Consumer Protection Bill
The government’s bid to safeguard the interests of consumers by means of the Consumer Protection Bill was too onerous on business, representatives from various economic sectors submitted in Parliament yesterday.
Retailers, direct marketers, cellphone operators, motor retailers and the financial services sector warned of the danger of over-regulation and of economic sectors being governed by a range of overlapping and possibly conflicting laws.
The bill — already adopted with amendments by the National Council of Provinces — will regulate the interaction between businesses and consumers. Consumers will be given basic rights through the prohibition of certain conduct, the encoding of common law principles and the provision of easier forms of redress.
The rights include the right to disclosure and information, choice, product safety, fair and reasonable terms and conditions, fair value and quality, privacy, fair and responsible marketing and consumer education and redress through the national consumer commission.
The Retailers Association, representing the major retail groups and supported by Business Unity SA, warned against a clause providing for strict liability for any damage caused by goods, regardless of fault on the part of the supplier or retailer.
Currently, the onus is on the consumer to prove fault on the part of the supplier.
“This section will add immense costs to big business with respect to insurance, and will lead to an unsustainable situation in relation to smaller and medium-sized businesses that cannot afford to insure themselves against this risk.
“In many instances, the middle-sized business will not withstand a strict liability claim, and will have to declare insolvency,” association representatives Christine Malan and Janine Jefferies said.
The Life Offices Association, South African Insurance Association and Linked Investment Services Providers Association all pleaded for the exclusion of the financial services sector from the ambit of the bill, saying consumer protection was already covered in a raft of sectoral legislation.
Trade and industry deputy director-general Zodwa Ntuli insisted, however, that the department was unwilling to grant up-front exemptions from the bill, but said they could be granted after investigations.
Consumer Protection Bill discussion
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