It’s been just over a year since the Competition & Markets Authority gained its new consumer enforcement powers. That means now is a good time to take stock of what the first 12 months of activity tells us – and what grocers should be doing about it.
When the enhanced powers came into force, the key area of concern was the ability to impose financial penalties of up to 10% of global turnover on operators that misled consumers, intentionally or otherwise. From the action taken to date, we’ve had some insight into how the CMA is approaching this – and it hasn’t shied away from using its powers.
The numbers speak for themselves. There have been no fewer than 14 investigations opened into alleged non-compliant behaviour, one of which has been resolved by way of financial penalties. The ongoing investigations include a couple of food retailers.
The financial penalties imposed to date amount to almost £4.7m – money that comes off the bottom line and flows directly into the UK government’s Consolidated Fund.
One of the fines imposed relates to activity before an investigation had even commenced. Euro Car Parks was fined £473,000 not for misleading consumers, but for failing to respond adequately to a CMA information request for three months. The CMA has the power to fine up to 1% of global turnover for failing to respond adequately to a request for information. It’s a stark reminder to ensure any information notice received from the CMA is responded to swiftly.
The most significant case resolved under the new powers involves the AA and BSM driving schools. They were fined 4.2m for drip pricing – specifically, for a mandatory £3 booking fee that was not included in the upfront price shown to customers. The CMA also ordered more than £760,000 to be repaid to customers.
While driving schools may seem a world away from grocery, there are clear lessons: any flat charge added at checkout that isn’t reflected in the headline price carries the same risk. One mitigating factor worth nothing – there was a 40% reduction in the financial penalty because of early engagement by the AA and BSM.
What can grocers learn?
Pricing is the most immediate risk. Consumers reasonably expect to pay a variable delivery fee on online purchases, but any fixed charge added at checkout – a processing or administration fee, for example – that is not referenced in the displayed product price is almost certain to be non-compliant.
Pricing cases are also among the easiest for the CMA to prosecute since they rely on historic pricing information to evidence non-compliance, reducing reliance on consumer behavioural evidence. That means investigations can move quickly.
The second area for food retailers to watch is customer reviews and star ratings. The CMA is currently scrutinising a star ratings system for restaurants and grocers to determine whether it was misleading to consumers. A customer discount in exchange for reviews arrangement is also under investigation.
An update on both is expected in September 2026 – but retailers should not wait. Now is the time to audit any customer reviews on websites, third-party platforms, marketplace listings and influencer or affiliate content.
The direction of travel is clear: the CMA is using its new powers actively and grocery is firmly in its sights. Compliance on pricing transparency and reviews is no longer a back-office legal question – it is a boardroom risk, and one that all retailers should take seriously.
Duncan Reed is partner in Birketts’ regulatory and corporate defence team
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