Introduction The National Consumer Commission is tasked with enforcing and implementing of the Consumer Protection Act. The Commission has now officially opened, issued draft guidelines for the lodging of complaints and is readying itself to start receiving complaints from consumers from 1 April 2011 when the act comes into force.The Consumer Protection Act puts the power into the hands of consumers. Consumers are given a myriad of rights and the act aims to prevent suppliers from taking advantage of vulnerable consumers.Consumers have a right to be heard and receive compensation if they are unfairly treated. Chapter 2 of the act deals with the rights of consumers, this chapter is the essence of the act in terms of Consumer rights. The following is a summarised overview of this chapter.
StructureThe Act consists of seven chapters and 122 sections: Chapter 1 deals with the interpretation, purpose and application of the Act.Chapter 2 identifies and elaborates on specific consumer rightsChapter 3 of the Act deals with the consumers' voiceChapter 4 deals with business names and industry codes of conductChapter 5 deals with national consumer protection institutionsChapter 6 deals with the enforcement of the ActChapter 7 deals with certain general provisions, i.e. the regulations required in terms of the Act.The Act also includes two schedules:· Schedule 1 explains the extent to which the Act amends existing law in the form of the National Credit Act, 2005 and the Lotteries Act, 1997.· Schedule 2 contains the transitional provisions.
The Right of equality in the consumer marketSuppliers must not unfairly exclude any person or category of persons from accessing any goods or services offered by the supplier, or charge different prices for any goods or services to any persons or category of persons, on the basis of one or more grounds of unfair discrimination contained in the Constitution (such as race, gender, sex, marital status, etc).The Act does make certain limited provision for differential treatment in certain instances, for example, in relation to the supply of goods and services to minors, and discounted prices offered to minors and people over the age of 60. In addition, a supplier may market any goods or services in a manner that implies or expresses a preference for a particular group of consumers who are distinguishable from the general population on the basis of one of the grounds of discrimination contained in the Constitution if the particular goods or services are reasonably intended or designed to satisfy any specific needs or interests that are common to, or uniquely characteristic of, that particular group of consumers.
The right to privacyThe Act entrenches the consumer’s right to privacy, and provides that a consumer has the right to restrict direct marketing, which is an approach by a third party, either in person or by email or electronic communication, for the direct or indirect purpose of promoting or offering to supply, in the ordinary course of business, any goods or services to the consumer; or requesting a donation of any kind for any reason.Consumers are able to exercise this right to privacy by refusing unwanted direct marketers from contacting them. In the event that the marketer continues communication, the consumer will be able to register a pre-emptive block against any communication that is primarily for the purpose of direct marketing. A person authorising or conducting any direct marketing must not direct or permit any person associated with that activity to direct or deliver any communication for the purpose of direct marketing to a person who has registered a pre-emptive block. The Regulations to the Act will stipulate certain days and times during which suppliers will not be allowed to contact consumers.
Consumer’s right to chooseThe Act makes extensive provisions for the consumer with regard to choice, which will ultimately reshape the way that business is conducted in South Africa. These provisions include: - consumer’s right to select suppliers; - the right to terminate a fixed-term agreement; - pre-authorisation of repairs or maintenance services; - consumer’s right to a cooling-off period after direct marketing; - consumer’s right to cancel advance reservation, booking or order; - consumer’s right to choose or examine goods; - consumer’s rights with respect to delivery of goods or supply of service; - consumer’s right to return goods; and - rights with regard to unsolicited goods or services.
Right to disclosure and informationThe Act contains numerous provisions relating to the mandatory disclosure of certain information to consumers regarding goods and services, in particular: - plain language is required on any notice to consumers, which should be understood, without undue effort, by a consumer with average literacy skills and minimal experience as a consumer of the relevant goods or services; - the price of goods for sale must be adequately displayed – consumers may not be charged more than the displayed or advertised price; - packaging and product labelling must not be misleading as to any matter implied or expressed therein, and must disclose any genetically modified ingredients contained in the product (where applicable). In addition, the Act prohibits any person from knowingly applying to any goods a trade description that is likely to mislead the consumer, or to alter, deface, cover, remove or obscure a trade description or trade mark applied to any goods in a manner calculated to mislead consumers - a supplier must apply a conspicuous notice to goods disclosing any reconditioned, rebuilt or grey market goods; - a written sales record must be provided in respect of each transaction to the consumer to whom any goods or services are supplied; - intermediaries are required to disclose prescribed information to any person whom the intermediary solicits or agrees to represent with respect to the sale of any property or services - Persons performing any services for a consumer at his premises or delivering any goods to, or installing any goods for, a consumer at his premises, must provide suitable identification on request by the consumer.
