Consumer Protection Act

Why is it a concern?

If found in contravention of the CPA through the National Consumer tribunal you may face:

• An administrative fine up to 10% of annual turnover or• An administrative fine of up to R1 Million, whichever is the greater.

When is applicable?

All of the provisions of the Act come into effect on 25 October 2010, which is 18 months after the date on

which the Act was signed.

What is it?

Fairness

Transparency

Honesty

“What the Labour Relations Act did for employees, the Customer Protection Act will do for consumers”

Who does it apply to?

The Consumer Protection Act applies to the following:

• Every transaction occurring within the Republic of South Africa;• Promotion or supply of any goods and services occurring within the

Republic; and• Goods or services that are supplied or performed, in the Republic, in

terms of transactions mentioned in the Act.

Who does it NOT apply to?

The Act is not applicable in respect of:

• Goods or services promoted or supplied to the state;• Industry-wide exemption being granted to regulatory authorities;• Credit agreements, in terms of the National Credit Act, but not goods or

services;• Services under employment contracts;• Agreements giving effect to collective bargaining agreements; and• Agreements giving effect to bargaining agreements (Section 213 of the

Labour Relations Act).

ASAWhile the Advertising Standards Authority (ASA) code may already cover many of these areas, the consumer now has a big stick: “the consumer may hold at their whim any or all persons in the supply chain liable for damages...”

From a Consumers Perspective

Think about how you would want to be marketed to.(Considering you have a conscience)

What are my rights?1. Right to Equality in the Consumer Market and Protection Against

Discriminatory Marketing Practices;2. Right to Privacy;3. Right to Choose;4. Right to Disclosure of Information;5. Right to Fair and Responsible Marketing;6. Right to Fair and Honest Dealing;7. Right to Fair, Just and Reasonable Terms and Conditions;8. Right to Fair Value, Good Quality and Safety; and9. Right to Accountability by Suppliers.

Make sure you and your company is informed...

Consumer Right No. 1:

Right to Equality in the Consumer Market and Protection Against Discriminatory

Marketing Practices

Consumer Right No. 1

• Your right to free and unlimited access to goods and services

• Your right to high-quality goods and services• Your right to fair pricing of goods and services• Your right to lodge complaints

Suppliers are not permitted to limit access to goods and services.

Can everyone easily access your products?

Where are you trading?

Consumer Right No. 1

• Your right to free and unlimited access to goods and services

• Your right to high-quality goods and services• Your right to fair pricing of goods and services• Your right to lodge complaints

Consumers have the right to query the inferior quality of goods and

services.

Quality Control?

Consumer Right No. 1

• Your right to free and unlimited access to goods and services

• Your right to high-quality goods and services• Your right to fair pricing of goods and services• Your right to lodge complaints

You cant charge unfair prices for the same goods and

services or limit access to goods and services.

4P’s – ethical in all areas

Consumer Right No. 1

• Your right to free and unlimited access to goods and services

• Your right to high-quality goods and services• Your right to fair pricing of goods and services• Your right to lodge complaints

National Consumer Tribunal

Do you have a complaints line, or

first line of contact?

Consumer Right No. 2:

Right to Privacy

Consumer Right No. 2

• Your right to restrict unwanted direct marketing• Your right to discontinue receipt of direct marketing at

any time

Consumers have the right to refuse unwanted sms’s, telephone calls, letters or ‘spam’e-mail.

Can your customers or prospects

unsubscribe...for free?

Consumer Right No. 2

• Your right to restrict unwanted direct marketing• Your right to discontinue receipt of direct marketing at

any time

Consumers have the right to opt out of receiving

direct marketing services by blocking the relevant

supplier/marketer.

Have you deleted them off your

database?

Consumer Right No. 3:

Right to Choose

Consumer Right No. 3

• Your right to select the supplier of your choice• Your right to cancel or renew a fixed-term agreement• Your right to request pre-authorisation for repairs or

maintenance services• Your right to cancel direct marketing contracts within the

cooling-off period• Your right to cancel advance reservations, bookings or

orders

Consumer Right No. 3

• Your right to choose or examine goods, even after purchase and delivery

• Your right to return goods and seek redress for unsatisfactory services

• Your right to retain and not pay for unsolicited goods or services

Consumer Right No. 3

You can’t lock in consumers unfairly to a

product or service

Are your consumers aware of your

terms?

Consumer Right No. 4:

Right to Disclosure of Information

Consumer Right No. 4

• Your right to information in plain and understandable language

• Your right to disclosure of prices of goods and services• Your right to product labelling and trade description• Your right to clear disclosure of reconditioned or grey

market goods• Your right to sales records• Your right to disclosure by intermediaries• Your right to identification of deliverers, installers and

others

Consumer Right No. 4

Consumers have the right to demand contracts /

agreements & information in easily-understood and

plain language.

