Amendment 104

Digital Markets, Competition and Consumers Bill - Report (2nd Day) – in the House of Lords am 5:45 pm ar 13 Mawrth 2024.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Baroness Hayman:

Moved by Baroness Hayman

104: Clause 223, page 149, line 27, at end insert—“(5A) Section (Right to repair) confers the right to repair on consumers.”

Photo of Baroness Hayman Baroness Hayman Crossbench

My Lords, I rise to move Amendment 104 and speak to Amendment 118, tabled in my name. I declare my interests as chair of Peers for the Planet. I express my gratitude to my supporters, the noble Baronesses, Lady Harding of Winscombe, Lady Ritchie of Downpatrick and Lady Bakewell of Hardington Mandeville. I also thank the external organisations that have supported us with evidence and briefings.

With these amendments, we return to the issue raised in Committee of the suite of consumer rights known as the right to repair. As I explained then, the current lack of such a consumer right to repair means that many of us have experienced intense frustration at non-existent or overpriced spare parts for broken electrical and electronic equipment, which we are repeatedly told will be more expensive to repair than simply to replace. The least well-off households, on tight budgets, therefore get forced into a cycle of regularly replacing cheap equipment rather than being able to repair it and keep it in use for longer. As well as the economic impact on families and consumers, this wastes scarce resources, such as rare metals, while producing large amounts of waste for landfill. The UK now produces the second-highest per capita amount of electrical and electronic waste in the world.

My amendment would task the Government with producing a strategy to enhance the consumer’s right of repair for electrical and electronic products, and would put a stop to restrictive practices that undermine consumer efforts to repair and continue to use the products they own. As I said in Committee, there is widespread public support for action. That support was echoed around the Committee when we debated it and is evidenced in the extreme popularity of television’s “The Repair Shop”. I am grateful for the support of its presenter, Jay Blades, when he said that too often our efforts to repair things

“are blocked by manufacturers’ badly designed products or unaffordable spare parts. Extending a right to repair would help us rediscover the joy and skill of restoration, repair and redesign”.

I am extremely grateful to the Minister, the noble Lord, Lord Offord, and his team of officials, from both his department and others, for their extensive engagement on this topic since Committee, but I am afraid that I remain unconvinced that everything is well and that there is no need for an overarching strategy. I recognise that a number of limited initiatives are under way, but I am afraid the reality is that the work that is being undertaken falls short of the necessary scale, breadth and urgency if we are to improve the consumer’s experience.

In addition, there is no clear point of accountability for this work at the centre of government. Responsibilities are split between at least three departments. The Department for Business and Trade is engaged in relation to post-Brexit product safety standards. Defra ostensibly owns waste and resource management policies across the board, but all responsibility for the repair of electrical and electronic products now rests under the eco-design regulations, which sit at DESNZ. But DESNZ focuses on reducing domestic greenhouse gas emissions, rather than on the repairability of products such as computers, tablets and smartphones.

My decision to return to this issue, with some limited changes in response to criticisms made in Committee, has been influenced by two additional points. First, I discovered that under the Northern Ireland protocol, where the single market in fact includes eco-design, eco-labelling and battery legislation, consumers in Northern Ireland will be able to repair phones, smart- phones and tablets, and to see a repair index in the energy label from next year. They will also be able to replace all batteries in consumer products from 2027. These rules come from the EU, which, like many other jurisdictions, is pressing ahead with its own reforms. This leads me to believe that the complexities that the Minister has previously outlined are not insuperable and that the Government, if they can do it in Northern Ireland, could extend similar protections to consumers in England, Scotland and Wales.

The second point that makes me return to the subject is the letter published yesterday by Philip Dunne MP, the chair of the Environmental Audit Committee in the House of Commons. That letter criticised and bemoaned—that is probably fair—the progress that has been made in the three and a half years since the committee’s report on electric waste. The letter says that adequate progress is simply not being made. In November 2020, the EAC said that the Government should enshrine the right to repair in law. In February 2021, the Government responded that they

“would explore whether requirements to improve repairability … could be considered for a wider range of products”.

More than three years later, they are still exploring but are yet to discover a single additional product for which they might legislate for increased repairability. I fear that the necessary action will simply not happen unless someone in government takes a grip—I can think of no one better than the Minister we have with us today—and we can see a coherent strategy and plan and the accountability for its implementation.

I believe I have responded to most of the points the Minister made in Committee. He also suggested that adding the right to repair to consumer law would oblige retailers to pre-emptively seek information from manufacturers, adding to costs and reducing choice. My amendment would not do that. It would put the obligation on manufacturers to proactively provide the data—it would not put the duty on retailers; nor do I think the amendment could possibly fall foul of WTO rules when so many other WTO members are doing similar things.

I simply do not believe that the progress made already is sufficient or that there are insuperable barriers to doing what needs to be done. The argument that we can rely on progress that is glacial at best simply does not hold water. Everyone seems to think that this is a good idea. No one argues against having better-designed and easier-to-repair products. It is just that no one seems to be willing to grasp the nettle to do anything about it. This amendment would make sure that they did. I beg to move.

Photo of The Earl of Lindsay The Earl of Lindsay Ceidwadwyr

My Lords, I will speak to Amendments 109 and 115. Once again, I do so with the co-sponsorship of the noble Baronesses, Lady Crawley and Lady Bakewell.

I will address Amendment 109 first. Fake reviews can cause loss, detriment and harm to consumers and law-abiding businesses. The government amendment that adds fake reviews to the practices in the schedule is therefore welcome. However, that amendment makes the practice an “excluded description”, meaning that enforcement action can be taken only through the civil route.

