Consumer Protection

The landmark Consumer Protection Act, 68 of 2008 was signed into law by the President on 24 April 2009. The objective of the Act is "to promote and advance the social and economic welfare of consumers in South Africa". Certain provisions of this legislation will take effect on 24 April 2010 while certain others (notably those with which supplier compliance is required) are expected to come into effect on 24 October 2010.

The Consumer Protection Act introduces a single, comprehensive framework for consumer protection in South Africa. It has been described as "a Bill of Rights for consumers" and provides for the following fundamental consumer rights:

• the right to equality in the consumer market;
• the right to privacy;
• the right to choice;
• the right to disclosure and information;
• the right to fair and responsible marketing;
• the right to fair and honest dealing;
• the right to fair, just and reasonable terms and conditions;
• the right to fair value, good quality and safety; and
• the right to suppliers' accountability to consumers.

With this codification of consumer rights comes a host of supplier obligations. Suppliers at all levels of the supply chain are directly affected by the legislation and should ensure that they understand and comply with their obligations under the Act.

The Act deals with an array of issues ranging from unwanted direct marketing, fixed-term agreements, pre-authorisation of repair or maintenance services, cancellation of advance reservations or bookings; over-selling and over-booking; return of goods; product labelling and trade descriptions, sales records, grey market goods, bait marketing, catalogue marketing and auctions to unfair contract terms, written consumer agreements and strict liability for damage caused by goods.

The far-reaching provisions of the Act are bound to redefine the way ordinary South Africans do business. It is important for businesses to reassess their interaction with consumers on all levels and, against that background, to familiarize themselves with the provisions of the legislation and the impact thereof on, for example, their standard terms and conditions, disclaimer notices, business names, insurance and marketing practices sooner rather than later.

The Act has a very wide application and manufacturers, importers, retailers, distributers, agents and marketers should be conscious of the fact that the Act applies not only to the provision but also to the promotion and marketing (ie advertising) of goods/services as well as to actual agreements between suppliers and consumers in terms of which goods/services are supplied or offered. It also applies, subject to certain exceptions, to franchisors and franchisees.

Cliffe Dekker Hofmeyr offers extensive services with regard to:

• Commenting and making submissions on the draft regulations soon to be published under the Act;

• Specialist advice on compliance with any aspect of the Consumer Protection Act, including the review and amendment of standard terms and conditions;

• Training;

• Compliance familiarisation seminars; and

• Reviewing internal documentation, systems and processes to ensure compliance.

Compliance familiarisation seminars:
We also offer the service of a Consumer Protection Act compliance familiarisation seminar. For more information, click here.