In this edition of MILS Legal Surgery, Professor Henry Blair takes a close look at three big-ticket issues that dealers should have on your radar in the year ahead.
Q: What’s new with Johnson and the discretionary commissions mess?
A: Not long ago, the Court of Appeal’s decision in Johnson v FirstRand Bank Ltd, Wrench v FirstRand Bank Ltd and Hopcraft v Close Brothers Ltd. [2024] EWCA Civ 1282 sent shockwaves through dealerships and finance companies alike. The Court of Appeal found that dealerships arranging finance for customers owe a fiduciary duty. The decision, while focused on financing, potentially impacts other aspects of a sale transaction.
The key question everyone’s been asking is whether the Supreme Court would agree to hear the matter—and in December, we got our answer.
In an early Christmas surprise on 11 December 2024, the Supreme Court confirmed that it will consider the appeal. It set down Hilary Term 2025 as the overall timeframe, then swiftly scheduled the hearing for 01–03 April 2025. The cases to be heard are Johnson, Wrench, and Hopcroft, meaning that all three will get their time in the Supreme Court spotlight.
Those wanting to dive deeper into procedural details – such as the judicial panel listed for the hearing – can see the Court’s official entry at https://www.supremecourt.uk/cases/uksc-2024-0158.
Q: Do I need to worry about the new EU General Product Safety Regulation (“GPSR”)?
A: In short, you might.
If you’re supplying cars, parts, or accessories to customers in the EU or Northern Ireland – even on a small scale – the EU’s GPSR will soon loom large. Coming into force and replacing older safety laws on 13 December 2024, the GPSR imposes obligations on sellers of any consumer products. Crucially, it covers new, used, repaired, and reconditioned goods that could be used by consumers.
One of the most significant changes is the requirement to have a “Responsible Person” based in the EU or Northern Ireland if your business is located outside those territories but sells into them. So, if you’re a UK-based dealership specialising in, say, refurbished engines or second-hand parts and shipping them across the Irish Sea, you’ll need to appoint an Authorised Representative who is physically located in the EU or Northern Ireland. That representative is on the hook for making sure your products comply with the GPSR, including labelling, record-keeping, and cooperating with local regulators.
All that said, if you’re only selling to consumers in England, Scotland, or Wales (and don’t send anything into Northern Ireland), you won’t need an EU-based Authorised Representative. You’ll simply stick to your usual UK compliance obligations, including the pre-existing UK product safety framework. However, if you have a website or an online store that also advertises to EU or NI customers, be careful: the mere possibility of your products being purchased by someone in the EU or NI could trigger GPSR obligations.
Q: Should I worry about the DMCCA’s new rules on “Drip Pricing”?
A: Pricing practices continue to be a hot topic in consumer law, and the Digital Markets, Competition and Consumers Act (“DMCCA”) is set to make some notable waves with respect to pricing in 2025. The CMA has been training its sights on “drip pricing,” a practice in which businesses advertise a base price but then add mandatory fees partway through the deal, resulting in a higher total price than initially stated.
The motor trade – dealerships, repairers, and finance institutions – aren’t immune. If, for example, a dealership promotes a tempting finance package online but then quietly tacks on non-optional administrative costs or processing fees at the end of the transaction, it’s potentially walking straight into the CMA’s crosshairs. The emphasis is on clarity from the get-go. The consumer should know upfront what they will pay in total, with no last-minute surprises.
In addition, the CMA has flagged other pricing practices it considers risky or unfair, including so-called “reference pricing” (e.g., “Was £X, Now £Y”) and certain forms of dynamic pricing, which adjusts the cost in real time based on market conditions or demand.
Previously, the approach of regulators tended to involve investigating a specific industry, naming and shaming particular businesses, and then pushing for undertakings or court action. But the DMCC Act’s new enforcement powers, coming online this spring, are a game-changer.
They mean that the old “warn and watch” approach could be replaced by swifter, costlier consequences.
What should the motor industry do right now? The best move is to review pricing structures and marketing materials with a fine-tooth comb, ensuring that “headline” figures match what consumers ultimately pay, and that any discounted or “was/now” pricing truly reflects an honest discount. Businesses should also keep careful records of how long a product or service was offered at the old price and how many customers paid that price.
In a legal landscape where surprise fees are being targeted and enforcement is stepping up, transparency is a dealership or repairer’s best
