21 FAQs people ask about distance selling and marketing
The regulations relating to distance selling (Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013) apply to sales of goods and services to consumers where there has been no face-to-face contact between the customer and your business (or someone acting for you). The regulations apply to selling by mail order, via the internet (or digital television), by telephone or by fax.
You are exempt from the regulations if you make a one-off distance sale in response to a request from a customer. However, this exemption does not apply if you have organised your business to regularly deal with "one-off" requests.
There are also a number of exemptions for particular products and services.
The Consumer Contracts (formerly Distance Selling) regulations do not apply to:
In addition, some products and services are exempt from the requirements to provide specified information or from the right to cancel.
In general, if you have not had face-to-face contact in connection with an individual order, it counts as distance selling. For example, you might provide a catalogue and take a first order face-to-face; if a customer places a subsequent order without seeing you again, that is distance selling.
Mail shots and advertisements on websites are covered by the UK Code of Non-Broadcast Advertising, Sales Promotion and Direct Marketing (CAP code). In essence, this requires ads to be legal, decent, honest and truthful. Following a recent change in the law, the CAP code now also applies to Facebook, Twitter and any other non-paid-for online space you control (eg blogs or other social media sites such as LinkedIn). Read an online version of the CAP code on the Committee of Advertising Practice website. Mail shots and websites are also covered by the Consumer Protection from Unfair Trading Regulations, which makes giving false or deceptive information about your goods or services an offence.
You should also be aware that what you say in your mail shots (or on your website, Facebook page, blog etc.) may become part of any eventual contract. So, for example, if a customer purchases something because of a false claim on your website, they may be entitled to make a claim against you.
You must provide clear information to help the consumer decide whether to buy from you. This "prior information" must include:
If you want to supply substitute goods because the ones you agree to supply are not available, you must explain this, and make it clear that you will meet the costs of returning any substitutes the customer does not want.
You do not have to provide prior information if you are agreeing to provide accommodation, transport, catering or leisure services on a specific date or within a specific period. So, for example, you can take a phone reservation for a room in your hotel without being required to provide this information.
In addition, the information requirements of the Consumer Contracts regulations also do not apply to sales of package travel or timeshares (which are covered by separate regulations), nor to everyday food and drink delivered by a regular "roundsman" like a milkman. This exception does not apply to home deliveries by supermarkets.
If you are required to provide "prior information", you must provide it in a durable form (see below). You can do this when you first provide the information or later. As well as the prior information, you must provide details of the following:
You can provide information in a durable form by letter, fax or email or in an advertisement or catalogue. All confirmation information must be provided in good time - at the latest when the goods are delivered (or the service performed).
Under normal contract law, a contract becomes binding when an offer is made and accepted. This can be either when you make an offer to sell to the customer, which the customer accepts, or when the customer makes an offer to buy from you, which you accept. However, under the regulations, your customer will normally have the right to cancel a purchase — under new regulations that came into force on 13 June 2014; this is now 14 calendar days after the delivery of the goods.
As you are bound by the contract once it is made, you do not want to enter into any contracts that you will be unable or unwilling to fulfil. This can happen, for example, if you offer to sell a product (and the customer accepts your offer) but you then find that you do not have the product in stock. For this reason, you may want to ensure that your marketing materials (for example, your catalogue or your online shop) state that you are not making an offer but are issuing an "invitation to treat" and that any offer the customer makes to buy from you will only be accepted when you say so.
Unless you have agreed otherwise, you must deliver goods (or start providing the service) within 30 days of the order.
If you are not able to meet this deadline, you must tell the customer (within the deadline) and ask them to accept a delay. If they do not accept, the contract is cancelled and you must refund any money they have paid within 30 days.
Customers usually have the right to cancel a purchase by giving you written notice within a specified time frame, though there are significant exceptions. Notice can be given by letter, fax or email, but not by phone.
Purchases of goods or services can be cancelled up to 14 calendar days after the delivery of the goods or the service contract commences. You must make a model cancellation form available for distance and door-step sales. If you provide digital downloads eg of music, films, computer games or apps these cannot be cancelled once the download process has started, but you must make this clear to the consumer - and the consumer must explicitly agree to this. However if the digital content is faulty, the consumer is entitled to a repair or replacement and if the fault can't be fixed or isn't fixed within a reasonable amount of time or without significant inconvenience, they can claim some or all of their money back. If you have failed to provide confirmation of all the required information, the cancellation period is extended to seven days after you provide the information — with an overall maximum of three months and seven working days.
