Consumer law update: enforcement evolution or revolution?

2024 saw a further uptick in the enforcement of consumer protection law both nationally and across the EU, adding real weight to the package of legislative reforms introduced through the EU’s New Deal for Consumers (which included for example the Sale of Goods Directive, the Digital Services Directive, and the Omnibus Directive).

In this article, we:

• Examine the evolving enforcement strategy and approach of the Competition and Consumer Protection Commission (the CCPC), as well as the EU’s Consumer Protection Cooperation Network (the CPC Network).
• Highlight key areas of enforcement focus in 2024 – including price transparency and unfair and misleading commercial practices more generally.
• Look ahead to where regulators are likely to direct their efforts in the year ahead.

Evidence of a shift in the CCPC approach to enforcement?

The CCPC’s approach to the enforcement of consumer protection legislation is generally informed by four high level prioritisation principles. In considering how to tackle perceived compliance issues, it will typically consider:

• the level of economic and/or physical harm to consumers and the wider economy
• the likely impact of its action
• the strategic significance of the matter by reference to its overall mission, vision, and goals
• the risks, resources, and costs required in tacking the relevant issue[1]

Applying these principles, the CCPC has traditionally directed its efforts initially towards initiatives that educate businesses about their consumer protection obligations and exercised its enforcement powers in cases of continued non-compliance or to bring about better compliance – rather than necessarily moving straight to an enforcement action.

However, it seems that this ‘carrot not the stick’ approach can no longer be assumed. With more public attention on the protection of consumer rights, both at a domestic and EU level, and the CCPC itself calling for larger fines to be imposed against companies violating consumer law (addressed below), businesses are starting to feel the bite.

While signs of a sea change have been apparent for some time, a tougher regulatory approach seems to have crystallised following the release of the CCPC’s 2023 Annual Report. In this, it sets out four strategic goals – the first of which was “visible enforcement and compliance”. The achievements listed under this strategic goal for 2023 included:

• a 100% increase in the issuance of Compliance Notices
• a 206% increase in ‘Fixed Payment Notices’ (which operate in practice as ‘on the spot fines’)
• 2,214 consumer protection and product safety inspections
• the CCPC’s co-leadership of a CPC Network coordinated action against WhatsApp which resulted in commitments being provided in respect of the communication of amendments to terms and conditions to consumers[2]

How 2024 played out… some enforcement highlights

1. Investigations and prosecutions relating to price transparency

This uptick in enforcement recorded in 2023 continued into 2024 with several high-profile regulatory actions:

• At a national level, pricing rules emerged as a hot topic with the controversial use of ‘dynamic pricing’ in the sale of tickets for Oasis’s highly anticipated reunion tour hitting a bum note in September with consumers across the country. More than 100 complaints were made to the CCPC’s Consumer Helpline, and an investigation was ultimately launched into whether any consumer protection laws had been broken. The outcome of the CCPC investigation is pending, and one to watch for 2025. For more information on ‘dynamic pricing’, see our previous article here.
   
• Transparent pricing and compliance with specific pricing regulations relating to the advertising of price reductions (including the Price Indication Regulations[3]) came into sharp focus in November. The CCPC announced on ‘Black Friday’ that it had initiated prosecutions against several nationwide retailers for breaches of pricing laws on foot of sales pricing inspections conducted on both online and instore retailers during the 2023 – 2024 winter sales and was also carrying out further fresh inspections. It is understood that these prosecutions will come before the District Court in January 2025. With other retailers said to have been interviewed under caution, it is possible that further prosecutions may follow over the course of 2025.

2. CCPC increasingly leading EU-level coordinated actions into key players in the tech and e-commerce sector

2024 was also a busy year for the CPC network, the EU network of national consumer protection authorities which works in collaboration with the European Commission to tackle cross-border infringements of EU consumer protection. Consistent with the concerns outlined in its second biennial report published in July 2024, it has stepped up its enforcement efforts against e-commerce and digital services platforms with the announcement of the initiation or completion of six coordinated actions.  

In respect of coordinated actions where commitments have been obtained, the issues in focus included:

• sustainability claims (Zalando[4])
• transparency on ranking information, seller information, delivery fees and amendments to certain consumer terms (Viagogo[5])
• application of price personalisation to products by automated means (Tinder[6])
• clarity on pricing information and customer reviews (Vinted[7])

Of the coordinated actions into the e-commerce sector announced in 2024, the CCPC is acting as co-lead regulator in two of the actions involving Apple[8] and Temu[9]. In November 2024, it was announced that commitments had been sought from both traders in respect of identified breaches of consumer protection legislation. The CCPC has indicated that if no commitments are provided or such commitments are unsatisfactory, a “dialogue” may commence with respective traders. This may be understood to be a more formal inquiry or possible investigation.

3. CCPC participation in a coordinated ‘sweep’ of car rental websites

Another specific area of focus in 2024 was the car rental sector. In recent years the CPC Network and the CCPC have carried out frequent ‘sweeps’ (i.e. unannounced inspections of traders’ websites) on online platforms to ‘spot-check’ for compliance with consumer protection legislation, with a particular focus on so-called ‘dark patterns’, environmental claims, and customer reviews.

