The National Trust is among the charities be have been exempted from a “loophole” in new consumer rights legislation that could have caused it to lose out on funding.
Coming into force this year, the Digital Markets, Competition and Consumers Act (DMCCA) 2024 is intended to minimise “subscription traps”, where consumers are misled into signing up through a free trial or reduced-price offer.
The new legislation will entitle members of the public to cancel a subscription contract during a two-week “cooling–off” period.
However, the National Trust and other charities warned last year in an open letter to Keir Starmer that the change would pose a threat to their business models, whereby they earn significant income through membership schemes.
Now, the government has confirmed in its response to a public consultation on the new legislation that membership schemes operated by charities like the National Trust will be exempt from the rules.
Decision welcomed by fundraisers
Hilary McGrady, director-general of the National Trust, said that the decision “comes as a huge relief”, with the government having recognised “the significant contribution” that membership charities like the trust make to the charity sector.
“Ahead of our busiest weekend of the year, when hundreds of thousands of families will enjoy time in nature and heritage, this is very welcome news,” she said.
“We now hope the government extends this approach to all charities, other non-profit organisations and to those in the wider visitor economy.”
Claire Stanley, director of policy and communications at the Chartered Institute of Fundraising, also welcomed the exemption.
“We have been calling for this on behalf of our members and the wider sector since the introduction of the original bill in 2023 and have worked closely with government over the past 18 months to reach a solution which ensures charities are not negatively impacted by this,” she said.
“Whilst we have always been clear that we support the DMCCA’s overall objective to strengthen consumer protection across the subscriptions landscape, we were concerned that the new regime did not account for the cross-cutting regulations and legislations that charities already adhere to.
“As such, many of the provisions introduced in the act would have disproportionately impacted charities and potentially forced affected organisations to divert funds away from their programmes and services.”
