Press Release: 1 November 2011

The Consumer Protection Act: Do You Know Your Rights? - Part 3

The new Consumer Protection Act has bearing on each and every individual in this country - because we are all consumers, in one way or another. It is important, therefore, as an ordinary consumer, to understand what your rights are under the new legislation.

Helaine Leggat, founder and owner of Legate ICT Consulting, is an Information Communication Technology lawyer, specialising in information security, governance and privacy, disciplines which require a working knowledge of Records and Information Management (RIM). Leggat gives advice to both consumers and suppliers when it comes to achieving compliance within the changing legislative landscape in South Africa, particularly in relation to the new CPA.

More about the CPA

The CPA came into full force and effect in April 2011, and replaces the provisions of five previous acts in a new and simplified manner. There are now nine basic consumer rights in the CPA – all of which have important implications for both the consumer and the supplier. In a bid to dispel any confusion surrounding the new legislation, this third part in a series of articles will examine consumer rights numbers 7 to 9, from the point of view of the consumer.

Who does the CPA apply to?

The CPA, as the name implies, is designed to protect the consumer. But first, who exactly is a consumer?

Leggat provides this definition: “Consumers are persons, to whom goods and services are marketed, who have entered into transactions with suppliers and are users of particular goods, or recipients or beneficiaries of services.”

She goes on to explain that the CPA applies to every transaction occurring within South Africa, as well as the promotion or supply of any goods and services occurring within the country.

Two types of consumers are afforded protection in terms of the Act. These are ‘natural’ persons (human beings) in all the above-mentioned circumstances; and ‘juristic’ persons (bodies corporate, partnerships, associations and trusts) who have asset value or annual turnover, at the time of transaction, under the ‘threshold’ determined by the Minister of Trade and Industry. The threshold is currently R2 million. “The CPA has very broad application, and all South Africans, whether consumer or supplier, should be aware of their key consumer rights and obligations,” Leggat says.

Who May Lodge a Complaint?

According to the new legislation, you may lodge a complaint if you are an individual, an authorised person acting on behalf of another, a person acting as a member or in the interest of an affected group of class, or a person acting in the public interest.

The Nine Rights of Consumers

To recap, the nine key consumer rights, as enshrined in the CPA, are as follows:

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;
9. Right to Accountability by Suppliers.

In this third article in the series, we will discuss rights numbers 7, 8 and 9.

Consumer Right No. 7: Right to Fair, Just and Reasonable Terms and Conditions

Consumers have the right to protection against unfair, unreasonable or unjust contract terms, including the price of goods or services. “This also means that suppliers are not permitted to require consumers to waive any rights, assume any obligations, or waive any liability of the suppliers on terms that are unfair, unreasonable or unjust,” says Leggat. This right also means that a supplier is obliged to draw to the consumer’s attention any potential risks or liabilities that may apply to the consumer in respect of goods and services purchased.

Consumers have the right of free access to copies of agreements/contracts entered into with a supplier, and also have the right to refuse any terms and conditions which are misleading or deceptive, or subject the consumer to fraudulent conduct, or are in any way contrary to the CPA.

Consumer Right No.8: Right to Fair Value, Good Quality and Safety

Consumers have the right to quality service and safe, quality goods.

“High quality service, which the consumers are entitled to expect, includes the timely completion of services, or timely notice of any unavoidable delays,” explains Leggat. “In terms of goods, consumers are entitled to receive goods that are of good quality, in good working order and free of any defects.”

This right also means that consumers are permitted to return goods to suppliers, without penalty and at the suppliers’ expense, within a period of six (6) months, if the goods are of inferior quality, unsafe or defective. Suppliers are obliged to refund, repair or replace the goods in question within three (3) months.

Suppliers are obliged to provide a warranty on every new or reconditioned part installed during repair or maintenance work, for a period of three (3) months after the date of installation.

It is also the suppliers’ responsibility to accept and dispose of waste which is unsuitable for common waste systems.

Finally, consumers have the right to claim damages for injuries caused by unsafe/defective goods. “Producers, importers, distributors or retailers of any goods are each liable for any harm caused wholly or in part, as a consequence of product defect, or hazard, or inadequate instructions for use,” says Leggat.

Consumer Right No.9: Right to Accountability from Suppliers

This means that a consumer is protected with regards to both lay-bye agreements, and pre-paid certificates, vouchers, membership fees and the like.

Leggat explains: “Consumers are entitled to purchase goods and services via lay-bye agreements. However, if the supplier fails to deliver any goods, they must supply equivalent or superior products, or refund money paid, plus interest, or keep the consumer’s deposit in an interest-bearing account.”

In terms of pre-paid certificates, credits, vouchers, membership fees or other money belonging to a consumer, suppliers are not permitted to treat such property as theirs; have to exercise care, diligence and skill in managing this money, and assume liability for any losses suffered by consumers in this regard.

How Does the Consumer Ensure Compliance?

“Compliance and risk mitigation apply not only to suppliers, but also to consumers,” says Michael Springer, managing director of Pitney Bowes South Africa. “The simplest and most effective way for consumers, especially juristic person consumers, to comply with the CPA is to manage their records in a responsible way. While there is no obligation imposed on natural person consumers to keep records, it makes sense that they do so,” says Springer.

Pitney Bowes, in consultation with legal experts in the field, such as Leggat, is at the forefront of thought leadership in the field of compliance and risk mitigation through records and information management.

“There is an increasing need for individuals to manage their digital and paper information,” Springer says. “The CPA is there to protect the consumer, and to promote a fair, accessible and sustainable marketplace for consumer products and services. However, the onus is on individual consumers to know and understand their rights, and to manage the information they have to hand accordingly.”

He notes that the outcome of any consumer complaint is highly dependent on the ability to prove the facts at issue. “This further emphasises the importance of good record-keeping and the ability to locate and produce records such as invoices, statements and delivery notes,” he concludes.

If you would like more information on the CPA and your rights, or how to ensure best RIM practice as a consumer, please contact Michael Springer at Pitney Bowes SA on 011-516-9400 or email Michaels@pitneybowes.co.za.

Editorial Contact: Kendal Hunt PR Consultant and Writer Kendal Hunt Communications Kendal@kendalhunt.co.za 011 462 6188