CMA warns wedding venues to play fair on deposits

The CMA advice reminds the businesses – which provide venues for a range of events including wedding receptions, parties and anniversaries – of their obligations under consumer protection law, and recommends that they review and, where necessary, change their terms.

With costs for hiring venues often running into thousands of pounds, potentially unfair cancellation terms can result in considerable loss to consumers, particularly when they have to pay significant sums up-front which they lose if they have to cancel or change their plans.

The letters inform the businesses of when their terms are more likely to be fair under consumer protection law, including the following:

The CMA has sent the letters on behalf of the Consumer Protection Partnership (CPP), which has been considering the use of advance payment and cancellation terms by businesses in their consumer contracts.

Nisha Arora, CMA senior director, said: “Planning a wedding or any large event can be stressful. Consumers are particularly vulnerable when they are focusing on preparing for a special event and have paid significant sums up-front. Businesses need to treat their customers fairly and should not require unjustifiable, non-refundable deposits or impose unreasonable cancellation charges, which could mean customers lose a significant amount of money if they change their mind about the venue or have to call off the event.

“Clear and fair terms benefit consumers and businesses, help to prevent disputes and provide protection should things go wrong. Unfair terms, even when a contract is signed, are not legally binding and we encourage any businesses which use advance payments and cancellation charges to review their terms to ensure they comply with consumer protection law.

“We have worked closely with Trading Standards Services and consumer advice bodies to help businesses improve their practices and ensure they comply with consumer protection law. Many businesses in this sector comply with consumer protection law and engage in good business practices, but we urge others to raise their standards. Businesses that use unfair terms risk enforcement action.

As the first item in a suite of planned compliance materials, the CMA has produced an at-a-glance guide for businesses to help them understand the things to look out for and tips on setting advance payment and cancellation terms that are more likely to be fair.

Leon Livermore, Chartered Trading Standards Institute chief executive, said: “Getting married should be one of the happiest and most exciting days of a couple’s life, but sadly it doesn’t always go to plan.

“If a wedding has to be cancelled or plans have to be changed, couples could face losing out on considerable amounts of money after putting hefty deposits down to secure their dream venue or location.

“When you are trying to plan the perfect day, it is often easy to overlook certain contractual details during the planning stages but consumers need to be cautious before entering into a contract and always be aware of any costly cancellation charges or non-refundable deposits.

“Trading Standards Services advise businesses to ensure their practices comply with consumer protection law, those that do not risk enforcement action.”