All the other banned practices, except two relating to matters under the remit of the Advertising Standards Authority, allow enforcement officers to take action through either the civil or the criminal courts. That depends on what is most appropriate and proportionate in the circumstances. If it is deemed that 29 out of the current 31 practices should have the option of a criminal penalty, we strongly believe that fake reviews should also be in this category, as the practice is arguably more serious and causes greater detriment to consumers and reputable businesses than a number of the other practices in that list. Making fake reviews either a civil or a criminal breach would send a strong message to those looking to deceive consumers and would give enforcers the opportunity to take stronger action if and when necessary.

I turn to Amendment 115. Invitation to purchase is a complex area of the legislation, and the Bill differentiates between this and “misleading omissions”. A commercial practice is a misleading omission if it omits “material information”; in other words, information the average consumer needs to make an informed decision. It can be challenging to decide what is information that consumers want and what is information that consumers need. If a practice is an invitation to purchase, a number of matters are identified as being material information. Therefore, an omission of any of these breaches the legislation and allows enforcement action to be taken.

One of those matters is the trader’s name and address. Rogue traders often approach vulnerable consumers offering unnecessary and substandard work, but without giving a price before starting the work. As price is part of the definition of invitation to purchase, in such circumstances the practice is not an invitation to purchase and so the trader’s name and address are not specifically material information. This is to the detriment of the consumer. This information is unlikely to be considered material information under misleading omissions, and the Companies Act 2006 does not require the provision of a name and address if a trader has no trading name or is trading under his own name.

This clearly is to the harm of consumers, who are unable to pursue their statutory rights if they do not know with whom they are dealing or how to contact them. It should be noted that reputable traders will give the information identified as material information as a matter of course, so this amendment would not impact honest, law-abiding traders.

Photo of Baroness Bakewell of Hardington Mandeville Baroness Bakewell of Hardington Mandeville Liberal Democrat Lords Spokesperson (Environment, Food and Rural Affairs) 6:00, 13 Mawrth 2024

My Lords, I put my name to two sets of amendments in this group: Amendments 104 and 118 on the right to repair, and Amendments 109 and 115 on trading standards issues.

I will speak first to the right to repair. The noble Baroness, Lady Hayman, set out clearly the rationale behind these amendments, and I know that she has been working with the Minister and officials to try to get some traction on this issue. Part of my role in the House, for my party, is waste: how to minimise it, how to deal with it when it is created, and how to prevent it being created in the first place.

I was also brought up to repair what was broken and give items a new lease of life; the Screwfix catalogue is always lying around somewhere in our house. If you are going out for the evening and have a full skirt, which is no longer fashionable and can be unpicked, it is relatively easy to sew it back up into something more appealing, ready to wear out and wow your friends in the evening. This is not the case when a washing machine goes wrong and starts to flood the kitchen floor.

The amendment is very detailed and gives plenty of time for manufacturers to adapt their practices and start thinking again about abandoning their wasteful practices, which force the hard-pressed consumer to buy a replacement for an item that, with a little thought, could well have been repaired and lasted much longer, instead of joining the heap of white goods at the local household waste recycling centre and then landfill. The right to be able to repair an electrical or electronic item or household product should be universal.

The noble Earl, Lord Lindsay, set out the arguments for Amendments 109 and 115 extremely well. While I understand that the Government do not believe that fake reviews should be a criminal offence, it is difficult to understand why, if there are currently 31 schedule practices, of which 29 are both civil and criminal breaches of the CPRs, two, including fake reviews, should be subject to civil breaches only. Of the 29, it is up to the judgment of the officer whether they take civil or criminal action. Many of the “fake review” fraudulent claims and activities are deliberately targeted at children and the elderly—the most vulnerable in our society. Civil action does not give the protection they deserve or require.

I have received a contribution from the National Trading Standards eCrime Team; it is a case study. A consumer is looking to buy a dehumidifier, so googles “dehumidifiers”; Google or other search engines show top results at the top of the page, which are usually Google adverts. The advert shows a 5-star-rated product. The consumer clicks on that product link, which takes them to a website that spotlights reviews that look genuine about how amazing the product is. The consumer buys the product and the money is taken from their bank, but it is a totally fake site with fake reviews and the products do not actually exist. There are 600 cases of consumers being tricked by fake reviews on this site and product alone; there is a detriment here of £90,000. There are multiple examples of this with lots of different products. Consumers are being drawn to sites using fake reviews and handing over their money, and the products do not arrive as they do not exist. I am sympathetic to the Minister’s wish not to increase the number of activities that come under the “criminal activity” banner but remain convinced that action is needed on this issue.

On invitation to purchase and the subject of price, I am grateful for the Minister’s clarification but remain concerned that a rogue trader will make a particularly good case that the price being quoted is the total cost to the consumer, only later to add in other costs and taxes. This is not something we are used to in this country. In America I can decide to buy something for $25, having looked at the price label, but when I get to the checkout I find I am charged $27.50, as both local and national tax have been added. All Americans are used to this; it is only the uninformed tourist who gets caught out, but usually only once.

I remain convinced that those targeted by rogue traders are those who may not be aware that VAT or material costs are not always included in the initial price quoted. Will the Minister see whether there is some way in which our request on this issue can be accommodated?

Photo of Baroness Crawley Baroness Crawley Llafur

My Lords, as the third of the consumer protection enforcement team mentioned by the noble Lords, Lord Clement-Jones and Lord Stevenson, I have added my name to Amendments 109 and 115.

