Key takeaways: What recent consumer law reforms mean for service providers

On 6 April 2025, the first wave of consumer protection provisions under the Digital Markets, Competition and Consumers Act 2024 (“DMCC Act”) came into force, marking the most significant overhaul of UK consumer protection law in over a decade. For businesses offering services to consumers, the changes require you to carefully rethink how you present key information about your product/services, in particular price, to consumers along the entire customer journey.

For the most part, the DMCC Act restates the existing Consumer Protection from Unfair Trading Regulations 2008 (“CPUT”) framework within Part 4 of the DMCC Act. However, the Government has built on, replaced and made material changes to certain sections with the aim to simplify and strengthen protection for consumers, making certain practices automatically banned/unfair.

Here are some of the key takeaways for traders to think about:

1. Transparency of the total price of a product/service

Consumers must be given all key information in a clear, fair and accessible way so that they can make an informed transactional decision relating to an ‘invitation to purchase’. An invitation to purchase is any commercial practice that gives information to consumers which indicates the characteristics of the trader’s product/service and which enables a consumer to make a decision in relation to such product/service (such as to purchase the product).

Traders are required to comply with an extensive list of ‘material information’ that must be disclosed within an invitation to purchase, such as total price of the product, applicable cancellation rights and information about the trader. Guidance on the new unfair commercial practices regime under the DMCC Act gives examples such as a price for a product in a shop, on a menu in a restaurant and on a poster in a train carriage.

While these concepts are not new to traders who regularly deal with consumers, failure to provide all such material information clearly, in a timely manner and in a way that the consumer is likely to see it, is automatically considered unfair – whether or not failure to provide such information would have likely affected their decision making.

A key change relates to the ‘material information’ required to be provided in respect of the way the ‘total price of a product’ is presented, notably:

• All mandatory fees (e.g. booking, delivery, admin charges) must be included in the headline price. “Drip pricing” practices - where additional costs are revealed late in the transaction - are now prohibited.
• Any optional costs or charges that may apply must be displayed, such as posting charges.
• If any of the above charges cannot be reasonably calculated in advance, the fact that such charges may be payable and how such charges will be calculated must be set out, and with equal prominence as the part of the total price that is calculable in advance.

2. Fake reviews and misleading endorsements are banned

It is now automatically unfair and illegal to:

1. Post or commission fake reviews;
2. Conceal incentivised reviews (e.g., influencers not clearly disclosing they have been paid to review a product); and
3. Publish consumer reviews (and information derived from them) in a misleading way.

Traders/platforms publishing reviews now have an active obligation to take reasonable steps to detect and remove inauthentic reviews.

Traders who use influencers and other content creators to promote their services/products should carry out an audit of such persons’ endorsements to ensure compliance, as anyone who engages the commissioning of a banned review may also be considered in breach under the new regime.

3. New focus on vulnerable consumers

The definition of ‘vulnerable consumers’ under the DMCC Act has been broadened, now recognising contextual vulnerability—including bereavement, going through a divorce, illness, or financial hardship. Businesses offering services to consumers will need to carefully consider and identify which types of consumers may be vulnerable and evaluate whether their current commercial practices exploit any such identified vulnerabilities.

4. The CMA can now directly enforce consumer law against companies in non-regulated sectors (e.g., retailers and fast moving consumer goods brands)

The Competition and Markets Authority (the “CMA”) has new powers to:

1. Impose fines of up to 10% of a company’s global turnover for breach of consumer law. Once the CMA has carried out its own investigation and satisfied itself of a breach having occurred, it can unilaterally impose such a penalty without going to court (which was not possible under the CPUT).
2. Impose penalties of up to 1% of global turnover for failure to comply with information notices (and daily penalties of up to 5% of global daily turnover for continuing breaches).

5. Subscription contracts reform taking effect in Spring 2026

A new legal framework in respect of subscription contracts, which requires extensive changes to subscription-based terms and conditions, will come into force in Spring 2026. Key changes include:

1. Renewal reminders – traders are required to send consumers ‘reminder notices’ in advance of renewal.
2. Initial and renewal 14 day cooling off periods – an initial 14 day cooling off period will be introduced to apply when a consumer enters a paid subscription contract, including when transitioning from a free or discounted trial to a paid subscription. Additionally, a 14 day cooling off period will apply again upon the renewal of any annual subscription contract lasting 12 months or more.
3. Cooling off period notice – traders must remind consumers of their initial 14 day cooling off period when a trial they have subscribed to is about to expire and again of their 14 day renewal cooling off period when their contract is about to renew.
4. Simplified exit mechanisms – consumers must be able to cancel contracts easily, and once cancelled, traders must send a confirmatory ‘cancellation notice’.

Final Thoughts

The DMCC Act is a clear signal that the UK is moving towards a more proactive, enforcement-led consumer protection regime. For traders, this means not only updating terms and processes but also embedding fairness and transparency into their business model from the get-go.

Further information 

If you would like a compliance audit or you have any queries about the DMCC Act or any other consumer law protection issues more generally, please get in touch with Caroline Sheldon from our Corporate, Commercial & Finance team.

About the author 

Caroline joined the Corporate, Commercial & Finance team in August 2022 as an associate and specialises in advising on commercial matters. She advises entrepreneurs, startups and established businesses across a variety of sectors, with a focus on those in the technology sector.