Commercial Law Update: 2023 in review

As we approach the end of another year, the commercial services team here at Brodies has taken the opportunity to pull together our thoughts on some legal developments in the year which caught our eye but may have passed below the radar for many. Once again, it was a busy year both domestically and internationally so not everyone is poring over what's happening in the law.

The aim here is to highlight some selected developments that might be of general interest to your business. In other words, what follows is not comprehensive – so please contact us if you have any queries on what we have discussed below or on anything else that may have happened in 2023. We plan to issue a second companion piece in early January with some thoughts on what we expect to happen in 2024.

1. Online Safety Act – The Online Safety Act 2023 received Royal Assent on 26 October 2023 and will take effect through phased implementation beginning in the second half of 2024. The UK Government press release stated the new laws "take a zero-tolerance approach to protecting children from online harm". Tech companies now have a legal responsibility to prevent and remove illegal content from their platforms and prevent children from accessing harmful and age-inappropriate content, including content depicting serious violence or relating to self-harm, eating disorders and bullying. Failure to comply with the rules will result in significant fines of up to £18 million or 10% of annual global revenue, whichever is higher. Ofcom is now the regulator for online safety. Its job is not to remove the online content, which is the responsibility of the tech companies, but to ensure that online services follow the rules and have appropriate systems and processes in place to protect users. Ofcom is currently consulting on the codes of practice and guidance, and when they come into effect, Ofcom will have the powers to take enforcement action.
2. Online Fraud Charter – On 30 November 2023, the Government published an Online Fraud Charter (the "Charter") which is a voluntary agreement between the Government and the technology sector to reduce fraud on their platforms and services. Signatories include Amazon, Facebook, Google, Microsoft, TikTok, X (previously Twitter) and YouTube. Tackling fraud has been a Government priority and follows the Fraud Strategy which it launched in May 2023. The Charter sets out various measures in relation to blocking, reporting, takedowns, advertising, law enforcement, intelligence sharing, transparency, communications and horizon scanning which the signatories agree to adopt within six months, meaning these measures should be in place by 30 May 2024.
3. Retained EU Law (Revocation and Reform) Act 2023 – In our 2023 review, we highlighted this as an important bill which had the potential to strike vast amounts of retained EU law from UK law. However, as the bill progressed in 2023, it lost its "sunset clause" which would have automatically deleted EU-based laws – some estimates suggested nearly 5,000 pieces of retained EU law may have been affected - and the law that was passed therefore lost some of its potency. The Retained EU Law (Revocation and Reform) Act received Royal Assent on 29 June 2023, and aims to make it easier to amend, repeal or replace EU law retained on the UK statute books. From 1 January 2024, retained EU law has been renamed as "assimilated law". Some assimilated law, including the retained EU law listed in Schedule 1 of the Act, EU rights which were directly effective in the UK, and the principle of EU law supremacy, will expire on 31 December 2023. The Act also grants powers to UK Government ministers and devolved ministers to recreate the effect of retained EU law supremacy in relation to specific instruments. The Act also gives courts across the UK greater discretion to depart from retained EU case law. Although the Act is less of a "bonfire" of EU legislation than was originally anticipated from the Bill, it is still significant and we may see further similar steps from the Government over the next year to deal with legacy EU law issues.
4. ICO Cookies Enforcement – The Information Commissioner’s Office ("ICO") has been monitoring the use of cookies on websites closely. Numerous requirements are placed on organisations using cookies, which we discussed in our blog earlier this month, but the most notable is the requirement to obtain consent. At the end of November, the ICO warned several UK websites that they will face enforcement action if they do not make changes to comply with the Privacy and Electronic Communications (EC Directive) Regulations 2003 and data protection legislation. The ICO specifically targeted business with websites which make it more difficult for users to reject cookies than accept them. Cookies may not always be at the forefront of consumers and businesses minds, but they are important from a data privacy point of view. Businesses should ensure they understand the requirements placed upon them and reflect these when creating, or instructing the creation, of their websites, in order to ensure they are complying the UK privacy laws.
5. Moveable Transactions (Scotland) Act 2023 – In our blog in October, we gave an overview of the Moveable Transactions (Scotland) Act 2023 ("MTA") which seeks to overhaul the existing laws in Scotland relating to the transfer of rights and the creation of security in moveable property. The MTA received Royal Assent on 13 June 2023 and is expected to come into force in the summer of 2024. It introduces a new legal framework for the transfer of rights in Scotland and creates a new form of security – the statutory pledge – over moveable property. One of the main aims of the MTA is to make it easier for Scottish businesses to use their moveable assets, such as inventory, machinery, livestock and IP as collateral for obtaining financing. The MTA will also enable assignations to be completed by registration in a new Register of Assignations as an alternative to the current requirement for intimation. The requirement for intimation will also be updated to allow electronic intimation. There will also be a new Register of Statutory Pledges created and it will become possible to take a statutory pledge over certain types of moveable assets without having physical possession of them.
6. Advertising – Climate change continues to be at the forefront of public consciousness, with increasing focus on the environmental and sustainability impacts of products and services and the claims by businesses as to their "green" credentials. In June 2023, the UK Advertising Standards Authority (the "ASA") published its updated green claims guidance (the "Guidance"), reflecting its recent decisions. The ASA highlighted that environmental claims must be clear, accurate and substantiated. The Guidance advised against using unqualified "carbon neutral" and "net zero" claims because the terms are not widely understood. Where they are used, the information underpinning such claims must not be omitted. Environmental claims must also be based on the full life cycle of a product, which means all of the stages of a product's existence, from, for example, its manufacturing to its eventual disposal need to be taken into account when claims are made. The Guidance also provided examples of the enforcement activities the ASA had carried out and case examples to show advertisers what not to do when making "green claims". The ASA has stressed in a blog that accompanied the Guidance that it is not trying to prohibit businesses from talking about the environment at all, but instead it calls for businesses to create their advertisements with precision and to ensure consumers are not being misled.

If you would like to discuss anything raised in this blog in more detail, please get in touch with a member of the corporate and commercial team or your usual Brodies contact.