Amendment 109 concerns the issue of fake reviews; this has already been well set out by the noble Earl, Lord Lindsay, and the noble Baroness, Lady Bakewell. It is worth looking again at Hansard and the example from the noble Baroness, Lady Bakewell, of the live evidence we have received from the National Trading Standards eCrime Team as to the sites where people are handing over their money as we speak, thinking they have read a legitimate review and bought an amazing product, but the product does not exist.

I recognise the move that the Government have made in adding fake reviews to the list of 31 commercial practices that are, in all circumstances, considered unfair and banned practices. However, trading standards sees the practice of giving fake reviews as clearly fraudulent in nature, and therefore it should be a criminal as well as a civil offence, if the circumstances are correct for that judgment to be made. At the moment, we are confined to looking at fake reviews as a civil offence.

Fake reviews are also a growing distortion of the online marketplace. They are unfair to legitimate businesses and completely deceptive of consumers. This amendment is important in making fake reviews a criminal as well as a civil offence. I hope that the Minister understands the seriousness of this—I am sure he does—and will think again about his stance on this amendment.

Photo of Lord Moynihan Lord Moynihan Ceidwadwyr

My Lords, I rise to speak to Amendment 150, which builds on the work undertaken in this House at the time of the Consumer Rights Act 2015. I am fully supported by the indefatigable Sharon Hodgson, the MP for Washington and Sunderland West in another place, who is the co-chair of the APPG on Ticket Abuse; I am the other co-chair. Many leading musicians, sportsmen and sportswomen also support further action, as does FanFair Alliance.

Amendment 156 seeks to protect the many people who buy tickets for popular sport and arts events from the fraudulent abuse provided by a poorly regulated secondary market, a term coined by touts in 2008 to provide their activities with a veneer of respectability. What we are dealing with is a black market that profits from ticket obtained in bulk, illegally. Promoters whose terms and conditions are ignored have, in effect, lost the ability to sell tickets to the public at face value. To see hundreds of thousands of attempts by bots to harvest tickets in bulk for a single event is not uncommon. These amendments simply seek to implement recommendations made by the Competition and Markets Authority and to provide important safeguards for consumers. As evidenced by the security team at the O2, there are daily stories of families travelling to London to go to sold-out events finding on arrival that the tickets they had bought in good faith were fraudulently sold and unsuitable for admission. They have no recourse available to them at the time of the event. They have lost all the costs they incurred for travel and a hotel, to which must be added the bitter disappointment of missing what might be the event of a lifetime for them and their children, and all the incidental costs of the process.

In 2007, when I joined the campaign against modern-day ticket touts, there were approximately 120 full-time ticket touts in the United Kingdom. By 2015, the number had risen to 400, who regularly attacked primary ticketing systems using aggressive software to harvest tickets in bulk—400 too many when we were working on the Bill which resulted in the Government accepting many of our amendments. Today, there are not 400, there are between 3,000 and 4,000 touts, not based only in the UK but attacking ticket systems for UK events. This explosion has been brought about by the advent of mobile and digital ticketing. Whereas touts previously had to wait for paper tickets to arrive by post, they can now harvest tickets and send them out in an instant from mobile devices and apps.

Put simply, this aggressive software takes the form of scalper bots, computer programs which can store the details of hundreds of credit cards, which, at the press of a button, sweep the market for tickets for popular events while the likes of us and, more importantly, many families across the country are filling in all their details online, often waiting a long time for their applications to be processed, only to find that all the tickets have been sold. Within minutes after filling in the forms, the tickets they were seeking appear on secondary ticketing sites, at vastly inflated prices, benefiting only the touts and the secondary platforms. Most ordinary fans do not stand a chance against this. This is particularly true, sadly, at the Royal Albert Hall, where the market provides evidence that board members and trustees can benefit from the corrosive practices of the secondary market, which I address in Amendment 151.

The truth is that tickets are being harvested by today’s ticket touts in bulk. To do so, they have perfected their trade to the point that they have become “trusted suppliers” for the likes of viagogo and StubHub and guarantee the delivery of a large number of tickets before they have gone on sale to the public. If, for whatever reason, they fail to deliver their tickets, many resort to printing fraudulent tickets and delivering them to the secondary market to retain their trusted supplier status in the future, to the detriment of consumers who turn up to the concert or sport event to find that they are turned away.

My noble friend the Minister kindly wrote to Members of the Committee and was correct when he said that ticketing is more secure. However, the same technology also enables touts to carry out larger attacks on ticketing systems than ever before due to the increased portability of digital tickets. Frankly, the ticketing industry is on the cusp of losing the ability to sell tickets to genuine fans at an affordable price, thus depriving the lowest-paid, hardest-working fans of the ability to see their favourite artist or sports team.

In writing to the Members of the Committee, my noble friend the Minister mentioned the trial resulting in the conviction of two touts and the subsequent £6 million forfeiture order. They used dishonest and fraudulent tactics which would have been found out far sooner if the amendments before the House this evening were on the statute book. National Trading Standards, whose budget has been frozen for many years, has stated that it simply does not have the budget to pursue any more cases of this kind. The number of touts now attacking ticketing systems makes it an impossible task for law enforcement to prosecute some, let alone all, of them to the point where it would disrupt their activities and protect consumers.

Recently, viagogo has taken to concealing the face value of tickets behind an icon. This is a loophole in consumer protection that needs to be closed. Consumers should be able to see clearly the original price of the ticket they are about to purchase, as well as the ticket tout’s details, in order to check that the business they are buying from even exists. That would have helped both the cases that are currently under consideration by the courts.

