Published on:
07
October 2008
New laws to protect consumers from high-pressure sales in the home (and at their place of work) have been introduced.
The regulations are designed to protect consumers when they enter into contracts signed in their home or their place of work. Unlike the old legislation the new laws, cover both solicited and unsolicited contracts. This means that consumers are now covered if they have invited a salesperson around to their home as well as whether they enter into an agreement after a salesperson has cold-called.
Consumers should be aware however that if they agree in writing to work starting straight away and then cancel their contract within seven days, they will still have to pay a reasonable amount for any work done by the trader.
Brian Wilson, Trading Standards Officer with Stirling Council and Clackmannanshire Council joint Trading Standards Service said: "The old regulations gave consumers seven days in which to change their mind about a contract if they had signed it following a cold-call. These regulations were particularly helpful in tackling rogue traders engaged in work like roofing, block paving and tarmacing.
"The new law now covers solicited as well as unsolicited calls, which is good news as the regulations have been expanded to further protect consumers from high-pressure selling in the home. However, the regulations now make provision for a trader to ask the consumer to sign and give permission to start work straight away. There is a worry that consumers may be pressured into doing this on the basis that they will receive an additional discount from an inflated price. The consumer can still cancel the work within seven days if they agree to the work starting straight away but, crucially, they will be liable for any reasonable costs incurred by the trader during that time.
"Overall, the new regulations are a positive improvement, but we want to make sure consumers are aware that rogue traders may look to pressure householders into letting them start work straight away. It is important that consumers should not feel pressured into letting traders start work straight away and should always take time to think about agreeing to any work on their home, taking the opportunity to shop around and get more quotes first."
The Cancellation of Contracts made in a Consumer's Home or Place of Work etc. Regulations 2008 came into effect on 1 October 2008
Explanatory Note to the Regulations:
These Regulations give cancellation rights in respect of a contract for goods or services made during a visit by a trader to a consumer's home or place of work or on an excursion organised by the trader. They revoke the Cancellation of Contracts Concluded away from Business Premises Regulations 1987 and re-implement Council Directive 85/577/EEC ("the Directive") to protect the consumer in respect of contracts negotiated away from business premises. The Directive provides cancellation rights for contracts made in similar circumstances during an unsolicited visit by a trader.
Regulations 5 and 6 set out the circumstances in which the consumer has a right to cancel the contract. The Regulations do not apply to excepted contracts set out in Schedule 3.
Regulation 7 provides for the right to cancel a contract and sets out the requirements of a notice of the right to cancel. Schedule 4 sets out the information to be contained in a notice of the right to cancel including a form of cancellation notice for use by the consumer in cancelling the contract.
Regulation 8 sets out the requirements for a consumer wishing to exercise his right to cancel the contract.
Regulation 9 provides for payment to be made in respect of certain contracts when goods or services are received before cancellation.
Regulations 10, 12, 13 and 14 provide for the consequences of cancellation and the obligations and rights of the parties in these circumstances.
Regulation 11 provides for the automatic cancellation of a consumer credit agreement entered into at the same time as a contract for goods or services when the contract for goods or services is cancelled.
Regulation 15 protects the rights of consumers by providing that any term in a contract that is inconsistent with a provision for the protection of a consumer under the Regulations is void.
Regulations 17 to 23 relate to enforcement of these Regulations. Regulation 17 provides that it is an offence for a trader to enter a contract to which these Regulations apply without complying with the requirements of regulation 7 relating to the service of notice of the right to cancel. A person guilty of such an offence is liable on summary conviction to a fine of up to £5,000.
A transposition note and an impact assessment of the effect that these Regulations will have on the costs to business and the voluntary sector are available from the Consumer and Competition Policy Directorate, Department for Business, Enterprise & Regulatory Reform, 1 Victoria Street, London SW1H 0ET or on the BERR website (www.berr.gov.uk). They are also annexed to the Explanatory Memorandum which is available alongside the Regulations on the OPSI website. Copies of the impact assessment and transposition note have also been placed in the libraries of both Houses of Parliament.