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CMA acts to maintain trust in online reviews and endorsements

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The CMA has found that online reviews and endorsements are proving useful to consumers, but it has concerns that some practices may be unlawful.

The Competition and Markets Authority (CMA) opened a call for information on online reviews and endorsements in February this year. In a report published today (19th June) it estimates that more than half of UK adults (54%) use online reviews, and that 6% use blogs or vlogs before making purchases.

Most buyers who used reviews and endorsements found that the product or service they bought matched up to their expectations.

However, the CMA has also heard about instances of potentially misleading practices:

- fake reviews being posted onto review sites
- negative reviews not being published
- businesses paying for endorsements in blogs and other online articles without this being made clear to consumers

In response, the CMA has opened an investigation using its consumer enforcement powers into a number of companies in connection with the potential non-disclosure of paid endorsements. Other concerns that have been raised with the CMA are being assessed to determine whether enforcement action is warranted.

The CMA has also produced information for businesses explaining what they need to do to help them comply with the law, alongside a comprehensive report on its findings.

In addition to UK-based action, the CMA, as part of its plans for assuming the presidency of the International Consumer Protection and Enforcement Network (ICPEN) on 1 July 2015, is proposing a project on online reviews and endorsements.

Nisha Arora, CMA Senior Director, Consumer, said:

"Millions of people look at online reviews and endorsements before making decisions such as where to stay on holiday, or which plumber to use.

We have found that consumers who use online reviews and endorsements find them valuable, but we have also heard about some practices that may be unlawful.

We are committed to ensuring that consumers’ trust in these important information tools is maintained, and will take enforcement action where necessary to tackle unlawful practices. We have opened an investigation into businesses that may be paying for endorsements in blogs and other online articles where the payment may not have been made clear to readers. We have also published information for businesses to tell them what they need to do to help them stay within the law."

The CMA is not naming the parties directly involved in its investigation at this early stage of the case.

The CMA has produced an infographic on consumer spending after reading online reviews. 

Source : Gov.co.uk
www.gov.uk/government/news/cma-acts-to-maintain-trust-in-online-reviews-and-endorsements

23 June 2015

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