Speculative ticketing—the practice of listing for resale tickets that a person does not possess or have title to—is widespread. The only solution is very simple: it is Amendment 150, which would ensure that the responsibility lies with resale websites to have resellers provide proof of purchase of tickets before they are allowed to list them. It is not too difficult. It happens in virtually every market. As the resale platforms control the flow of money from the transactions on their websites and make guarantees to consumers about the validity of the tickets, it seems appropriate that they should also take responsibility for ensuring that tickets listed do in fact exist, something that they currently do not do. Every auction house, every online sale and every market requires such information—why not the ticket touts?

To give some idea of the scale of the problem, which the Minister questioned in his letter to the Committee, one top-flight Premier League football club has cancelled 34,000 tickets acquired by touts using bots this season, so the law criminalising this activity is clearly not working. Technology has overtaken the sanctions on the statute book. These amendments would go a long way to help all sports and arts organisations stop the manipulation of the market which is ruining the experience for true fans and would help the CMA in a way that it has specifically requested this House to consider.

The changes I am asking the House to accept are simple yet vital consumer protection measures. I am not seeking to ban the secondary market, as the Irish Government have done in the face of these market abuses; nor am I seeking to criminalise the secondary market, as my noble friends on this side of the House did when it came to the Olympic and Paralympic Games in 2012. I am simply asking the Government to ensure that there are methods in the legislation to stop touts exploiting consumers with hidden icons on their tickets, to provide proof of legitimate purchase and to stop touts selling thousands of tickets that that they do not have at the time of offering them for sale. Hiding critical details behind icons is disingenuous, at least, and dishonest, at worst. There is adequate room on tickets for this information, as evidenced by many theatre tickets across London.

Photo of Baroness Bennett of Manor Castle Baroness Bennett of Manor Castle Green 6:15, 13 Mawrth 2024

My Lords, I rise very briefly. I spoke on these important subjects in Committee, and I am not going to repeat everything I said. I want to speak specifically on Amendment 104 on the right to repair, which the noble Baroness, Lady Hayman, so powerfully introduced, just to make a couple of additional points. She said that we are per capita the second-highest producer of e-waste in the world. It is interesting that we were talking about the security implications of this Bill in an earlier group on media ownership. With the incredible amount of e-waste in the world—53 million tonnes in 2022—and the need for rare earth minerals and the other minerals that go into these replacement products, it is worth saying there is a security implication to this that people may well not have thought of.

The noble Baroness, Lady Hayman, said that the Minister said that things were heading in the right direction. It is worth noting that there are a couple of areas where it very clearly is not. Increasingly, producers of devices, particularly phones, are hard-coding error messages into their product, so that if a third party tries to repair it, there is an error message and the device will not work any more. That has very clearly got worse, not better. There is also an increased amount of parts pairing, in which individual parts are tied to the device they are shipped with using a unique serial number, so you cannot get a replacement part put in. Again, the device will stop working. I think that was a really important point to make.

I have two points to make about how much further other parts of the world have gone. First, it was EU regulations that forced the latest iPhone to include a USB-C charging point rather than a proprietary one. That has both saved resources and saved people money, because the cost is about 1/10th of the proprietary charger, so this is also a cost of living issue. Secondly, I note that Germany and Austria have subsidies for repairs to allow low-income people to get electronic devices repaired when they would not be able to afford to do so otherwise. Please let us get some progress here.

Photo of Lord Clement-Jones Lord Clement-Jones Liberal Democrat Lords Spokesperson (Science, Innovation and Technology)

My Lords, my noble friend Lady Bakewell has clearly set out our support for Amendment 104 by the noble Baroness, Lady Hayman, and Amendments 109 and 115 by the noble Earl, Lord Lindsay, so I will not repeat what she has said. I shall speak to Amendments 107A and 107B relating to fake reviews, Amendments 105, 106, 110 and 111 regarding electrical safety and Amendment 108 on package travel.

The issue of electronic safety is a relatively new entrant in our discussions on the Bill, for which I apologise, but charities such as Electrical Safety First and Which? as well as the Government’s own Office for Product Safety and Standards have repeatedly found unsafe goods listed on online marketplaces. For instance, one investigation undertaken by Electrical Safety First found that 93% of products bought from online marketplaces were unsafe.

The Government have made a series of commitments on both online safety and product safety, included committing to ensuring that only safe products could be placed on the market now and in future, ensuring that the product safety framework was fit for purpose and making the UK the safest place in the world to be online. In my view, failing to address the sale of unsafe goods within the Bill means that they will fail to achieve their objectives in protecting consumers and promoting competition, and in addition will continue to fail in achieving their objective of ensuring that the UK is the safest place in the world to be online and that only safe products are placed on the market. By not including the sale of unsafe products within the scope of the Bill, it seems that the Government are allowing the UK to become what has been described as a Wild West for unsafe products.

There is a clear interrelationship between scams and unsafe products. For instance, Electrical Safety First found unsafe devices claiming to save consumers energy being sold on the online marketplace eBay. Not only were these devices ineffective at saving consumers energy, but they were also unsafe, placing consumers and their homes at the risk of electrical shock and fire. By not including unsafe products in the Bill, the Government therefore continue to place consumers at risk on a daily basis.

