What is the issue?
Research has shown that as much as £23 billion of UK consumer spending is potentially influenced by online reviews annually.
The DMCC Act specifically addresses fake and misleading consumer reviews by inserting new provisions relating to them in the "blacklist" in Schedule 20 of the Act. The fact that the provisions are in the “blacklist” means the Competition and Markets Authority (“CMA”) does not have to show that the practice has affected the transactional decision-making of the average consumer when bringing enforcement action. This makes the new provisions an attractive enforcement option for cases under the new Act.
What is a fake consumer review?
A “fake consumer review” is one “that purports to be, but is not, based on a person’s genuine experience.
The scope of the new provisions is broad. They cover reviews of products, services and digital content and are wide enough to cover delivery or after-sales care. Reviews can take various forms including text, speech and graphic representations (e.g. a star rating appearing next to a product listed in a search result).
It isn't just reviews that are covered by the new provisions, but also information that is derived from or is influenced by them ("consumer review information"). In practice, this means information such as aggregated information in the form of overall ratings, review counts and rankings are in scope too.
What does the law prohibit?
- Submitting or commissioning fake reviews or a consumer review that conceals the fact it is has been incentivised
“Submitting” covers supplying a review with a view to publication and includes where the review is provided to a trader to publish or where the reviewer publishes it directly. Commissioning includes incentivising by any means, so it will include where money, discounts, free products or stays are offered in return for the review. Circumstances such as the reviewer having a financial interest in the trader or in the product being reviewed are also likely to be viewed as being an incentive under the Act.
- Publishing consumer reviews or consumer review information in a misleading way
This is likely to be interpreted broadly and, for example, will cover where negative reviews are removed or not published and where greater prominence is given to positive reviews.
- Offering services to do or facilitate any of the above
Even if you do not yourself submit, commission or publish fake or misleading consumer reviews, if a company or individual does this on your behalf, then you will still be caught by the new provisions.
- Taking reasonable and proportionate steps to prevent banned reviews
This places a positive obligation on a publisher to take reasonable and proportionate steps as are necessary to prevent and remove banned reviews and false and misleading consumer review information.
Publishers include traders who display or make available consumer reviews or consumer review information and various intermediaries who display or make available reviews of other traders or their products. This will include specialist review sites, online marketplaces and search services.
The requirements of this obligation will vary by business, according to factors set out in guidance issued by the CMA. These include having regard to the relevant business model and the potential impact of the trader's activity. Those which have higher risk practices will have to implement more extensive measures. Example measures include a trader carrying out regular and comprehensive assessments to evaluate the risk of consumers encountering banned review material on its website and to identify appropriate measures to address this.
More information on this obligation can be found here.
What happens if I don’t comply?
The DMCC Act introduces much wider-ranging enforcement powers for the CMA, which will be able to issue GDPR- style fines without going to court first, as well as ordering redress and compliance measures. More information is available here.
What should I do now?
Any business that publishes or allows consumer reviews on its site should take into account guidance from the CMA and consider whether its own practices require changes. In addition, undertakings the CMA has agreed regarding fake reviews under the current law will also provide useful insight into the CMA’s approach to the new DMCC Act provisions.
