Consumer rights are changing: MSE asks Jo Swinson what's happening

So to explain what's happening and why, we put both our and our users' concerns and questions to Consumer Affairs Minister Jo Swinson. Read what she said in our Q&A below.

If you want to know your rights for goods and services bought before 1 October, see our Consumer Rights guide.

Consumer Affairs Minister Jo Swinson explains what's happening to consumer rights.

Q (MSE). Why has the government updated our consumer rights now?

A (Jo Swinson). These changes are long overdue. Consumers and businesses alike have told us that consumer law was too complicated and hard to understand.They said they spent too much time trying to resolve issues because it wasn't clear enough what should happen if things go wrong.

A good example of this is a consumer having faulty goods, and after multiple attempts at repair, a business still not offering a refund. We want everyone to have clear expectations in situations like that.

Our changes also take account of the way people buy digital content.  This is a large and growing part of the economy and we have updated the law for the 21st century by giving consumers clear rights when they buy digital content.

What we have achieved here is a set of consumer rights that is fit for the future.

Q. We've heard two elements of the Act are coming in earlier than the main changes in October. Can you explain what they are and when they will be happening?

A. The main elements of the Act which we intend to come into force before October relate to the resale of tickets for events and requirements on letting agents.

The new rules applying to the resale of tickets on online secondary platforms, such as ViaGoGo and others, will come into force in late May.  This is to ensure that the provisions on the resale of tickets are in force for major summer events such as the Ashes, Wimbledon and the Rugby World Cup in the autumn.

The new rules set out what information needs to be provided to prospective buyers using these platforms, and restricts the ability of event organisers to cancel tickets that are being resold or to blacklist the original purchaser for reselling.

The rules also oblige the ticket sales platform to report incidents of criminal activity, and require the Government to establish a review of the consumer protection measures for the sector.

New requirements on letting agents are also intended to come into force in late May. Letting agents will be required to publicise their fees, clearly state whether they are a member of a client money protection scheme, and state which redress scheme they are a member of.

Q. We've asked lots of questions about the changes to the law on faulty goods, services and digital goods but we believe other rights will be included in the Act. Can you explain what these are?

A. In addition to the rights on goods, services and digital content, the Act contains a wide range of other measures that help to make the law clearer, and work better for consumers. In particular, the Act will:

• Require contract terms to be in clear language and clarify what the contract terms that consumers may challenge as unfair in the courts – this aims to make the small print bigger.

• Give the courts and enforcers greater flexibility to take the most appropriate action for consumers when dealing with breaches of consumer law.

• Introduce easier routes for consumers and small businesses to challenge anti-competitive behaviour.

• Consolidate enforcers' powers to investigate potential breaches of consumer law and clarifies that Trading Standards can operate across local authority boundaries.

Q. I purchased a washing machine three and a half years ago and it's now broken down. What help can I expect from the retailer under the new consumer rights rules as I'm currently being told I need to pay £200 for the repair, as I'm out of the warranty period?

The machine didn't cost much more but surely it should last more than three years!

A. Because you're talking about goods that you own at the moment, the current law applies rather than the new Act. Even if you're outside your warranty period, you may still have rights under the law as they are separate from any rights you have under a warranty. 

It will depend on whether you can prove that the machine was faulty when you bought it, which could be the case if it hasn't lasted as long as a reasonable person would expect, based on factors like how much it cost and how it was described. 

If this is the case then the retailer should put things right free of charge. This would mean providing a repair or a replacement and this would need to be done in a reasonable time and without causing you significant inconvenience. 

Ultimately, if these requirements are not met, then you could return the machine and get some money back.

Under the new Consumer Rights Act, the right to repair or replacement after three and a half years will still depend on whether you can show the goods did not meet your rights – for example, if they are not of satisfactory quality.

If this is the case, you'll only have to allow the trader to deal with the fault through one repair or replacement, and if that doesn't fix the fault or another fault appears, you'll be able to move straight to claiming some money back.

Q. A small part on my two year-old tumble dryer has just broken, and the machine is useless without it. I'm still within the guarantee but am being told the part is a 'consumable' item so isn't covered.

Does the new Act clarify what counts as 'consumable' so people know what they may still have to pay for?

A. The Act doesn't talk about consumable items and non-consumable items in those terms, but you will still be protected by the law even if the terms of your guarantee exclude those parts. Your rights under the law are separate from any rights under a guarantee.

If you can prove that the dryer was faulty when you bought it, for example because the tumble dryer has not lasted as long as you would reasonably expect for one of this cost and description, then you'll have rights under the Act.