Consumers shopping on online marketplaces in other jurisdictions are better protected than UK consumers —in the EU, Australia and the USA, to name but three. The UK is clearly not moving at the same pace as comparable countries when it comes to regulating online marketplaces. The Bill is an opportunity to address that, but in its current form it is a missed opportunity to protect consumers.

I turn to Amendments 107A and 107B. In September 2023, as we know, the Government consulted on adding fake reviews to the unfair commercial practices list via Schedule 19 to the digital markets Bill, and now we have the government amendments to the Bill to reflect that. They are welcome so far as they go, but it is perplexing—informed organisations such as Trustpilot are perplexed—as to why the Government are not placing a stronger duty on social media firms and ISPs that host the sale of fake reviews. The wording does not expressly bring social media and internet service provider sites within scope where these are used by review sellers and brokers to offer their services. That seems extremely unsatisfactory, given that the Bill is so far through its scrutiny, and it is only on Report here in the Lords that we are seeing the wording that the Government intend to use to ensure that fake reviews are included in Schedule 19 on commercial practices.

Amendment 107A seeks to ensure that there is no loophole in the application of new paragraph 12A(4) inserted by Amendment 107. The inclusion of the words “for the facilitating of” in paragraph 12A(4)(b) could be read narrowly to suggest that the purpose of the service is relevant. In our view, providers of certain services such as social media sites that host the sale of fake reviews could potentially use that as a technicality through which to avoid liability by claiming that the purpose of the service they offer is not for doing anything covered by sub-paragraphs (1) and (2), and therefore this provision is not applicable in the event of abuse.

Is the Minister of the view that the facilitation of the sale of fake reviews by social media and internet service providers will be in the scope of this legislation under paragraph 12A(4), given the integral role that such services can play in enabling fake reviews to find customers? If not, why is such a gap being left in the legislation? Apparently, the Government are citing the legal scope constraints that act to limit their ability to tackle activity that happens upstream. I do not know what discussions have taken place between Trustpilot and the Government, but that sounds rather extraordinary.

I turn to Amendment 108. Since our discussions in Committee, it seems that Ryanair has started to work with some online travel agents. That definitely sounds like a win for our debates if we can take it as such, but other low-cost airlines are still resisting booking through agents, causing various harms to consumer protection, as we have discussed. The Minister’s statement about the package travel restrictions call for evidence is welcome, but the matter under discussion has always been a wider point regarding the use of third-party agents. Hence I have come back with one of the amendments that I tabled in Committee.

The Minister made one or two points in Committee that are worth picking up. He said that

“the contract is between the trader and the consumer, and therefore the consumer benefits from the relevant consumer rights”.

He also said that whether the transactional decision

“is carried out by the consumer themselves or a third party is not relevant. The consumer that the contract is with will receive the relevant consumer rights”.

Yes, the consumer is entitled to protection, but where an agent is involved this requires either the trader to pay the agent or the agent to stump up the refund themselves. That position also does not reflect the regrettable truth that consumers are being discriminated against because they choose to book through third parties.

The Minister brought up the question of the consumer-to-trader relationship and whether or not traders would

“become consumers in the eyes of the law”.

However, the issue is not that the agent becomes the consumer but that consumers who book directly through a third party are equally protected.

The Minister said that

“the Government have ensured that the CMA has significant powers to investigate and act if it finds that businesses are behaving anti- competitively in a market”.

It is not the CMA’s market powers that are in dispute; the problem is that the CMA is not acting to use those powers to investigate key consumer markets, despite clear evidence that competition is not working well.

The Minister also said:

“The operation of airlines and travel agents is governed by PTRs and ATOL. Those are being reviewed. That is the appropriate way to consider these issues”.—[Official Report, 31/1/24; cols. GC 394-95.]

Although important, neither of those addresses the misuse of market power and the damage that this is causing to consumer protection and to the viability of the market. Neither the PTR or ATOL regimes protect consumer choice or promote competition. The loss of that is the real threat, which can be addressed only through a CMA market review.

Finally, as regards ticketing, I very strongly support the amendment in the name of the noble Lord, Lord Moynihan. I salute him and Sharon Hodgson MP for their work through the all-party ticketing group throughout the years. In Committee, the noble Lord, Lord Offord, said that the Government do not wish to prevent consumers having choice in respect to secondary ticketing, but surely it should be an informed choice, in the way that the noble Lord outlined in his amendment. The Minister talked about the fact that the Government have legislated to give consumers fuller information on tickets that they are buying on the secondary market, but that is still not full information.

The noble Lord, Lord Moynihan, pointed out that these were recommendations from the CMA itself. It is quite clear that the Government have not listened to the CMA. It must be pretty unprecedented for a Government to turn down strong recommendations from a regulator, let alone from Professor Waterson, who could not have been clearer in his 225-page report.

The Minister finished in Committee by saying that he did not believe

“that the evidence to date justifies new and” what he called

“onerous secondary ticketing measures”.—[Official Report, 7/2/24; col. GC 540.]

The amendments from the noble Lord, Lord Moynihan, are not unduly onerous. They seem eminently reasonable and should be incorporated in the Bill.

Photo of Lord Leong Lord Leong Shadow Spokesperson (Business and Trade), Opposition Whip (Lords) 6:30, 13 Mawrth 2024

My Lords, I thank all noble Lords who have spoken in this debate. Once again, I have been extremely impressed by the range of expertise and the depth of insight. Conscious of the time we have all been here, I will address some of the key amendments as briefly as I can.

