CMA Publishes COVID-19 Taskforce Update for July

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Latham & Watkins LLPThe CMA continues to field COVID-19 complaints concerning refunds and previously widespread excessive prices on day-to-day products.

The CMA continues to respond to complaints from consumers on COVID-19-related issues. Consumers submitted more than 80,000 complaints through 28 June 2020, with the volume decreasing from 7,000 a week in May to 3,500 a week in June.

The vast majority of complaints concern refunds for cancellations, with concerns covering an outright refusal to pay a refund; complexity in granting refunds; and pressure to accept vouchers instead of refunds. Most complaints relate to holidays and lettings, followed by travel, and the supply of goods. Examples of recent interventions by the CMA are undertakings accepted by the CMA from holiday lettings firms. (More information is available here.)

Complaints to the CMA over allegedly excessive prices have become less frequent than in previous months, leading the CMA to consider that consumer concerns over excessive prices are less widespread. Most pricing complaints have related to food and drink products, followed by hygiene and personal care products. Complaints relating to medication products follow as the third-highest category. The CMA has opened competition law investigations into suspected breaches of competition law by four pharmacies and convenience stores. These investigations relate to suspected charging of excessive and unfair prices for hand sanitizer products during the COVID-19 pandemic. (See here for further details.)

The CMA issued a joint statement on pricing practices with several trade associations noting that,

[w]e remain concerned about the behaviour of a small number of businesses at this time. The vast majority have responded responsibly, but there is a minority who have not. Those who inflate prices to profit off the backs of their customers are adding to their distress at a time of particular vulnerability and may be severely damaging their own reputation.”

The statement continued, “[c]onsumers are likely to remember those businesses who attempted to profiteer and may well vote with their wallets once this crisis ends. For many businesses, the crisis could represent an opportunity to do the right thing, and as a result develop relationships with new customers”.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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