Schedule 18 - Commercial practices which are in all circumstances considered unfair

Digital Markets, Competition and Consumers Bill – in a Public Bill Committee at 10:00 am on 4 July 2023.

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Photo of Richard Thomson Richard Thomson Shadow SNP Spokesperson (Wales), Shadow SNP Spokesperson (Northern Ireland), Shadow SNP Spokesperson (Trade), Shadow SNP Spokesperson (Business) 10:00, 4 July 2023

I beg to move Amendment 68, in schedule 18, page 343, line 2, at end insert—

“32 Making claims about—

(a) the environmental benefits, or

(b) the sustainability (as defined by section 234(1C)) of a product or service which are not based on evidence which can be verified by a court.”

This amendment seeks to ban the practice of “greenwashing”. It would include the making of unsubstantiated claims about the sustainability of products and services an unfair commercial practice.

Photo of Steve McCabe Steve McCabe Labour, Birmingham, Selly Oak

With this it will be convenient to discuss Amendment 69, in Clause 234, page 157, line 29, at end insert—

“(1A) The Secretary of State must consult on a definition of sustainability for the purposes of paragraph 32 of Schedule 18.

(1B) A consultation under subsection (1A) must—

(a) set out which products and services can be labelled sustainable; and

(b) require the definition to comply with international standards.

(1C) Following a consultation under subsection (1A) the Secretary of State must by regulations amend this Chapter to add a definition of sustainable.”

This amendment seeks to ban the practice of “greenwashing”. It requires the Government to define which products and services can be labelled “sustainable” and requires that this definition complies with international standards.

Photo of Richard Thomson Richard Thomson Shadow SNP Spokesperson (Wales), Shadow SNP Spokesperson (Northern Ireland), Shadow SNP Spokesperson (Trade), Shadow SNP Spokesperson (Business)

It is a pleasure to serve under your chairmanship, Mr McCabe. With your indulgence, if it is appropriate, I will also speak to Amendment 69 and am happy to speak to amendments 115 and 116.

Photo of Steve McCabe Steve McCabe Labour, Birmingham, Selly Oak

We will stick to amendments 68 and 69.

Photo of Richard Thomson Richard Thomson Shadow SNP Spokesperson (Wales), Shadow SNP Spokesperson (Northern Ireland), Shadow SNP Spokesperson (Trade), Shadow SNP Spokesperson (Business)

Thank you for your guidance, Mr McCabe.

I have not yet spoken in Committee, and the reason for that is simple. As I said on Second Reading, from a Scottish National party perspective, we think that the Bill is generally speaking a good Bill. Our concern is primarily with the bits that we feel are missing, so the amendments that I will speak to this morning and afternoon are with a view to fill in some of the potholes that we see in the road for the Bill.

Amendments 68 and 69 would tackle the phenomenon of greenwashing. By that, I mean the practice by which companies use advertising and/or public messaging to appear more eco-friendly, whether in the generality or with regard to specific products, than is actually the case. The amendments would compel the Secretary of State to consult on a definition of sustainability for these purposes that is in line with international standards and then to amend the relevant chapter to add that definition to the Bill, and to add greenwashing to the schedule 18 list of practices which are in all circumstances considered unfair.

Extravagant claims about the environmental credentials of companies and products, in a bid to make them seem more eco-friendly than is the case, are certainly nothing new, but there is growing concern among consumers about the environmental impact of their economic and lifestyle choices. In a survey for the ClientEarth organisation—it dates from only a few years ago; I think the figures are still relevant—66% of consumers have indicated that they are happy to pay more for products that they consider to be environmentally friendly, and that rises to 72% for consumers under the age of 20, so there is not only a massive concern but, potentially, a massive spend on the part of people who wish to buy products that are in line with their ethical objectives when it comes to consumption. But that means that there is also a massive spend that is potentially being misdirected and which is, in effect, penalising companies that are more genuine and honest in their claims than some other companies.

An absence of rules or a slackness in the rules on what is permitted allows all kinds of exaggerated and potentially misleading claims to fill that space. A European Commission study from 2020 highlighted the fact that more than 50% of examined environmental claims were found to be vague, misleading or unfounded. The way we get around that is, as the Commission proposes, to come up with some reliable, comparable and verifiable information that will allow consumers to make informed choices. The European Union proposals to target the problem have in their sights explicit claims that are made in the promotion of products. Claims will need to be independently verified on environmental grounds, to be proven with scientific evidence, to cover environmental impacts that are actually relevant to the product, and to identify any possible trade-offs in its manufacture, production or use, to give a full and accurate picture that will allow consumers to make an informed choice. The EU will target the 230 or more “environmental labels” in existence in the marketplace at present.

