Businesses selling to consumers – and yes, that includes universities selling courses to students – need to comply with new rules, or face heavy fines.
The Digital Markets, Competition and Consumers Act (DMCC Act) was passed back in May 2024, but isn’t set to come into force until the autumn.
In the meantime the Competition and Markets Authority (CMA) has been running a consultation on the detail of the act and its extensive new fining and enforcement powers, and the Advertising Standards Authority (ASA)’s Committee of Advertising Practice (CAP) has been consulting over amendments to its codes.
There could be some pretty significant implications for universities – especially when it comes to international (and, increasingly, domestic) agent activity, and for the way in which courses are promoted and sold, and changes implemented as cuts rain down on provision across the sector.
Even typing the word “consumer”, let alone referencing the detail of consumer protection law, can be like catnip to some – but in the continued absence of a set of rights bespoke to the relationship between student and university, it’s the framework that applies whether folk like the nomenclature or not.
And in reality, once you remove the word “consumer”, it’s hard to argue with most of what’s in here unless you’re keen that higher education providers be able to mislead students signing up for 3-4 year course and an up to 40 year commitment to pay for it.
All along they could see
The first aspect that catches the eye surrounds omissions of material information. Previously an omission was only considered unfair if it both met the definition of “material information” and demonstrably influenced a consumer’s decision. The new rules remove the dual burden – so if material information – like course content, fee structures, or additional costs – is omitted in an invitation to purchase (e.g., a prospectus or offer letter), the omission is deemed inherently unfair, and there’s no longer a requirement to prove that the omission led to a changed decision. Information gaps now carry automatic compliance risks.
If, for example, a university fails to disclose that core modules (or a pathway of optional ones) will only be available at a particular campus, a student might enrol under the impression that they can study all aspects of their course on the main campus, only to find out after enrolment that they need to travel to another city. Under the previous rules, this could have been debated based on whether the omission was truly significant to the student’s decision. Now, the omission would likely be considered unfair without further discussion.
There are plenty of OIA decisions, for example, that seem to rest on whether a student actually experienced detriment.
Similarly, a university might promote a programme as offering “access to industry-standard facilities.” However, if students later discover that access is heavily restricted to certain hours or that equipment must be booked weeks in advance, this could be considered a misleading practice. In the past, universities could have argued that the promotional wording was reasonable marketing. Ambiguity or exaggeration are the problem now.
A university might outline tuition fees clearly but neglect to inform students about additional costs, like charges for field trips or specialist equipment. This could now be deemed a serious breach because these costs represent material information – and while in the past a university might have argued that failing to mention a minor fee did not affect a student’s decision to enrol, that defence is no longer viable.
There’s plenty of students who, in the past, have tried to challenge a misleading or incomplete disclosure only to be asked to demonstrate that it caused significant harm or confusion in their decision-making. Now, they can raise complaints without needing to prove the degree of impact. Crucially given the cuts context, a student who accepts an offer without being informed that certain modules are being (or are likely to be) phased out could now make a decent case.
I was blind to the truth
Professional diligence is about the standard of skill, care, and honesty that a university is expected to demonstrate in its dealings with students and applicants.
We’re talking transparency (clear communication of key information about courses, fees, terms, and conditions), care (ensuring that processes like admissions, marketing, and complaint handling are conducted in a manner that is fair, accurate, and sensitive to the needs of students), and prevention of exploitation (practices that take unfair advantage of students’ lack of knowledge, experience, or specific vulnerabilities.)
Under the old regime, breaches of professional diligence had to be proven to cause “material distortion” of consumer decision-making. In practical terms, this theoretically meant (and you’ll see a pattern here) that a university could only be held accountable if there was demonstrable evidence that a practice significantly influenced students’ choices.
The DMCC Act has lowered the threshold – requiring only that the practice be “likely to cause” a different transactional decision. The adjustment simplifies enforcement and increases accountability by focussing on the practice, rather than proof of its impact.
So if a university markets a course as “fully accredited,” professional diligence would require verifying that this is accurate and ensuring students know exactly which accrediting body is involved. Hidden or ambiguous fees would breach the standard of professional diligence. If a course structure is subject to change, professional diligence requires that this possibility be clearly outlined at the offer stage – and no, the mere fact that a module is optional doesn’t make it immaterial, especially if it’s part of a collection of modules forming a definable pathway or is heavily promoted.
