Page last updated at 11:29 GMT, Friday, 13 June 2008 12:29 UK

Compensation claims a step closer

Scam artist
People have used the internet to rip-off consumers

Opportunities for consumers to take on businesses they believe have treated them unfairly and seek compensation in the courts could be stepped up.

New regulations came into force in May giving UK consumers more protection.

The rules allowed agencies such as the Office of Fair Trading (OFT), but not individuals, to take action against businesses trading unfairly.

The government now wants the Law Commission to review the legal issues for private redress.

The move could potentially help people who want to take businesses to the civil courts to ask for compensation.

This could cover a wide range of issues from misleading statements by estate agents to aggressive sales practices or debt collection.


The National Consumer Council (NCC) welcomed the new consumer protection regulations when they came into force in May.

But it said that, unlike in Ireland, it lacked a way for consumers to seek compensation when businesses acted unfairly against them.

It says the Trade Descriptions Act allow a judge, under criminal law, to order compensation for a victim of an offence.

But the more wide ranging consumer protection regulations do not allow consumers to seek compensation via trading standards departments or the OFT that takes the court action.

"The Department for Business, Enterprise and Regulatory Reform has failed to give consumers the tools they need to benefit from the broad scope of the regulations," a NCC spokesman said.

Potential changes

The government department says that consumers can already seek compensation through common law for most issues in the new regulations.

Handing over cash
The regulations impose a duty on businesses not to trade unfairly

But a spokesman said it was keen for the Law Commission to look at the legal implications of private redress as soon as possible.

The Law Commission had previously booked in the review for 2010.

The new regulations were hailed as the biggest shake-up in consumer law for 40 years.

Some 31 specific practices will now be banned, and the law's wider duty not to trade unfairly is intended to avoid the need for a new law to cover every new scam.

The new legislation outlaws information which, even if it is factually correct, deceives the average consumer into making a transaction he or she would not have taken otherwise.

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