A summary of the UK Government's 2018 green paper on 'Modernising Consumer Markets' and considering the regulatory framework post Brexit.

1. A future for regulation in the
UK
Tom Kiedrowski
Managing Director, Cedar Tree Advisory Service
2 May 2018
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2. 1 Introduction
• EU exit has raised concerns over the potential for the
removal of consumer safeguards and weaker regulatory
protection
• At the same time businesses have expressed concern
over the regulatory uncertainty that EU exit could
create
• The Government has made it clear on several occasions
- including at previous NCF events - that EU exit isn’t
about a race to the bottom
• The latest green paper from BEIS gives us some insights
as how the post-Brexit regulatory and consumer
landscapes might evolve with its commitment to:
"an open, liberal, modern economy, built on
the core principles of competition, free
trade and high regulatory standards"
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3. 3
• The Government published its green
paper on 11 April, setting out 3
principles for responding to the
challenges and opportunities of
modern consumer markets:
• Competition has a central role to play,
working with regulation in the consumer
interest
• Consumers should be able to enjoy the
benefits of modern technologies and
business models
• But with effective protections and redress
if things go wrong
• The consultation closes on 4 July
2 Modernising Consumer Markets

4. 3 Competition in the Consumer Interest
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• The Govt doesn’t plan to make fundamental changes to the legal framework after the
EU exit
• A statutory review of certain aspects of the UK's competition regime under the
Enterprise and Regulatory Reform Act 2013 is required by April 2019, including:
• Have the 2014 reforms to the competition regime helped to deliver competition in
the UK economy for the benefit of consumers?
• Does the competition regime provide the CMA and regulators with the tools they
currently need to tackle anti-competitive behaviour and promote competition?
• Do you agree with the approach set out in the draft Strategic Steer to the CMA?
Are there any other areas you think should be included?
• Is the competition regime sufficiently equipped to manage emerging challenges,
including the growth of fast-moving digital markets?
• The green paper includes some questions on how the regime should be adapted for the
digital economy, including:
• how it should address digital platforms, agglomeration across the sectors, data
algorithms and the consolidation of competitors?
In other words does the CMA has the necessary tools, particularly in regards to
emerging challenges and fast moving digital markets?

5. 4 Regulation in the Consumer Interest
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“To ensure the roles of government and the regulators are clear in
working together to create well-functioning consumer markets and an
environment for long-term investment”
• The creation of a new Consumer Forum, chaired by the Minister for
Consumer Affairs, to discuss overarching priorities for the regulated
sectors.
• The introduction of ‘scorecards’ for suppliers and digital comparison
tools operating in regulated sectors including energy, telecoms and
water to tackle poor performance, for example by ‘naming and
shaming’ poor performers or highlighting suppliers who fail to meet
certain minimum standards.
• Telecom is identified the sector as having high levels of consumer
detriment and consults on whether consumer advocacy
arrangements in the telecoms sector need to be strengthened?
• Protecting the vulnerable: by preventing harm to vulnerable
consumers and encouraging companies to have policies and
processes for supporting the vulnerable, particularly given
technological changes

6. 5 A CONSUMER CHARTER FOR
REGULATORS (2012)
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“The main purpose of regulation is to promote and
protect the interests of consumers in sectors where
market forces alone would not deliver the best
outcome. An effective regulator will...
• Put consumer interests at the heart of what
regulators do
• Understand what a good outcome looks like for
all consumers and deliver it
• Be an alert watchdog and act swiftly on behalf
of consumers
• Be transparent and accountable to consumers

7. 6 Enjoying the benefits of modern
technologies and business models
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The Government wants to revise the legal framework to
support:
• consumer-to-consumer transactions, especially online.
• contributions on, and experiences of personalisation of
prices and search results to inform its future work.
In addition, the green paper suggests that the data collected
by online companies in exchange for 'free' goods and
services means that consumers will need to understand what
they have agreed to when accepting T&Cs and privacy
notices: less than 1% of consumers open the T&Cs when
purchasing goods and services online.
Firms can expect new guidance to be issued by the
Behavioural Insights Team on presenting T&Cs and privacy
notices online.

8. 7 Effective protections and redress
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• Strengthening enforcement:
• Govt intends to give civil courts the power to impose financial
penalties on companies for breaches of consumer law
• all consumer law enforcers, including the CMA and Trading
Standards, will be able to ask the courts to impose fines. The
financial penalty would be subject to a total cap of 10% of a firm's
worldwide turnover (as currently under competition law)
• Options for making the Office for Product Safety and Standards an
independent body, subject to public consultation
• Improving redress – ADR:
• how to make ADR more accessible and simpler for consumers, and
how to incentivise more businesses to participate in ADR?
• Should businesses in non-regulated sectors be given a choice of ADR
provider amidst concerns that it confuses?
• Mandatory ADR to be considered for sectors where there are high
levels of high value complaints such as second hand cars and home
improvements
• Reducing the use of unfair terms:
• 54% of businesses are not familiar with the law in relation to unfair
terms. CMA to continue to work, with other regulators, to improve
compliance and reduce the use of unfair terms in consumer
contracts

9. Thank you!
• To discuss any of the issues raised in this presentation, please contact
Tom Kiedrowski at:
enquiries@cedartreeadvisory.com
Or visit the website at:
www.cedartreeadvisory.com
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