Do you make sales and contact

information easily accessible to your

customers?

Consumer Right No. 5:

Right to Fair and Responsible Marketing

Consumer Right No. 5

• Your right to protection against bait marketing• Your right to protection against negative option

marketing• Your right to protection against direct marketing• Your right to protection in catalogue marketing• Your right to protection in terms of trade coupons and

similar promotions• Your right to protection in customer loyalty programmes

Consumer Right No. 5

Suppliers are not permitted to mislead

consumers for goods or services advertised.

If it is in any way ambiguous, make it

clear – change it. Ruling will be in

favour of consumers.

Free install – only available when purchasing Sky

Multiroom on top of a standard

package.

Direct Marketing

Consumer Right No. 5

Impact on Business Practices

• Section 1 defines ‘‘direct marketing’’ to mean: to approach a person, either in person or by mail 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 person.

Impact on Business Practices

• 11. (2). To facilitate the realisation of each consumer’s right to privacy, and to enable consumers to efficiently protect themselves against the activities contemplated in subsection

• (1), a person who has been approached through direct marketing may demand that the person responsible for initiating the communication desist from initiating any further communication.

Impact on Business Practices

• Section 12 - Regulation of time for contacting consumers

• 12. (1) A supplier must not engage in any direct marketing directed to a consumer at home for any promotional purpose during a prohibited period prescribed in terms of this section, except to the extent that the consumer has expressly or implicitly requested or agreed otherwise.

• 12. (2) In order to protect the privacy of consumers, the Minister, by notice in the Gazette, may prescribe specific days, dates, public holidays or times of days for the purpose of subsection (1).

Impact on Business Practices

• 28. Whenever a person is engaged in direct marketing at the premises of a consumer, or performing any services or delivering or installing goods, that person must visibly wear or display an identity badge or provide identity particulars in a form that satisfies any prescribed standards

Consumer Right No. 6:

Right to Fair and Honest Dealing

Consumer Right No. 6

• Your right to protection against unconscionable conduct• Your right to protection against false, misleading or

deceptive representations• Your right to protection against pyramid and related

schemes• Your right to assume that suppliers are entitled to sell

goods• Your right to changes, deferrals and waivers, and

substitution of goods.• Your right to protection against over-selling and over-

booking

Consumer Right No. 6

• Your right to protection against unconscionable conduct• Your right to protection against false, misleading or

deceptive representations• Your right to protection against pyramid and related

schemes• Your right to assume that suppliers are entitled to sell

goods• Your right to changes, deferrals and waivers, and

substitution of goods.• Your right to protection against over-selling and over-

booking

Consumer Right No. 6Suppliers are not

permitted to, directly or indirectly, provide

consumers with false,misleading or deceptive

representations regarding goods or

services; and

Suppliers are not permitted to use

exaggeration, innuendo or ambiguity when

referring to goods or services or the benefits

thereof.

Is the information you are

communicating correct, can you

provide evidence?

Consumer Right No. 7:

Right to Fair, Just and Reasonable Terms and Conditions

Consumer Right No. 7

• Your right to protection against unfair, unreasonable or unjust contract terms

• Your right to obtain notice for certain terms and conditions

• Your right to obtain free copies of agreements/contracts• Your right to refuse prohibited transactions, agreements,

and terms or conditions• Your right to approach the Court to ensure fair and just

conduct, terms and conditions

Consumer Right No. 8:

Right to Fair Value, Good Quality and Safety

Just when you thought it was safe to go outside...

Consumer Right No. 8

• Your right to demand quality service• Your right to safe, good quality goods• Your right to implied warranty of quality• Your right to a warranty on repaired goods• Your right to receive warnings on the fact and nature of

risks• Your right to recovery and safe disposal of designated

products or components

Consumer Right No. 8

• Your right to have products monitored for safety and/or recalled

• Your right to claim damages for injuries caused by unsafe/defective goods

Consumer Right No. 9:

Right to Accountability from Suppliers

Consumer Right No. 9

• Your right to protection in lay-bye agreements• Your right to protection with regard to prepaid

certificates, credits and vouchers, and access to prepaid services and service facilities

Thoughts• Use technologies to facilitate these rights

• You are required to comply with the law, so why not do so and use the marketing opportunity to tell your customers how much you protect them.

• There are going to be major implications in terms of consumers getting compensation for what the do or do not get.

• Product recalls could become a lot more prominent

http://consumerist.com

End of story, good-bye, the end. Any questions?