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Retail horizon scan

January 2026

As we enter 2026, the pace of legal and regulatory change shows no sign of slowing, and we are pleased to present this updated edition of our retail horizon scan to help you navigate the changing landscape. 

This edition reflects key developments that have occurred over the latter half of 2025 and highlights important changes coming into force in 2026. This includes the Employment Rights Act which represents the most significant overhaul of UK employment law in a generation, with key provisions including employees acquiring protection against unfair dismissal after just six months rather than two years, and the cap on compensation being completely removed. We are also expecting updates this year from the CMA's first investigations using its new enforcement powers under the Digital Markets Competition and Consumer Act (DMCCA), as well as the outcome of the UK Government's consultation on copyright and generative AI. This attracted over 11,500 responses with an overwhelming consensus against the Government's preferred option of allowing copyright works to be scraped for AI training, unless opted out.

The retail sector continues to face challenges and opportunities across multiple fronts, from enhanced consumer protection measures and sustainability requirements to immigration reforms and technological developments. Our team is here to support you in anticipating and responding to these changes and ensuring your business remains compliant and competitive. 

This horizon scanning document is intended only as a general statement of the law and no action should be taken in reliance on it without specific legal advice. 

For more information please get in touch with Sally Britton or Lewis Cohen

Advertising

Advertising

Less healthy food and drinks

New rules on TV and online advertising of less healthy food and drink products started on 5 January 2026. Such products are now banned from TV adverts between 5.30am to 9.00pm. In addition, there is now a ban on paid-for online advertising for such products (with some limited exceptions). The Advertising Standards Authority (ASA) has published guidance on advertising less healthy products.

Tobacco and Vapes Bill

This is set to become law in 2026 and will ban advertising and sponsorship for herbal smoking products, cigarette papers, vaping, consumer nicotine products and tobacco products. It is currently progressing through Parliament.

Greenwashing

Please see the ESG section for more information about upcoming developments regarding greenwashing.

Digital Fairness Act

The EU has proposed a new Digital Fairness Act (DFA) planned for Q4 2026. The DFA will tackle unfair commercial practices including dark patterns, influencer marketing, addictive design and targeted advertising. The European Commission launched a public consultation and call for evidence which closed on 24 October 2025. On 19 December 2025, the Commission published a report setting out input to the consultation and call for evidence, this will inform the content of the final version of the Act.

Fraudulent advertising

Under the Online Safety Act (OSA), in-scope service providers must put in place proportionate systems and processes to prevent fraudulent advertising and take it down when made aware. Ofcom is expected to launch a consultation on various duties under the OSA in July 2026 including fraudulent advertising, with final policy statements to be published by mid-2027.

Voluntary Code of Good Practice for prize draw operators

In November 2025, the Department of Culture, Media and Sport published a new code for prize draw operators. This code is for situations where the outcome is determined by chance and where there is both a paid and free entry route to choose from (the code does not cover solely skill-based competitions). The code is intended to strengthen player protections, transparency and accountability. It is voluntary and does not replace existing consumer and advertising law. The Government has indicated it will legislate in this area in future if the code is not adhered to.

Commercial and tech

Commercial and tech

EU AI Act

The EU AI Act became law in summer 2024. It will apply to any AI output that is available within the EU, so will impact UK companies that provide or deploy AI services in the EU. Some of the new rules have already started with the remaining provisions due to start in August 2026 including new transparency rules and the obligations on high-risk systems, but this timescale may be impacted by the proposed Digital Omnibus Package (see below). Track developments on our AI resource centre.

EU Data Act

Key obligations under the EU Data Act are expected to come into force in 2026 including an obligation for manufacturers to design and manufacture in-scope connected products placed on the EU market after 12 September 2026 (and provide related services) in a manner that allows a user to access the product data and related service data. The Data Act also introduced new rules in September last year regarding EU customers wishing to switch to an alternative cloud provider midway through a subscription and terminate their contracts early. Please see our article here for more information. This may be impacted by the Digital Omnibus Package (see below).

Digital Omnibus Package

The EU has proposed a Digital Omnibus Package to simplify existing rules on AI, cybersecurity and data. On AI, it is proposed that companies will only have to apply the rules for high-risk AI systems under the EU AI Act once the necessary support tools and standards are in place. It also proposes targeted amendments to the EU AI Act, including simpler rules, opportunities for real-world testing and centralised oversight of AI systems. In regard to cybersecurity, companies must currently report cybersecurity incidents under several different laws. The package introduces a single-entry point where companies can meet all incident-reporting obligations. It also proposes targeted amendments to the General Data Protection Regulation (GDPR) to harmonise, clarify and simplify certain rules, without lowering data protection standards, and modernised cookie rules which will improve users’ experience online. It also proposes to make data rules simpler and practical for consumers and businesses by consolidating EU data rules through the Data Act. This includes introducing targeted exemptions to some of the Data Act's cloud-switching rules for SMEs and SMCs, offering new guidance on compliance with the Data Act and boosting European AI companies by unlocking access to high-quality and fresh datasets for AI. It also proposes a new data union strategy to unlock high-quality data for AI and European Business Wallets to digitise companies' operations and interactions so they won't need to be done in person e.g. digitally sign, timestamp and seal documents.