Similarly, if a university’s marketing materials bang on about high employment rates but fail to clarify that these figures only apply to graduates from a single, high-performing faculty, that would also likely represent a lack of professional diligence – because they mislead by omission or misrepresentation, with students potentially making uninformed decisions. See also claims of student satisfaction in the NSS that a PGT applicant might think apply across the board.
Such a fool to believe
Misleading practices are those that create a false impression that could cause students (consumers) to make decisions they might not otherwise have made. There are two main types of misleading practices under the DMCC Act:
- Misleading omissions: Failing to provide necessary information that students need to make informed decisions.
- Misleading actions: Providing false or deceptive information or presenting it in a way that misleads students about key aspects of a course or service.
Previously, misleading actions had to involve predefined “features” of a product, like price, availability, or performance. The DMCC Act broadens this, covering any misleading information relevant to a consumer’s transactional decision.
This in theory means that universities will have to be much more vigilant about how they present information in promotional materials, course descriptions, and enrolment documents. So if a university claims that a programme provides “strong industry links” but fails to clarify that placements are limited and highly competitive, this could be seen as misleading. And omitting critical information – like the fact that modules (or collections of them) have limited enrolment caps or are, given cuts, unlikely to run, could lead to non-compliance.
The interaction between honesty over how many academics a university expects to still be in post (and therefore the breath of electives) in a faculty or department while officially a consultation is on, and the standard of honesty required for prospective students about what the course could look like by the time they arrive, becomes quite a fraught line to tread – especially when SSRs form the basis of plenty of league table positions.
And you hurt me this way
Aggressive practices involve using intimidation, coercion, or undue influence to pressure students (consumers) into making decisions. Previously for a practice to be deemed aggressive, it needed to significantly impair a consumer’s ability to make a free choice – but again the new rules remove the need to demonstrate a significant impairment.
Universities now have to ensure that their interactions with students – especially in financial and administrative matters – do not involve undue pressure or aggressive tactics. So pressuring a student to settle an outstanding fee under threat of immediate expulsion (or via communication with UKVI, implied deportation) could be seen as undue influence. And insisting that students make immediate decisions about enrolment offers under tight, artificial deadlines could also be considered undue pressure.
Changes matter too. A student facing demands to agree to a last-minute course or provision change – without much of an opportunity to seek advice – could argue that this constitutes undue influence too, as could not being upfront and clear about a right to alternatives like compensation.
Didn’t I treat you right
The old regime maintained a list of so-called “banned practices” – the new Act updates the list to include new ones like manipulating consumer reviews, and revises current ones over stuff like commercial “intent”.
The practice of posting fake positive reviews, suppressing negative feedback, or otherwise manipulating review platforms will now be explicitly banned. Universities might showcase testimonials, student reviews, or satisfaction survey results in marketing materials – if they selectively hide negative comments or fabricate positive ones, this is now a clear breach of the rules, and are prohibited outright, regardless of whether they affect a consumer’s transactional decision.
Crucially, this also extends to partnerships with third parties, such as educational agents or recruitment services. If agents engage in misleading promotions on behalf of the university, the institution can be held directly accountable.
So-called “drip-pricing” refers to practices where consumers are shown an initial price but encounter additional, unavoidable charges later in the purchase process. So if hidden fees (e.g., for lab materials, field trips, or administrative costs) are only revealed after students have accepted an offer, this would breach the new rules.
So if a university says that tuition fees for subsequent years may increase by “inflation” but does not define the specific measure (e.g., CPI, RPI), students may be misled about their future financial commitments. Similarly, a university that says it might raise fees to the “maximum permitted by the UK government” would not be giving students a concrete understanding of how much their fees might increase. The lack of clarity over what the government could do or how inflation might spike makes the practice inherently risky under drip-pricing rules.
Well you cheat, and you lie
Pre-existing rules on “commercial intent” have also been given an update – and key here is that it becomes automatically unfair to fail to identify when there is a commercial motive behind a practice. So if a university engages agents – whether international or domestic – to promote itself and its courses, and those agents (or their sub agents) are being paid to do so, they’re acting under a commercial arrangement.
