My Lords, this amendment relates to communication of the costs that the consumer will face. This can be particularly important for digital content provided under the “freemium” model, discussed earlier in Committee, where the original digital content may be provided for free, but consumers have the opportunity to purchase extensions and improvements to this content through “in-app purchasing”. That is why the Government are committed to providing clarity and transparency to consumers when it comes to costs.
I am sure that noble Lords will be happy to know that the Consumer Contracts Regulations, which came into force in June of this year, ensure that the trader provides information to the consumer about the total price, including taxes, before the sale is made. Under the regulations, this will have to be clear and comprehensible to the consumer before they buy. The Bill makes it clear that this information becomes part of the contract and cannot be changed without the consumer’s express consent. Furthermore, the regulations make it clear that the consumer’s express consent must be given before any payments are made in addition to the main price.
We have also made it clear that pre-ticked boxes, where the trader has already ticked the “agree” box for the consumer, are not enough to signify express consent for those additional payments. This should go a considerable way towards ensuring that a consumer knows exactly what they are buying before they commit to it. Under the “Unfair Terms” part of the Bill, which is still to come, additional charges will not be able to be hidden in the small print.
Legislation to provide clarity on pricing and a clear obligation to pay is already in place. However, we are all aware of cases where young children in particular have racked up high bills relating to in-app purchases in games. This is an issue for enforcement. That is why the then Office of Fair Trading conducted an investigation into children’s online games at the end of last year, which resulted in the publication of a set of principles for games manufacturers in January, based on the Consumer Contracts Regulations and the Consumer Protection from Unfair Trading Regulations.
The noble Lord, Lord Stevenson, asked me to clarify whether the Office of Fair Trading principles applied to the online games industry. The amendment would provide a statutory basis. So the OFT principles are based on statute. They are based on the Consumer Contracts Regulations and the Consumer Protection from Unfair Trading Regulations. I am therefore confident that the OFT—now, of course, rebadged as the CMA—already has the legal toolkit that it needs. To reiterate this, the CMA, as it is now known, is currently looking into industry’s compliance with these principles and will consider enforcement action in necessary cases.