I will give an example, and it is one of the more egregious ones; I certainly was not aware of this until recently. A symbol found on some products looks a bit like the yin and yang symbol, with arrows pointing into each other. At first glance by the unwary—I include myself in that—it looks like it means that the product is recyclable. I found it on the side of a bottle of gin. It looked like it was a kind of earthenware thing. The world can stand only so many table lamps made out of such things, so I was thinking, “I want to dispose of this product responsibly. What can I do with it?” I had a look at it and I thought, “Well, that’s a recycling symbol. Into the recycling it goes.” But I went and had a look afterwards and it turns out that the symbol is no such thing: it makes no claim about whether the product is recyclable; it simply means that the company is contributing to the costs of a Europe-wide recycling scheme and not that the product itself is recyclable.

That product—I am sure I am not the only person who has done that—has ended up in a recycling stream, potentially fouling that section of the recycling stream and all the other recyclates there. It is exactly that sort of thing that we are talking about. I should say that the bottle of gin was not purchased for me; I do not particularly care for the stuff. Nevertheless, it is those sorts of claims that influence consumer purchases and influence what materials go into manufacturing. Those economic signals go throughout the market, and there is a misalignment with the expectations that people have when it comes to disposing of the product. It has influenced the choice, led to adverse outcomes and, potentially, penalised those companies that deal in a more honest fashion with how their products are disposed of at the end of their life.

The point has been well made about the importance of making sure that environmental claims are verifiable so that consumers can make informed choices. The way to do that is, as with other unfair practices, to include it as the 32nd example of unfair practices that are considered unfair in all circumstances. It would also allow Ministers to go away and consult on a definition of what is sustainable and then come back and add that to the Bill in a way that would allow us to at least emulate if not exceed the best practice emerging elsewhere.

The amendments are important. I look forward to the Minister’s comments. If the Government are not minded to accept the amendments, I look forward to hearing how they intend to tackle unfair practice.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy) 10:15, 4 July 2023

I will speak just briefly to schedule 18 and then to amendments 68 and 69. I thank the hon. Member for Gordon for his amendments and his explanation of them.

Schedule 18 introduces—

Photo of Steve McCabe Steve McCabe Labour, Birmingham, Selly Oak

Order. The general debate comes at the end. We need to stick with the Amendment.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy)

That is fine. I have one line, but it can come later.

Amendment 68 would ban the practice of greenwashing. Making unsubstantiated claims about the sustainability of products and services would be an unfair commercial practice. Amendment 69 is consequential on amendment 68 and would require the Government to define which products and services can be labelled “sustainable”, and requires that the definition complies with international standards.

I support the principle of the amendments tabled and the arguments made. They are along the lines of the discussion that we had in Committee last week when I spoke to the issues around greenwashing, our standards and support for evidence. I asked the Minister what overall strategy he has to ensure that green claims are accurate and evidenced, and I asked that we have a strategy for the prevention of false claims as well as a mechanism for enforcement against them. As has been argued, that issue is on the increase, particularly for younger people.

Research has shown that those under 35 across the world make decisions about products, services and even their employment on how much they trust the information that they see in relation to sustainability and climate responsibility. If we do not tackle that issue, we will see a further increase in people misleadingly marketing products because they know that those issues drive consumer purchases. They have great influence on consumer purchases and decisions.

The Minister might refer to the green claims code introduced by the CMA. Important work has been done, but in the absence of any real leadership or strategy from the Government I want to ask the Minister whether they intend to put the green claims code, or its successor, on a statutory footing. Making sure that we have a robust legislative underpinning and strategy for such issues is increasingly important, because many stakeholders see a gap.

Greenwashing was also mentioned by consumer groups in the Committee’s evidence sessions. I would press the Minister on whether the Government have plans to introduce amendments on the issue, and to strengthen voluntary or other codes relating to green claims and expectations. In an increasingly green economy, consumers are at risk of falling victim to misleading green advertising, and legislation needs to catch up.

