Thursday 14 July 2016

UK: Law Commission report - consumer prepayments on retailer insolvency

The Law Commission for England and Wales today published its report and recommendations on the law concerning consumer prepayments on retailer insolvency: see here (pdf). The report contains the following five key recommendations (and sets out a number of options for more fundamental reform, should the Government wish to adopt them):
  • Regulating Christmas and similar savings schemes, which the Commission believes pose a particular risk to vulnerable consumers.
  • Introducing a general power for Government to require prepayment protection in sectors which pose a particular risk to consumers.
  • Giving consumers more information about obtaining a refund through their debit or credit card issuer.
  • Making a limited change to the insolvency hierarchy, to give a preference to the most vulnerable category of prepaying consumers (their claims would rank below preferential claims from employees and above those of floating charge holders).
  • Making changes to the rules on when consumers acquire ownership of goods.

Further information about the Commission's project is available here.

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