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Consumers set for better protection from unfair contracts

contract
Press Association
Press Association
Editor
25 July 2012

Consumers will have greater protection from unfair terms hidden in the small print of financial, energy, mobile and gym contracts, under new proposals.

Fierce competition could be driving some traders to hide their full costs in the small print, the Law Commission and the Scottish Law Commission say.

The commissions are seeking views on proposals to protect consumers from unexpected charges and to require terms to be written in easy-to-understand language.

The earliest any changes could come into effect is 2014, as the proposals still have to be approved by the Department for Business and then Parliament.

'Must be clear'

Law Commission spokesman David Hertzell says: "We know that the majority of consumers do not read contracts thoroughly before they sign them.

"They tend to focus on what appears to be the cost, expecting traders to make their money from the ticket price and not from charges that emerge later in the small print.

"We believe that it should be made clear to consumers what they are committing themselves to before they sign a contract.

"If they are taking out a loan, for example, they should know up front exactly what it is going to cost them. If they are signing up for a mobile phone or gym membership, it should be clear from the start what the service will cost and how long the contract will run for."

The Law Commission is a Government-appointed body created to keep the law under review and recommend reform.

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