AI in retail and customer service: consumer law when an AI agent serves the customer

Cue 1 A member of staff and an AI agent standing behind the same counter under the same rule book

EMMA 00:00 George, we've put an AI agent on our shop's chat. If it tells a customer something wrong, isn't that the supplier's problem?

GEORGE 00:08 No. The Competition and Markets Authority published guidance on 9 March 2026. It says you're responsible for what an AI agent does in the same way you're responsible for what an employee does.

EMMA 00:22 Even though we didn't build it?

GEORGE 00:24 Even if someone else designed or provides the agent on your behalf.

Cue 2 A fine notice reading up to 10 per cent of worldwide turnover

EMMA 00:29 What's the headline?

GEORGE 00:30 One sentence. When it comes to dealing with your customers, the same rules apply whether using AI or human agents.

EMMA 00:38 And if we get it wrong?

GEORGE 00:40 You could be fined up to ten per cent of your worldwide turnover. And possibly forced to compensate the customers affected.

Cue 3 A chat window labelled clearly as an AI assistant, beside one posing as a named person

EMMA 00:49 Do we have to say it's AI?

GEORGE 00:51 The test is this. If the fact they're dealing with AI rather than a person might affect people's decisions, then you should tell them. Don't let customers think it's a real person.

EMMA 01:04 Our marketing team wants to call it our AI expert.

GEORGE 01:08 Careful. The guidance also says don't overstate the role of AI, or what it can or can't do.

Cue 4 An agent being handed three documents: statutory rights, the returns policy, and consent rules

EMMA 01:16 What does the agent need to know?

GEORGE 01:18 Three things. To respect customers' statutory rights and the terms of contracts, like cancellation rights. To avoid misleading customers, by what it says and what it doesn't say. And to properly obtain any consents the law requires.

EMMA 01:33 It's had none of that. We just switched it on.

GEORGE 01:37 Then it's guessing. An agent that's never been given your returns policy and the law on faulty goods will make both up.

Cue 5 A test bench of customer questions run through the agent before the shop opens

EMMA 01:46 What should we have done first?

GEORGE 01:48 Tested it. The guidance calls testing a crucial part of training. You use the results to check and improve it before you deploy.

EMMA 01:58 And the supplier?

GEORGE 01:59 Ask how it was trained on consumer law and what the tests showed. If someone else provides the AI and you don't check they've done that, you may break the law.

Cue 1 A person reviewing a sample of an agent's conversations against a checklist

EMMA 02:11 George, the agent's live and it seems fine. Can I leave it to run?

GEORGE 02:17 No. The guidance says regularly check how it's performing. That it's delivering the right results, behaving as intended, and complying with consumer law.

EMMA 02:26 Checked by whom?

GEORGE 02:27 A person. It says make sure there's a human in the loop, actively checking that the agent's making correct decisions. Some models can hallucinate results that are inaccurate.

Cue 2 One wrong rule inside an agent producing the same wrong answer to a crowd of customers

EMMA 02:38 Suppose I find it's telling people the wrong thing.

GEORGE 02:42 Act quickly. For example by refining the prompts or the workflows. Especially if it deals with large numbers of people, or with vulnerable customers.

EMMA 02:52 Why the hurry?

GEORGE 02:53 One wrong answer from a person is one wrong answer. One wrong rule in an agent is the same wrong answer to everybody, until somebody changes it.

Cue 3 Two kettles: one faulty, one unwanted, each with a different right and time limit

EMMA 03:04 And if I know and leave it?

GEORGE 03:06 The guidance says if you don't act quickly to address problems, you may end up breaking the law.

EMMA 03:14 Refunds are where ours struggles.

GEORGE 03:16 That's the guidance's own example. The agent needs the Consumer Rights Act 2015, for goods that are faulty. And the Consumer Contracts Regulations 2013, for someone who's changed their mind after buying at a distance.

Cue 4 A price tag showing the full price with every unavoidable charge included

EMMA 03:30 They're different?

GEORGE 03:30 Different rights, different time limits. A faulty kettle and an unwanted kettle aren't the same request.

EMMA 03:37 We also offer sixty days to return. Longer than the law.

GEORGE 03:41 Then the agent must apply it. The guidance's example of a fault is exactly that. An agent not always taking the extended returns policy into account.

Cue 5 A cluster of customer complaints all pointing at the same chat answer

EMMA 03:52 What about the agent writing our promotions?

GEORGE 03:54 Accurate prices, including all unavoidable charges. Paid endorsements properly labelled. And any offers or price reductions genuine.

EMMA 04:01 One cheap way to keep an eye on all this?

GEORGE 04:05 Read the complaints. A cluster of customers saying the chat told them something different is the cheapest monitoring you'll ever get.