It is crucial to comprehend the statutory rights that your customers possess and to establish a returns and complaints process that is compliant.
Introduction
Consumer rights are not negotiable. When a customer buys goods, services, or digital content from your website, they acquire a set of statutory rights that cannot be excluded or diminished by your terms and conditions. The Consumer Rights Act 2015 sets out these rights in detail, and every business that sells online must understand and comply with them.
Handling refunds, returns, and complaints is not merely a customer service function. It is a legal obligation with specific timeframes, procedures, and remedies that the law prescribes. Getting it wrong can result in regulatory enforcement, adverse court judgements, and lasting damage to your business’s reputation.
This article explains the key consumer rights that apply to online sales, the remedies available to consumers when things go wrong, and how to build a returns and complaints process that is both legally compliant and commercially effective.
Statutory Rights Under the Consumer Rights Act 2015
Goods
Every contract for the supply of goods to a consumer includes statutory terms that the goods will be of satisfactory quality, fit for a particular purpose, and as described. Satisfactory quality is assessed by reference to what a reasonable person would consider satisfactory, taking into account the description, the price, and all other relevant circumstances. Fit for purpose means that the goods must be suitable for any specific purpose that the consumer told the trader about before the contract was signed, as long as the trader agreed to that purpose. ‘As described’ means that the goods must match the description given, whether on the product page, in marketing materials, or in conversation.
These terms are implied by law in every consumer contract and cannot be excluded. Any attempt to exclude or limit them in your terms and conditions is likely to be treated as an unfair term and will be unenforceable.
Services
For contracts for the supply of services, the Consumer Rights Act implies a term that the service will be performed with reasonable care and skill. If a specific time for performance has not been agreed upon, the service must be performed within a reasonable timeframe. If a specific price has not been agreed upon, the consumer must pay a reasonable amount. Where the service does not meet the required standard, the consumer has a right to require the trader to perform it again, and if that is not possible or cannot be done within a reasonable time, the consumer is entitled to a price reduction.
Digital Content
The Consumer Rights Act was the first piece of UK legislation to specifically address digital content, which it defines as data produced and supplied in digital form. This covers software, apps, music, video, games, and ebooks, whether supplied on a physical medium or downloaded or streamed. Digital content must be of satisfactory quality, fit for a particular purpose, and as described. Where digital content causes damage to a device or other digital content, the consumer has a right to repair or compensation.
The Short-Term Right to Reject
For goods, the Consumer Rights Act provides a short-term right to reject that is particularly important for online sellers. Within 30 days of delivery, a consumer who discovers that goods do not meet statutory standards has the right to reject them and receive a full refund. This is a powerful right: within the 30-day window, the consumer does not have to accept a repair or replacement.
The 30-day period begins when the consumer takes ownership of the goods. For online sales, this is typically the date of delivery. If the consumer exercises the right to reject within this period, you must provide a full refund without undue delay and in any event within 14 days of the day on which you agree that the consumer is entitled to a refund.
It is essential to distinguish between the short-term right to reject under the Consumer Rights Act and the right to cancel under the Consumer Contracts Regulations discussed in Article 4 of this series. The right to cancel is a cooling-off right that applies regardless of whether there is a fault with the goods. The right to reject applies only where the goods do not conform to the contract but provides a full refund, including return postage.
The Right to Repair or Replacement
After the 30-day short-term right to reject has expired, the consumer’s primary remedy is to request a repair or replacement. The trader can refuse if the consumer’s choice is disproportionate to the other. The repair or replacement must be provided within a reasonable time and without significant inconvenience to the consumer, and the trader bears any necessary costs.
The trader has one opportunity to repair or replace the goods. If the repair or replacement fails or is not provided within a reasonable time, the consumer has the right to a price reduction or, if the fault is sufficiently serious, the right to reject the goods and receive a refund. For goods rejected after the first 30 days but within six months of delivery, the refund is full. The trader may claim a deduction for the consumer’s use of the goods after six months.
The Burden of Proof
For the first six months after delivery, any fault with the goods is presumed to have been present at the time of delivery unless the trader can prove otherwise. This is a significant assumption that operates in the consumer’s favour. It means that for the first six months, the consumer is not required to prove that the goods were faulty when delivered; it is for the trader to prove that they were delivered without fault.
