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Consumer contract rules vary depending on the type of contract. In today's competitive marketplaces, businesses may be involved in several types of transactions e.g., a trader selling goods from a high street shop and from a website. Understanding the definitions of the contracts you make will help you to follow the correct rules.

Consumer contracts are divided into three main types:

• Distance contracts are agreements made between a trader and consumer when they're not physically present. These contracts are negotiated and agreed upon using distance communication, such as online, over the phone, or by post. This refers to organised distance selling methods, like websites, rather than one-off instances, such as a shop taking a single order by phone. Read more on online selling rules.
• Off-premises contracts are generally agreements made between a trader and consumer when they are together at a place that is not the trader's usual place of business. Examples include doorstep sales and excursions organised by the trader. There are four types of off-premises contracts to be aware of:
  • A contract made away from your usual place of business – for example at the consumer's home or workplace.
  • A consumer makes an offer in a place that is not your usual place of business, and you agree to it later – for example, where a consumer signs an order form during a visit to their home and the trader agrees on the contract later.
  • A contract is agreed upon either on your business premises or through distance communication following a meeting with a consumer in a place that is not your usual place of business. For example, a salesperson meets a consumer in the high street then the consumer is then taken to the local office to sign the contract. An example of using distance communication would be if the salesperson in the high street meets the consumer and immediately enters into a contract with them using a tablet computer.
  • A contract made with the consumer during an excursion organised by the trader with the aim of selling or promoting goods or services to the consumer. 
• On-premises contracts are agreements made at your business premises, including permanent locations and temporary ones like market stalls. If a contract does not fall under the definition of a distance or off-premises contract it will be an on-premises contract.

If you are unsure which of these contract types applies to your business, contact the Trading Standards Service for more advice on Consumerline at Tel: 0300 123 6262.

Contracts are divided into three main types:

• Sales contracts: For goods, or goods and services combined (e.g., window supply and installation).
• Service contracts: For services only (e.g., personal training or legal advice).
• Digital content contracts: For data, such as downloads, apps, games, or streaming.

Before entering into a contract, you need to provide a consumer with certain information. The information must be presented in a clear and easily understandable way, such as a notice, price list or a written contract that a consumer can easily read. In general, the following pieces of information need to be provided for all types of contracts:

• the main characteristics of the goods, services or digital content
• your identity including your business name, address and contact details
• the total price of the goods, services or digital content including taxes (or how the price is calculated)
• any additional delivery charges, or advice that charges may be payable
• any arrangements for payment, delivery, performance, and the time by which you will deliver the goods or perform the service
• details of any complaint handling policy
• in the case of a sales contract, a reminder that (as the trader) you are under a legal duty to supply goods under the contract
• the existence and the conditions of any after-sales services and commercial guarantees
• details of any duration of the contract, or conditions for terminating the contract if it will be automatically renewed
• details of functionality if you are supplying digital content
• compatibility details for digital content with hardware and software

If you fail to provide this information or provide it incorrectly you may have breached your contract with a consumer, and they could seek redress under the Consumer Rights Act 2015.

For on-premises contracts, you don’t have to provide information that’s already evident to the customer. For example, your business name and address can be omitted if it is clearly displayed on the premises. Similarly, a description of an item is unnecessary if it’s already obvious what the item is, for example - a dictionary. 

The requirement to supply all the information listed above does not apply to on-premises sales for day-to-day transactions where the consumer buys and gets the goods straight away. For example, buying a newspaper, a cup of coffee or groceries. However, information such as price and main characteristics must still be given. 

You must provide consumers with certain information before entering a contract. 

If you sell goods, services or digital content off-premises, for example, in a customer’s home, or you sell online, by mail or via an order by telephone or a similar distance communication (e.g. online sale), you must provide .

This additional information includes:

• The right to cancel: Where a right to cancel exists, the conditions, time limit and process for cancelling. 
• Cancellation rights: If consumers have a right to cancel, provide them with a standardised cancellation form that complies with the format in the Consumer Contracts Regulations -  download a model cancellation form template (DOC, 14K). In situations where there is no right to cancel, clearly outline any circumstances that may limit or remove their cancellation right. 
• Return costs: Where applicable, inform customers that they will be responsible for the return costs of cancelled goods. Additionally, where the goods because of their nature cannot be returned by post e.g. a large item of furniture, you must inform customers how much it will cost to return the item. 
• Service and digital content costs: If you provide services or digital content during the cancellation period, disclose any associated costs. See right to cancel consumer contracts.

