Estate agents are being encouraged to respond to the Competition and Market’s Authority consolation on the new draft guidance on the protection from unfair trading provisions introduced in the Digital Markets, Competition and Consumers (DMCC) Act 2024.
The DMCC is the new home for the Material Information requirements which were previously contained by the Consumer Protection from Unfair Practice Regulations 2008.
This comprehensive guidance is designed to help businesses, including estate agents, navigate the new rules, while also aiding enforcers and consumer advisers in understanding the boundaries of acceptable commercial practices.
The DMCC Act represents a significant overhaul of consumer protection laws, building upon and expanding the framework previously established under the CPRs. It is slated that the new CMA powers will come into effect from April this year.
Sally Holdway, Director at Home Owner’s Passport (HOP) said: “We have very much seen a carrot rather than a stick approach to enforcement from Trading Standards over the course of the last 12 months since the Material Information Guidance was introduced in November 2023.
“However, the tone of the new guidance and the direct enforcement powers which will pass to the CMA seem to indicate that we can expect this honeymoon period to be coming to an end over the coming weeks and months.”
Under the new legislation, the CMA’s enforcement powers have been significantly enhanced compared to those previously available to National Trading Standards (NTS) under the CPRs. While the NTS could investigate breaches and bring cases to court, their ability to impose direct consequences was limited. The CMA now has the authority to make binding decisions about whether a commercial practice is unfair, eliminating the need for lengthy court proceedings in many cases.
Additionally, the CMA can issue penalties directly, including fines of up to 10% of a business’s global turnover for serious violations. This represents a substantial increase in enforcement capabilities, allowing for more immediate and impactful responses to breaches. The introduction of civil fines ensures that businesses face real consequences for non-compliance, creating a stronger deterrent against unfair trading practices.
According to Holdway, HOP,which will be running a series of free webinars for agents to attend over the coming weeks on the new Act, is advising all agents to take a five step plan over the coming months.
+ Review the current and proposed guidelines, and if at all possible make time to respond to the current consultation.
+ Audit Current Business Practices and carry out a risk assessment as to whether your agency will be compliant with the new Guidance
+ Update Staff Training on the new requirements and sanctions
+ Update and implement business processes to ensure that new and existing listings are compliant
+ Introduce enhanced record keeping and ongoing monitoring systems so that should there be any investigation it can be demonstrated to the CMA that steps have been taken to comply with the rules.
Agents have until 22 January to respond to the consultation which can be accessed here.