Cloud and AI Development Act

The EU has proposed a new Cloud and AI Development Act which is expected in 2026 following a consultation in 2025. This will improve Europe's infrastructure to support the growth of AI and Cloud services and provide sustainability targets for data centres used to operate AI.

UK AI Regulation

In the UK, there is a non-legislative approach to AI whereby regulators provide guidance based on a set of principles. In 2025, the Government indicated it would bring forward AI-specific legislation to govern a small number of companies creating frontier AI systems. However, this is yet to emerge. More developments may occur after publication of the Government's response to its consultation on copyright and AI (please see the IP section). The Digital Regulation Co-operation Forum plans to consider regulatory challenges to the uptake of agentic AI. The Government launched a call for views on the AI Growth Lab last year which may inform future decisions on regulation in this space.

Blockchain

The Property (Digital Assets etc) Act became law in December 2025. It establishes, in statute, the common law position that certain digital assets can constitute property. The Act expressly makes provision about the types of things that are capable of being objects of personal property rights, including a thing that is digital or electronic in nature, despite being neither a thing in possession nor a thing in action. Our article summarises the impact of the new law.

Late payments

In 2025, the Government consulted on proposals to tackle late payments to small businesses. We are currently waiting for the outcome of the consultation which is due in Q1 2026 and will likely lead to legislation in this area in 2026 or 2027. Proposals include making the statutory interest rate for late payments mandatory, requiring businesses wishing to challenge an invoice to do so within 30 days (or else be liable to statutory interest) and capping payment terms at 60 days. It also proposes allowing the Small Business Commissioner to fine large firms that regularly pay late and conduct spot checks as well as mandating audit committee or board-level scrutiny of payment practices. New rules started on 1 January 2026 under the Companies (Directors' Report) (Payment Reporting) Regulations 2025 which require large companies to list information about payment practices in their director's report.

New EU rules on communicating software updates

In the EU, new rules will come into force in relation to communicating software updates on 27 September 2026 under the Empowering Consumers for the Green Transition Directive. This includes a ban on withholding the fact a software update will negatively impact the functioning of goods or services and falsely presenting software updates as necessary. Pre-contractual information must also be provided to consumers including telling them how long the producer or provider commits to providing software updates for.

Cybersecurity

Please see the Health & Safety/Product Safety section.

Franchising reform

The case of APK Communications Ltd v Vodafone Ltd is expected to be heard in the High Court in 2026. Vodafone franchisees are claiming that a duty of good faith should be implied into their franchising relationship. This may have wider implications for agency or distribution agreements. In January 2026, the Prime Minister assured Parliament he would examine the outcome of the case and consider if stronger regulations are needed in franchising. Further, an appeal is due to be heard by December 2026 in the case of Ellis v John Benson [2025]; the High Court in this case found implied duties of good faith and fair dealing in 20 one-sided franchise agreements.

Guidance for service providers on equality

Following consultations and the Supreme Court judgment in For Women Scotland v Scottish Ministers [2025], the Equality and Human Rights Commission has submitted to the UK Government for approval its updated draft Code of Practice for services, functions and associations. This will provide guidance on obligations under the Equality Act 2010, particularly regarding discrimination in the supply of services.

Competition and consumer

Competition and Consumer

Digital Markets Competitions and Consumers Act

New rules under the Digital Markets Competition and Consumer Act (DMCCA) on subscriptions are expected in autumn 2026. We are also expecting outcomes this year of the CMA's first investigations using its new enforcement powers under the DMCCA. There may also be fresh enforcement action this year based on the CMA's priorities (published in its approach document in April 2025). Their focus for enforcement includes aggressive sales practices that prey on consumers in vulnerable positions, providing information to consumers that is objectively false, banned practices including the new banned practice relating to fake reviews, fees that are hidden until late in the purchase process, and contract terms that are clearly imbalanced and unfair, including those that impose unfair exit charges on consumers. In December 2025, the CMA published new price transparency guidance to help companies comply with the rules.

Digital markets

In 2025, the Competition and Markets Authority (CMA) designated Apple and Google as havingstrategic market status under the DMCCA in relation to their market platforms. This may impact the process for reviewing and ranking third party apps in Apple and Google stores. In addition, the CMA designated Google as having strategic market status in relation to search and advertising services. Again, this may impact ranking principles for search listings and transparency, attribution and choice in how content is used in Google's AI services. The CMA may also investigate whether Microsoft and Amazon Web Services should be designated as having strategic market status in relation to cloud services (due to concerns around the technical and commercial barriers to switching cloud providers, as addressed in the EU by the Data Act). We summarised these developments in our article looking at the CMA's focus on big tech. 

Dark patterns

The court case brought by the CMA against Emma Group in relation to the use of dark patterns on its website will take place in June 2026. The CMA is seeking an enforcement order requiring Emma to changes it online selling practices.

