THE CONSUMER PROTECTION ACT

Quality in a service or product is not what you put into it, but what the client or customer gets out of it

Peter Drucker---Management Guru

On 31 March 2011, the Consumer Protection Act, already referred to as the CPA, comes into force. Described by commentators as a revolutionary and radical law, it has been in the making for some time and finally brings South Africa in line with international accepted benchmarks regarding the protection and enhancement of consumer rights.

The CPA codifies and entrenches the following consumer rights;

• The right to equality
• The right to fair value , good quality and safety
• The right to fair, just and reasonable terms and conditions
• The right to fair and honest dealing
• The right to fair and responsible marketing
• The right to disclosure
• The right to choose
• The right to privacy

Andrew Layman, former CEO of the Pietermaritzburg Chamber of Business and now CEO of the Durban Chamber of Commerce and Industry, recently addressed local business leaders and said the CPA would change the way businesses operated and expressed concern about the lack of awareness in the business community about the implication of the CPA. His view, probably applies to many enterprises trading in the building industry as well.

Many building industry enterprises will be contracting to provide their products and/or services to persons who are regarded as consumers in the CPA. Of considerable importance to these enterprises will be the challenge to ensure that their contracts are written in what is called “plain language”. This may prove to be a difficult and elusive requirement to achieve and its application may be a formidable challenge in a country like South Africa with 11 official languages.

To date, many enterprises relied on the fine print in their contract documentation which often was prepared by members of the legal profession. These conditions are frequently crouched in long and complicated sentences using complex terminology beyond the comprehension of the average consumer.

A further risk to businesses may be groundless and frivolous complaints lodged particularly rogue consumers who may want to use the CPA to delay, or even escape from their contractual obligations.

It is worth noting that according to the National Credit Regulator (NCR) there were some 8.6 million South African consumers with bad credit records listed at the end of December 2010. This represents a considerable percentage of adult South African consumers. Has it become a case of BEWARE for both buyers and sellers? This is perhaps an appropriate opportunity for those dealing CPA designated consumers to ensure their contract documentation complies.

Pieter Rautenbach