Amendments 104 and 118, in the names of the noble Baronesses, Lady Hayman, Lady Bakewell, Lady Ritchie and Lady Harding, would require the Secretary of State to publish a strategy conferring the right to access repair. They would also ban practices which prevent repair or prematurely terminate software support. The right to repair is an essential part of the circular economy. Many businesses understand that this is an opportunity for innovation, creating new jobs, saving money, reducing waste and saving scarce resources.

We are sympathetic to the noble Baroness’s amendment. The noble Baroness, Lady Hayman, has made strong arguments for her amendment, and she has a lot of support around this House for action to be taken on this issue. We are, in principle, supportive of the right to repair and its contribution to the circular economy, although we recognise that the impact on the sector will be significant. We would, therefore, encourage the Minister, if he cannot accept this amendment today, to make a firm commitment at the Dispatch Box that the Government will work with the noble Baroness, across departments, to ensure that real progress will be made on this issue in the near future.

We support Amendments 105 and 106 from the noble Lord, Lord Clement-Jones. These would make selling goods online, when they do not meet specified safety requirements, constitute an unfair commercial practice. Additionally, we are broadly sympathetic to Amendment 108 in the name of the noble Lord, Lord Clement-Jones, which lists five new unfair commercial practices. However, we would welcome proposals for further discussion.

Moving on to fake reviews, Amendment 109, in the names of the noble Earl, Lord Lindsay, and the noble Baroness, Lady Crawley, would insert provisions around fake reviews of products into Schedule 19. We welcome government Amendment 107, which adds various activities relating to fake reviews directed at consumers to the list of unfair practices in Schedule 19 to the Bill.

However, we would encourage the Government to adopt Amendments 107A and 107B from the noble Lord, Lord Clement-Jones. These propose small improvements to address the role played by internet service providers and social media in promoting fake reviews. If the Minister does not accept these amendments, can he explain why ISPs and social media are not specifically covered within the government amendments?

We must not forget the real-life consequences of the issues at stake among all the technical details. We all remember the awful tragedy of the Grenfell Tower fire in June 2017, which killed 72 people and injured 70 more. The source of this blaze was recently identified as a faulty fridge-freezer. Even one more preventable death from recalled products, where there are known risks to consumers, would be one too many. We urgently need to act to do whatever we can to prevent further tragedy.

The following amendments address this issue directly. Amendment 110, again in the name of the remarkably industrious noble Lord, Lord Clement-Jones, would make it a misleading action to sell goods online without taking reasonable steps to ensure that they have not been subject to a product recall. Amendment 111 would require the Secretary of State to make regulations to define the “reasonable steps” set out in Amendment 110. Amendment 120, in the noble Lord’s name, defines the terms “online marketplace” and “safety requirements”, which we support.

The Government set up the Working Group on Product Recalls and Safety to bring together experts from fire services, trading standards, consumer groups and industry. They were tasked with identifying the causes of fire from white goods—everyday items such as dishwashers, washing machines, tumble dryers and fridge-freezers—and the actions needed to reduce them. Experts suspect that selling recalled and faulty goods via online stores and social media platforms is common practice. I ask the Minister: when did this working group last meet? Are there are plans for consultations to explore this dangerous behaviour?

Moving on to drip pricing, we thank the Government for listening to our concerns in this area and bringing forward Amendments 112, 113 and 114. We ask the Government specifically to keep the definition of mandatory fees under review.

Amendment 115, in the name of the noble Earl, Lord Lindsay, is a sensible one, proposing that price should be removed from any invitation to purchase so that it is not an inducement to buy.

The following government amendments are technical, clarificatory and consequential and we are broadly in agreement: Amendments 116, 117, 119, 121, and 141 to 149.

In Committee, I spoke about the UK’s secondary ticketing market. It is estimated to be worth £1 billion annually. The industry model is to purchase tickets for sporting and cultural events in bulk, and then resell them at inflated prices, as referred to by the noble Lord, Lord Moynihan. Such practices exclude people who cannot afford artificially high prices and exploit the people who can. Several renowned artists, through their management firms, are implementing measures to ensure that genuine fans secure tickets initially, and to identify and nullify tickets resold for profit.

I am pleased to speak to Amendment 150 in the name of the noble Lord, Lord Moynihan, supported by the noble Lord, Lord Clement-Jones, and my noble friend—and good friend—Lady Jones of Whitchurch. Not only would it prevent bulk-buying of tickets, it would end the fraudulent practice of speculative selling. This is where touts list and sell seats they do not have, bank the proceeds and then hope to secure a ticket later to fulfil an order. This is despicable. I respectfully remind the Minister that these practices most certainly are not good examples of competitive markets, nor do they give consumers genuine choice and flexibility.

Online ticket touts create nothing except misery for fans. They exploit the market and distort it, purely for their own profit. The voices of the creatives, the ones both we and their fans want to support, are calling for the Government to act. We on this side will support the noble Lord, Lord Moynihan, if he seeks to test the opinion of the House on Amendment 150. Of course, we will consider and vote for it in its place on the list.

Finally, we support Amendment 151, which addresses a very specific situation. When a trustee of a charity receives tickets in respect of their role, they must not resell them on a secondary ticketing site for more than face value plus a handling charge.

I hope the Minister has been persuaded by my whistle-stop summary, and as I catch my breath, I will listen with interest to his response.

Photo of Lord Offord of Garvel Lord Offord of Garvel Parliamentary Under Secretary of State (Department for Business and Trade)

As ever, I start by thanking noble Lords for their amendments and all who spoke for their important and considered contributions. On Amendment 104 on right to repair, tabled by the noble Baroness, Lady Hayman, it has been a great pleasure to discuss this with her during this process and, indeed, since Committee. I also thank the noble Lord, Lord Leong, and the noble Baronesses, Lady Bakewell and Lady Bennett, for their impassioned contributions on this issue.

