Recommendation 4

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.