For off-premises sales the information must be provided to the consumer in writing or on another durable medium before the contract is made. A durable medium is something personally addressed to the customer that they can keep and cannot be changed for example a letter, an email or on a personal account on a website. 

For distance sales the information can be provided in a way that is suitable to the means of the distance communication. For example, for telephone sales you may give the information over the phone, but it must still be provided on a durable medium before goods are delivered or a service has commenced. 

It is a criminal offence under the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 to not provide the consumer with their cancellation rights (where they exist) for off premises sales

If you fail to supply cancellation rights (where they exist) or any required information for any contracts, you may be committing a criminal offence under the . 

If you fail to tell the consumer about delivery charges or costs of returning items before entering the contract, they are not liable to pay these charges.

When making an invitation to purchase for example advertising your product along with the description and price, you must ensure that all non-optional fees and charges are included in the advertisement. If you fail to include these charges you may be committing a criminal offence. See further information on what information must not be omitted from invitations to purchase.

If you are trading online, you must clearly indicate where there is an obligation for a consumer to pay. This can be through a clearly labelled 'pay now' button at the correct stage in the ordering process. You should also supply an email address to allow consumers to contact you easily.
 

Consumers who decide that they do not wish to proceed with an off-premises or distance contract have two main rights. They can:

• Withdraw an offer - If a consumer has not accepted your offer (for example, when your terms and conditions state that the contract is not formed until the goods are dispatched), the consumer has an open-ended right to withdraw. This right will terminate when the contract is formed (e.g., when you dispatch the goods). After this point, the consumer may exercise their right to cancel the contract, if applicable.
• Cancel a contract - within a specified period of time consumers have the right to pull out of a contract, providing the contract is not one where there is no right to cancel

Consumers who enter into off-premises or distance contracts will have 14 calendar days in which to change their minds and return goods or cancel a service. They do not have to give you a reason for doing so. You must provide them with a cancellation form, but they do not have to use it if they make it clear that they are cancelling. Download a model cancellation form template (DOC, 14K).

For sales contracts, the 14 days for cancellation start the day after the consumer receives the goods. In the case of service-only contracts and digital content, it starts the day after the day on which you enter into the contract with the consumer. When the 14-day right to cancel starts can vary depending on the type of contract made and other relevant circumstances, such as parts of one order being delivered on different days. 

If you do not tell the customer about their right to cancel, their cancellation rights could be extended by up to 12 months.  

Effects of withdrawal or cancellation

If the consumer withdraws or cancels a contract the contract will come to an end. 
You should refund the consumer all payments made, including the original delivery costs. If the customer chooses a more expensive delivery method (such as next-day delivery), you are only obligated to refund the basic delivery cost. You must refund consumers within 14 days from the day after they inform you, they want to cancel. If the consumer is sending goods back, you must refund them within 14 days of receiving the goods back or receiving proof they have been sent.
The consumer must pay the return costs unless: 

• you have agreed to pay the cost of return
• you have failed to make the consumer aware before the contract was made that they would have to pay for return

If you don’t make consumers aware that they will have to pay to return the goods, then you must pay these costs. 

Collection of cancelled goods

When the consumer cancels goods, the trader will be responsible for collection if: 

• the trader has offered to collect them
• it is an off-premises contract, and the goods were left with the consumer at the time the contract was made and the goods because of their nature cannot be returned by post. 

You may charge for collection of the goods if you have made it clear to the consumer that the goods must be collected (if for example, they are too big to return by post) and they will have to pay for the collection. 

This information must have been made clear in the contract and available to the consumer before the contract was made, otherwise the consumer won’t have to pay for collection of the goods.

Limiting cancellation rights

If the consumer cancels after entering a contract, you may claim money for goods already used, including digital content downloaded or for services already performed. Service contracts and the service element of a sales contract (if there is one) can start within the cooling-off period. You can charge for services provided during that period if the customer later cancels, as long as:

• The consumer has expressly requested for the service to start. 
• The consumer has acknowledged that they will have to pay all or part of the cost of the service.
• The consumer has acknowledged that they will lose their right to cancel when the service is completed (for services-only contracts)
• The consumer must ask for the service to start, and you cannot start the service during the cancellation period on your own accord.

In services-only contracts, the consumer may lose their right to cancel if the service is performed fully during the cooling-off period. The customer must have agreed to this beforehand. 