Unfair consumer contract terms

In October 2025, the CMA announced it is planning to update its guidance on unfair consumer contract terms (CMA37) to make it easier to understand. It will consult on revised guidance in due course.

EU Digital Fairness Act

For more information about the DFA, please see the Advertising section.

Price Marking Order reforms

Reforms to the Price Marking Order 2004 have been delayed from 1 October 2025 until 6 April 2026. Key changes include clearer shelf pricing as well as unit pricing of loyalty scheme and volume promotions. Please see our article here for more information.

ESG

Please see the ESG section for more information about consumer developments in relation to product sustainability, including new rules in the EU starting on 27 September 2026 regarding pre-contract information that must be shown to a consumer under the Empowering Consumers for the Green Transition Directive. This Directive also introduces new rules on unfair commercial practices in relation to software (see Tech section) and greenwashing. There are also new rules regarding the repairability of products starting on 31 July 2026 under the Right to Repair Directive.

Withdrawal button

From 19 June 2026, online retailers in the EU must provide an electronic withdrawal button on their websites for all types of distance contracts for which a right of withdrawal applies. This stems from the EU's Digital Financial Services Contracts Directive which aims to make withdrawing from online contracts as simple as concluding them.

Labour markets

Anticompetitive behaviour in labour markets is a growing focus for competition regulators globally and has been addressed by the CMA in its guidance issued in September 2025 on competition law and labour markets (Competing for talent - GOV.UK). The guidance confirms that no-poaching and wage fixing agreements amount to anticompetitive conduct. It also contains examples of exchange of competitively sensitive information which is likely to be anticompetitive. The guidance contains practical steps to avoid breaking competition law which should be followed by businesses. 

Corporate

Corporate

Companies House reform 

The Economic Crime and Corporate Transparency Act 2023 (ECCTA) has introduced a number of company law reform measures, implementation of which will continue during 2026. Compulsory ID verification for new directors of UK companies (and overseas companies with UK branches), LLP members and people with significant control (PSCs) who are individuals came into force on 18 November 2025; the transitional deadlines for existing directors, LLP members and PSCs will depend on the positions they hold: see Companies House reform: Timing of compulsory ID verification confirmed. ID verification is expected to be expanded in 2026 to apply to relevant officers of certain corporate PSCs ("Relevant Legal Entities") and corporate general partners of limited partnerships. It is expected that a prohibition on the use of corporate directors will be introduced, subject to certain exemptions. Limited partnership law will be reformed, requiring more information to be submitted to Companies House.

PISCES

Interest has been increasing in the Private Intermittent Securities and Capital Exchange System (PISCES), a framework for a new type of trading platform that will enable intermittent trading of private company shares. Institutional investors, employees of participating companies and high net worth or sophisticated investors will be able to trade shares. So far, two PISCES platform operators have been approved by the FCA. For the latest news on PISCES, please see our series of website briefings, the most recent of which is here: Understanding PISCES – who can invest and how?

New public offers regime and "POPs"

The UK's prospectus regime was replaced on 19 January 2026 with a new public offers and admissions to trading (POAT) regime. A key change is that the requirement for a prospectus for a public offer will be replaced by a general prohibition on public offers and an extensive set of exceptions to that prohibition. One of the exceptions will be offers of relevant securities made by means of a regulated platform, known as a "public offer platform" or "POP". POP operators will be regulated by the FCA.

Data

Data

Data (Use and Access) Act 

There still remain a number of provisions in the Data (Use and Access) Act 2025 which have not been commenced, and there has been a slight slippage of the Government's timetable for this. We should still expect some important provisions to be commenced very soon though, including flexible automated decision-making rules, new "recognised legitimate interests" grounds for processing, and simplified international transfers. The Act amends the UK GDPR and Data Protection Act 2018 (rather than being a standalone statute). The Information Commissioner (ICO) is understood to be developing updated guidance on these changes.

Direct Marketing Code of Practice

It is likely that the ICO will also be announcing work on the statutory Direct Marketing Code of Practice which has still not been published, despite it being required as far back as 2018.

Employment

Employment

Beliefs, and single-sex services

Employees continue to assert political, gender-critical and other protected beliefs in the workplace. In the context of the ongoing transgender/gender-critical debate, following the Supreme Court's ruling that 'man' and 'woman' in discrimination law refer to biological sex only, we are starting to see employment tribunal case law on the provision of workplace single-sex facilities such as toilets and changing rooms. These tribunal decisions are likely to be appealed and employers should continue to monitor developments in this area.