This focus continued in 2024, with the CCPC announcing in October that, together with competent authorities in 10 other EU Member States, it had carried out a sweep on 78 third party car rental websites. Arising out of this, the CCPC, together with its Belgian counterpart, engaged with Rentalcars.com regarding the alleged provision of unclear and misleading information to consumers. The result of this engagement with Rentalcars.com agreed to make changes to the provision of certain information on their platform[10].  

Looking ahead to 2025

1. Further sanctioning powers for the CCPC?

As well as a stepped-up approach to enforcement, a further significance of 2024 is that it marked the 10-year anniversary since the CCPC’s establishment. While increased prosecutorial activity indicates that it’s not afraid to show its teeth, it has also openly called for greater fining powers. In particular, the CCPC Chairperson, Brian McHugh, emphasised the need for more substantial penalties for breaches of consumer protection legislation stating that “…send[ing] a clear message to all businesses on the importance of consumer protection law, the punishment should fit the crime. Fines need to be big enough to stop even the largest businesses from breaking the law”[11].

Businesses are reminded that since the enactment of the Consumer Rights Act, 2022 (which implemented amongst other EU legislation, the so-called Omnibus Directive), there is the real possibility of large-scale fines of up to 4% of a trader’s turnover arising out of cross-border breaches of consumer protection legislation. However, these fines may only be applied by the Irish courts, and the CCPC’s recent statement would seem to indicate its view that there is a need for it to be able to apply (or recommend the application of) greater penalties. What it may have in mind here is to replicate in relation to its consumer protection law, the powers it now has to impose administrative financial sanctions in respect of relevant competition law breaches under the Competition (Amendment) Act 2022 (albeit these are subject to court confirmation).

2. Key areas of regulatory focus

Looking ahead to 2025, we don’t expect any dampening of consumer law enforcement with the following likely to be key areas of focus:

• Continued focus on the e-commerce and tech sector: The CCPC has taken a lead role in many of the recent CPC Network engagements into e-commerce and tech companies, particularly where those companies are head quartered in Ireland. We expect this trend is likely to continue into 2025 with the potential for such engagements to run in parallel with investigations by the EU Commission into compliance with the Digital Services Act.[12] With the General Product Safety Regulation now also in effect, we also expect further potential for ‘overlapping’ issues to arise and possible coordination between the EU Commission, consumer protection authorities and market surveillance authorities.
   
• Price transparency and the use of ‘dynamic pricing’: The CCPC enforcement actions in 2024 highlighted significant regulatory attention on price transparency, particularly concerning ‘dynamic pricing’ and compliance with pricing laws in the context of discount/sales practices. The investigation into the use of ‘dynamic pricing’ for Oasis reunion tour tickets and the prosecutions against retailers for breaches of pricing laws may yield some clarity on the CCPC and the Court’s view of certain pricing laws which can be difficult for a trader to navigate in practice.
   
• Sustainability claims: Green claims continue to be a focus at EU and national level, with the Green Transition and proposed Green Claims Directive due to come into force in 2026 and (likely) 2027 respectively.[13] As noted above, the CPC Network’s engagement with Zalando showed the stringent approach to environmental and sustainability claims, in particular the use of generic terms such as ‘sustainable’, ‘eco’, etc. At national level, while we are not aware of any prosecutions to date, the CCPC did participate in a ‘sweep’ for greenwashing claims in 2020, subsequently engaging with retailers where issues were identified, and it has noted the “increasing focus on the support of green choices by consumers” in its 2024 – 2026 Strategy Statement.[14]

3. Our top tips for businesses

With the enforcement of consumer protection legislation now firmly in a new era, all consumer-facing businesses should adopt a proactive approach to ensuring that they comply with their consumer protection obligations in all engagements with customers.  Our top tips for businesses as you look ahead to 2025:

• Horizon scanning: Be aware of the consumer laws which affect your business including in relation to consumer statutory remedies and ‘mandatory information’ which must be provided to consumers before a contract is concluded. While there has been a spate of legislative developments in recent years, consumer protection law is continuing to evolve at EU and national level so keeping abreast of further legislative updates such as the Right to Repair Directive (which has a transposition deadline of 31 July 2026) is important.
   
• Be proactive when it comes to compliance and adopt a holistic approach covering the whole ‘customer journey’: When planning a new product or marketing campaign, consider all steps in the customer journey and how they fit together. From advertising and marketing, to terms of service, and post-sale remedies, take proactive steps to ensure compliance with applicable consumer protection laws. Transparency and clarity are key guiding principles, but there is devil in the detail of what it takes to be compliant, e.g. with prescriptive rules applying on what information must be provided to customers at certain points of their purchasing journey.
   
• Price transparency is key! Given that this has been a key enforcement area across all industries and sectors, businesses should take particular care to ensure that pricing information, and in particular any price reduction announcements, comply with relevant pricing regulations.

For further information, please contact Katie O’Connor, partner, Denise Daly Byrne, partner, Mairéad O’Brien, senior associate or your usual ALG Consumer & Advertising team contact.

Date published: 21 January 2025