After six months, the consumer must prove that the goods were defective at delivery or that the defect was inherent. In practice, this may require evidence from an independent expert, particularly for high-value goods.
Handling Refunds Correctly
When a refund is due, whether under the short-term right to reject, the right to cancel, or following a failed repair or replacement, the trader must process it using the same means of payment used by the consumer, unless the consumer expressly agrees otherwise. The refund must be made without undue delay. For cancellation refunds, the deadline is 14 days. For refunds following rejection, the deadline is also 14 days from the date the trader agrees the refund is due.
A common source of complaint is businesses that issue refunds only as store credit or vouchers. Unless the consumer specifically agrees, you cannot substitute store credit for a cash refund where a refund is legally required. Offering store credit as an alternative is acceptable, but it must be the consumer’s choice, not the trader’s imposition.
Return costs depend on the reason for the return. Where the consumer is exercising the right to cancel under the Consumer Contracts Regulations, the consumer bears the cost of return postage, provided they were informed of this before the contract was concluded. Where the consumer is rejecting faulty goods, the trader bears the cost of return. Many businesses get this distinction wrong, which generates complaints and potential enforcement action.
Complaints Handling
Every online business should have a clear, accessible complaints procedure. This is not merely good practice; it is a regulatory expectation. The procedure should be easy to find on your website and should explain how to make a complaint, what the consumer can expect in terms of response times, and what the escalation process is if the complaint is not resolved.
Online traders must inform consumers about the availability of alternative dispute resolution, as required by the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015. You must provide a link to the EU/UK Online Dispute Resolution platform on your website, and if you are a member of or bound by a certified ADR scheme, you must inform consumers of this fact. Even if you are not a member of an ADR scheme, you must inform the consumer whether you are willing to use ADR to resolve the dispute.
Prompt and fair complaints handling reduces the risk of formal disputes, regulatory complaints, and negative reviews. It is one of the most effective forms of risk management for online businesses.
Unfair Trading Practices
The Consumer Protection from Unfair Trading Regulations 2008 prohibit unfair commercial practices, including misleading actions, misleading omissions, and aggressive practices. For online businesses, the most common issues involve misleading product descriptions, fake or manipulated reviews, hidden charges, false urgency tactics such as countdown timers on non-time-limited offers, and drip pricing, where additional charges are added during the checkout process.
These regulations give consumers additional rights to seek redress, including the right to unwind the contract within 90 days, a right to a discount for misleading or aggressive practices, and a right to damages for consequential loss. The Competition and Markets Authority and local trading standards officers have powers to enforce these regulations, and they are increasingly active in the online marketplace.
Practical Steps for Compliance
Start by reviewing your product descriptions to ensure they are accurate and not misleading. Please review your pricing to ensure all charges are clearly disclosed upfront. Ensure your returns policy accurately reflects the consumer’s statutory rights and does not attempt to restrict them. Implement a complaints procedure that is accessible, responsive, and fair.
Train your customer service team to understand the legal framework. They must understand the distinction between the right to cancel and the right to reject, determine the due date and form of a refund, determine who is responsible for the cost of returns under various circumstances, and know when to escalate a complaint. A well-trained team serves as your primary defence against formal disputes and regulatory action.
Keep records of all complaints, returns, and refunds. These records serve both as evidence of compliance and as a source of insight into potential quality issues with your products or services. A pattern of complaints about a particular product should trigger a review of that product and its description.
Conclusion
Consumer rights are the foundation of trust in online commerce. Customers need to know that if something goes wrong, they have effective remedies available to them. Businesses that respect and implement these rights properly find that they generate fewer disputes, fewer complaints to regulators, and stronger customer loyalty. Treating consumer rights as an obligation to minimise them is both legally risky and commercially counterproductive. Treating them as a standard of service to be met is the approach that delivers the best outcomes for businesses and consumers alike.
Need help with consumer compliance?
Lawdit Solicitors’ The StayLegal package includes compliant terms of sale, returns policies, and complaints procedures tailored to your business. Visit staylegal.co.uk to learn more.
Next in this series: Article 9 – Age Verification and Restricted Products: Legal Obligations for Age-Gated Content and Goods
