89/12    12 October 2012

The OFT has written to 62 of the top online retailers ahead of the busy Christmas period after a sweep of 156 websites found signs that many may not be fully complying with consumer protection law.

The sweep looked for potential breaches of the Distance Selling Regulations (DSRs) and other consumer protection laws and is part of the OFT's ongoing work to ensure that consumers can shop confidently online.

Key areas of concern that the OFT has raised with retailers include:

• 33 per cent of sites that provided information on cancellation appeared to impose unreasonable restrictions on customers' rights to a refund. Most common was requiring that the product must be in the original packaging or in the original condition, which can infringe on consumers' rights to reasonably inspect/ assess the product.
  
• 60 per cent provided a web contact form rather than an email contact address, as required by the E-Commerce Regulations. Two per cent provided no electronic contact details at all.
  
• While 60 per cent of sites indicated upfront that compulsory charges would be added to the first price shown, 24 per cent of these sites went on to add further unexpected charges at the check-out.

However, the sweep also found that the majority of sites were compliant with the DSRs in providing other required information to the consumer. For example, 99 per cent of sites provided details on when the goods would be delivered or the service would start and 95 per cent provided a full geographical address when payment was required in advance.

Traders that do not make amendments to comply with the law risk formal enforcement action from the OFT or Local Trading Standards Services.

To support compliance with the regulations the OFT has created a web-based guidance tool for businesses, the Distance Selling Hub, which includes tips to resolve the key issues identified in the sweep. Top tips include being clear and open about cancellation rights and providing a full refund plus a refund of delivery charges when things go wrong.

The OFT has also produced a short video to help consumers understand their rights when they are shopping online. The video, 'Buying online: know your consumer rights' is available on YouTube.
Cavendish Elithorn, Senior Director of the Goods and Consumer Group at OFT, said:

'The OFT recognises that most businesses want to play fair with their customers and to comply with the law. We encourage all online retailers to check their websites so customers can be confident their rights are being respected when they shop online. Businesses can find more information on our online Distance Selling Hub.'  

NOTES

1. The web sweep was conducted by BDRC Continental on behalf of the OFT and looked at the websites of a 156 online retailers. Four fifths (80 percent) of the items reviewed were described as goods, and one fifth (20 percent) were services. All reviews were conducted by project executives and telephone interviewers from BDRC Continental. See a copy of the report (pdf 430kb).
   
2. The OFT has not formally considered whether those subject to the sweep have breached the DSRs. Under the DSRs enforcers, such as the OFT, can apply for a court injunction to stop breaches of the DSRs.
   
3. Anyone concerned that a company is not complying with the law can report it to the Citizens Advice consumer service on 08454 040506.  As well as providing free, confidential and impartial advice to consumers, the service may also report a business to the appropriate trading standards service.
   
4. The Distance Selling Hub is available at www.oft.gov.uk/distanceselling and provides information for businesses about the rules and regulations that apply to the sale of certain goods and services over the Internet, telephone, through interactive TV, by text or by mail order.
   
5. In 2007 the OFT published the Internet Shopping Market Study which highlighted the lack of awareness of online shoppers' rights by businesses and consumers. In 2010 the OFT published its E - Protection Strategy which highlighted low levels of business compliance with relevant consumer protection law.