Photo of Kevin Hollinrake Kevin Hollinrake Parliamentary Under Secretary of State (Department for Business and Trade)

Amendments 68 and 69 would add the practice of greenwashing to the list of banned practices in schedule 18, and would introduce a requirement for the Government to consult on the matter. I thank the hon. Member for Gordon for his amendments, and I absolutely agree that consumers should not be misled. I admire his commitment to recycling, which is admirable. I wondered whether I should touch on that, given the difficulties that the SNP has got into with its deposit return scheme, but—

Photo of Richard Thomson Richard Thomson Shadow SNP Spokesperson (Wales), Shadow SNP Spokesperson (Northern Ireland), Shadow SNP Spokesperson (Trade), Shadow SNP Spokesperson (Business)

I thank the Minister for that sideswipe, but it would be a great deal easier for the Scottish Government to comply with an English-designed scheme if that scheme was actually in existence for us to emulate. Absent our deposit return scheme, we are stuck with the recycling schemes that we have, and I wonder whether the Minister will get to the point.

Photo of Kevin Hollinrake Kevin Hollinrake Parliamentary Under Secretary of State (Department for Business and Trade)

I was just referring to the hon. Gentleman’s point. I will briefly say that our perspective is that a nationwide scheme would be best for business.

Misleading consumers about the environmental qualities or impact of goods and services in a way that causes, or would likely cause, consumers to take a different decision is already against the law. Furthermore, under Clause 187, when the CMA gives a provisional notice to a person in respect of an infringement of the unfair trading provisions, the CMA can require the respondent to provide evidence to substantiate the claims that they make to consumers. That meets the Shadow Minister’s requirement. It is against the law to mislead, and as she says, the CMA’s draft guidance on sustainability agreements between businesses, which aim to ensure that environmental goals are achieved, will give greater clarity on these issues. Those interventions are already significant. The Government’s priority is to ensure that interventions support our environmental goals; we would then observe their impact before taking further steps. I hope the hon. Member will withdraw Amendment 68 on that basis.

Photo of Richard Thomson Richard Thomson Shadow SNP Spokesperson (Wales), Shadow SNP Spokesperson (Northern Ireland), Shadow SNP Spokesperson (Trade), Shadow SNP Spokesperson (Business)

I am sorry to disappoint the Minister, but this is an issue of fundamental importance, and if I withdrew the Amendment, it would be an opportunity missed. Of course, we could go through any number of proposed amendments to the Bill and say that there is already legislation in place that in some way tackles that issue. Of course it is true that there are measures on this issue, but there is still a proliferation of claims out there that have not been tackled by existing legislation. I know the Minister is a keen advocate for ensuring that markets work as effectively as they can, and for allowing markets to reach conclusions. The amendment is simply a tool that would allow Ministers to act in the interests of consumers. It would be a missed opportunity not to push it to a vote, and not to include it in the Bill.

Question put, That the amendment be made.

Division number 6 Digital Markets, Competition and Consumers Bill — Schedule 18 - Commercial practices which are in all circumstances considered unfair

Aye: 5 MPs

No: 6 MPs

Aye: A-Z by last name

No: A-Z by last name

The Committee divided: Ayes 5, Noes 6.

Question accordingly negatived.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy) 10:30, 4 July 2023

I beg to move Amendment 115, in schedule 18, page 343, line 2, at end insert—

“32 At any stage of a purchase process, presenting a price for a product which omits obligatory charges or fees (or an estimate thereof) which are payable by the Majority of consumers, which are not revealed to the consumer until later in the purchase process.”

This amendment adds the practice of “drip-pricing”, a pricing technique in which traders advertise only part of a product’s price and reveal other obligatory charges later as the customer goes through the buying process, to the list of unfair commercial practices.

Amendment 115 would add the practice of drip pricing to the list of unfair commercial practices. Drip pricing is a pricing technique whereby traders advertise only part of a product’s price and reveal other obligatory charges later as the customer goes through the buying process. For example, an airline may advertise a flight abroad at a certain cost that does not include an obligatory seat charge. That is added only later in the purchasing process, by which point the consumer has already prepared to purchase the product and is less likely to stop the purchase. The argument that this practice should be included in the Bill was well documented during the Committee’s evidence sessions. The consumer group Which? stated:

“We think that drip pricing is another practice that is very harmful. There is a lot of evidence that that is the case, and it should be included on the face of the Bill.”––[Official Report, Digital Markets, Competition and Consumers Public Bill Committee, 13 June 2023; c. 13, Q16.]

That sentiment was reflected in Committee by Citizens Advice, the National Consumers Federation and Consumer Scotland, all of which argued that schedule 18 could be improved by adding the practice of drip pricing. Which? provided evidence of consumer detriment in its written submission, which states:

“We know that in many online markets people overpay for products and services because only part of an item’s price is initially shown and the total amount to be paid is revealed only at the end of the buying process. For example, multiple hotel booking firms were shown to have failed to have displayed compulsory charges such as taxes, booking or resort fees in the headline price. However, while the use of these practices is common, the CMA has found its enforcement against drip pricing has been inhibited by the absence of an explicit ban.”