Employment Rights Act

The Employment Rights Act represents the most significant overhaul of UK employment law in a generation. Key provisions include:

  • Unfair dismissal: Employees will acquire protection after just six months rather than two years, and the cap on compensation will be completely removed. Employers should ensure their probationary review processes are proactive and robust, review their recruitment practices to reduce the likelihood of early-stage dismissals, and consider alternative workforce arrangements, including agency workers, to mitigate risks associated with early-stage terminations.
  • Zero hours and shift workers: New rights to guaranteed hours, reasonable shift notice and compensation for late cancellations of shifts will impact flexible scheduling practices and operational costs. Employers should identify the scope of the impact on their workforce and configure their systems to comply with the new requirements.
  • Fire and rehire restrictions: Automatic unfair dismissal for restricted contract variations will materially affect workforce restructuring and outsourcing policies. Employers may wish to consider accelerating any planned restructuring before the new provisions come into force.
  • Collective redundancies: Maximum awards for collective consultation breaches will double to half a year's pay per employee. Consultation obligations in larger, multi-site organisations will also more likely be triggered. Employers should review redundancy processes to ensure they are robust, factor increased liability exposure into restructuring budgets, and carefully track the number of dismissals across their organisation.
  • Trade unions: The Act resets the power balance between unions and employers, heralding a significant increase in union involvement in the workplace over the next several years.
  • Time limits: Employment tribunal claim time limits will double to six months, which will lead to an increase in the number of claims made and prolonging the uncertainty for employers of whether staff will litigate against them.

Phased implementation this year and into 2027 requires careful planning and preparation. Please visit our Employment Rights Act Hub for more information.

Preventing harassment

Employers are currently required to take proactive "reasonable steps" to prevent sexual harassment in the workplace. The Employment Rights Act will strengthen this obligation to take "all reasonable steps". It will also introduce direct employer liability for sexual and other harassment of employees by customers, suppliers and other third parties. In addition, NDAs preventing employees from alleging or disclosing harassment or discrimination will be void.

Mishcon de Reya's Employment team offers a training solution to assist employers in equipping their workforce to deal with harassment issues effectively. For more information, please contact Will Winch or visit our Duty to Prevent Sexual Harassment in the Workplace Hub.

Non-compete clauses

The Government has launched a fresh review of non-compete clauses in employment contracts. It explores several potential models, including an outright ban, a ban below a salary threshold, statutory duration limits, and a hybrid model. The Government's concerns relate to the widespread use of non-compete clauses, their impact on competition and innovation, and their potential to inhibit labour mobility and entrepreneurship. We discuss the options in our article on the Government's review.

Draft Equality (Race and Disabilities) Bill

Publication of this draft Bill is anticipated in 2026. The Bill is expected to introduce mandatory ethnicity and disability pay reporting for employers with 250+ employees as well as ethnicity and disability equal pay rights.

ESG

ESG

Sustainable products

In the EU, new rules under the Right to Repair Directive will come into force on 31 July 2026, whereby products will need to meet new repairability requirements and processes for product warranties may need to be reviewed. New secondary legislation under the Ecodesign for Sustainable Products Regulation is expected soon in relation to the product priorities identified last year, including textiles (by 2027) and furniture (by 2028). New rules also come into force under the Empowering Consumers for the Green Transition Directive by 27 September 2026 whereby consumers must be given pre-contract information about the sustainability of the product. The EU has also announced plans to introduce a new Circular Economy Act in Q4 2026 to address e-waste and measures regarding the single market for waste, secondary raw materials and their use in products. In the UK, the Product Regulation and Metrology Act paves the way for regulations similar to the EU in respect of reducing or mitigating products' environmental impacts.

Packaging

In the EU, the Packaging and Packaging Waste Regulation will repeal and replace the Packaging Waste Directive on 12 August 2026. This aims to reduce packaging waste by setting binding re-use targets, restricting certain types of single-use packaging, and requiring economic operators to minimise packaging. In the UK, the Producer Responsibility Obligations (Packaging and Packaging Waste) (Amendment) Regulations 2025 were introduced in December 2025 and took effect from 1 January 2026. These introduce minor technical and clarifying changes to the original regulations that were established in 2024.

Greenwashing

In the EU, new rules on greenwashing under the Empowering Consumers for the Green Transition Directive will start on 27 September 2026. This includes a ban on unsubstantiated generic environmental claims (such as "environmentally friendly", "eco-friendly", "green", "biodegradable" and "carbon friendly"), claims based on greenhouse gas offsetting, overly-wide environmental claims (for example about an entire product when it only concerns an aspect) and misleading sustainability labels. We are still awaiting news on the future of the Green Claims Directive which has been proposed to regulate the substantiation and communication of green claims.

In the UK, the ASA and CMA may increasingly turn their attention to greenwashing, with the CMA now having new enforcement powers under the Digital Markets, Competition and Consumers Act to fine companies for breaches of consumer law including misleading advertising such as greenwashing. Guidance is set out under the CMA's Green Claims Code. We reported on the ASA's rulings about three fashion retailers' adverts about sustainability in our article here.

The new failure to prevent fraud offence (under the Economic Crime and Corporate Transparency Act) means that companies could also now be held criminally liable for greenwashing, unless they can demonstrate reasonable procedures to prevent misleading claims and statements.