In sales contracts, where goods and services are provided together, the consumer will only have to pay for any services started or completed during the cooling-off period and will still be entitled to cancel and receive a refund for any goods provided. For example, a customer orders the supply and fitting of a fireplace online. The fireplace is delivered and fitted on the same day. The customer may have to pay for the labour fitting costs but can still remove the fireplace and return it to the trader for a refund. The amount you can charge for services performed up until the point the customer cancels should be reasonable and proportionate.

If you fail to inform the customer of their rights on cancellation and inform them that they may have to pay costs for services started/completed within the cancellation period, they will not have to pay for the services. 

You may also be able to make a deduction from the refund of goods if a consumer has handled goods beyond what is reasonably necessary, for example altering or damaging the goods. No other deductions, such as cancellation or restocking fees, can be made when a consumer wishes to cancel their contract within the cancellation period.  

Supply of downloads and streaming services in the cancellation period

You may supply digital downloads and streaming services within the 14-day cooling-off period, provided that:  

• The customer agrees and confirms before they download or stream content that they are aware they'll lose their 14-day right to cancel.
• The customer agrees to an instant download before they start the download.
• You include this information in your confirmation of the contract, along with the other pre-contract information.

If you don't follow these rules, the customer will keep their 14-day right to cancel without paying.

Consumers who enter into off-premises or distance contracts will usually have 14 calendar days to change their minds. However, a number of distance and off-premises contracts do not have cancellation rights. These include:

• Off premises contracts where the price is £42 and under.
• Goods that are clearly personalised or made to a customer’s specification (e.g., made to measure blinds for non-standard sized windows).
• Off-premises contracts where the consumer has contacted the trader to carry out urgent repairs or maintenance. Any extra services or goods supplied whilst at the consumers property (other than the requested repair or maintenance and goods supplied as part of that) will still carry a right to cancel.
• Goods received sealed for health protection or hygiene reasons, once unsealed.
• Sealed audio, video and software products once unsealed.
• Goods that have been inseparably mixed after delivery.
• Goods or services where prices are dependent on fluctuations in financial markets outside of the trader’s control, for example investment type products such as vintage wines.
• Goods which will deteriorate or expire rapidly (e.g., flowers and fresh fruit).
• Newspapers and magazines (but not subscriptions)
• Contracts concluded at public auction (auctions where the consumer has the option to attend in person). For online only auctions for example eBay, the consumer will still have a right to cancel.
• Contracts for accommodation, transport of goods, vehicle rental, catering or services related to leisure activities, if the contract states a specific time period (e.g., concert tickets).
• Medicinal products or services that are either dispensed or are available free under an NHS arrangement
• Contracts for passenger transport services such as bus, rail or flight tickets. 

It is your responsibility as a trader to deliver goods that you have sold to a consumer unless you have agreed otherwise.

If you have not agreed a date for delivery, you must deliver the goods no later than 30 days after the order has been made. 

Consumers can treat a contract as ended, and request a full refund, if:

• you refuse to deliver the goods
• you don't deliver within the agreed time and it's clear from circumstances, or from what the consumer tells you, that delivery by the agreed time was essential
• the consumer specified an appropriate delivery period, which you failed to meet

If you fail to deliver part of a contract for a variety of goods on time, a consumer can decide to cancel that part or cancel the whole order and return the goods which have already been delivered. You must reimburse the consumer without delay for cancelled or returned goods.

Goods remain your responsibility until they have come into the physical possession of the consumer or someone, they have appointed to receive them. If your carrier fails to deliver the goods, or they deliver to the wrong address, you are responsible for them - not the consumer.

However, if the consumer agrees to use their own delivery carrier, you cease to be responsible once that carrier has received the goods.
 

Consumer contract rules are designed to protect consumers from unintentionally paying for additional charges when buying goods or services.

No additional charges as a default option

Your business might offer additional items linked to a main contract, such as:

• insurance with a contract for a holiday
• gift-wrapping when buying goods as a present

You should always ask consumers for their consent to such additional charges.  You must not present these charges as the default option. For example, online consumers should not have to untick a box to remove an additional option which requires further payment.

Consumers do not have to make additional payments which they have not actively consented to. Consumers have the right to request a refund for any payments in this situation.

Telephone helpline charges

If you have a telephone helpline for consumers to contact you about a contract that they have entered into with you, you can't charge more than a basic call rate for this service.

This means you can only charge normal geographic or mobile call rates. For example, phone numbers beginning with 01, 02 or 03.  

If a consumer is charged more than the basic rate, they are entitled to claim any overcharge back from you.

You should check carefully with your telephone provider whether your phone line costs consumers more than basic rates.