The new rules require that any promotional materials or advice provided by these agents clearly disclose the nature of that relationship – so that students don’t get misled into believing that a recommendation is impartial or based solely on academic merits. A lack of active curiosity about what’s being said would also be a professional diligence issue.
Similarly, if an agent is doling out brochures at a fair, or operating a “central casting photos” website that portrays itself as an “independent educational consultant” without disclosing that it’s getting commission from the university for promoting certain courses, students might not realise that the advice or marketing materials they receive are influenced by financial incentives. Also banned.
Finally in this section, the scope of what counts as material information has expanded beyond those defined by EU obligations, and misleading actions are no longer restricted to predefined “features” of a product or service – now, any information relevant to a student’s decision can trigger a breach.
So again, if a university claims to offer “state-of-the-art facilities” but fails to mention that construction delays may affect access for the first academic year, that would be a problem. See also the breadth of optional modules, the actual availability of placements, the ease with which a student might find a house or a job, and capacity restrictions on key facilities or services (the contrast between mental health messaging and counselling appointment delays springs to mind here).
Cause I couldn’t see it coming
There’s a few complementary bits about scope and definitions.
“Commercial practice” will now mean any act, omission, or representation by a trader relating to the promotion or supply of goods, services, or digital content to a consumer. This now includes single acts, promotions by third parties, and indirect transactions. “Product” now explicitly includes both physical and intangible items, such as services, digital content, and rights (e.g., cancellation rights).
And “transactional decision” is now broadly defined to cover decisions about whether, how, or on what terms to enter into, retain, modify (that’s changes to provision right there), or terminate a contract. That will include choices about enrolment, course selection, or exercising rights (like refunds/compensation if a student chooses to not accept a change).
That expanded scope means universities should be mindful of how all their interactions, promotions, and partnerships influence student decisions. Even actions that indirectly affect decisions – like partnerships with online platforms or agents – fall within these rules.
For example, a university’s website might feature rankings or third-party endorsements. If these create an inaccurate impression of the university’s offerings, this could be subject to enforcement even if no immediate enrolment occurs. Similarly, information presented by student advisors or student ambassadors, whether in-person or online, must reflect complete and accurate details about course availability and associated costs.
Even if a student travels to attend an open day based on claims of available scholarships and later learns that the advertised funding does not apply to their circumstances, this could trigger a valid complaint under the expanded rules. If a university’s online application portal promotes a “guaranteed placement year” but later informs students that placements are competitive and limited, that would be a problem. And if a university uses social media influencers to promote courses but does not disclose that these influencers are paid by the institution, that may also fall foul.
Oh – and if a course closes to new students, and a commitment to “teach it out” is offered to a student without being clear about alternatives or without specifying what is being guaranteed (“the award” is obviously not enough), that would also be a problem.
I know it sounds funny
It’s also worth briefly explaining some changes relating to (consumer) vulnerability. It’s no longer viewed as a peripheral issue – and instead is now embedded within the broader assessment of fairness in commercial practices. The rules explicitly acknowledge that certain groups may experience disproportionate harm from practices that might not affect others to the same degree, but the change shifts enforcement priorities to focus more on the experiences of those in vulnerable situations rather than just their characteristics.
Universities must now proactively identify and mitigate risks to vulnerable students as part of their duty of professional diligence, and enforcement bodies can act if a practice is likely to disadvantage or mislead vulnerable students, even if the practice is not harmful to others.
That raises questions where a university might have marketed courses to international students without fully explaining complex visa restrictions, or if a disabled student faced unexpected additional costs for accommodation, or accommodations.
Aggressive fee collection tactics might now be evaluated over whether they cause undue stress or confusion for those thousands away from home, and crucially telling students they can exit a contract when they’re only told about changes in September might represent a problem too, even if the CMA thought it realistic they could exit – which it notably doesn’t – because a student agreeing to a contract change is very much a transactional decision when their vulnerability is situationally heightened.