It would mean that you'd be due a free repair of the dryer, by replacing the broken part (if that's possible) and if that repair failed to fix the problem or the part broke again, you would be entitled to send the dryer back and get some money back.

Q. It's currently not clear whether you have to accept a repair if that's what the retailer offers. Is this one of the things the new Act is going to simplify?

A. Yes, the Act is clearer about when you must accept a repair:

• You don't have to accept a repair for faulty goods in the first 30 days – you can get a full refund instead; and

• You don't have to accept a further repair if you've already given the retailer the opportunity to fix faulty goods through a repair or replacement. At this point, you can get a refund instead (this refund could be full or partial, depending on the amount of time that you've owned the goods).

But there are situations where you will have to accept a repair of goods. If you're outside your initial 30 day period, then you are entitled to have the fault put right. You can ask for either a repair or a replacement, but if the replacement would be disproportionately costly to the trader compared to a repair you would have to accept a repair instead.

For example, if your new £500 tablet doesn't work, you couldn't demand a replacement if the retailer can provide a repair quickly and at a fraction of the cost.

If your digital content is faulty you can't hand it back for a refund, but the trader still has to put it right. That means they have to provide a repair or replacement (a patch or a new download, perhaps).

There isn't the same minimum of one repair or replacement for digital content so the trader can provide more than one, but they must be done within a reasonable time and without significant inconvenience to you. If the trader fails to do this, then you're entitled to some money back.

Q. How long is a 'reasonable time' to carry out a repair and when the Act says repairs or replacements need to be carried out without a 'significant inconvenience' what does this mean?

A. These requirements depend on the circumstances, and that's a really important part of making sure that the law is flexible enough to work properly.

The time needed to repair a fault on a wooden table that just needs to be sanded down is very different to the time needed to find and fix a fault in a complex piece of machinery like a car. The law needs to cover both of these cases and a huge range of others.

'Reasonable time' means the time that would be reasonable for the repair to take, given the nature of the goods, the issue with the goods, and the purpose for which the consumer bought the goods.

'Significant inconvenience' is also meant to provide the same sort of flexibility, and depends on the nature of the goods and the purpose for which the consumer bought them. But I know that some consumers find it hard to argue that they have experienced it.

That's why the new Act says that you can ask for a refund if the goods still don't meet the Act's requirements after one repair or replacement – it's to stop people from becoming trapped in a cycle of repairs or replacements unsure of whether or not they can claim to have experienced 'significant inconvenience'.

Q. Does the one repair-and-then-refund rule apply only to a single fault (i.e. one attempt to repair it), or would this cover two different faults?

A. One repair can fix two (or more) faults. Once the retailer has given a repair, if the same fault (or one of the same faults) comes back or if a different fault appears, then the consumer can ask for a refund.

Q. Can the trader still turn down my request for a repair or replacement if they think it's disproportionately expensive? What does disproportionately expensive mean?

A. The trader has to provide either a repair or replacement as long as it's possible to do so. If the remedy requested (that is, the repair or replacement) is disproportionate then the trader must provide the other.

A repair will be disproportionate if the costs for the trader are unreasonable compared to the cost of providing a replacement. The value of the goods, the extent of the problem, and whether a replacement can be provided without significant inconvenience to the consumer all need to be taken into consideration.

For example, if a consumer complained that a drawer on their £700 chest of drawers kept sticking and insisted on a replacement, the trader could refuse to replace it as long as they were able to provide a repair, assuming that repair would cost a lot less than the £700.

Q. What happens if goods can't be tested fully until after 30 days? For example buying a lawn mower in winter - a time when you don't mow grass.

A. After 30 days you lose your right to go directly to a refund, but it doesn't mean you are left without any rights.

If the goods do not meet the Act's requirements, the trader will still need to put things right by repairing or replacing the goods. If they fail to do so, you can get some money back, as explained in question 6 above.

Q. What do people do if the business doesn't follow the new rules?

A. Our changes will mean that it is very clear what the trader's obligations are, and help to resolve any problems that arise.

My advice is that consumers should first speak to the trader to give them the chance to put things right.

If this fails they should contact Citizens Advice (03454 04 05 06). They provide free advice on consumer rights and can also refer your complaint to local Trading Standards officers who have the power to investigate breaches of law.

Of course the law also gives consumers the right to take the trader to court. However, we recognise that even a relatively simple process like the small claims court may put many consumers off.

