Google to enforce sanctions on fake reviews in the UK

LONDON - In a significant move to bolster consumer trust in online reviews, Google (NASDAQ:GOOGL) has agreed to implement stringent measures to address the issue of fake reviews in the UK. This decision follows an investigation by the Competition and Markets Authority (CMA), which raised concerns that the tech giant may have been breaching consumer law by not adequately protecting users from deceptive reviews.

Google's agreement includes a set of undertakings that will see the company adopt more rigorous processes to detect and remove fake reviews. The firm will also introduce sanctions against individuals who post fake or misleading reviews for UK businesses, as well as against the businesses that benefit from such practices.

The CMA's Chief Executive, Sarah Cardell, commented on the importance of the agreement, stating that unchecked fake reviews undermine trust and disadvantage honest businesses. She praised Google's leadership in tackling the issue and emphasized that the agreed-upon changes would ensure robust processes are in place for consumers to rely on reviews when making choices.

As part of the undertakings, Google will add 'warning' alerts to the profiles of businesses found to be using fake reviews to enhance their star ratings. These alerts will be visible on the businesses' Google profiles, alongside their overall review scores. Additionally, businesses that repeatedly engage in fake review activity will face the deactivation of their review function and could have all their reviews deleted for six months or more.

The CMA has also highlighted the significant influence of online reviews on consumer spending, with an estimated £23 billion of UK consumer spending potentially affected annually. According to research, 89% of consumers use online reviews when researching products or services.

Google will report to the CMA over a three-year period to ensure compliance with the undertakings. The CMA also mentioned that forthcoming legislation, expected to be enacted in April 2025, will grant it stronger powers to fine firms up to 10% of their global turnover for breaching consumer law.

The CMA's ongoing investigation into Amazon (NASDAQ:AMZN)'s handling of fake reviews will provide an update in due course. Meanwhile, the authority is set to publish final guidance later this year to assist businesses in complying with consumer law, as part of its broader efforts to promote fair online practices.

This news is based on a press release statement provided by the RNS, the news service of the London Stock Exchange (LON:LSEG).

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