Major changes to UK consumer law are on their way: is your charity ready?

Major changes to consumer law will affect how charities contract with individuals.

The consumer law provisions of the Digital Markets, Competition and Consumers Act 2024 are expected to come into effect in April 2025. They represent major changes to UK consumer law that will have a significant impact charities and social enterprises entering into business to consumer (or B2C) contracts – i.e. contracts under which a charity or social enterprise provides services, goods or digital content to a consumer, such as an individual beneficiary.

The Act makes the following changes to consumer law:

Subscription contracts: subscription contracts can be particularly useful for charities or social enterprises when they want to offer regular, auto-renewing payments (whether for a fixed or indefinite period) for services, goods or digital content. This approach can help maintain a consistent cash flow, which is crucial for planning and executing long-term projects. We work with a number of clients that offer subscription services – for example where individuals can sign up for regular newsletters, magazines, or access to the exclusive content of a culture and heritage organisation through annual membership. This is a relatively straightforward example of a subscription contract, but charities should be aware that other arrangements they maintain may be inadvertently caught by the legislation – e.g., a charity that offers a quarterly update newsletter to a repeat donor.

Under the Act, charities or social enterprises that offer subscription contracts will, unless the contract is excluded, be required to:

(i) provide more information to consumers before entering into a contract, e.g. as to the contract’s key terms and the consumer’s ability to cancel during a cooling off period (see below) and beyond – distinguishing between “key pre-contract information” and “full pre-contract information”, which must be given separately;

(ii) send reminders before a contract "rolls over" into a new term (auto-renewal). Reminder notices must be sent to notify the consumer that the subscription contract will continue and that a renewal payment is due. The reminders are of the first renewal payment and of subsequent renewal payments which are either the last payment for six months or every six months after the previous notice; and

(iii) allow "cooling off" periods, enabling a consumer to cancel a subscription contract within 14 days of the contract being entered into, or within 14 days of its renewal date.

Whilst the new law relating to subscription contracts is not expected to come into force until the Spring of 2026, charities and social enterprises should be planning well ahead to ensure that their subscription contracts and related processes are compliant.

Pricing: the Act tightens up the law on misleading pricing practices, for example around headline prices which do not reflect the true cost of products or services and drip pricing (where a lower price is used to attract consumers, only for them to discover that it does not include unavoidable charges disclosed at a later date).

Fake or misleading reviews: the Act prohibits the submission or commissioning of fake reviews and requires businesses to ensure that they do not publish consumer reviews in a misleading manner, and to take reasonable and proportionate steps to prevent fake reviews and avoid misleading presentation of reviews.

Historically, breaching consumer law has been seen as primarily invoking reputational risk. However, under the Act, charities and social enterprises that engage in B2C contracts face a much higher risk of a substantial fine from serious non-compliance. Under the Act, consumer law is effectively brought into line with competition law - the Competition and Markets Authority may impose fines of up to 10% of global annual turnover on organisations found to have infringed consumer law.

We can help your charity or social enterprise navigate these changes to consumer law. For further information, please contact a member of the team.

If you would like to discuss any aspect of this article further, please contact the Charities and Social Economy team on 0113 244 6100.

You can also keep up to date by following Wrigleys Solicitors on LinkedIn.

The information in this article is necessarily of a general nature.  The law stated is correct at the date (stated above) this article was first posted to our website.

Specific advice should be sought for specific situations. If you have any queries or need any legal advice please feel free to contact Wrigleys Solicitors.