That is why we are also introducing a requirement on traders to give details of certified Alternative Dispute Resolution (ADR) schemes from July 2015.

ADR involves an impartial third party (such as an ombudsman, mediator or adjudicator) looking at the evidence from both parties and providing an impartial view of the dispute. This should take no longer than 90 days and be free or very low cost to the consumer.

Whilst not all traders will be obliged to use ADR, they must all highlight the ADR provider in their sector and confirm whether they will use that provider. Citizens Advice have a page on their website that gives guidance on the Small Claims Court process (you can select what part of the UK you're in at the top of the page).

MSE Insert: You can also see our own Small Claims Court guide for how to make a claim, whether it's the best course of action, and how to max your chance of winning.

Q. You've told us in the past the law can be just as hard for businesses to understand as it is for the consumer. How are businesses being educated about the updated rights and what training are they expected to provide for their staff?

A. The success of the Act will depend on businesses knowing about the changes, and acting upon them. This is why we formed an Implementation Group, which includes representatives from business, consumer groups (including MoneySavingExpert.com) and enforcement bodies.

Business education is a key part of this work. In the next few months, we have all kinds of publicity lined up aimed at getting the Consumer Rights Act on the radar of businesses, and giving them the tools to adopt the changes as easily as possible.

While it will be up to individual businesses to decide on training for their staff, we are doing everything we can to help. For example, the Implementation Group has put together a simple explanation of the new rights, which businesses can choose to display. This should help their staff when they are talking to consumers.

And we want consumers to be part of this too. MoneySavingExpert readers will be ahead of the curve in understanding their new rights in October. I am sure they will put their savvy shopping to great use in helping businesses who aren't up to speed.

Q. Lots of MoneySavers have been told in the past to take their complaint to the manufacturer rather than the retailer. Will this still be the case and how does it apply to digital goods, eg an app I've bought from iTunes?

A. Let me be clear here, that's not the case now and it won't be the case under the Consumer Rights Act. If goods, digital content or services go wrong, the consumer will have legal rights against the person or company that they bought them from.

That means if you buy an app, you go to the app marketplace and don't have to try to track down the developer!

If you get a manufacturer's warranty it may give you additional rights that work alongside your legal rights under the Act. You can choose to exercise your rights under the warranty and would need to go to the manufacturer to do that.

You can also exercise your rights under the Act against the trader you bought from, whether or not the goods came with a warranty.

Q. Some of the boundaries between goods, services, and now we have digital goods too, are a bit blurred. For example buying a CD-Rom (goods) which comes with a year's licence (a service) and downloadable software (digital content) could be all three.

How do people tell which rights they're entitled to?

A. The general rule is that you look at the part of the contract that's gone wrong, and then you look at the part of the Act that deals with that type of contract. So, in the example quoted, if the downloaded software was faulty, you would look at the digital content rules under the Act, but if the CD-ROM didn't work, you would look to the goods rules.

There are a couple of particular rules to be aware of, though:

If digital content that is on or in goods (e.g. software on a CD-ROM, or the program in a washing machine) goes wrong, then it means the goods are faulty and the goods remedies therefore apply.

If you pay a trader to both provide goods and install them (a service) and the installation isn't carried out properly, then the goods remedies apply except for the 30 day right to reject. This means that the trader has a chance to correct the installation.

(If the goods themselves are faulty, rather than the installation, you still get the 30 day right to reject.)

Q. Are the rules different for second hand goods?

A. No, the law works in the same way for new and second hand goods. Second hand goods will still need to meet the requirements under the Act such as being of satisfactory quality, but the standard for second hand goods to meet this would normally be lower than for new goods.

Many of the protections under the Act will not apply to second hand goods that are sold at a public auction which individuals can go to in person.

Instead, there will be rights under the Sale of Goods Act, with less extensive statutory remedies. This is because buyers in these situations can adjust their bid to reflect the quality of particular goods.

The Sale of Goods Act 1979 will remain in force for sales contracts that are not between a consumer and a trader (for example, supply contracts from one trader to another), and contracts where consumers buy second hand goods at public auction.

Q. How extensive will the digital rights be in practice? For example if the initial "goods" are fine, but a later update by the developers causes bugs or crashes?

A. The new rights for digital content give important protections to consumers and have been carefully developed to reflect the nature of digital content. The Act recognises that the nature of some types of digital content means that they can change over time through updates, etc.

The digital content must still meet the required standards – it must still be of satisfactory quality, fit for a particular purpose and match the description after the update. If the update means that this is no longer the case, the trader must put it right or give you some money back.