Failure to inform your retail customers of their rights to cancel the use of your product or service may have serious ramifications to your business.
Without clarity on cancellation rights, it can become more of a challenge to resolve any disputes which may arise, so it’s important for any business owner (and their team) to clearly set out their company’s approach to cancellations.
In this month’s blog, our focus is on two core areas regarding cancellation rights for consumers. Selling without face to face contact and selling away from your usual trade premises.
If you don’t understand what the law means to your business it may well jeopardise your reputation.
The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013
Its name is quite a mouthful but it’s important for any business that deals with consumers to understand how the rules on cancellations work.
A consumer is someone who is buying something for their own use which, means that they are not buying it for their business, or profession.
The law states if a consumer goes to a shop to purchase goods or services, they have no right to cancel a purchase UNLESS they are given rights to do so by the sales contract or any agreement in place. This is often referred to as a Returns Policy. This does not apply where goods are faulty or misdescribed or a service is not provided to a reasonably competent standard.
Cancellation rights apply when a consumer buys something online or through a catalogue or away from the trader’s usual premises, so for example in their home or at a craft fair.
Whether you’re a tradesman providing a service, or an independent business selling telecoms contracts, it’s essential you inform your customers of their rights to cancel when they have one.
By doing this you are making it clear that they can cancel – within the set down 14-day time period – and move on to elsewhere, hassle-free.
It’s worth noting when someone buys something online (the purchaser) they get 14 days to cancel as long as you tell them about their cancellation rights.
If you as the trader fail to tell them and explain how they can be exercised, the purchaser has up to one year to cancel and you have to refund the purchase price, cost of delivery and pay for the return costs in full.
Cancellation must be distinguished from Termination of a contract. This has a very specific legal meaning.
Termination is where someone has breached the conditions of the agreed contract. It’s a get-out clause for either party who have failed to adhere to what was agreed.
It is a criminal offence not to tell a consumer they have cancellation rights if they are completing agreements off-trade premises.
Be sure to tell your clients about their cancellation rights – even more, so where failing to inform them could cost your company money!
To summarise, every business must understand the rights their customers have to cancel and should always clearly share these before any transaction takes place.
For further information about cancellation rights please get in touch.