Customer’s information needs The information needs of customers are:
Detailed legal records with reference to products and services, such as product liability, injury and unsubstantiated death claims over all jurisdictions for five years; penalties inflicted and citations for regulatory non-compliance, detailing each incident and corresponding penalty, settlement effected and such related information.
3 Customer’s information needs (Contd.)
Risks of injury from normal usage of product/service;
Noise, odour and other nuisances/problems associated with use of the product/service;
Design for recycling;
Biodegradability of products and packaging;
Unusual life cycle costs;
Customer’s information needs (Contd.)
Warnings, with appropriate detail;
Content, additives and treatments of food and medicines, sufficient to allow reasonably-informed consumers to make rational market decisions and to protect themselves and their families; and
Consumer and Consumer Protection A consumer is any person who, or firm, or association which
buys or hires (fully/partly paid for) any goods or service.
the purpose of purchase of goods should not be for resale or any commercial purpose (except self-employment).
the services availed does not include free service or services under a personal contract.
Consumer Protection refers to the steps necessary to be taken or measures required to be accepted to protect consumers from business malpractices
Parties to Consumer Protection Consumers: should know their rights and exercise them Businessmen: producers, distributors, dealers, wholesalers as well as retailers should pay due attention to consumer rights in their own interest, by ensuring supply of quality goods and services at reasonable prices Government: the government should enforce various laws and amend existing laws to protect consumer interests
History and growth of consumer protection
1920's: efforts in US to reduce the exaggerated claims of advertisers of goods and services and demands made for impartial testing of goods.
1930's: growth of consumer cooperatives, the first federal consumer agency, Food and Drug Administration, demands for labelling of products and the introduction of USDA stamps.
History and growth of consumer protection (Contd.)
1940's: 150 local consumer councils across the United States eventually drew together to form the National Association of Consumers.
1950's: The American Council of Consumer Interests was established by 750 members from universities, schools and consumer research organizations.
Ralph Nader’s Contribution to Consumer Protection
He coined the term “consumer advocate.”
He called for the accountability of carmakers
He worked towards improved environment, healthcare, insurance, pension and disability rights.
He is the founder of numerous non-profit organizations
Ralph Nader’s Contribution to Consumer Protection (Contd.)
He educated America's consumers
He started the U.S. Public Interest Group (PIRG)
He founded the Center for Study of Responsive Law, Center for Auto Safety, the Disability Rights Center, the Pension Rights Center, the Project for Corporate Responsibility, and the Clean Water Action Project.
Consumer Duties and Responsibilities Substantiate the Complaint Listen to Seller Cooperate with the Seller if Needed Avoid Inconvenience to Others Do not Personalize Issues Not lend self to others
Consumer Duties and Responsibilities (Contd.) Be Well Informed Understand the Grievances Redressal process Avoid Impulsive Buying Buy Goods from Authorized Agents
How are Indian consumers exploited? Exorbitant Prices of Products and Services Deceptive Selling Practices False and Misleading Advertisements Defective Quality, Higher Prices Sale of Hazardous Products to Ignorant Consumers Suppression of Material Information
How are Indian consumers exploited? (Contd.) False Product Differentiation Producers’/Sellers’ Collusion Supply of Adulterated and Substandard Products Cheating Consumers by Giving Lesser Quantity for the Price Dishonoured Guarantees and Warranties Poor Redressal of Customers’ Genuine Grievances
How are Indian consumers exploited? (Contd.) Creating a Scare out of Scarcity Making Consumer buy Unwanted Goods Misleading Representation on Utility of Products Manipulating Conditions of Delivery Customers pay for Numerous Intermediaries Fall in Prices Never Passed to Consumers
How are Indian consumers exploited? (Contd.) Buying unaffordable goods Advertisement cost Counterfeits: These constitute a substantial quantity of goods on store shelves Hoarding and Blackmarketing Tie-in-Sales Gifts for products/services
Legal protection to consumers A number of laws have been passed by the Government of India over the years to protect the interest of consumers. Agricultural Products (Grading and Marketing) Act, 1937 Industries (Development and Regulation) Act, 1951 Prevention of Food Adulteration Act, 1954 Essential Commodities Act, 1955
Legal protection to consumers (Contd.) The Standards of Weights and Measures Act, 1956 Monopolies and Restrictive Trade Practices Act, 1969 Prevention of Black-marketing and Maintenance of Essential Supplies Act, 1980 Bureau of Indian Standards Act, 1986 Consumer Protection Act, 1986
CONSUMER PROTECTION ACT 1986 The Consumer Protection Act (COPRA), 1986, conferred a legal right to the individual consumer to seek legal redress or recover costs and damages for injury or loans suffered by him/her as a result of faulty, defective goods and services, bought or secured for valuable consideration.
Rights of consumers under COPRA The SIX RIGHTS of the consumer as enunciated under Section 6 of the COPRA are: The Right to Safety The Right to be Informed The Right to Choose The Right to be Heard The Right to Seek Redressal The Right to Consumer Education
Redressal agencies under COPRA Redressal agencies for settlement of consumer disputes:
A Consumer Disputes Redressal Forum known as the District Forum has been established by the State Government in each district of the State by notification.
A Consumer Disputes Redressal Commission known as the State Commission has been established in each state by the State Government by notification.
A National Consumer Disputes Redressal Commission known as the National Commission established by the Centre by notification.
CONSUMER PROTECTION (AMENDMENT) ACT 2002 The main changes introduced by the Amendment Act are as follows:
The District Consumer Redressal Forums can now deal with complaints involving compensation amount upto Rs. 2 million
For the State Commission the limit is Rs. 10 million
For the National Commission, the limit is more than Rs. 10 million.
Setting up of benches and increase in the number of members in the National and State Commissions.
CONSUMER PROTECTION (AMENDMENT) ACT 2002
A sitting judge of the High Court is to preside over selection committee when the president of the State Commission is absent
In absence of the incumbent president of the District Forum, State Commission or National Commission, the senior member to act as president of the respective bodies.
Minimum qualifications prescribed for members of all consumer courts
CONSUMER PROTECTION (AMENDMENT) ACT 2002
For admission of complaints, issue of notices and disposal of complaints a specific time frame has been prescribed
Exclusion of services used for commercial purposes from the purview of consumer courts
The court can award punitive damages.
Any affected party to deposit 50 percent of the amount awarded to the consumer if appealed against the order of the Forum
If any person fails to pay compensation, the consumer court can order recovery in the same manner as arrears of land revenue.
INSTITUTIONAL ARRANGEMENTS UNDER COPRA
Consumer protection councils- both as the centre and states
THREE-TIER CONSUMER DISPUTE REDRESSAL SYSTEM
State Consumer Dispute Redressal Commission
ROLE AND INITIATIVES OF VOLUNTARY ORGANISATIONS Consumer Associations or Councils Consumer Co-operatives Co-ordination at the National Level
OTHER INITIATIVES TO PROMOTE CONSUMER PROTECTION National Awards Publicity measures Customer Service Department of RBI