Source · Select Committees · Public Accounts Committee
Recommendation 4
4
Gaps in the regulatory framework make it harder to protect consumers from new risks presented...
Conclusion
Gaps in the regulatory framework make it harder to protect consumers from new risks presented by online marketplaces and emerging technologies. People increasingly purchase goods online, including through online marketplaces such as Amazon, eBay and Etsy which are now used by nine in ten adults who use the internet. Online marketplaces are not responsible for the safety of products sold by third parties on their platforms. As many sellers are small operators working from their homes, or based abroad, regulators struggle to enforce safety regulations to the same extent as on the high street, due in part to gaps and limitations in their powers. These gaps make it harder to protect consumers, and can give online sellers an unfair competitive advantage over high street traders. Changes in product technologies present new risks but also opportunities. For example, an estimated 15% of products bought for the home now include ‘smart’ technology. Software in smart products can identify faults, prompt recalls or use updates to increase safety features, but may also be susceptible to hacking. The government faces a challenge in ensuring that regulations keep up with social and technological changes, and recently consulted on a major review of the regulatory regime that is considering how to respond to changes in product lifecycles and technologies. Recommendation: The Department and OPSS should write to us within six months to update us on the progress of their product safety review, and how and when they will address gaps in the regulatory framework. This should include a clear assessment of the key constraints the regime faces in regulating product safety through online marketplaces and keeping regulations up to date with changes in product technologies.
Government Response
Acknowledged
HM Government
Acknowledged
4.1 The government agrees with the Committee’s recommendation. Target implementation date: Spring 2022 4.2 OPSS will write to the Committee within six months of the PAC report to detail progress made on its plan for the future of UK product safety regulation. 4.3 In OPSS’ first three years, it has conducted significant research into emerging technologies, such as ‘smart’ products, and set up a major review into the product safety system looking to ensure UK regulations are fit for purpose now and in the future. OPSS is creating a robust approach to working with and holding to account online retailers and preventing unsafe products from reaching consumers. OPSS continues to develop this. OPSS’ data strategy, product safety review and regulatory strategy will all help to address aspects of these challenges. 4.4 The Product Safety Review consultation closed on 17 June 2021 and OPSS has been reviewing the 158 responses. OPSS will be looking to address identified gaps in the regulatory and legislative framework and seeking to build in sufficient flexibility to allow it to meet future challenges and changes in markets and consumer practices. OPSS’ response was published on 11 November 2021. 4.5 OPSS is also acting ahead of any legislative changes. It has an expanded online investigation capability with a dedicated team able to conduct online market surveillance and work with platforms to have non-compliant items dealt with. OPSS has conducted enforcement investigations into online sales of toys and electricals and has established more robust approaches for third party sellers outside the UK.