Article reference: UK-IA-SGA32

Information requirements for on-premises contracts

About this series of articles

This article is one in a series about the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, often abbreviated to CC (ICAC). The series explains the law, and how to apply it to your business so that you remain compliant.

If your business already compliant with distance selling rules, the changes represent evolution rather than a revolution. However, there are some important changes.

This article explains the statutory requirements for information you must give to your customer for an on-premises transaction. We explained the requirements for off-premises and distance contracts in the previous article in this series.

What is an on-premises contract?

An on-premises contract is defined in the Regulations, rather inconveniently, as “a contract between a trader and a consumer which is neither a distance contract nor an off-premises contract”.

This of course, is not very clear. We cannot say how a particular local trading standards authority will interpret this (the Regulations will be policed by your local weights and measures team), but we suggest that on-premises means pretty much what it says - in your shop or your office or other regular place of business.

Compliance requirements

The Regulations require that you give certain information to consumers who buy goods, services or digital content from you at your business premises. There are exemptions from all of the Regulations as well as additional exemptions from the cancellation provisions.

One of the pillars of Regulations is the requirement for a trader to give a consumer specific information in a way that is clear, comprehensible and legible, before he enters into a contract with you. This information must be given on paper or, if the consumer agrees, on another durable medium.

The information that you are required to give

The following text is a précis of the items required for an on-premises contract. There are additional requirements for an off-premises contract.

The items are:

1

the main characteristics of the goods or services

2

the identity of the trader

The Regulations specify “such as the trader’s trading name”. We suggest this is an error. The Business Names Act 1985 requires that the trader should give his true name (company or partnership name), as well as any trade name if different.

3

the total price of the goods or services inclusive of taxes

If that cannot be calculated up front, you must disclose exactly how the price will be calculated.

4

all additional charges, including delivery

If they cannot be calculated in advance, then you must inform that they may be charged and tell how they will be calculated.

5

the arrangements for payment, delivery, performance, and the time by which the trader undertakes to deliver the goods or to perform the services.

6

where applicable, the trader’s complaint handling policy

There is no explanation of exactly what “applicable” means.

7

in the case of a sales contract, you must remind your customer reminder that the trader is under a legal duty to supply goods that are in conformity with the contract.

This has been basic law for many years, updated by the Sale of Goods Act 1979, but the difference now is that you must point out your obligation to your customer.

8

the existence and the conditions of after-sale customer assistance, after-sales services and commercial guarantees, as appropriate.

Most businesses would inform about these matters as a marketing initiative. We guess the difference now is that you must spell out carefully the terms of any paid service or guarantee. This provision is assumed to have been drawn to hit the hard sell of guarantees and insurance as an additional item, by phone or at the pay point.

9

where applicable, the functionality, including applicable technical protection measures, of digital content.

We suggest this means you have to provide your full technical specification in simple language. This seems to us to be an impossible task. The last part seems to mean that you must warn if your product might change or damage your customer’s data in any way.

 

More seriously, remember that this and other items in this list which refer to digital content apply not only to downloaded software and games but also to boxed or otherwise sealed products. So you will not be able to blame your supplier from the other side of the world if the instructions and explanation are not clear.

10

if you sell a digital product, any relevant compatibility of digital content with hardware and software that the trader is aware of or can reasonably be expected to have been aware of.

This item is qualified so you are not quite expected to be a technology expert. Nevertheless, this is an area which has previously ignored and will now be watched.

Compatibility has been a serious issue for many years. We think that the teams at weights and measures will come down hard on a trader who fails to explain both compatibility and non-compatibility.

Changing the information

If you need to change any of this information you must agree the change with your customer because that change represents a change to the contract terms. If you don’t, the consumer is not bound by the change. This was always the case, but it is now more important than ever because the contract may include information you have provided before the contract was made.

Enforcement

As far as we aware, each local authority is responsible for arranging the enforcement of the Regulations in its own way and for training its own staff. Policies on enforcement will differ widely and a local authority is under no obligation to specify its priorities.

So we don’t know how far the law will be enforced by your local weights and measures team, but we guess that the consequence of non-compliance will be more than simply having to return payment to a customer who complains.

Keep accurate records

The best way to avoid any claim, any reporting and any time or money penalty, is to keep accurate records of what information you gave out. So we recommend:

  • use a full set of information, even if that involves giving some that is not strictly relevant to a particular consumer;
  • remember that all information you have provided anywhere is deemed to be what amounts to a contract term. So beware of generalisations, exaggerated promises, and simply out of date information. Make sure your marketing team knows that too!
  • avoid changing the information – it will reduce the need to keep records!
  • so far as possible, give the information before the contract comes into being.

Further information

We recommend that you read about how to provide your customer with the required information next.

Unless you are exempt from the Regulations or are already compliant, you are likely to need to update your customer contract templates. These are likely to include your terms and conditions of sale on your website if you sell online and your offline customer contract if you sell offline.

If you have any questions about the Consumer Contract Regulations 2013, or would like help updating your contracts to comply, please ask us. We’d be delighted to help.

Please note that the information provided on this page:

  • Does not provide a complete or authoritative statement of the law;
  • Does not constitute legal advice by Net Lawman;
  • Does not create a contractual relationship;
  • Does not form part of any other advice, whether paid or free.
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