Sustainability, due diligence and disclosure

In the EU:

  • Under revisions to the Corporate Sustainability Reporting Directive, only EU undertakings with more than 1,000 employees and €450 million annual turnover must report, using simplified European Sustainability Reporting Standards. Non-EU groups report only if they generate more than €450 million annual turnover in the EU, with an EU subsidiary/branch exceeding €200 million turnover.
  • Under revisions to the Corporate Sustainability Due Diligence Directive, simplified due diligence obligations apply from 2029 for EU undertakings with more than 5,000 employees and annual turnover of over €1.5 billion, and for non-EU companies above the same turnover threshold in the EU. Transition plans are no longer required.
  • Application of the Deforestation-free Products Regulation is delayed until 30 December 2026 at the earliest. Full due diligence is only required of large organisations that place regulated commodities/derived products on the EU market for the first time.
  • Applicable from December 2027, the Forced Labour Products Regulation prohibits products made with forced labour being imported into/sold in/exported from the EU market.

In the UK:

  • The Government has released exposure drafts of new UK Sustainability Reporting Standards, closely aligned to ISSB standards. Results of consultation will inform the Government's decision to endorse the draft standards and make them available for voluntary use. A separate decision will be made regarding mandatory reporting.
  • The Government is also consulting on how to implement its manifesto commitment to require UK-regulated financial institutions and large companies to develop and implement credible transition plans, aligned with the 1.5°C goal of the Paris Agreement.
  • The Government is considering legislative options to strengthen the Modern Slavery regime, including introduction of mandatory human rights and environmental due diligence measures, and a new "failure to prevent" obligation in relation to forced labour.
  • Requirements for large businesses to establish and implement due diligence in relation to use of forest risk commodities, similar to EU regulations, remain subject to secondary legislation.
Health & safety/product safety

Health & safety/product safety

Product safety

In the UK, a new Product Regulation and Metrology Act became law in July 2025. This will reform the UK's product safety regime. It is framework legislation that will allow the Government to make secondary legislation introducing product requirements (for example, how a product is made and marketed). Likely areas of focus for upcoming secondary legislation include tackling the sale of unsafe products through online marketplaces.

In the EU, in summer 2025 the European Commission carried out its first product safety sweep under the General Product Safety Regulations and more are expected this year, with a focus on the sale of unsafe products through online marketplaces. The EU is also replacing the Machinery Directive with the Machinery Products Regulation from January 2027, with revisions to address risks from emerging digital technologies. The UK is considering whether to introduce similar revisions into UK law.

Product liability

The EU's Revised Product Liability Directive starts to apply from 9 December 2026 but companies should start to prepare now. It extends the existing product liability regime to capture emerging digital technologies (including software), contains broader responsibilities and potential liabilities and makes it easier for consumers to bring claim for damages caused by defective products.

In the UK, last year the Law Commission announced a review of the UK product liability regime, also in light of emerging digital technologies, and a consultation paper on this is expected in the second half of 2026.

Cybersecurity

Cybersecurity rules are being introduced to regulate products which connect to the internet. In the UK, the security-related obligations and liability regime under Part 1 of the Product Security and Telecommunications Infrastructure Act 2022 (PSTIA) started applying to certain manufacturers, importers and distributors of consumer connectable products in the UK from 29 April 2024, and new rules under the EU's Cyber Resilience Act are due to start applying in December 2027 (this is the EU's answer to the UK PSTIA, which seeks to impose minimum cyber standards on IoT devices). The UK may extend the UK PSTIA to the regulation of B2B connected devices to align with the EU's Cyber Resilience Act.

The UK Government introduced the Cyber Security and Resilience Bill to Parliament for its first reading on 12 November 2025, this will focus on the cybersecurity of digital services as opposed to products. It will extend the existing Network and Information Systems (NIS) Regulations 2018 to data centres, critical supply chains and IT managed services. For more information about cybersecurity in relation to the Digital Omnibus Package, please see the Commercial and Technology section. We may also see proposed legislation this year on the regulation of ransomware payments.

Crime and Policing Bill

The Crime and Policing Bill is currently going through the legislative process to become law. It will ensure the police and courts have the necessary powers to help tackle assaults against retail workers and shop theft. It will create a standalone offence for assaulting a retail worker to protect staff, measure the scale of the problem and drive down retail crime. The offence will carry a maximum of six months' imprisonment and/or an unlimited fine. The new law will also ensure that all shop theft is treated with the seriousness it deserves by removing the immunity granted to shop theft of goods valued at £200 or less.

Martyn's Law

The Terrorism (Protection of Premises) Act 2025 (aka Martyn's Law), which seeks to ensure and improve the safety and security of public venues, received Royal Assent on 3 April 2025. The purpose of Martyn's Law (named in memory of Martyn Hett, one of the victims of the 2017 Manchester Arena bombing) is to ensure that venues and events are better prepared to respond to terrorist attacks by requiring those responsible to assess risks and implement appropriate security measures. It has not yet come into force, as there is a planned implementation period of at least 24 months, giving venues and event organisers time to understand and meet their new obligations.

