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Digital Markets, Competition and Consumers Bill

My Lords, I am delighted to speak to this group of amendments, and I thank the noble Lord, Lord Clement-Jones, and my noble friends Lord Lucas and Lord Mendoza for their amendments. I will first address the government amendments.

Amendments 122 to 125, 138 and 139 aim to address the concerns raised by my noble friend Lord Mott about certain microbusinesses, such as small local farm shops, being unintentionally captured by the new subscriptions rules simply because they are incorporated. Together, these amendments alter the requirement for a business to be unincorporated in order to benefit from the exclusion. Instead, a business will benefit from this exclusion so long as it meets the “micro-entity” thresholds in the Companies Act 2006. The other requirements of the exclusion, which require a business to deliver foodstuffs to the home or workplace without the use of couriers, remain unchanged. This ensures that the exclusion remains well targeted and captures only the smallest of businesses. I am grateful to my noble friend for highlighting this issue, and I hope he is reassured by these amendments.

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I turn to gift aid. Government Amendments 154 to 156 address the concerns raised in Committee by my noble friend Lord Mendoza, and many other noble Lords, about the Bill’s impact on the ability of charities to claim gift aid. The Government’s intention is that charities can continue to claim gift aid and comply with the subscription measures, where they apply. Our amendments achieve this by amending the consequential power in Clause 335. This will enable the Treasury to amend the gift aid rules in the Income Tax Act 2007.

The Treasury has committed to introduce secondary legislation to do this, and I am pleased to point noble Lords to the statement to this effect made by the Chancellor in last week’s Budget. It is our firm intention

that this will be in place by the time the subscription regime commences, and the Government will of course continue to engage with the charity sector through this period. I hope this reassures your Lordships of the Government’s commitment to resolve this issue. I know that my noble friend Lord Mendoza and the noble Lord, Lord Clement-Jones, have tabled their own amendments on this matter, and I look forward to hearing from them.

I turn now to a package of amendments—Amendments 128 to 130, 132, 136 and 137—which are intended to provide greater assurance and clarity for businesses in relation to the subscription measures. Government Amendment 128 removes the requirement that consumers can exit their contract “in a single communication”. Instead, traders must ensure that consumers can exit

“in a way which is straightforward”.

The purpose of the amendment is to make it absolutely clear that businesses are not prevented from engaging with their customers during the exit process, and to replace prescriptive language with a principle-based approach. I stress that traders will not be prohibited from requesting feedback or from volunteering counter- offers to consumers who want to end their subscription, so long as this does not unreasonably hinder a consumer from ending their contract if they so wish.

Government Amendments 129, 130 and 132 also relate to how a consumer can cancel or end a contract. These amendments remove the phrase “by any means” and replace it with language from the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013. This simply means that a consumer can exercise a right to exit their contract by making a clear statement to this effect. The intention of these amendments is to bring greater clarity, particularly to businesses, by aligning the language with that of familiar consumer law provisions. I ask noble Lords to support these amendments, and I hope that, alongside government Amendment 128, they put to rest the notion that consumers will be able to end their contract via unconventional means.

Government Amendments 136 and 137 relate to the cooling-off period, an area in which the noble Lord, Lord Clement-Jones, has also tabled amendments. Noble Lords raised concerns in Committee about consumers binge-watching services then cancelling for free. The Government wholeheartedly agree that consumers should not be able to sign up, use a service or digital content and then cancel for free. The rules governing what happens when a consumer cancels in the cooling-off period will be set out in secondary legislation. The Government will consult on these rules by the end of this year. Crucially, this consultation will include a proposal to introduce a “use it and lose it” rule, whereby consumers lose their right to a full refund if they use a product during the cooling-off period. Our amendments now make it clear that regulations can apply such rules.

Amendment 136 states explicitly that the regulatory power can be used to introduce a waiver from cooling-off rights, including for digital content. Amendment 137 makes it clear that a consumer may lose their right to a full refund if they cancel during a cooling-off period, particularly if they have received digital content or services during that period.

Finally, I am sure noble Lords will be pleased to hear that, further to assurances provided in Committee, the Government have decided that the subscription contract measures will come into force no earlier than spring 2026. This will guarantee that businesses have sufficient time to adapt their operations, while ensuring that consumers benefit from the protections in a reasonable timeframe. I hope these amendments demonstrate that the Government have listened to concerns expressed across the House and in Committee, and that noble Lords agree that they will provide businesses the assurance they have been seeking. I beg to move.