Noble Lords may recall from Committee that there is much excellent work under way in this area across government, involving in my department, Defra, the Department for Energy Security and Net Zero and the Department for Science, Innovation and Technology. Waste prevention and eco-design are two key strands of this work. As well as this cross-government work, Defra, which published Maximising Resources, Minimising Waste last year, is currently setting up the necessary programme management and governance functions around that work, and will work closely with other government departments, including those with a consumer perspective, to achieve these goals. I appreciate the point that there is a lot to co-ordinate here, and I hope that this governance will reassure noble Lords that the problem is being gripped. The Government will also set out in a future publication how each scheme interacts and adds up into a coherent whole.

I appreciate the point that the noble Baroness made about Northern Ireland, and we will of course consider carefully the implications of new EU regulations in Northern Ireland. Naturally, we will adopt an approach that best suits the UK circumstances when designing our own regulations; we are always open to allowing for more or less any objective that would even improve on the EU’s regime.

While I am sympathetic to the intent of these amendments, the Government’s view is that there is already a strategic framework in place for supporting right to repair. I greatly appreciate all the work that the noble Baroness, Lady Hayman, is doing in this space. Of course, her continued input would be greatly welcomed as this work progresses. I have said to her before that we are violently agreeing on the need for this to happen, and I am very happy to work with her to move forward.

I turn to Amendment 108, tabled by the noble Lord, Lord Clement-Jones, relating to third-party agents. I would like once again to reassure him that the protections sought in these amendments are mostly provided for elsewhere in consumer law. Clauses 225 and 227 prohibit traders using misleading actions or aggressive practices, including influencing a consumer’s decision on whether to use a third party. A particular dispute between an airline and an online travel agent has often been raised, including in Committee, when discussing this issue.

The CMA has significant powers to investigate and act if it finds that businesses are behaving anti-competitively in a particular market. It is right that those matters be determined by the CMA as it sees fit, which means that I cannot comment on its work—but I can assure the noble Lord that it is alive to this issue. More broadly, we have recently consulted on the package travel regulations that govern many of these sectors, and I look forward to sharing the response to the call for evidence.

I turn to the issue of invitation to purchase, and thank my noble friend Lord Lindsay for his Amendment 115, as well as the noble Baroness, Lady Bakewell, for her contribution on this issue. The amendment would remove the requirement that a price is provided before an action is considered an invitation to purchase. Actions that are considered an invitation to purchase attract specific consumer rights. The Government believe that the changes proposed by this amendment would expand the definition too far, rendering the invitation to purchase provisions unworkable in practice. The Government are confident that sufficient legal protection is already in place for circumstances in which vulnerable customers engage rogue traders to undertake services on their behalf. In the Consumer Rights Act 2015 there are pre-contract information obligations on traders to provide identity and contact details. Nevertheless, I draw your Lordships’ attention to my commitment for officials to continue to work with noble Lords to identify practical measures to support trading standards officers.

The noble Baroness, Lady Bakewell, raised an important point about VAT. I can provide an assurance that pricing information must already include any relevant taxes, including VAT, and VAT and pricing information is also subject to the Price Marking Order that the Government consulted on last year. We will introduce secondary legislation to improve transparency, including on all taxes.

I turn to government Amendments 107 and 119 on the topic of fake reviews, and shall also respond to Amendments 107B and 109 tabled by the noble Lord, Lord Clement-Jones, and my noble friend Lord Lindsay. I am grateful to them for their amendments, and to the noble Baroness, Lady Crawley, and the noble Lord, Lord Leong, for their input on this important matter.

Government Amendment 107 adds commercial practices related to fake reviews to the list of banned practices in Schedule 19. These prohibit the submitting and commissioning of fake reviews and require traders that publish consumer reviews to take reasonable steps to prevent the publication of fake reviews. On Amendment 107A tabled by the noble Lord, Lord Clement-Jones, having engaged with platforms such as Trustpilot, we understand concerns about platforms allowing fake review bartering to happen on their sites. When intermediary platforms are aware of fake review banned practices being offered on their sites and do not take action, they may already be liable for a breach of the professional diligence unfair commercial practice in the Consumer Protection from Unfair Trading Regulations, which are being restated in this Bill. The Government have held a round-table meeting with online platforms to make sure that these responsibilities are understood, and we will continue to do so.

As regards Amendment 107B, the Government’s amendment provides a non-exhaustive list of what publishing reviews in a misleading way may involve. This list will be expanded on in guidance produced by the CMA, including how businesses that may want to highlight their most positive consumer reviews can do so in ways that do not mislead consumers.

The noble Baroness, Lady Crawley, raised the important issue of criminal liability. Government Amendment 119 excludes the new banned practices from criminal liability, as misrepresenting reviews and publishing fake reviews are already covered through the prohibitions on misleading actions and omissions in the Consumer Protection from Unfair Trading Regulations. These are being restated in this Bill and carry criminal liability. Further criminal sanctions may be available under the Fraud Act and other legislation when the relevant requirements are met. It is not the Government’s intention to proliferate new criminal sanctions. I hope that the reassurance that existing criminal sanctions are already available helps the noble Lord to understand our approach.

The noble Baroness, Lady Bakewell, raised the issue of websites selling products that do not arrive or even exist. This is a case of fraud or misleading trading under consumer law, and of course the Fraud Act already deals with it. Further measures on fake reviews are therefore not necessary. These government amendments build on extensive consultation and the clear view expressed in Committee.