Immigration

Immigration

Home Office consults on major changes to Indefinite Leave to Remain ('ILR')

The Home Office is consulting on proposals to significantly transform the requirements for ILR. Changes could come into force as early as spring 2026; however, nothing is yet set in stone and any changes are subject to consultation. We discuss the proposals in our article here.

The key proposals are:

  • Doubling the standard timeline to ILR from five to 10 years (which can be extended or reduced depending on individual circumstances).
  • Introducing new expedited pathways to ILR for high-earners and top talent. 
  • Effectively abolishing the 10 year long residence route to ILR.  
  • Introducing requirements for certain dependants to meet strict financial criteria.  This could have unforeseen knock-on implications for children's ability to qualify for ILR. 

The detail of any changes will depend on the outcome of the consultation, set to end on 12 February 2026.  Mishcon de Reya is responding to the consultation in full.  Please contact us for further information.

Other key immigration changes

  • English language requirement: From 8 January 2026, the minimum English language requirement for Skilled Worker, High Potential Individual, and Scale-up visas has risen from B1 to B2 level. This change applies to new applicants, rather than existing visa holders.
  • High Potential Individual visa: The list of qualifying universities has been expanded, so that overseas graduates from the world's top 100 universities may be eligible for the visa.
  • Graduate visa: From 1 January 2027, the standard duration of the Graduate visa will be reduced to 18 months. Applications submitted before this date should continue to receive two years of leave. PhD graduates will remain eligible for three years of leave.
  • Students switching to Innovator Founder:  Student visa holders who have completed their UK studies and are applying to switch to the Innovator Founder route can potentially now work for their own business while their application is being processed.
Insurance and commercial dispute resolution

Insurance and commercial dispute resolution

COVID-19 

The ongoing litigation regarding business interruption insurance claims arising out of COVID-19 closures continues, with further arguments about the extent of coverage under various policies, but the deadline for bringing proceedings is now fast approaching. Find out more in our article here.

Supply chain issues 

Increasing overseas conflict and political instability, coupled with the global sanctions regime, mean that supply chain issues remain a top priority for retailers, potentially resulting in litigation or arbitration arising out of force majeure, termination and frustration.

Group actions 

Focus on group actions in England and Wales has been steadily increasing in recent years. Retail companies may find themselves in the position of claimant or defendant, offering both opportunities and risks. Our guide to group actions is available here: Guide to Group Actions.

Litigation funding 

In December 2025, the Government confirmed its intention to introduce legislation "as soon as Parliamentary time allows" to reverse the Supreme Court's 2023 decision in PACCAR and to implement regulation of third-party litigation funding agreements.  Once these changes have been implemented the Government will consider the wider litigation funding reforms proposed by the Civil Justice Council. We discussed the Government's announcement in our article here.

Open justice

The Public Domain Documents Pilot came into force on 1 January 2026, operating in the Commercial Court, the London Circuit Commercial Court and the Financial List. The pilot makes it easier for members of the public to access certain documents used or referred to in public hearings.

Intellectual property

Intellectual property

GenAI & IP

In December 2025, the UK Government published a progress report following its consultation on copyright and generative AI, ahead of a final report and economic impact assessment due by 18 March 2026 (it is not yet clear when the consultation response itself may be published). The consultation attracted over 11,500 responses, with an overwhelming majority expressing support for always requiring licences for using copyright works in AI training, and only 3%  supporting the Government's preferred option of a text and data mining exception with rights holder opt-out. The Government will be looking to balance the views of the creative industries with its desire to encourage investment in AI in the UK.

Meanwhile, GenAI cases continue to come before the courts (you can track them in our GenAI and copyright tracker and sign up to receive alerts). Following the High Court decision rejecting Getty Images' claim for copyright infringement against Stability AI, Getty Images have been granted permission to appeal. The Court of Appeal's decision should provide useful guidance on a number of issues relating to both the training and use of GenAI models.

UKIPO design consultation

The UKIPO launched a major consultation in late 2025 on the UK's design law framework. The consultation focuses on measures to improve registration quality, particularly in the face of a perceived increase in abusive registrations (often used to extract takedowns of legitimate designs from online platforms). The consultation also addresses digital-age challenges including clarifying the scope of design protection for graphical user interfaces and animated designs, and proposing to remove protection for computer-generated designs without human authors. Further issues discussed in the consultation include potential simplification of the framework for protecting unregistered designs, the complex overlap with copyright, and the rules around first disclosure of unregistered designs (a subject made particularly complex post-Brexit).

The Government's response to the consultation is awaited but design-led businesses should note the potential for divergence following the EU design reform package in 2024 (see below).

UKIPO fee increases

The UKIPO is set to increase official fees relating to trade marks, designs and patents on 1 April 2026 (subject to parliamentary approval). Fees have not been changed for a considerable period, but the UKIPO has decided that an uplift is necessary to address inflationary rises. Fees are increasing by an average of 25% and will affect virtually all services offered by the UKIPO including applications, opposition/invalidity proceedings, renewals and recordals. Where appropriate, rights holders should look to incur relevant fees before the increases take effect.  

