Understanding the DMCCA: What It Means for Your Business

On 1 January 2025, the UK’s new regime for regulating digital markets, set out in the Digital Markets, Competition and Consumer Act 2024 (DMCCA), came into effect, bringing major changes to consumer protection law. The DMCCA gives the Competition and Markets Authority (CMA) strong enforcement powers, including the ability to impose fines based on a business’s global turnover. If your business deals with UK consumers, it’s essential to understand the impact of these changes and prepare for compliance.

Key Changes to Commercial Practices

The DMCCA introduces stricter rules on unfair practices, covering both physical and digital products before, during, and after a contract is made. Below are some key examples of changes —note that this is not an exhaustive list, and more provisions apply.

• Fake Reviews: it will be illegal to publish or commission fake reviews. Businesses must take reasonable steps to prevent fake reviews from appearing online.
• Drip Pricing: headline prices must include all mandatory fixed fees. Variable fees must be clearly disclosed, along with how they are calculated.
• Pre-Contract Information: businesses must provide clear details upfront, including:
  • identity and contact information.
  • when products, software, or digital content will be delivered.
  • functionality details (e.g., region coding).
  • complaints handling policies and cancellation rights.
• Cancellation Rights: cancelling subscriptions must be simple, without unnecessary steps. A clear statement (like an email) should be enough — businesses cannot force consumers to use a specific method.
• End-of-Contract Notices: when consumers cancel, they must receive an acknowledgment of termination and the end date — within 24 hours for online cancellations and within three working days for other methods.
• Autorenewal Rules:
  • Reminder Notices: for subscriptions with free or discounted trials, consumers must be reminded before the first full-price payment is taken.
  • Ongoing Reminders: for renewals under six months, reminders must be sent before the last renewal payment in each period. For longer intervals (e.g., annual renewals), reminders must be sent before each renewal.
• Cooling-Off Periods: after each renewal, businesses must send a notice outlining the cooling-off period, how to cancel, and what happens after cancellation.
• Prize Draws: businesses cannot create false impressions of prizes or make consumers pay to claim a prize.

Global Reach and Extra-Territorial Impact

The DMCCA applies to foreign businesses targeting UK consumers or with a UK trading address. Non-compliant international businesses could face:

• Civil debt enforcement;
• Asset seizures; and
• Website takedowns.

How to Prepare

• Audit existing practices to ensure they align with the DMCCA.
• Prepare response strategies for potential CMA investigations.
• Seek expert legal advice to navigate the new requirements.

How can we help?

If you need legal advice on ensuring compliance with the DMCCA, book a free consultation with us and we will be happy to assist.