CMA launches court action against Emma to protect UK consumers
CMA takes Emma to court after it fails to address all of the CMA’s concerns about misleading practices.
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The Competition and Markets Authority (CMA) opened an investigation into Emma over concerns that some of its online sales practices – such as discounts and urgency claims, including countdown timers and high demand prompts – may mislead consumers.
The CMA called on the business to make changes and agree to commitments – known as ‘undertakings’ – to ensure its compliance with consumer protection law and ensure shoppers get a fair deal.
Emma has failed to take the necessary action to address all of the CMA’s concerns relating to the use of reference pricing. As a result, the CMA has now launched court action.
George Lusty, the CMA’s Interim Executive Director for Consumer Protection and Markets said:
We have given Emma sufficient opportunity to alter the way it does business to address our concerns. They have failed to make all the changes that we require, which is why we’ve progressed to court action.
We are concerned that when sales tactics such as discounts and countdown clocks are used in a misleading way, they can pressure shoppers into making quick purchases and spending more than they otherwise would, for fear of missing out.
Emma can still agree to change its practices by consenting to an order or giving undertakings to the court ahead of the case being heard. It is for the court to determine a date for the hearing.
The CMA is monitoring sales practice across the sector and this action is part of an ongoing programme of consumer enforcement work focused on so-called ‘Online Choice Architecture’. This aims to tackle potentially harmful online selling practices, including pressure selling tactics such as urgent time limited claims.
Under this programme, the CMA has secured formal changes to the business practices of Simba Sleep. These included ensuring that any ‘was’ price is genuine – in other words, that a sufficient volume of product was sold at that price before using it as a ‘was’ price.
From April 2025 the CMA expects to have the power to decide itself whether consumer law has been broken, and to fine companies up to 10% of their global turnover, if appropriate. Firms will have the right to appeal the CMA’s decision to the courts.
For more information on today’s announcement, visit the Emma case page.
Notes to editors
- The CMA’s investigation concerns Emma Sleep GmbH, Emma Matratzen GmbH and Emma Sleep UK Limited (collectively ‘Emma’).
- In May 2024, Emma was issued with a letter before claim in relation to these possible breaches of consumer protection legislation.
- Find out more on the CMA’s consumer campaign on misleading online practices.
- The CMA has issued guidance for traders active in the online mattress sector on discount and reference pricing principles. The aim is to help them understand and comply with their existing obligations under consumer protection law when making price reduction claims online.
- An undertaking to the court has the same effect as a court order. At present, it should not be assumed that any business under investigation has broken consumer protection law which it will be for the court to decide.
- As an enforcer under Part 8 of the Enterprise Act 2002, the CMA cannot currently levy administrative fines for breaches of consumer law. However, parliament recently passed legislation to give the CMA stronger consumer powers, which will enable the CMA to decide when consumer law has been broken without first taking a case to court. The Digital Markets, Competition and Consumers Act 2024 will, once it comes into effect, empower the CMA to fine those firms that do break consumer law up to 10% of their global turnover. Firms will have a right to appeal to the High Court. At present, the CMA can enforce consumer law through the courts, and where appropriate, seek additional measures to improve consumer choice, drive compliance with the law, or secure redress for consumers.
- For media enquiries, contact the CMA press office on 020 3738 6460 or [email protected].