The fee increases form part of wider changes taking place at the UKIPO under the One IPO Transformation Programme, which aims to revolutionise digital services offered by the UKIPO. Further information on the UKIPO fee increases is contained in our article linked here.

TM specifications: UKIPO practice on bad faith

We have reported in previous editions on the implications of the Supreme Court decision in Sky v SkyKick and the UKIPO's Practice Amendment Notice 1/25 in relation to bad faith in trade mark specifications.

The Practice Amendment Notice warns against applications covering excessive goods and services, overly broad terms, and class headings without genuine intention to use. Our article containing further information on the Practice Amendment Notice is here. We expect to see more decisions relating to bad faith in trade mark specifications from the UKIPO and the courts.

Recent decisions include the  ENERJO case (concerning a 120 page specification spanning 13 classes which was held to amount to bad faith due to "sheer size and disparate nature" without reasonable intention to use) and the WISE case (concerning a class 9 computer software specification which was restricted to financial services software – our article on the WISE case is here).

UKIPO to discontinue series trade marks later this year

Also forming part of UKIPO's One IPO Transformation Programme, is the discontinuation of series trade marks by the UKIPO. Trade mark applicants can currently file a single trade mark application at the UKIPO containing up to six trade marks which differ in only non-distinctive matter. Series trade marks may be useful where, for example, a business is not yet sure which variant of a mark it wishes to use.

Following consultation, the UKIPO has decided to discontinue the option to file for a series of marks. This change was originally expected to take place in Autumn 2025 as part of the new digital trade marks service, but this has not yet been launched by the UKIPO. We have written about series marks and the digital transformation programme in this article.

Use of UK cloned trade marks

From 1 January 2026, EU trade mark registrations that were, on Brexit, converted into UK "cloned" trade marks (known as comparable trade marks) are vulnerable to cancellation by third parties if they have not been put to genuine use in the UK for a continuous period of five years. Because many of the newly created UK cloned trade marks had never actually been used in the UK, the UKIPO decided at the time of Brexit that the use of such marks in the EU before 1 January 2021 (whether inside or outside the UK) would count as use of the cloned UK right. As the five year window since Brexit has now passed, any cloned UK marks that have not been put to use in the UK are now at risk.

EU protection for craft and industrial products

From 1 December 2025, craft and industrial products are able to benefit from geographical indication ("CIGI") protection across the EU, marking a significant expansion beyond traditional food and agricultural products. Examples of CIGIs already registered following the launch of the EU CIGI scheme include Limoges porcelain, Lenços de Namorados handkerchiefs, and Calais-Caudry lace. Protection is available for products such as textiles, jewellery and porcelain, provided they demonstrate a genuine link between their quality or characteristics and their geographical origin, irrespective of whether the products originate from within the EU.  

Producers in England, Scotland and Wales can seek EU CIGI protection by applying directly to the EUIPO. In the UK, they can also continue to protect such products through collective or certification trade marks. Producers in Northern Ireland will be able to seek EU CIGI protection (including within Northern Ireland) via the UKIPO.    

EU design reform

A number of revisions to EU design law and practice took effect on 1 May 2025, such as changes in terminology and definitions, new fees and simplified processes (Phase I). Further changes will come into force from 1 July 2026 (Phase II), with EU member states also required to implement changes to their national design laws by 9 December 2027. Key Phase II developments concern application requirements and design representation and 'fast track' invalidity proceedings. The EU design law changes are discussed in our article here.

Avoiding genericism in a brand name: DRYROBE v D-Robe

The High Court has issued a rare decision considering the concept of genericism (the process by which a brand name loses its distinctiveness, sometimes called 'genericide'). Genericism presents significant challenges, in particular, for brand owners whose innovative product or service becomes known as a category term. This was the situation in the case of DRYROBE v D-Robe where Dryrobe's novel changing robe was the first of its kind on the UK market in 2011, before competitors started to enter the market in 2018.

To avoid suggestions that the DRYROBE mark had become the category term for changing robes, the claimant had implemented a robust (and "relentless") campaign to maintain the acquired distinctiveness of its mark, including correcting generic use by consumers and third parties through a range of techniques including social media campaigns, and taking legal action where appropriate. The court concluded that this robust programme of brand management countered the defendant's arguments of genericism and the trade mark was upheld as valid and found to have been infringed. The case demonstrates the effectiveness of such brand education campaigns.

Precision matters: Thom Browne v adidas

The Court of Appeal has issued its first decision in relation to the validity of 'position marks' i.e., marks that consist of a combination of a visual element and its position on goods, where their distinctive character derives at least in part from their positioning. The case concerned position marks owned by adidas, for three stripes on various articles of clothing, including tracksuit tops and bottoms. The court's decision confirms that this category of trade marks must still comply with the requirements of clarity and precision which govern "traditional" trade mark registrations, with the court finding that adidas' marks were not sufficiently clear and precise, and so were therefore invalid. The court at first instance had also found that Thom Browne had not infringed adidas' three stripe marks, a decision that was not appealed by adidas. Mishcon de Reya acted for Thom Browne in this matter.

