Brexit: will consumers be protected? Contents

Summary of conclusions and recommendations

The EU’s consumer protection acquis and the UK

1.We agree with the Minister that the cooperation between the EU and the UK on the development of the consumer protection acquis has played an important role in shaping this area of law. The UK’s influence is illustrated by the recent proposal introducing pan-European consumer protection rights addressing the sale of digital content, which draws heavily for its inspiration on the rights introduced in the UK by the Consumer Rights Act 2015. (Paragraph 19)

2.As a result of this interaction, the EU’s consumer protection acquis and UK national law are interwoven in a complex and interconnected fashion. Citizens’ legal protections are strengthened by a harmonised system of consumer protection. While the many items of EU law provide the basis for consumer protection in the UK, our national law often provides for a higher degree of protection. (Paragraph 20)

Significant areas of the acquis

3.Witnesses with diverse areas of operation and expertise have highlighted the range and significance of individual items of EU legislation. It is clear that beyond setting the baseline for the consumer protection standards that individuals enjoy, EU legislation also plays a crucial role in facilitating a range of cross-border cooperative mechanisms designed to police consumer protection within the Single Market. (Paragraph 38)

4.While the range of legislation identified by our witnesses is broad, another theme is the importance of the agencies, networks and infrastructure, largely created by EU law, which, cooperate on a reciprocal basis, develop policy and facilitate information sharing and exchange between national and EU bodies as a means of protecting consumers across the EU. (Paragraph 39)

5.Of particular importance in this regard is the Consumer Protection Cooperation Regulation which encourages cooperation between national bodies tasked with protecting consumers. We note that the latest iteration of this legislation which is due to be agreed by the Council shortly, includes a provision that encourages cooperation with non-EU Member States. (Paragraph 40)

6.With regard to the international standards organisations CEN and CENELEC, we acknowledge that they are not formally EU bodies, and understand that the resolution of the UK’s individual membership of these bodies post-Brexit is not directly within the Government’s gift. Nevertheless, we call on the Government to support the BSI’s efforts to amend these bodies’ statutes to accommodate the UK’s new status outside the EU and invite the Government to provide an update on this important issue when it responds to this report. (Paragraph 41)

The Government’s approach to consumer protection and Brexit

7.At the outset of our inquiry, witnesses were clearly concerned that the Government had not yet engaged sufficiently with bodies that deal with consumer affairs. However, by September, when the Competition and Markets Authority gave evidence, there was a marked change in tone and the CMA suggested that the Government had improved its contact with relevant stakeholders. This increased level of engagement was confirmed by the Minister in October. (Paragraph 48)

8.We welcome the Minister’s and the Department’s promise to engage with stakeholders and consumer groups throughout the Brexit process on a regular and systematic basis, and hope that they are able to fulfil this wish. (Paragraph 49)

9.All our witnesses praised the Government’s commitment to robust consumer protection rights post-Brexit and welcomed the European Union (Withdrawal) Bill as the means for achieving that end. The weight of our evidence suggests that the consumer protection acquis can be incorporated here via the Bill. (Paragraph 59)

10.We also welcome the Minister’s promise that the UK system will guarantee the rights of those UK consumers who have made cross-border purchases. However, a significant question remains about the protection and enforceability of the consumer protection rights of those UK citizens who visit the EU27 post-Brexit. We ask the Minister to address this specific point in the Government’s response to this report. (Paragraph 60)

11.The Minister offered us repeated, clear and unambiguous statements that the UK’s departure from the EU will not lead to any reduction in the standards of consumer protection currently enjoyed by consumers in the UK. But, she did not address the question as to how the Government will maintain access to the cooperation mechanisms that facilitate the protection of European consumers which are intrinsic to the maintenance and development of standards across the EU. We ask the Minister to address this question when the Government responds to this report. (Paragraph 64)

12.The Minister was sympathetic to the concerns of our witnesses about the loss of the EU based reciprocal arrangements that police EU consumer protection law, of which the Consumer Protection Cooperation Regulation is particularly important. Nevertheless, she was unable to provide us with any detail as to how the Government might secure their application to the UK post-Brexit and we question whether the Government has given any thought to finding a solution to this problem. (Paragraph 73)

13.Reflecting the evidence we received throughout this inquiry, both the Minister and the Deputy Director in the Department acknowledged the importance of the Consumer Protection Cooperation Regulation and classed its post-Brexit operation in the UK as a high priority for the negotiations. We agree. (Paragraph 74)

14.We call on the Government to make every effort to engage the provision in the reformed Regulation (which will shortly be agreed by the Council) that encourages cooperation with non-EU Member States. (Paragraph 75)

15.Our evidence also pointed to the important role played in consumer protection by a number of the EU’s Regulatory Agencies. We are concerned that when pressed, beyond advocating a “special and deep relationship” the Minister was unable to offer us any plan as to how the UK might secure access and/or membership of these agencies post-Brexit. (Paragraph 76)

16.We ask the Government to provide us with a clear approach as to how it will secure the UK’s post-Brexit access to the EU’s reciprocal cross-border mechanisms, resources and infrastructure that police European consumer protection standards. (Paragraph 77)

17.We are concerned by the clear evidence from the national regulatory and trading standards bodies that they are already struggling to fulfil their important roles because of financial restraints even before the additional complications and challenges of Brexit. We were particularly struck by the implications of the Financial Conduct Authority’s testimony that coping with Brexit will “involve some very hard choices”. (Paragraph 84)

18.Despite placing the responsibility on local authorities, the Minister seemed sympathetic to our witnesses’ views, but we are concerned that she was not able to offer us any solutions to this important problem. We encourage the Government to come forward with a plan to address this problem urgently. (Paragraph 85)

19.We urge the Government, when it responds to this report, to set out a clear plan aimed at alleviating the pressures on national regulators, and addressing how they will continue to interact in the interests of consumers, post-Brexit, with other national regulators in the EU’s remaining 27 Member States. (Paragraph 86)

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