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Lack of Knowledge on Unfair Contract Rules

Lack of Knowledge on Unfair Contract Rules

According to the research, which was published by the Competition and Markets Authority (CMA), 54% of businesses surveyed don’t fully understand the rules on unfair terms, and this can have a direct impact on how they treat their customers.

Unfair terms are those that give businesses an unfair advantage over consumers, often by reducing their rights or ability to complain if things go wrong. For example, they can include:

  • keeping all of a customer’s deposit if they cancel, regardless of the amount the business is actually losing as a result,
  • using excessively long notice periods that end up tying customers into a contract for longer than they want, and
  • excluding the business’ liability for things that are its fault (i.e. delays, or faulty goods or services).

The research showed that less than half (45%) of those surveyed claimed to know the rules on unfair terms well, whereas 36% owned up to not having a strong grasp, and 18% admitted they had never heard of them.

“Consumers have a right to be treated fairly – and businesses need to know that they can’t rely on their terms and conditions if they’re not fair,” commented Paul Latham, Director of Communications at the CMA.

“We know that the majority of businesses want to do the right thing by their customers, but it’s worrying that many businesses are not familiar with the law,” he added.

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