The UK Competition and Markets Authority's ("CMA") has published an open letter to businesses in the weddings sector explaining how consumer protection law applies to the wedding contracts which these businesses have with consumers during the COVID-19 pandemic and securing a promise from the Bijou Weddings Group to offer affected customers fairer partial refunds.
| what you need to know - key takeaways |
- The CMA's recent actions as part of its investigation into the weddings sector align with its priority to protect consumers and should therefore be taken as a warning to businesses not to breach consumer protection law.
- This forms part of a wider consumer law enforcement drive by the CMA over the last two years, with the CMA increasingly cracking down on businesses who act in contravention of consumer protection law.
- Businesses should review their practices to ensure that they are complying with consumer protection law and address any issues with such compliance. See our Ashurst guide on UK consumer law here in association with ICLG.
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The huge impact of the COVID-19 pandemic on wedding services has seen the weddings sector become an area of focus for the CMA's COVID-19 Taskforce. Complaints were raised about businesses not respecting the cancellation rights of consumers through failing to provide refunds for the costs of organising weddings which could not take place because of the pandemic. This led to the CMA opening an investigation into the weddings and private events sector (among several other sectors) and issuing its views on consumer protection law in relation to cancellations and refunds during the crisis; namely that where consumers have paid money in advance for services that can no longer take place because of the pandemic, they should be entitled to a refund.
CMA's open letter to businesses
On 7 September 2020, the CMA published an open letter to businesses in the weddings sector explaining how consumer protection law applies to the wedding contracts that these businesses have with consumers during the pandemic. This letter encourages businesses to become compliant with consumer protection law, states particular issues and warns of action that may be taken against them if they do not comply with consumer law.
It highlights the following issues:
- refusing to offer or give fair refunds where weddings were/are not able to take place because of lockdown laws;
- where, as lockdowns restrictions are being eased, the Government is issuing guidance for wedding businesses which results in them self-determining how to manage their business in line with consumer protection law; and
- businesses relying on terms in wedding contracts which are unfair in order to deny consumers refunds.
Other action
In conjunction with the publication of its open letter, the CMA:
- stated its view on how the law operates in relation to contracts for wedding services affected by the pandemic and has obtained;
- secured a promise from the Bijou Weddings Group to offer affected customers fairer partial refunds that more accurately reflect the services received up until the date of cancellation and to clearly communicate to every affected customer who has not re-scheduled their wedding the refund process that has been agreed; and
- contacted a number of businesses in the weddings sector directly in relation to their obligations under consumer protection law.
Looking forward
The CMA appreciates that these are unprecedented times and that businesses are facing enormous challenges. Their actions against businesses in the weddings sector have thus far, therefore, been gentle. This forms part of a wider consumer law enforcement drive in the UK, with the CMA having prioritised protecting consumers in its 2020/2021 Annual Plan and the CMA having already launched and number of consumer law cases recently. For more on the UK consumer law regime, see our Ashurst guide in association with ICLG.
With thanks to Victoria Beswick of Ashurst for her contribution.
