New laws announced to tackle fake reviews

New legislation was introduced this week that aims to address a range of unfair practices on online platforms, including clamping down on subscription traps and tackling fake reviews. 

The Digital Markets Competition and Consumer Bill (DMCC) will also give the Competition and Markets Authority (CMA), the regulator, new powers to investigate and fine businesses up to 10% of global turnover, and could mean directors are disqualified for not complying with the rules. 

As part of the Bill, a Digital Markets Unit (DMU) within the CMA will be given new powers to tackle competition issues in digital markets. Find out what’s in the bill, and what it could mean for consumers.

How to spot fake reviews - stay one step ahead with our in-depth guide.

How will the DMCC Bill tackle fake reviews?

Following a consultation, the new bill would allow the UK government to make fake reviews illegal, in the banning of three new offences: 

• Commissioning or submitting of fake reviews
• Posting consumer reviews without taking reasonable steps to check they are genuine 
• Offering or advertising to submit, commission or facilitate fake reviews 

The bill follows years of investigations by Which? highlighting the persistence and scale of fake reviews on online platforms, and the potential risks to consumers. We first uncovered the trading of fake positive reviews in 2018.

Since then we’ve repeatedly found unscrupulous sellers and businesses trading in and posting fake five star reviews across a variety of platforms including Amazon, Facebook, Google and Trustpilot.

How will the DMCC Bill tackle subscription traps?

A subscription trap is where a consumer agrees to a rolling subscription without knowing, or with no option to cancel. They cost consumers more than a billion pounds a year. 

New rules introduced in the Bill will ensure consumers can exit subscriptions in a more straightforward, cost effective and timely way. Businesses will also be required to issue a reminder to consumers when a free trial or introductory offer is coming to the end. 

We know that subscription services can be a real worry for consumers - in April we found that more than four million consumers who signed up for a subscription to Amazon Prime may have done so accidentally. Almost a quarter of those we surveyed who had accidentally signed up only realised they had so when they found that they had been charged. 

New powers for the CMA

The Bill will strengthen the CMA’s powers to crack down on unfair practices, allowing it to decide when consumer law has been broken, rather than having to take each case to court. This will help ensure people are protected more quickly, and fair-dealing firms are not disadvantaged. It will also be able to fine businesses found to be breaching consumer laws up to 10% of their global turnover.

The bill will also give the DMU within the CMA new powers to tackle competition issues in digital markets, by setting rules that will prevent businesses, such as tech giants, from using their size and power to limit digital innovation - encouraging competitive markets and more choice for consumers.

Sarah Cardell, Chief Executive of the CMA, said: ‘We welcome this flagship bill, which provides the CMA with new powers to do even more to protect people, businesses and support the economy. 

‘This has the potential to be a watershed moment in the way we protect consumers in the UK and the way we ensure digital markets work for the UK economy, supporting economic growth, investment and innovation....

‘Proposals to give the CMA stronger enforcement powers when firms break consumer law – including the ability to directly impose fines for the first time – are crucial to ensure we can continue cracking down on rip-offs and underhand deals, helping to deter firms from taking advantage of people.’

More effective action against platforms

Previously the CMA was able to investigate and monitor online platforms, and had launched formal probes into a number of platforms - including Amazon, Google and Facebook. It had also secured a commitment from Facebook to take firm action against review trading on the social media platform. 

Despite this, a recent Which? Investigation found that Facebook was still failing to tackle groups trading in fake reviews for Amazon, Google and Trustpilot. We hope that the strengthening of the CMA’s powers will allow it to take effective action against platforms that are floating the new rules. 

Rocio Concha, Which? Director of Policy and Advocacy, said: ‘This bill is a pivotal step to make markets in the UK work better for consumers, businesses and support economic growth.

‘Whether it’s fake reviews by dishonest businesses or people getting trapped in unwanted and costly subscriptions, our consumer protections are overdue an upgrade. Which? has long campaigned for stronger powers for the Competition and Markets Authority, including tough enforcement and the ability to fine firms that break the law directly.

‘The empowerment of the CMA’s Digital Markets Unit will also be a major step forward. It needs the right powers to loosen the vice-like grip of a handful of tech giants that will foster innovation and give consumers more choice and lower prices.’

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