A customer who cancels a purchase must take reasonable care of any goods you have supplied and make them available for you to collect. You must refund the customer any money they have paid as soon as possible, and in any case within 14 calendar days of receipt of cancelled goods. Unless you are collecting the cancelled goods, you are entitled to wait for evidence of the return of goods before giving a refund. You are also permitted to deduct damages for wear and tear where the goods have been used. Make sure the customer is informed, in plain language, of who is responsible for the cost of returning goods and other information regarding cancelling purchases and refunds. If you don't make this clear, you will be responsible for the return of cancelled purchases.
You can agree a contract that requires the customer to return the goods to you if they cancel and to pay the direct costs of your recovering the goods if they fail to do so. If so, this must be included in the information you confirm to them. You cannot, however, require the customer to pay the cost of returning any faulty or substitute goods.
Unless you have agreed otherwise, customers do not have an automatic right to cancel purchases of:
In general, the customer still has the right to cancel before the end of the cooling-off period. One way round this is to agree with the customer, when you are negotiating the contract, that they will not be able to cancel once performance of the service has started. You must agree this before you agree the contract, and must confirm this as part of the durable information you provide.
The customer's right to cancel automatically ends if you start performing the service with the customer's agreement and have already provided the required durable information. But if you start performing the service without the customer's agreement, the customer will still have the right to cancel until the end of the cooling-off period.
If the purchase is being made under a related credit agreement (eg credit offered by you or a related business), the credit agreement is automatically cancelled.
If the customer has used credit not related to you (for example, a credit card but not your own store card), that credit agreement will still stand — but you are required to refund the customer as soon as possible and in any case within 30 days. In practice, credit card issuers usually have systems (and agreements with you) that allow them to automatically reclaim any such refund.
You can if the customer agrees. If so, your agreement should clearly state what rights the customer has to return goods he does not want, who will be responsible for returning the goods and so on.
However, if you send goods on approval without the customer's agreement, the situation is completely different. The customer is under no obligation to return the goods to you (or to allow you to collect them) and it is an offence for you to demand payment for them.
While the customer's cancellation rights under the Consumer Contracts regulations come to an end once the cooling-off period is over, consumers have other rights. For example, they can reject goods that you have misdescribed or that are faulty.
If goods develop a fault within six months of being supplied, it will generally be assumed that the fault was there when you sold them (unless you can prove otherwise). So customers will be able to return these goods to you and require a refund. You should not require customers to pay for the cost of returning faulty goods.
Unless you have agreed otherwise in the contract, the customer is not obliged to return the goods to you at all — they are simply required to make them available for you to collect.
You can, however, agree a contract that requires the customer to return the goods to you if they cancel and to pay the direct costs of your recovering the goods if they fail to do so. If so, this must be included in the information you confirm to them. You cannot, however, require the customer to pay the cost of returning any faulty or substitute goods.
The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (formerly Consumer Protection (Distance Selling) Regulations 2000) protect UK consumers, and apply regardless of which country a supplier is based in.
Many other countries have similar laws protecting their consumers which will apply to any supplier — including businesses based in the UK. Within the European Union, most countries' consumer protection laws are very similar.
The distance selling regulations apply to sales made to consumers over the internet (or using other technologies such as digital television) in the same way as they apply to selling using mail order.
There are also additional regulations you need to consider:
You can make cold calls, but you must not make unsolicited marketing calls to individuals or businesses who have indicated that they do not want to receive them. They can do this either directly to you or by registering with the Telephone Preference Service.
If you are making a marketing call, you must clearly state the name of your business and explain the nature of your call at the start of the conversation.
Pestering customers with repeated unwanted phone calls is an offence under the Consumer Protection from Unfair Trading Regulations.
Individual consumers can register with the Mailing Preference Service (MPS) to say that they do not want to receive direct mail from companies with which they do not have an existing relationship. Use of the MPS list is not a legal requirement, but direct mail companies, such as mailing list providers and members of the Direct Marketing Association, will screen their mailing lists against it.
If you do not have an existing relationship for a similar product, you should not send unsolicited emails or "spam" to consumers. You must only send messages if the consumer has previously agreed (for example, by opting-in on your website).
There is a limited exception where you are allowed to send emails to individuals when the following three conditions are met:
You can send unsolicited emails to companies, but must include an opt-out so they can say they do not want to receive similar messages in future.
Where you send an email to several recipients, you should also take care to ensure that you do not accidentally disclose other recipients' email addresses. This could be a breach of the Data Protection Act's requirement that you keep personal data secure.
The same rules apply to using any other form of internet communication such as instant messaging software.
SMS messages are covered by the same rules as email: unless you have a relationship with them, you can only send emails to individuals who have opted-in and to companies who have not opted-out. You must also provide a simple method for recipients to opt-out from receiving further messages.
Few organisations use faxes anymore, however you must not send an unsolicited fax to an individual without their prior consent. You can send unsolicited faxes to companies, but not if they have asked you not to or registered their fax number with the Facsimile Preference Service.