In its 2021 paper, “Reforming Competition and Consumer Policy”, the CMA notes:

“Drip pricing causes real detriment to consumers...Advertising of Prices market study concluded that of a series of different price framing practices, drip pricing was clearly the most harmful frame for consumers in terms of purchasing and search errors, and that raised levels of consumer learning did not fully mitigate issues with the practice. Lengthy transaction processes associated with drip pricing can ensure consumers gain a greater sense of ownership of a product and are less likely consider other offers once additional costs are revealed.”

It is clear that the introduction of drip pricing to the list of unfair commercial practices would be supported by consumer groups and the CMA, so I urge the Minister to consider supporting the amendment. I look forward to his response.

Photo of Kevin Hollinrake Kevin Hollinrake Parliamentary Under Secretary of State (Department for Business and Trade)

I share the hon. Member’s concerns. That is why we commissioned research earlier this year, which we will publish shortly. It will detail how widespread and harmful the practice is. The Prime Minister has already said that we will gather evidence on what steps the Government should take to tackle drip pricing, so I think we are aligned in our commitment to tackling the issue.

One of the key challenges, which I do not think the hon. Lady addressed, is distinguishing drip pricing that is harmful or anti-competitive from practices that may offer greater value to the consumer—for example, a company offering optional extras such as faster postage or insurance. We will consult during the passage of the Bill on which elements of drip pricing might need tackling, and on whether further action is required. We believe it is important to conduct that exercise first, so that we have a proper, evidence-driven policy. I hope the hon. Member will withdraw the Amendment.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy)

I thank the Minister for his comments. There are issues to consider in relation to the Amendment, but I think the broad thrust of the argument for taking action is clear. The Minister says that the findings of the research will be published shortly; I am assuming that “shortly” is not in more than a year’s time. We need to clarify that with the Government. If shortly means shortly, however, then I would be grateful for confirmation that, on the basis of the research, the Minister intends to address drip pricing; that may determine the wording in the Bill. Can the Minister confirm that there is an intention to address the issue during the passage of the Bill, perhaps through a Government amendment? The Opposition are very willing to work with the Government on that.

Photo of Kevin Hollinrake Kevin Hollinrake Parliamentary Under Secretary of State (Department for Business and Trade)

I am keen to make a commitment to work with the hon. Member on the issue, and to ensure that a measure is brought forward as quickly as possible. I cannot give a precise date, but it will be very shortly.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy)

On the basis that shortly means shortly, I am willing to withdraw the Amendment. Will the Minister clarify that he expects the research to come forward before Report, so that we have time to look at it? That would be a good point at which to bring forward an amendment on the issue.

Photo of Kevin Hollinrake Kevin Hollinrake Parliamentary Under Secretary of State (Department for Business and Trade)

I cannot say when Report will be, and I do not have the timetable for that, or for the consultation on the work that we may need to do on the issue. I cannot make that precise commitment, but we are very committed to delivering on drip pricing. As the hon. Member knows, the Prime Minister spoke on it, so I cannot imagine that there will be any undue delay.

Amendment, by leave, withdrawn.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy)

I beg to move Amendment 116, in schedule 18, page 343, line 2, at end insert—

“32 Commissioning, incentivising or authorising the writing or submission of false consumer reviews or endorsements, in order to promote products.

33 Offering or advertising to submit, commission or facilitate false consumer reviews or endorsements.

34 Displaying consumer reviews of products on an online interface—

(a) without taking reasonable and proportionate steps to ensure that such reviews are submitted by consumers who have used or purchased the products in question;

(b) where any consumers who provided reviews were incentivised to describe certain products in a particular way, without taking reasonable and proportionate steps to ensure this is not the case; or

(c) in a way that deceives or manipulates consumers, or where a practice has been undertaken in relation to reviews that otherwise materially distorts or impairs the ability of consumers to make free and informed decisions, without taking reasonable and proportionate steps to ensure this is not the case.”

This amendment adds the practice of commissioning fake reviews, offering services to write fake reviews, and displaying consumer reviews without taking reasonable steps to verify their accuracy, to the list of unfair commercial practices.

Photo of Steve McCabe Steve McCabe Labour, Birmingham, Selly Oak

With this it will be convenient to discuss Amendment 125, in schedule 18, page 343, line 2, at end insert—

“32 Stating or otherwise creating the impression that reviews of a product are submitted by consumers who have actually used or purchased the product without taking reasonable and proportionate steps to check that they originate from such consumers.

