Consumer Protection Act postponement likely

Although due on April 24, the whistle has not sounded for the kickoff of the Consumer Protection Act (CPA), according to Rosalind Lake, an associate at the Johannesburg branch of lawyers, Deneys Reitz. This is a new act, signed into law on April 29, 2009, but with the provisions of the act only due to be applied this year. “The act was due to be introduced in two parts this year in order to afford business reasonable time to align their trading practices and systems to ensure compliance,” Lake told FTW. The sections governing the establishment of the National Consumer Commission (NCC) – an enforcement and investigative body –were due to come into operation on April 24 along with the regulations to be promulgated in terms of the act. But this failed to happen, although Lake suggested it might be due to appear about now. There appears to be a headhunt still taking place to staff the NCC – a department of trade and industry entity. And Lake hinted that the right sort of staff would be those from the Competition Commission as they have appropriate regulatory experience and necessary economic and legal training to be able to implement the act. The remainder of the act was due to come into force on October 24. But Lake felt that – with the minister of trade and industry given the discretion to defer the effect of any specific provision for a further six months if it is required – this could be the case. “I’d say there’s likely to be a six-month blanket extension of the act,” she told FTW. But that original April 24 could still remain a significant date, she added. Sections due to become applicable on that date – like product liability – are very likely to be enforced, once the act comes into being, as the retrospective date of application. However, although there is a delay, Lake felt that SA business was still very busy getting its CPA ducks in a row. “It’s a bit difficult when all the information is not available, but commerce and industry are definitely anticipating the introduction of the consumer protection legislation.” According to the dti, the primary purpose is to prevent exploitation or harm to consumers. It regulates the way businesses relate with consumers and how they market their products and services, she added. It applies to ‘every transaction occurring within the Republic’ (subject to certain exemptions), and also to the marketing and supply of goods and services. The CPA touches on many aspects of supply relationships, including warranties, pricing, standards of service and quality, advertising, labelling, marketing and others. “Contraventions of the act will not be treated lightly,” Lake said, “and there is provision for hefty penalties for noncompliance. “It is essential that firms continue to consider their practices and agreements in light of the changes that will be brought about by this act, and make the necessary adjustments to ensure compliance.”