Transparency of heating oil price comparison websites
Office of Fair Trading (OFT) closed consumer enforcement case.
Case information
Case reference: CRE-E-26547, 26555, 26759, 26760, 26761
Relevant law: Enterprise Act 2002, Consumer Protection from Unfair Trading Regulations 2008
Issues
These investigations were opened by the OFT as part of its off grid energy market study. Based upon complaints and comments on potential consumer problems, the OFT looked at the ease with which consumers could compare prices on-line.
Websites seemed to share certain characteristics of price comparison sites using domain names that might indicate they were a price comparison site, but not prominently displaying the names of businesses operating the site, and in some cases making claims or comments about comparisons or obtaining best prices without always being clear whether a price comparison was being made.
The OFT was concerned that consumers might be misled or confused by websites giving the impression they were price comparison sites for domestic heating oil when they were not. The OFT was also concerned that price comparison sites should make it clear how many prices have been compared and whether there is any connection between the supplier providing the quotation and the price comparison site.
Summary
As a result of its investigations, the OFT formed the view that several businesses may be operating in breach of the Consumer Protection from Unfair Trading Regulations 2008 (CPRs). In particular the OFT identified evidence of commercial practices which it believed constituted misleading statements or omissions about the operation of the websites. In the course of its investigation, the OFT sent information requests to four companies under section 224 of the Enterprise Act.
All the businesses have co-operated with the OFT investigations.
Fuelfighter.co.uk is operated by WCF Limited. Its website claimed that it was an independent price comparison site and provided a list of customer testimonials that supported this claim. The OFT was concerned that these claims could not be substantiated. The company had set up the site with the intention of operating it as a price comparison site but had yet to introduce other suppliers, so the only business supplying quotations through the site was WCF Limited. The customer testimonials could not be substantiated. The company and its directors signed undertakings not to mislead consumers by claiming its website was an independent price comparison site when it was not, omitting information about the ownership of the website and the businesses providing quotations via the website.
The price comparison site Boilerjuice.co.uk is operated by Boiler Juice Limited. Although a separate company, it is ultimately owned by DCC plc which also owns some of the oil distribution companies providing quotations via the Boiler Juice website.
The OFT was concerned that the website omitted information about the ultimate ownership of Boiler Juice Limitedand its connection to some of the oil distributers providing quotations via the website was not clear. The OFT was also concerned that the quotations omitted to tell consumers the number of businesses being compared when a quotation is provided. Boiler Juice Limited made changes to its website in response to the OFT concerns and the company and its directors have signed undertakings not to omit material information about the ownership of the website or failure to disclose connections between the businesses providing information or quotations to consumers. Also to make clear the number of businesses providing quotations prior to a consumer accepting a quotation.
The Cheapheatingoil website is operated by Johnston Oils Limited. The website did not claim it was a price comparison website. Although it did not claim to be a price comparison site, from its style and from some statements it contained, the OFT was concerned that consumers could be misled into thinking that the website was comparing prices. Johnston Oils Limited changed its website to include ownership details on the home page and enhanced the site to be clear that it is not a price comparison website. The case in relation to this company was closed with a letter advising the company about our general concerns.
Related documents
- Press release: OFT takes action against heating oil companies and price comparison websites (9 September 2011).