UK Contract Law Update: Consumer Terms and Conditions (2025)

Over the past six months, significant developments have reshaped the legal and regulatory environment surrounding consumer-facing terms and conditions in the UK. These changes reflect a stronger push for transparency, fair pricing, and greater consumer rights—particularly in digital contracts, subscriptions, and pricing structures.

1. New Consumer Enforcement Powers

Since April 2025, the Digital Markets, Competition and Consumers Act 2024 (DMCC Act) has introduced wide-ranging reforms. Most notably, the Competition and Markets Authority (CMA) now has the power to enforce consumer protection laws directly, without the need to bring court proceedings. Businesses that breach consumer protection rules can face fines of up to 10% of global turnover.

This enforcement model marks a shift toward quicker, more decisive regulatory action and places greater pressure on businesses to ensure their terms are legally compliant and commercially fair.

2. Total Price Transparency

One of the most immediate impacts of the DMCC Act is the prohibition of so-called “drip pricing” practices. This includes situations where mandatory fees—such as booking charges or service fees—are added late in the online checkout process.

Businesses are now required to display all unavoidable costs upfront. The total price must be clear from the beginning of the transaction, and consumers must not be misled about the real cost of goods or services.

3. Regulation of Online Reviews

Consumer protection law now formally prohibits the use of fake or misleading online reviews. Specifically, businesses must not:

Post fabricated reviews or endorsements;

Incentivise reviews without clear disclosure;

Manipulate review systems by highlighting only positive feedback or suppressing negative commentary.

Retailers and platforms are required to take reasonable steps to monitor and remove deceptive or unreliable reviews. This includes having appropriate systems in place to assess the authenticity of user-generated content.

4. Subscription Contract Reform (Forthcoming)

While not yet in force, significant reforms to subscription-based contracts are expected to take effect in 2026. Businesses offering auto-renewing services will need to:

Provide consumers with clear pre-contractual information about renewal terms and costs;

Offer a 14-day cooling-off period at the start of the contract and at each renewal (for contracts lasting 12 months or more);

Send renewal reminders before auto-renewal occurs;

Make cancellation straightforward and accessible—particularly for online services.

Although these rules are not yet live, businesses should begin reviewing their subscription models to ensure future compliance.

5. Mid-Contract Price Increases in Telecoms

A separate regulatory development in early 2025 now requires telecom providers to display clear, pound-and-pence pricing for mid-contract increases, rather than using inflation-based percentages. While such increases are still permitted, consumers must be able to understand the exact cost implications at the time of signing.

This change reflects broader regulatory trends toward simplicity and transparency in consumer contracts across all industries.

Implications for Consumer-Facing Terms

These developments are not just regulatory tweaks—they require businesses to revisit and often revise the terms and conditions that underpin their customer relationships. In particular, companies should:

  • Disclose full pricing information at the start of any transaction, including all unavoidable charges.
  • Avoid ambiguous or one-sided variation clauses, especially those allowing the business to make changes without consumer agreement.
  • Review review policies to ensure fake or incentivised reviews are not posted or featured on their websites.
  • Prepare for subscription law reform by mapping current services, updating renewal notices, and building easy cancellation mechanisms into digital platforms.
  • Align website and mobile interfaces with consumer protection standards, avoiding any misleading or obstructive designs.
  • Recommended Next Steps
  • Review and update your terms and conditions to reflect the DMCC Act’s new standards.
  • Audit your pricing practices to ensure compliance with the total price disclosure rules.
  • Implement a clear review management policy to identify and remove non-genuine or misleading feedback.
  • Plan for upcoming subscription regulations, especially around cooling-off rights, reminders, and contract cancellation flows.
  • Train relevant teams—including legal, customer service, and marketing—on the new consumer law requirements and expectations.

Conclusion

UK consumer law is now more robust and enforcement-ready than ever before. Regulators are focused on eliminating hidden fees, false endorsements, and confusing cancellation procedures. For businesses, this is both a compliance challenge and an opportunity to strengthen consumer trust by making terms and practices clearer, fairer, and easier to understand.

If you need help auditing your terms and conditions, drafting compliant policies, or preparing for upcoming legislative changes, we would be pleased to assist.

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