The Trading Bulletin: June 2024

Welcome to our Trading Law Bulletin, where we share the latest developments on data protection, financial services, health and safety, environmental issues, and marketing.

Data protection updates

New fining guidance

New data protection fining guidance has recently been published by the ICO. The new guidance takes into account substantial developments in the data protection landscape and aims to provide greater transparency for organisations by, amongst other things, setting out the methodology the ICO will use to calculate the appropriate amount of the fine.

The guidance has also replaced sections regarding penalty notices in the ICO Regulatory Action Policy (published in November 2018).

Further information can be found on the ICO's website.

The ICO joins the Global Cooperation Agreement for Privacy Enforcement

The ICO has signed a new international multilateral agreement with the Global Cooperation Arrangement for Privacy Enforcement (Global CAPE) (which facilitates cooperation and assistance in privacy and data security investigations among a number of Asian Pacific countries). The ICO and Global CAPE will work together to provide more streamlined cross-border data protection and privacy enforcement.

See the ICO's update here.

European Union AI Act

In March 2024 the European Parliament formally adopted the Artificial Intelligence Act (AI Act), which is deemed to be the world’s first comprehensive horizontal legal framework for AI. The AI Act provides EU-wide rules on data quality, enforcement, transparency, human oversight, and AI liability. Non-compliance by EU Member States could result in regulatory fines of up to 35 million euros or 7% of global worldwide turnover.

The European Commission has provided further information here.

The growing threat of cyber attacks

Recent data from the ICO reveals that more organisations than ever are experiencing cyber security breaches. Over 3,000 cyber breaches were reported to the ICO last year, with the finance (22%), retail (18%) and education (11%) sectors reporting the most incidents. With such statistics, the ICO is calling for organisations to improve their cyber security in order to protect the personal information they hold. To assist organisations, the ICO has published the “Learning from the mistakes of others” report, which offers practical advice for understanding common security failures and includes simple steps which can be taken to improve security.

The “Learning from the mistakes of others” report can be found here.

Financial Services updates

FCA Anti-Greenwashing Guidance

FCA-authorised retailers should note that the FCA has published its final guidance on the new anti-greenwashing rule, which came into force on 31 May 2024. The anti-greenwashing rule requires FCA-authorised firms to ensure (among other things) that any references they make in the course of their regulated activities to the sustainability characteristics of financial products and services are fair, clear, evidenced and neither misleading nor exaggerated.

For more information on the FCA's anti-greenwashing rule click here.

To find out more about the FCA's Consumer Duty click here.

Financial Conduct Authority Business Plan 2024/2024

FCA-authorised retailers should note that the FCA's most recent business plan demonstrates that consumer duty remains a priority with the FCA investigating the transparency of charges, consumer wellbeing and claims (particularly in relation to vulnerable consumers) and the accessibility of financial products and services.

To read the FCA's 2024/2025 Business Plan click here.

Health and Safety/Environmental updates

Assaulting a retail worker to be made a standalone criminal offence.

Rishi Sunak confirmed the Criminal Justice Bill will be amended to create a standalone offence of “Assaulting a retail worker”.

Our Head of Retail and Consumer, Nathan Peacey, gives his thoughts on this in Drapers article.

Asbestos – Your Duty (Podcast)

As part of HSEs Asbestos campaign, HSE have released a podcast covering asbestos in non-domestic settings. [22:03] Craig Barker, Group Property FHS & Asbestos Manager at Marks and Spencer discusses how Marks and Spencer manage the risk in their stores and distribution centres.

Listen to the podcast here.

Building Safety Act

Following the end of the transitional period on 6 April 2024 it is no longer possible to issue an initial notice to stay within the old regime and all projects involving Higher-Risk Buildings are now subject to the more rigorous building control regime.

Read our article here.

Updates to RIDDOR Guidance

HSE has updated its Report of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR) guidance including further details on who should report under RIDDOR and whether the incident is reportable.

See RIDDOR guidance here.

Enforcement action for non-compliance with Extended Producer Responsibility Scheme is on the horizon

Under the Packaging Waste (Data Reporting) (England) Regulations 2023, the Government requires in-scope organisations to collect and report packaging data. Late data submissions provided by 31 May 2024 were not subject to enforcement action. However, from 1 June 2024, the Environment Agency (the "EA") can commence enforcement action against companies who fail to comply with their packaging data reporting requirements.

See our article here.

Marketing updates

Misleading advertising

The ASA estimates that about 70% of the complaints they receive on a yearly basis relate to misleading ads, so it is only natural that the authority has decided to put together a piece on how to avoid misleading consumers.

The CMA green claims crackdown

On 27 March, the CMA issued an open letter to fashion retailers calling on them to consider their obligations in relation to green claims. For more on this, see our previous Retail Reduced round-up here.

Aside from setting out some of the key principles from the Green Claims Code, the letter noted that if retailers do not comply with their duties under consumer protection law, enforcement is likely. With the Digital Markets, Competition and Consumers Bill having completed its passage through Parliament on 23 May – and the powers it will introduce for the CMA in relation to tough financial penalties for breaches of consumer law – businesses need to review their handling of environmental claims in marketing.

Podcasts – new ASA guidance on advertising

On 16 May, the ASA and CAP published new research and guidance on how to make sure that in-podcast advertising were identifiable as such when read out by presenters. Given the popularity of podcasts, it is important for podcasters to understand that the non-broadcast advertising rules apply to them as well.

The research suggested that consumers preferred to have clear warnings at the beginning of an ad, such as the terms "paid-for advertisement" or "sponsored" to ensure they identified the content as an ad. Other things, such as music being played to make the ad stand out from the rest of the podcast was another preferred method of ad identification.

The guidance will come into effect from 16 August 2024.

The CMA asks grocery stores to ensure accurate pricing

The CMA has been looking into whether in-store pricing at grocery retailers is clear, accurate and matched the price people were charged at the till. The failure to provide clear and accurate pricing information is a breach of consumer law. During some of its on-site inspections, the CMA found that some products had either inaccurate prices or no prices at all.

The review was conducted across England and Wales at 139 grocery stores, with a focus on specific products, such as fresh fruit and vegetables and discounted goods. Overall, the majority of issues were found at independent food stores and symbol convenience stores (which are small, independent retailers operating under a symbol brand name). 60% of the errors resulted in the payment of higher prices at the till.

A CMA spokesperson noted the importance of getting the price right, especially at a time when people are looking to save money where they can.

If you would like to discuss any of these points further, please contact one of the team below.