Government Amendments 112 to 114 add provisions to address drip pricing. These amendments will require traders to present consumers with the total price of a product, including all unavoidable fees, taxes and charges that must be paid by all consumers, rather than drip-feeding such charges through the purchasing process. They also clarify that when unavoidable fees cannot be reasonably calculated in advance, such as delivery fees, traders must set out the existence of such fees and how they are calculated with the total price. These amendments build on much-appreciated and widespread input from this House, and I hope they will be supported.

I turn now to product safety in online marketplaces and Amendments 105, 106, 110, 111 and 120 from the noble Lord, Lord Clement-Jones. Existing UK product safety law is clear: all products must be safe, including those sold online. However, we recognise the challenge that the growth of e-commerce poses to product safety. The Government recently consulted on proposals as part of the product safety review. We are analysing consultation responses and considering feedback from extensive engagement with organisations and stakeholders. These will inform policy development ahead of the government response later this year. I will confirm in writing to the noble Lord, Lord Leong, when the working group on product safety last met. Product safety legislation already covers a range of product safety issues in detail and includes product categories broader than those linked to the supply of products to consumers in this Bill.

I now turn to secondary ticketing and Amendment 150 on ticketing and Amendment 151 on trustees from my noble friend Lord Moynihan. I also thank the noble Lord, Lord Leong, for his contribution on this issue. It is already a criminal offence for traders to offer for sale a product that cannot be legally sold. Therefore, we do not see these measures adding significantly to existing protection against fraud or mis-selling. I can assure noble Lords that the Government are committed to protecting consumers from fraudulent activity in the secondary ticketing market. In fact, even in the last few hours, four touts have been found guilty by a court in Leeds, using the existing powers and legislation. As I hope noble Lords would agree, we want the focus to be on consumer choice and using powers to enforce existing law, rather than creating further legislation for uncertain gain.

The Government’s analysis is that it is the gift of the primary market to limit, or stop entirely, the secondary market, if that is what it wishes to do. Some event organisers have successfully managed their sales and marketing to inhibit resale of their tickets. To give an example, as an avid sports fan, I go to Murrayfield and my ticket is a personal ticket with my name and seat number on it. If I am found to have sold it on to someone else at a higher price, I will lose any right to further tickets. In contrast, I am going to Munich on 14 June for the opening match of Euro 2024, where I hope Scotland will turn over Germany, and in that particular case I do not have a named ticket. Indeed, I was not able to get a ticket and I have in fact accessed the secondary market—and I will not be able to tell your Lordships’ House until the day before whether those tickets are legal or not.

I also observe that a large number of the promoters of pop concerts—for example, for Ed Sheeran, Mumford & Sons, Iron Maiden and Glastonbury—are now putting in place restrictions on primary market sales, which can be done using technology, ID, mobile phones, et cetera. I would therefore submit to this House that the legislation is currently in place and we should focus our attention on putting pressure on the organisers of these events to use existing legislation to prevent the unfair secondary market. In the meantime, however, we also have consumer choice, and I exercise my right to try to get to the match on 14 June.

I turn to consumer savings schemes and Amendment 141. I shall also briefly address the remaining government amendments in this group. Government Amendment 141 extends protections for users of consumer savings schemes to include bankruptcy orders, winding-up orders, and the appointment of liquidators and administrative receivers. This ensures that consumers are safeguarded across a more comprehensive range of insolvency events, as originally intended.

Government Amendments 142 to 149 are minor and technical amendments to Clause 297 on alternative dispute resolution—ADR. They clarify that any variation made by the Secretary of State to an ADR provider’s accreditation must be considered necessary to return the ADR provider to compliance and must be kept under review.

Finally, government Amendments 116 and 117 implement the recommendation of the Delegated Powers and Regulatory Reform Committee that the affirmative procedure be applied to all exercises of the power in Clause 232, not just the first. We are grateful for the committee’s scrutiny and agree that the higher level of parliamentary scrutiny is appropriate for changes to consumer redress rights.

In conclusion, I am extremely grateful to the noble Lord, Lord Clement-Jones, the noble Baronesses, Lady Hayman, Lady Crawley and Lady Bakewell, and my noble friends Lord Moynihan and Lord Lindsay for their amendments and contributions. I hope, however, that they feel satisfied by my responses and will not feel the need to press their amendments.

Photo of Baroness Hayman Baroness Hayman Crossbench 6:45, 13 Mawrth 2024

My Lords, I am extremely grateful to everyone who has taken part in this debate. I have to say that I have never really experienced such violent agreement—as the Minister put it—from both Front Benches, and such little appetite for doing anything about it, or for any action. So I have to say that I think we are missing a legislative opportunity to do something that would have enormous support both in the country and, I believe, among individuals around the House. However, I really do not want to be churlish. I am genuinely grateful to the Minister, because he has spent a lot of time and thought on this issue and I recognise that he is confident that progress will be made without legislation.

I will just say that I think it would be prudent if I put a note in my diary, for maybe nine months’ time, to put down an Oral Question to see exactly what progress we have made. At the same time, I might remind myself to look very carefully at the Labour Party manifesto to see what its policy on waste actually is. On that note, I beg to leave to withdraw my amendment.

Amendment 104 withdrawn.

Clause 224: Prohibition of unfair commercial practices

Amendments 105 and 106 not moved.

Schedule 19: Commercial practices which are in all circumstances considered unfair