33 Submitting or commissioning another legal or natural person to submit false consumer reviews or endorsements, or misrepresenting consumer reviews or social endorsements, in order to promote products.”

This amendment would add fake reviews to the list of banned practices.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy)

I am pleased to speak to Amendment 116, tabled by my hon. Friend the Member for Pontypridd and me. I will also touch on amendment 125, tabled by my hon. Friend the Member for Bermondsey and Old Southwark. They are similar provisions, and he will want to make his own arguments for amendment 125.

Amendment 116 adds the practice of commissioning fake reviews, offering to provide the service of writing fake reviews, and displaying consumer reviews without taking reasonable steps to verify their accuracy to the list of unfair commercial practices. Amendment 125 would similarly add fake reviews to the list of banned practices. We support both the amendments, but I will speak to amendment 116 in more detail, as it provides a more comprehensive legislative basis for banning fake reviews, and was recommended by the consumer group Which?.

When the Bill was published, the Government announced with much fanfare that they would introduce provisions banning the unfair commercial practice of fake reviews. However, nowhere in the Bill is there any measure that bans fake reviews. The supposed banning of fake reviews can be found in Clause 234, which gives the Secretary of State the power to add to the list of banned practices. Unless the Minister corrects me, all we have is a promise from the Government that at some point in the future—beyond 2025—fake reviews might be banned. As Which? said during the Committee’s evidence sessions,

“We do not think that we should wait. Clearly, fake reviews are harmful, so the buying, selling and hosting of fake reviews should be included in schedule 18.”––[Official Report, Digital Markets, Competition and Consumers Public Bill Committee, 13 June 2023; c. 13, Q16.]

It was not just consumer groups that expressed that sentiment; the British Retail Consortium also stated:

“We are concerned about fake reviews. We support the banning of them. We wish that what the Government propose for them was on the face of the Bill.”––[Official Report, Digital Markets, Competition and Consumers Public Bill Committee, 13 June 2023; c. 49, Q78.]

I would be grateful for the Minister’s explanation of why the Government have left a ban out of primary legislation. One view is that the Government intended to include a ban, but ran out of time. Well, we have time to catch up during the passage of the Bill. Retail and consumer groups consider this measure very much noticeable by its absence, and it is important and significant that we address it during the passage of the Bill.

I have no doubt that the Minister will stress the need for further work and consultation on the issue. If so, perhaps he could also reflect on the considerable evidence of consumer detriment caused by fake reviews. Which? research from 2020 found that consumers are far more than twice as likely to buy poor-quality products that have been boosted by fake reviews. That affects the Minister’s constituents, mine, and those of every Member of this Committee.

As the CMA has noted, the average UK household spends £900 a year as a result of being influenced by online reviews. That demonstrates how significant the financial damage of fake reviews can be. In the Department for Business and Trade’s research from April this year, 11% to 15% of reviews in the category that it assessed were fake. That is the Government’s own research. The evidence is clear: action on fake reviews is needed now to protect consumers from their negative consequences. I would go so far as to say that the Opposition are doing the Government a favour by introducing these amendments. We have done the Government’s work for them.

I urge the Minister to support the amendments. Perhaps he will want to bring forward his own, as the Government are known to take good ideas when they see them, many of which they take from the Opposition. We understand that there has been significant dysfunction in Government, which may have got in the way of their doing the work that the country needs them to do. I therefore urge the Minister to support the amendments. He may also want to bring forward his own amendments at a future stage of the Bill or in the other place. I jest, with good reason, but we are not precious; we just want the right thing to be done. I hope that in his response, the Minister will confirm what action the Government will take during the passage of the Bill.

Photo of Richard Thomson Richard Thomson Shadow SNP Spokesperson (Wales), Shadow SNP Spokesperson (Northern Ireland), Shadow SNP Spokesperson (Trade), Shadow SNP Spokesperson (Business)

I very much support Amendment 116, to the extent that I withdrew my attempt at an amendment that would have countered fake reviews. It is clear that fake reviews are a matter of real concern, not just for reputable companies, but for consumers, who like to rely on customer feedback before making some of their most important financial choices. Schedule 18 defines and sets out unfair practices, and it is only right that fake reviews be added to them. We again come back to the fundamental principle that if a market is to work effectively and efficiently, people need access to timely and accurate information. That goal of having accurate information in the marketplace is subverted considerably when fake information and misinformation are allowed to abound.