The ASA’s consultation largely reflects all of the above. Central to changes it is proposing is the requirement for price transparency – marketers must now include all mandatory fees upfront and clearly outline optional costs. Misleading by omission, such as failing to disclose future price increases, is prohibited, as is the use of fake reviews or selectively promoting favourable feedback. Stricter oversight will also apply to marketing targeting vulnerable groups, with particular sensitivity to factors like age and mental health.
If, for instance, a university advertises tuition fees that may rise “by inflation,” it’s pretty clear that they’d need to specify the inflation index (CPI, RPI, or others) they are referencing, along with the specific timing or source of that data. If different universities adopt varied approaches to calculating inflation-linked fee increases, different students would end up being charged more in ways they were unable to choose between – a real problem.
Its proposed new regs also boost up that focus on professional diligence. Marketing practices that impair a consumer’s ability to make well-informed choices will be judged as unfair, marketing towards children (under 16) must avoid direct appeals to buy products or services, and children over 16 are textbook vulnerable. And yes agents – and agents of agents – are covered.
That just won’t do
A cynic might argue that there’s little for universities to worry about here – in England, the Office for Students (OfS) hasn’t exactly been proactive over this agenda, and it’s pretty unclear as to who might be doing active enforcement elsewhere in the UK.
In theory the big change in the DMCC Act is that the CMA gets enhanced enforcement powers – and will now be able to directly assess and enforce breaches of consumer protection rules without having to rely on court decisions, impose civil penalties for unfair commercial practices (up to a whopping 10 per cent of turnover, no less), and hold corporate officers liable for offences if they are found to have consented to or negligently allowed breaches of consumer protection law to occur.
That’s breaches of consumer protection law in general, by the way – suggesting that a university sat on legal advice that says something along the lines of “it’s probably a breach but the risk is low given the number of complaints and so on” might need to re-evaluate the angle of the see-saw.
That would all matter more if the CMA had shown anything other than a passing interest in universities over consumer law complexities during Covid and strikes, the big question marks over the legality of fee increases for continuing students, or the ongoing questions that surround making changes to what was offered and promised to continuing students as cuts get implemented.
One of OfS’ excuses in this space – that it was never given enforcement powers over consumer law, and so has to instead test whether providers have paid due regard, and refer cases of concern to National Trading Standards – at least in theory could get interesting if interim chair David Behan’s request for OfS to be given those powers got picked up by government. Either way, none of that sounds like it’s coming soon.
There are some wider questions concerning both the CMA and the EU. The CMA’s chair was all but sacked a few weeks ago by a government keen to signal that red tape from regulators was holding back growth. On the other hand, much of what’s in the DMCC Act aligns us with developments in EU law – and it’s alignment that matters for the closer relationship that Keir Starmer is trying to deliver without crossing any of the formal “red lines”. Whether all of that impacts the results of the consultation remains to be seen.
The interactions with everything from the soon-to-be-mandatory Agent Quality Framework (where plausible deniability looks to be soon getting less plausible and less deniable) to student protection (an issue both for OfS and, soon, Medr) are fascinating – in the latter’s case partly because the duties here go well beyond “cessation”, partly because cuts to things are often defined as immaterial in ways that this legislation would surely prevent, and partly because even where changes are material, students are under intense pressure to just accept them – because what are the alternatives?
As such we might reasonably have expected OfS, Medr and even the SFC to have drawn the CMA and ASA consultations to the attention of a sector for whom the changes could be profound. If that has happened, I’ve not heard about it.
Taken at face value, this all looks pretty sensible from a student point of view – be (more) honest about what’s on offer, be careful about who’s offering it (especially when you’ve incentivised them to do so), think about who’s vulnerable (both characteristically and situationally) and then deliver what you’ve promised – they all sound like the sort of thing that should be in law even if it wasn’t through the optic of “consumer”.
But it continues to be the case that all of that sits uneasily with a sector that is used historically, and is now being expected by government and regulators actively, to scale up and down what it offers in a given year based on the (previously public) funding available to it. It’s a set of circumstances that, in theory, should have been making it much harder to implement cuts, but doesn’t seem to have so far. If the stable door is about to get a new lock on it, it does feel like the horse will have long bolted by the time that lock could have helped.