Right to fair and responsible marketingThe Act sets out standards for fair and responsible marketing, and provides that suppliers may not market goods or services in a manner that is reasonably likely to imply false, fraudulent, misleading or deceptive representation. In addition, the Act prohibits the following types of marketing: Bait marketing – advertising goods at a price in instances where the goods are not available at all, or are not available at that advertised price; Negative option marketing – stipulating that a contract will automatically be concluded unless the consumer declines such an offer; and Referral selling – inducing a consumer to accept any goods or service on the representation that the consumer will receive a rebate, commission or other benefit if the consumer subsequently gives the supplier the names of consumers (or otherwise assists the supplier to supply goods or services to other consumers), and that rebate or other benefit is contingent upon an event occurring after the consumer agrees to the transaction.The Act provides stringent requirements for suppliers involved in certain types of marketing, including: Catalogue marketing – which applies to agreement for the supply of goods or services that are not entered into in person, and include agreements concluded either telephonically, by post, fax or electronically, where the consumer does not have the opportunity to inspect the goods before concluding the transaction. Trade coupons and similar promotions – which applies to instances where a supplier promises a gift, prize, award, free good or service or price reduction to the consumer.. Customer loyalty programmes – in terms of which loyalty credits or awards are offered or tendered as consideration for any goods or services offered in terms of a loyalty programme. Promotional competitions – The use of competitions, games or schemes is subject to a number of prescribed conditions as set out in the Act. Alternative work schemes – in terms of which the Act provides that a person may not falsely represent availability, profitability, risk, or other material aspect of work, where one person invites another to conduct work from their home.
Right to fair and honest dealingsThe Act provides that suppliers may not use physical force against a consumer, coercion, undue influence, pressure, duress or harassment, unfair tactics or any other similar conduct, in connection with the marketing or supply of any goods or services to a consumer, or in negotiating or concluding an agreement with a consumer, or demanding or collecting payment, or recovering goods, from a consumer.Suppliers may not knowingly take advantage of the fact that a consumer was substantially unable to protect the consumer’s own interests due to physical or mental disability, illiteracy, ignorance, inability to understand the language of the agreement, or any other similar factor.False, misleading or deceptive representation with regard to the marketing of any goods and services is prohibited, as are pyramid or related schemes, as well as over-selling and over-booking. The Act regulates auction proceedings and introduces a host of new requirements for those engaging in a sale by way of auction.
Right to fair value, good quality and safetyThis section of the Act will significantly impact service delivery.In terms of the Act, consumers are entitled to: - timely performance and completion of any services and to timely notice of any unavoidable delay in the performance of those services; - performance of services in a manner and quality that the consumer is generally entitled to expect; - the use, delivery or installation of goods that are free of defect and of a quality that the consumer is generally entitled to expect; and - the return of any property or control over any property of the consumer in at least as good a condition as it was when the consumer made it available to the supplier. The Act provides that if a supplier does not perform or supply a service to the standards required, the consumer may ask the supplier to remedy any defect in the quality of the services performed, or request that the supplier refund a reasonable portion of the price paid for the service supplied.Every consumer has a right to receive goods that are: - reasonably suitable for the purpose they are generally intended; - of good quality, in good working order and free of defect; - usable and durable for a reasonable period of time; and - comply with any applicable standards set under the Standards Act or any other public regulation. To determine whether a particular good satisfies these requirements, all the circumstances of the supply of that good must be considered.In any transaction or agreement, there is an implied provision that the supplier warrants that the goods comply with requirements and standards above. If a supplier fails to uphold this warranty, the consumer may return the goods to the supplier without penalty and at the supplier’s risk and expense, within six months of delivery of the goods.The supplier of an activity or facility that is subject to risk of an unusual nature, which the consumer could not reasonably be expected to be aware of, or which could result in serious injury or death, must specifically draw the consumer’s attention to this risk.One of the most far-reaching provisions of the Act is that it imposes a form of stringent liability on the producer or importer, distributor or retailer of any goods, who will be held liable for any harm (including death, injury or economic loss) occasioned by the supply of unsafe goods, a product failure, defect or hazard in any goods or inadequate instructions or warnings provided to the consumer in respect of any hazard associated with the use of goods, irrespective of whether the harm resulted from any negligence on the part of the producer, importer, distributor or retailer, as the case may be. Limited defences are available to such a producer, importer, distributor or retailer in terms of the Act. For example, it would be a defence to such a claim that the alleged unsafe product failure, defect or hazard did not exist in the goods at the time it was supplied by that person to another person alleged to be liable, or, that it is unreasonable to expect the distributor or retailer to have discovered the unsafe product characteristic, failure, defect or hazard, having regard to that person’s role in the marketing of the goods to the consumer
Supplier’s accountability to consumers’ propertyWhere a supplier is holding a consumer’s deposit, money or any other property belonging to or ordinarily under the control of a consumer, the supplier must not treat that property as being the property of the supplier. In the handling, safeguard and utilisation of that property, the supplier must exercise the degree of care, diligence and skill reasonably expected for managing any property belonging to another person. The supplier is liable to the owner of the property, should they fail to comply with the above.