As the hon. Member for Feltham and Heston has said, the amendment comes from the consumer group Which?, which might be thought to know something about standing up for the best interests of consumers in the marketplace. It would outlaw certain practices to do with commissioning, incentivising or authorising the writing or submission of fake reviews, and all the criteria in the amendment clearly relate to unfair commercial practices. If we are in the business of defining unfair practices, those seem to me to be pretty reasonable definitions to add to the schedule.

Let me return to our debate on Second Reading, when we had possibly the most unencouraging engagement across the Floor of the House when I was challenged by John Redwood about how we might go about defining fake reviews. However, there seemed to be an outbreak of consensus, at least at that stage, on co-operation between the Government and the Opposition parties over what that might look like, although I have not seen any proposals coming forward from the Government.

The issue has managed to unite Labour and the SNP with the consumers’ organisation. The question I would pose to the Minister, which I would like him to address this time, is, if not this, what? We all seem to agree that fake reviews are a problem. If we are not going to deal with the matter in this way with this definition, how are we going to deal with it so the marketplace can work with effective information and so the views of consumers can play their full part in helping people to make informed choices, which are so important in ensuring the marketplace can work effectively?

Photo of Neil Coyle Neil Coyle Labour, Bermondsey and Old Southwark 10:45, 4 July 2023

My hon. Friend the Member for Feltham and Heston and the hon. Member for Gordon have already made some excellent points, so I will be brief.

Amendment 125 would add fake reviews to the list of banned practices. No customer should be hoodwinked by the deceitful practice of submitting a fake review. Fundamentally, many customers see fake reviews as fraud, which is the fastest-growing crime. Our police services are overstretched and sadly, under this Government, they do not have the resources to tackle fraud. The amendment examines alternative routes to securing action to tackle a problem that is leading to dangerous circumstances, as has been outlined.

Amendment 125 would provide a stronger power than the one proposed, and it has been called for by organisations representing British customers and responsible British businesses. It would be better for good business, better for customers and better for ensuring that standards were upheld. The charity Electrical Safety First, which is based in Bermondsey and Old Southwark, has said that in one of its investigations 93% of products bought from online marketplaces were unsafe—93%! In some significant part, that is down to fake reviews imposing a false legitimacy on goods. People buy because they believe other people have bought and have had an enjoyable experience or got the product they sought.

My hon. Friend the Member for Feltham and Heston has already provided examples of the need to protect consumers, and I draw the attention of the Committee these live examples, which are happening right now. “A portable heater” was on eBay and people were saying it was fine, but it had

“easy access to live parts with 240 volts running through the heating element, posing” what ESF called

“an imminent risk to life.”

Another example is a

“‘water-proof’ extension lead… on Amazon.”

Guess what? There are

“no water-proof capabilities” and this

“presents a significant risk of electric shock. This item has already been recalled as unsafe by the Office for Product Safety and Standards”.

A combination of the takedown power and the removal of fake reviews that claimed that these products were okay and good to use would be a significant step forward—one that, sadly, is not in the Bill.

One last example is the bargain beauty products—not something I buy often for myself—on eBay that had no fuse in the plugs. That is how dangerous they were. Those goods, known to be dangerous, are still online. Removing fake reviews might help to prevent people from buying such shoddy items, but removing the goods altogether should be the fundamental aim. I politely suggest that the Minister adds ESF and specific consumer groups such as Which? to his round of pending meetings, to ensure that the Bill is improved—and to tackle the problem that he previously acknowledged existed. He likened himself earlier to “Pale Rider”. He may think he is “Pale Rider”, but I am not convinced that he has turned up on a horse, or even on a pony. Given that there is no baron here, it is more as though he is on a rocking horse.

Photo of Kevin Hollinrake Kevin Hollinrake Parliamentary Under Secretary of State (Department for Business and Trade)

I am not sure that I can take that analogy any further. I think we are all in agreement. They say that the art of originality is to remember what you have heard but forget where you heard it. The Opposition say that we are stealing their good ideas, but obviously we committed some time ago to taking action in this area. I am not averse to taking some of the good ideas that we hear from the Opposition from time to time, but we also have to ensure that we reject the many bad ideas we hear from them in debates.

The Government agree that legislation to tackle fake reviews should be strengthened. We anticipate doing so by adding to the list of banned practices. However, it is important to get the details of those proposals right. That includes defining what we mean by fake reviews and how “reasonable and proportionate” steps will be understood. Similarly, we want those rules to encompass the manipulation of reviews that may harm consumers, which also needs detailed work with stakeholders to define. For example, the issue is not just about people trying to boost reviews, as the hon. Member for Feltham and Heston stated; it is also to do with people removing negative reviews inappropriately, which might affect ratings on review sites. The Government will therefore be consulting on fake reviews during the passage of the Bill to ensure that these rules work as intended and are clear for businesses. We will be doing that shortly, in the autumn.

