Fake Reviews Under Fire: How the Digital Markets, Competition and Consumers Act 2024 (DMCC Act) Targets Misleading Practices

Fake reviews have become a growing concern for businesses and consumers alike, undermining trust and distorting purchasing decisions. Under the new Digital Markets, Competition and Consumers (DMCC) Act, tackling misleading practices such as fabricated reviews is a key priority. This legislation introduces stricter rules and enforcement powers to ensure transparency and protect consumers from deceptive content. As part of our series on the DMCC Act, in this article we explore what constitutes a fake review, the legal implications for businesses, and how compliance with the DMCC Act can safeguard both reputation and consumer confidence.

Against the backdrop of the CMA’s estimation that as much as £23 billion of UK consumer spending is potentially influenced by online reviews annually (which likely will not all be made in good faith), clearly, reviews play a huge role in the UK market and are something the Government wanted to regulate.

The DMCC tackles this by including a Schedule of “blacklist” provisions which are always considered unfair¹ – and therefore not legally binding on consumers. The DMCC deals with fake and misleading reviews within the “blacklist” – which makes it much easier for the CMA to regulate infringing traders.

The DMCC defines a fake consumer review as one which purports to be, but is not, based on a person’s genuine experience.

With respect to publishing consumer reviews in a misleading way, the legislation gives a non-exhaustive list of examples, such as when:

• Promoting positive reviews: a positive review is given greater prominence by a business than a negative review;
• Filtering out negative reviews: negative reviews are not published or removed, and only positive reviews are published;
• Incentivised reviews: a review has been incentivised by the trader (e.g. in exchange for a gifted product) It must also be clear to a consumer whether a review is incentivised, such as when the product being reviewed has been gifted to the reviewer. 

You may have heard on the news that the CMA had been investigating some of Amazon and Google’s business practices. Until recently, they had been under investigation by the CMA since 2021 regarding whether they had taken sufficient action to protect consumers against fake or misleading reviews. Both companies failed to meet the expected standards and consequently have had to provide undertakings to the CMA.

Amazon has provided 38 undertakings which in short relate to ensuring they have rigorous processes in place to tackle fake reviews and catalogue abuse, sanctioning the parties on their platform that are responsible for catalogue abuse and utilising fake reviews, and creating more user-friendly reporting mechanisms.

Catalogue abuse is different to fake reviews. It refers to conduct by a trader which hijacks the reviews of well-performing products and adds them to an entirely separate and different product to falsely boost its star rating or overall reputation. If a consumer is not paying close attention, it could be misled as to the quality of the products being sold by the infringing trader.

Platforms which allow third party sellers to sell through them should therefore be alive to this risk.

Your business is probably not under similar obligations as Google or Amazon for these reviews– it is unlikely that the CMA will impose such stringent obligations on most smaller businesses. However, the larger your platform is (and therefore the wider the potential exposure and risk of harm to consumers from fake reviews), the more onus there is on you to take preventative steps. 

Within the games industry, Valve – which runs Steam (the largest digital distribution platform for PC games) – has introduced a number of tools to combat fake reviews including giving users the ability to filter reviews by language and by prohibiting the reviews of users who receive PC games outside of Steam (for example, via a giveaway site, from another digital or retail store, or from developers directly for testing purposes) from counting towards a game’s review score.

When it comes to complying with the DMCC on fake reviews, we recommend that businesses check out the CMA’s guidance from April of this year, on how best to comply with the fake reviews regime. In particular, the CMA states that businesses must take reasonable and proportionate steps that sufficiently protect consumers from the risks around fake reviews.

Whilst this will vary depending on the type of business and the impact of the information provided to the consumer, the CMA recommends two key components for compliance with the DMCC:

• maintain a clear policy on the prevention and removal of false and misleading consumer review information; and
• assess the risks of such information appearing on your own media and take reasonable and proportionate steps to address those issues or risks.

Due to the relatively recent introduction of these rules and the CMA’s three-month grace period which expired in June, there has been little practical enforcement yet. However, at the end of July, the CMA reported that it had investigated 100 businesses for how they were tackling fake or misleading reviews and found that 54 of those businesses could be failing to comply with the regulations. The CMA has asked those 54 businesses to explain why they are failing to comply and what steps they are taking to rectify this. There will likely be some useful compliance tips coming out of this, so stay tuned.

What’s Next?

In our DMCC Act video series, we also dive deeper into:

• Subscriptions – How to design fair and compliant subscription models.
• Drip Pricing and Enforcement – Understanding pricing transparency and the CMA’s new enforcement toolkit.

Stay tuned for practical insights and actionable guidance to help your business navigate these changes in the DMCC Act confidently.

¹  this means that the CMA does not have to show that the practice has affected the transactional decision-making of the average consumer when bringing enforcement action. This makes the new provisions an attractive enforcement option for cases under the new Act.