Last year the government of Germany took Nintendo to court to contest their eShop policies, including the fact that you can’t get a refund after pre-ordering. As it turns out, Germany isn’t the only European government that takes issue with that policy, and Nintendo isn’t the only company drawing the ire of consumer protection agencies.
The United Kingdom’s Competition and Markets Authority has just announced that Nintendo, Microsoft, and Sony, the three major console manufacturers, are all under investigation. The CMA wants to make sure that people making online purchases aren’t being taken advantage of by predatory policies like a lack of refunds or auto-renewing payment plans that don’t require authorization.
The CMA has written to all three companies to ask for a summary of their policies. They would also like to hear from consumers who use online services to get their side of the story. Anyone looking to contact the CMA can do so by clicking here. The investigation includes questions like:
- Are the contract terms unfair? – Do the companies’ terms give them wide discretion to change the quality of the deal, for example, by reducing the number of games included or increasing the price?
- How easy it is to cancel or obtain a refund? – Are there any factors that make it difficult for people to cancel their contract or get their money back?
- How fair is the auto-renewal process? – Are customers clearly told that their membership will be rolled over, are they regularly reminded that they are on a roll-over contract before further payments are taken, and is auto-renewal set as the default option?
The CMA has not reached any kind of decision regarding the legality of these online services at this time, but they “could take enforcement action” if their suspicions prove to be correct. Andrea Coscelli, Chief Executive of the CMA, issued the following statement:
“Roll-over contracts are becoming more and more commonplace and its essential that they work well for customers. Our investigation will look into whether the biggest online gaming companies are being fair with their customers when they automatically renew their contracts, and whether people can easily cancel or get a refund. Should we find that the firms aren’t treating people fairly under consumer protection law, we are fully prepared to take action.”
— Andrea Coscelli
It’s likely that Nintendo, Microsoft, and Sony will attempt to argue that they are in full compliance of the law unless/until it becomes totally untenable to do so. For instance, Nintendo argued to the German court that because games can be pre-loaded (but not played), players aren’t entitled to the option of a refund.