The hon. Member for Bermondsey and Old Southwark talked about ESF and Which?. I have spoken to both organisations and met them regularly. In fact, one of my first jobs in my ministerial role was to speak at an Electrical Safety First conference. On that note, I hope that hon. Members will withdraw their amendments.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy)

I am slightly disappointed by the Minister’s response; it does not sound as if there is anything other than long grass here. Significant groundwork has been done, both within Government and with stakeholders. Having another consultation in the autumn is like long grass: it is designed to spin things out until we reach 2025 and then there is something to add to the schedule. Unless the Minister wants to tell me that there is an intention to do more during the course of the Bill, we will be pushing this to a vote.

Division number 7 Digital Markets, Competition and Consumers Bill — Schedule 18 - Commercial practices which are in all circumstances considered unfair

Aye: 5 MPs

No: 6 MPs

Aye: A-Z by last name

No: A-Z by last name

The Committee divided: Ayes 5, Noes 6.

Question accordingly negatived.

Amendment proposed: 125, in schedule 18, page 343, line 2, at end insert—

“32 Stating or otherwise creating the impression that reviews of a product are submitted by consumers who have actually used or purchased the product without taking reasonable and proportionate steps to check that they originate from such consumers.

33 Submitting or commissioning another legal or natural person to submit false consumer reviews or endorsements, or misrepresenting consumer reviews or social endorsements, in order to promote products.”—

This amendment would add fake reviews to the list of banned practices.

Question put, That the amendment be made.

Division number 8 Digital Markets, Competition and Consumers Bill — Schedule 18 - Commercial practices which are in all circumstances considered unfair

Aye: 5 MPs

No: 6 MPs

Aye: A-Z by last name

No: A-Z by last name

The Committee divided: Ayes 5, Noes 6.

Question accordingly negatived.

Question proposed, That the schedule be the Eighteenth schedule to the Bill.

Photo of Seema Malhotra Seema Malhotra Shadow Minister (Business, Energy and Industrial Strategy)

Schedule 18 introduces a list of commercial practices that will automatically be considered unfair in all circumstances and will be prohibited. The list is long and comprehensive, and the Opposition welcome every practice listed, including a seller’s claiming to be a signatory to a code of conduct when they are not, falsely claiming that a product is able to prevent disease, providing inaccurate information about the availability of a product, and threatening a consumer if they do not buy a product.

However, we are concerned that there are significant omissions, which we addressed during our debates on the amendments. We will be happy to consider alternative wording, but we will continue to pursue additions that we believe would strengthen the Bill and its implementation. Nevertheless, we support the inclusion of this important schedule in the Bill.

Photo of Kevin Hollinrake Kevin Hollinrake Parliamentary Under Secretary of State (Department for Business and Trade)

As has been said, the schedule protects consumers from the most prevalent and harmful commercial practices engaged in by deceitful traders. It largely replicates schedule 1 to the Consumer Protection from Unfair Trading Regulations 2008 and provides a list of 31 commercial practices that are banned in all circumstances due to their inherently unfair nature. Among those practices are operating pyramid promotional schemes, displaying trust marks without obtaining the necessary authorisation, and stating that a product can be legally sold when it cannot.

Question put and agreed to.

Schedule 18 accordingly agreed to.

Clauses 218 to 221 ordered to stand part of the Bill.

amendment

As a bill passes through Parliament, MPs and peers may suggest amendments - or changes - which they believe will improve the quality of the legislation.

Many hundreds of amendments are proposed by members to major bills as they pass through committee stage, report stage and third reading in both Houses of Parliament.

In the end only a handful of amendments will be incorporated into any bill.

The Speaker - or the chairman in the case of standing committees - has the power to select which amendments should be debated.

Secretary of State

Secretary of State was originally the title given to the two officials who conducted the Royal Correspondence under Elizabeth I. Now it is the title held by some of the more important Government Ministers, for example the Secretary of State for Foreign Affairs.

clause

A parliamentary bill is divided into sections called clauses.

Printed in the margin next to each clause is a brief explanatory `side-note' giving details of what the effect of the clause will be.

During the committee stage of a bill, MPs examine these clauses in detail and may introduce new clauses of their own or table amendments to the existing clauses.

