Consumer act 'can put bosses behind bars'

The act - which comes into effect later this month - was conceived in 2008 and is a Department of Trade and Industry initiative to promote and protect consumer rights in their dealings with business enterprises.

Penalties

Failure to comply with the provisions of the act can result in companies being fined 10% of their annual turnover or company bosses being sent to jail.

Natasha Bouwman, the institute's spokeswoman, said this legislative provision would cushion consumers who were most vulnerable to exploitative practices by business people.

The consumer act "stipulates numerous prohibited practices, for example, negative option marketing and bait marketing, as well as consumer entitlements, such as the right to return goods, under each fundamental right in order to achieve protection thereof," Bouwman said.

Thami Bolani, the National Consumer Forum's (NCF's) spokesman, said the consumer act was long overdue and that it would "level the playing field between consumers and business".

Consumer education

On Tuesday, some members of the financial industry added their voices on the act.

Happy Ntshingila, Absa's chief marketing and communication executive, said his organisation had joined hands with the NCF to set up an annual conference that educated consumers about their rights when concluding business transactions.

He said that as part of Absa's strategy, the bank had "adopted the Financial Services Authority regulations around Treating Customers Fairly 2007, and we see the implementation of the Consumer Protection Act as further building on the same foundation".

Nedbank's group programme manager, Alan Britton, said the bank supported the legislation as it would serve the needs of consumers. "While the bank will always act in the best interest of the consumer, we advise that the consumer should always take the time to study and understand the contents of any contract or information provided," he said.

Consumers will now be able to use the provisions of the act to demand accountability from suppliers of goods and services. This includes the right to contest terms and conditions that are deemed to be unfair on purchased items.

The act will be implemented in stages and all provisions will be fully effective from October this year.

Source: Business Day