he UK‘s competition watchdog has threatened Groupon with court action if the deals site does not quickly “improve its treatment of customers“.
The Competition and Markets Authority (CMA) announced on Monday an investigation into Groupon has found evidence the website – which offers everything from garden furniture to discounted haircuts and experience days – does not always give customers cash refunds, seeing some instead “only offered Groupon credits”.
The regulator also said it has concerns the company is failing to deliver all its products within the timeframes it advertises, and is failing to ensure that its descriptions of its offerings are accurate.
The CMA also said it is concerned Groupon is not making sure the goods it sells “are of a satisfactory quality”.
The regulator said it is asking the New York-listed firm, which operates as Groupon UK in Britain and is registered here as MyCityDeal Ltd, “to change its practices swiftly or face court action”.
READ MORECheap Covid travel tests on government website not available to bookSupermarket chain Aldi launches major London hiring spree Law firm secures new City office in building with climbing ‘skywall’ BRANDPOST | PAID CONTENTHow the London melting pot can be the ideas factory of the worldCMA chief executive, Andrea Coscelli, said: “More people than ever are shopping online, especially over the last year. It is therefore essential that online businesses treat customers fairly and refund them money where due under consumer law.
“Groupon must swiftly step up and do right by its customers if it wants to avoid court action.”
It is not the first time the CMA – formerly known as the Office of Fair Trading – has probed Groupon. The first was in 2012, when the OFT raised concerns about “unfair and misleading pricing practices”.
Groupon committed to change its practices. The CMA then launched a new investigation in April this year, the regulator saying it wanted to look at the accuracy of the firm’s product descriptions, in addition to confirming Groupon was paying refunds to customers and delivering deals within advertised timeframes.
The CMA said on Monday that “as well as potentially breaking consumer protection law, Groupon UK could be in breach of the formal commitments – known as ‘undertakings’ – that it gave to the CMA’s predecessor, the Office of Fair Trading (OFT), in 2012”.
It said: “As part of these commitments, Groupon UK pledged to ensure information on its website is not misleading and to comply with customers’ legal cancellation and refund rights.”
The CMA said Groupon can now avoid court action by making further pledges, and potentially reimbursing consumers denied a refund.
A Groupon spokesperson told the Standard: “We have and will continue to cooperate fully with the CMA. We take the outcome of the investigation very seriously and will be carefully reviewing the CMA’s findings.”