ImplicationsPrevious legislation ignored these principles and for the first time we have statutory recognition of our right to confidentiality, information, disclosure, fairness, transparency, choice, safety and redress. “From April 1 onwards, it will not only be disrespectful, but illegal, to ignore consumers’ rights,”The Consumer Protection Forum also said that South African consumers would now benefit from increased levels of protection, mainly because of regulatory measures introduced across different industries. “Good progress to protect the consumer has been made on all fronts,” forum spokesman Peter Setou said. “Whether it is a dispute over contracts or complaints about the quality of products and services, consumers are getting better access to protection, information and advice than ever before.” The new act brings with it the National Consumer Commission, a body launched this month to ensure consumer complaints are heeded. MamodupiMohlala, who heads the commission, said it would herald a new era for consumer protection in South Africa. “Today is a proud day for us as the National Consumer Commission, for we are at the door step of a major consumer revolution. This revolution is being ushered in by the promulgation and coming into operation of the Consumer Protection Act on April 1,” Mohlala said at the launch. “This is an act that for the first time protects consumer rights in an uncompromising manner in the South African landscape.” Minister of Trade and Industry Rob Davies said the effective empowerment of consumers would encourage enterprises to improve their products and services. “The Consumer Commission will be a key pillar in implementing the consumer protection legislation. The act requires that the commission plays an active and proactive role in strengthening consumer protection. “The act makes provision for a comprehensive and overarching consumer law of general application that will regulate the interaction between businesses and consumers in the marketplace and provides more protection to consumers that was provided for in previous legislation,” Davies said at the launch. Examples of how the act will affect consumers include: - Returns and refunds It’s all about you in the new act, especially when it comes to returning goods or asking for refunds. Consumers will now have up to six months to return faulty or unsafe goods. If the product fails again within the next three months, the supplier is again obliged to replace it or refund you. - Deliveries Ordering online? Goods will have to be delivered at an agreed date, time and place. If not, you will be free to accept or cancel the agreement. Companies are also obliged to deliver goods that match the sample or description of the product. - SMS competitions A small victory, but a victory nonetheless. As of March 31, companies will not be allowed to charge you an exorbitant R5 or R10 to enter an SMS or MMS competition, but will have to stick to the usual rates. - Repairs Companies will have to provide you with an estimate for the work - which you must approve - and cannot charge you more than that. If more work is required above and beyond the estimate, they first have to get the go-ahead from you. - Privacy Gone are the dreaded telemarketer calls and junk mail flyers. According to the new act, sales people cannot bombard you with calls and leaflets at certain times of the day and certain days of the year. - Cooling-off period According to this clause, you will have five business days to change your mind about that mid-life-crisis Harley or the seaside cottage you fell in love with. Notify the company in writing, and they will have 15 days to pay you back in full. - Contracts Thanks to the new act, automatic contract renewals will be no more. Companies will have to contact you in writing - between 40 and 80 business days before your contract expires. - VoetstootsFrom March 31, suppliers, particularly in the car industry, will have to let you know of all defects of your purchase and you have to agree to buying the product in that condition. Presentation developed by Russell Florence 0839974027 firstname.lastname@example.orgBibliography:http://www.nortonsinc.com/index.php?option=com_content&view=article&id=460&Itemid=7
Conclusion <br />Please be advised that as from the 1st April 2011 the Office of the Consumer Protection is known as National Consumer Commission. Consumers must lodge their complaints/consumer related matters/follow up on complaints previously lodged with the Office of Consumer Protection/clarity on the Consumer Protection Act 2008, directly with Commission by contacting <br />Tel: 0860266786 <br />Fax: to 0861 515 259 E-mail: email@example.com<br /> <br />