On the 20th of March, the CMA (Competition & Markets Authority) launched its COVID-19 task force. The purpose was to monitor markets in the wake of the pandemic, identify practices that adversely affect consumers, and consider appropriate responses to help businesses comply with the law and protect consumers’ rights.
As a result of a large volume of similar complaints from consumers, in April the CMA launched an investigation.
They identified 3 sectors of particular concern:
- Weddings and private events
- Holiday accommodation
- Nurseries and childcare providers
Their statement on 30th April highlighted areas of concern with an assurance that further guidance will follow. Guidance for holiday accommodation, nurseries, and childcare providers has already been published. The guidance for weddings and private events will be next. As it will be publicly available, so couples will see it on the same day as venues, it is worth being ahead of the curve.Â
Avoiding court
It is an uncomfortable truth that it is in the interest of other venues for your venue to be taken to court. Although no one would wish that on another venue, it would allow everyone to see what a judge considers fair and how other similar cases might be decided. Don't let your venue be the test case.
Getting the information you need
The ideal is to speak to a solicitor for specialist advice. However, some venues have been reluctant, perhaps because they feel that solicitors won't understand the complexities of weddings or that the cost will outweigh the benefits.
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For those wanting to be able to make informed decisions, I would urge you to read the exact wording of any laws relevant to any disputes, in conjunction with the guidance already available through the CMA. Don't rely on speculation from other venues. Each piece is quite hefty to read in its entirety but all of the answers to the individual issues being raised in forums are in there.Â
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We have found that their piece on unfair terms has been particularly helpful in understanding why their stance on 30th April was so different from the opinions of many venues.
The only variation then will be in how you and your clients interpret the wording. The CMA further guidance is aimed to help with that and avoid the expense and distress of a court case.Â
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What is the CMA guidance likely to include?
The CMA don't adjust the laws, their guidance helps businesses understand the intent of the laws when applied to different and often complex situations. As such, we can look at other guidance issued during these unprecedented times to see what the CMA guidance for weddings might include. We'd particularly draw your attention to last week's CMA Open Letter to Nurseries. Also, the more in-depth CMA guidance issued to nurseries that you can read here.
How are nurseries similar to wedding venues?
Some of the areas of particular dispute are relevant, and perhaps fairly unique, to both nurseries and wedding venues. This is particularly the case with prepayments.
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In particular, both have huge customer loyalty.
- Clients don't want to change to a different nursery / wedding venue.
- Clients want to ensure that their nursery / wedding venue survives to be there for them in the future.
- Clients are concerned that their nursery / wedding venue will let someone else have their place or date.
- Conversely, nurseries / wedding venues feel that long lead times prevent them filling empty spaces / dates.
- Clients are worried about how they will be treated by their nursery / wedding venue in the future if they don't comply with their terms.
- Many costs incurred by nurseries / wedding venues are in maintaining buildings, facilities and staff training and aren't just incurred on the day of delivery.
- Nurseries / wedding venues were prevented from supplying their service as contracted as a direct result of the pandemic.
We would encourage you to read the guidance for nurseries if you'd like your venue to be a step ahead of the CMA guidance on weddings.
What are the CMA taking into consideration?
When the investigation was launched in April many venues felt that the CMA didn't understand the intricacies of weddings and they probably had a very good point!Â
The statement on 30th April simply set out some basic principles. They made it clear that they would then start the process of understanding the issues that venues, suppliers and couples were facing. That process has already taken 3 months which is a good indication of the amount of information that needed to be considered.
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From what we can see, they have been thorough and have consulted with numerous relevant stakeholders and wedding venues to understand the complexities.
Getting the balance right
Ultimately the CMA is there to protect consumers. However, the knowledge that so many venues don't keep deposits and prepayments in a client account has put venues in a position of power.Â
The CMA are needing to be incredibly careful to ensure that their guidance doesn't force venues to close as they will take those deposits and prepayments down with them.
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We are looking forward to guidance that takes the needs of the vast majority of venues and couples into consideration and helps end the disputes that are so damaging to the reputation of some of our most popular venues.