Energy regulator Ofgem announced yesterday (November 20) that it can now take direct action against ‘rogue’ brokers and other organisations that are marketing energy products or services to business customers, after being granted powers by Government under the Business Protection from Misleading Marketing Regulations (BPMMR).
Ofgem can seek undertakings from brokers and other organisations to stop misleading marketing activity or apply to court for an injunction to ensure that they are complying with the legislation. At present, Ofgem and the Office of Fair Trading have concurrent powers to enforce the regulations in the energy sector, after Ofgem made its case at the start of 2013 to BIS for it to have the power to enforce the BPMMRs.
Ofgem has also been developing an industry-wide code of practice for brokers that market energy to business, which will set out that brokers have to behave in a fair and transparent way to give businesses confidence when using their services. Ofgem will publish the code for consultation in December 2013.
A recent Ofgem survey found that around one third of businesses who had been approached by brokers did not consider that the broker had been upfront about the costs of their services, while previous Ofgem research has shown that businesses are concerned about cold calling, high-pressure sales tactics and the unprofessional behaviour of some brokers.
Ofgem gains new powers to protect businesses from mis-selling energy brokers