Representatives from TPO, ARLA, RICS and UKALA met with the Committee of Advertising Practice (CAP) on 22 March regarding the ASA ruling on disclosure of non-optional fees and charges to tenants.
CAP is the body responsible for issuing guidance on how, in practical terms, the obligations now placed on letting agents by the ASA ruling can be met. The group welcomed CAP's offer to the organisations attending the meeting for further involvement in process of defining the best approach for guidance.
CAP had provided in advance of the meeting some draft guidance which will now be developed further in the light of the discussions and in consultation with the group. The industry representatives emphasised where further detail would be helpful, specifically with regard to how the role of internet portals might need to be brought within the scope of the guidance. CAP recognised the importance of providing clear and relevant advice including illustrative examples. CAP also appreciated the need to finalise this guidance promptly.
At the meeting it was determined that:
- Only fees relevant to the transactional decision should be disclosed more transparently. Precisely which fees this will apply to remains to be determined but we will continue to work with the CAP to provide further clarity in this regard.
- No enforcement action will be taken until the CAP guidance has been finalised and thereafter a period of grace of at least one month will apply to enable agents to develop their approach to compliance before enforcement commences.
The ASA ruling makes clear that consumers need more information up front about non-optional fees. It is highly likely therefore that agents will need to make changes to advertising across all forms of media to comply. However until the formal guidance is issued agents should ensure that their current advertisements do not disadvantage the consumer either by giving misleading information or by omitting material information. For the avoidance of doubt the ruling does not apply to fees payable by landlords to letting agents.