection in this strategy will need to be revisited once the eventual shape of the consumer landscape is clear, this strategy will remain valid irrespective of who is responsible for consumer issues. 
3. The strategy recognises action by the OFT, Trading Standards and the Police against misleading sites, while the OFT has carried out integrated competition and consumer work on behavioural advertising, advertising practices and consumer contracts online to inform future action in emerging online issues.
4. Figures on levels of trust for online shopping are from Attitudes to Online Markets (OFT1253) (pdf 1.3Mb)
5. The strategy was developed in response to issues in The Consumer White Paper last year. The consultation was published in July 2010 and received 45 responses. 
6. For full details of the OFT's internet consumer protection team and completed cases, see the Internet enforcement page.