When a bill becomes an Act of Parliament, clauses become known as sections.

Second Reading

The Second Reading is the most important stage for a Bill. It is when the main purpose of a Bill is discussed and voted on. If the Bill passes it moves on to the Committee Stage. Further information can be obtained from factsheet L1 on the UK Parliament website.

European Commission

The European Commission is the politically independent institution that represents and upholds the interests of the EU as a whole. It is the driving force within the EU’s institutional system: it proposes legislation, policies and programmes of action and it is responsible for implementing the decisions of Parliament and the Council.

Like the Parliament and Council, the European Commission was set up in the 1950s under the EU’s founding treaties.

Website: http://europa.eu.int/comm/index_en.htm

Minister

Ministers make up the Government and almost all are members of the House of Lords or the House of Commons. There are three main types of Minister. Departmental Ministers are in charge of Government Departments. The Government is divided into different Departments which have responsibilities for different areas. For example the Treasury is in charge of Government spending. Departmental Ministers in the Cabinet are generally called 'Secretary of State' but some have special titles such as Chancellor of the Exchequer. Ministers of State and Junior Ministers assist the ministers in charge of the department. They normally have responsibility for a particular area within the department and are sometimes given a title that reflects this - for example Minister of Transport.

Amendment

As a bill passes through Parliament, MPs and peers may suggest amendments - or changes - which they believe will improve the quality of the legislation.

Many hundreds of amendments are proposed by members to major bills as they pass through committee stage, report stage and third reading in both Houses of Parliament.

In the end only a handful of amendments will be incorporated into any bill.

The Speaker - or the chairman in the case of standing committees - has the power to select which amendments should be debated.

shadow

The shadow cabinet is the name given to the group of senior members from the chief opposition party who would form the cabinet if they were to come to power after a General Election. Each member of the shadow cabinet is allocated responsibility for `shadowing' the work of one of the members of the real cabinet.

The Party Leader assigns specific portfolios according to the ability, seniority and popularity of the shadow cabinet's members.

http://www.bbc.co.uk

Division

The House of Commons votes by dividing. Those voting Aye (yes) to any proposition walk through the division lobby to the right of the Speaker and those voting no through the lobby to the left. In each of the lobbies there are desks occupied by Clerks who tick Members' names off division lists as they pass through. Then at the exit doors the Members are counted by two Members acting as tellers. The Speaker calls for a vote by announcing "Clear the Lobbies". In the House of Lords "Clear the Bar" is called. Division Bells ring throughout the building and the police direct all Strangers to leave the vicinity of the Members’ Lobby. They also walk through the public rooms of the House shouting "division". MPs have eight minutes to get to the Division Lobby before the doors are closed. Members make their way to the Chamber, where Whips are on hand to remind the uncertain which way, if any, their party is voting. Meanwhile the Clerks who will take the names of those voting have taken their place at the high tables with the alphabetical lists of MPs' names on which ticks are made to record the vote. When the tellers are ready the counting process begins - the recording of names by the Clerk and the counting of heads by the tellers. When both lobbies have been counted and the figures entered on a card this is given to the Speaker who reads the figures and announces "So the Ayes [or Noes] have it". In the House of Lords the process is the same except that the Lobbies are called the Contents Lobby and the Not Contents Lobby. Unlike many other legislatures, the House of Commons and the House of Lords have not adopted a mechanical or electronic means of voting. This was considered in 1998 but rejected. Divisions rarely take less than ten minutes and those where most Members are voting usually take about fifteen. Further information can be obtained from factsheet P9 at the UK Parliament site.

majority

The term "majority" is used in two ways in Parliament. Firstly a Government cannot operate effectively unless it can command a majority in the House of Commons - a majority means winning more than 50% of the votes in a division. Should a Government fail to hold the confidence of the House, it has to hold a General Election. Secondly the term can also be used in an election, where it refers to the margin which the candidate with the most votes has over the candidate coming second. To win a seat a candidate need only have a majority of 1.

Prime Minister

http://en.wikipedia.org/wiki/Prime_Minister_of_the_United_Kingdom

Opposition

The Opposition are the political parties in the House of Commons other than the largest or Government party. They are called the Opposition because they sit on the benches opposite the Government in the House of Commons Chamber. The largest of the Opposition parties is known as Her Majesty's Opposition. The role of the Official Opposition is to question and scrutinise the work of Government. The Opposition often votes against the Government. In a sense the Official Opposition is the "Government in waiting".

other place

The House of Lords. When used in the House of Lords, this phrase refers to the House of Commons.