Protection for works of applied art: Mio/Konektra

We have reported previously on the complexity and uncertainty around protection of works of applied art, both in the UK and the EU (with national courts in the EU disagreeing as to whether, for example, copyright should be available to protect the design of the Birkenstock sandal).

In December 2025, the European Court of Justice (CJEU) issued its decision in two cases referred to it from national EU courts, Mio/Konektra, providing important clarification on copyright protection in the EU. Whilst the CJEU reiterated that 'originality' is the sole requirement for copyright protection for works of applied art, and that the test for originality is no higher for such works, it also considered a number of factors that might be relevant in the assessment of that originality requirement. Separately, it introduced a new 'recognisability' requirement for assessing infringement. The decision is not binding on the UK courts but they may take it into account. The UKIPO design consultation also deals with the complex overlap between copyright and design protection for works of applied art. Our article discusses the case in more detail.

Infringement by importers and distributors: Martin v BSH

This case, concerning copyright in wine labels, is a reminder that UK importers and distributors of goods may be liable for IP infringement even if they were not involved in creating/designing the relevant goods and believed that IP matters were their supplier's responsibility. The court found that there was copyright infringement and passing off in relation to one of the wine labels in issue, and fixed liability on the UK importer and distributor of the wine bottles, as well as the Argentinian winery that had produced the wine.

While knowledge is not required for primary copyright infringement, it is for acts of secondary infringement such as importing, possessing or dealing with an infringing copy. However, a secondary infringer can be straightforwardly fixed with knowledge by putting them on notice of the claim. 

Real estate

Real estate

Business rates

The November 2025 budget announced a potentially significant rebalancing of the business rates system, coming into force in April 2026. There will be a new, lower multiplier for smaller retail, hospitality and leisure premises, balanced by a higher multiplier for business premises with a rateable value of £500,000 or more.

However, a nationwide revaluation of business premises will also take effect in April 2026, based on values as they stood at April 2024. Many businesses will see significant increases in their rateable values, and therefore a sharp increase in their rates bills, despite the headline-grabbing lower multipliers.  Business ratepayers should be prepared to lodge valuation appeals in spring 2026, as bills based on the new rateable values begin to arrive.

Upwards-only rent reviews to be banned

The English Devolution and Community Empowerment Bill includes a ban on upwards-only rent review clauses in commercial leases. The ban is likely to come into force in late 2026, but will not affect existing leases entered into before the new law comes into force (commencement). Nor will it apply to leases entered into after commencement pursuant to pre-commencement agreements for lease.

If an existing (pre-commencement) lease is renewed in the future, then the ban will apply to the renewal lease. For more information, please see our article here

Landlords' insurance commissions – going to appeal

A High Court decision in 2025 cast doubt on whether commercial landlords can charge tenants for the commission element of an insurance premium. There was no issue over the commission payable to the landlord's broker, but could the tenant be forced to pay a separate commission that would go into the landlord's own pocket? No, said the High Court.

The landlord is taking the dispute to the Court of Appeal and the hearing will take place in June 2026. Depending on the outcome, there could be scope for many business tenants to claim refunds going back several years. Each case will depend on the wording used in the lease. Please see our article on this controversial issue here

Potentially tougher energy efficient measures?

There has been a further delay in the Government announcing plans to toughen the minimum energy efficiency standards for commercial properties. Despite the continuing delay, we do expect the minimum energy grade to increase from the current grade E at some stage.

A consultation some years ago proposed a minimum grade C by 2027 and grade B by 2030, but it is likely these timescales will slip. Some energy efficiency duties may also be imposed on tenants, instead of the legal burden falling entirely on landlords as at present. This means tenants may come under pressure to accept lease covenants to use their premises in a more energy-efficient way. 

Landlord and Tenant Act 1954 consultation

The initial consultation in 2025 concluded with a recommendation to keep this Act on the statute book. The 1954 Act gives business tenants a statutory right to renew their lease, unless the lease is contracted out of the Act's protection. The option to contract out will be retained.

However, 2026 is likely to see a follow-up consultation on streamlining the process to make it less time-consuming, especially for tenants of shorter leases. See our client bulletin for more details.

Retail Academy

At Mishcon de Reya we are passionate about retail because it brings together a host of ideas and professions: self-expression, sustainability, forward- thinking, commercialism, brand identity, to name but a few.

Our knowledge spans the spectrum of retail and consumer goods and services, from the high street to high-end luxury and from online to experiential. Among our clients you will find famous retail brands, alongside retail developers and operators, entrepreneurial start-ups, small independents and individuals. Our aim is to help each of these clients protect and maximise the value of their assets, whether these are their brand, their products and services, their property, their people or their reputation.

Our Retail Academy hosts regular webinars and events on legal issues relevant to the retail sector and we regularly post articles, videos and podcasts on the Retail Academy website here. If you would like to be kept up to date with our latest Retail Academy news and events, please subscribe to our mailing list.

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