Effective consumer protection was brought a step closer on Friday with the adoption in the National Assembly of the Consumer Protection Bill.

Introducing debate on the measure, Trade and Industry Minister Mandisi Mpahlwa said it was aimed at promoting and advancing the social and economic welfare of South African consumers.

Among other things, the bill would provide for the establishment of a statutory National Consumer Commission, with a mandate to proactively identify, investigate, and prosecute contraventions of consumer laws before the National Consumer Tribunal.

Fair and competitive

"It [the bill] seeks to regulate the commercial relationship between a supplier and a consumer to ensure fair and competitive markets," he said.

Some of the abuses it sought to address included unfair contract terms, misleading and fraudulent advertising, non-honouring of guarantees, abuse of personal information, non-disclosure of terms and conditions and poor product quality.

"The bill addresses these challenges by adopting a rights-based approach, aimed at asserting consumer rights when contracting with suppliers.

"These rights are designed in a manner that prohibits certain conduct upfront, encodes common law principles, provides for the establishment of effective redress mechanisms for consumers, recognises and supports the role of consumer NGOs, and promotes customer responsibility in the public and private sectors," he said.

The bill backed up these rights by giving consumers the right to receive documents written in plain and understandable language. This would prohibit unfair contract terms, enhance choice by requiring disclosure and information on prices, contract terms, quality, safety, guarantees and warrantees.

Advertising, marketing and promotions would have to adhere to certain standards, including that they should not be misleading, fraudulent or misrepresent the benefits of any product, service, or skill, Mpahlwa said.

Promotion proscription

The bill provides, among other things, that the minister may prescribe certain days, dates and times during which consumers may not be contacted for promotional purposes.

To enhance consumer choice, suppliers are prohibited from requiring consumers to buy bundled goods or services, unless it can be proven that it results in economic benefit for consumers.

The right to choose includes the right to decide whether or not to continue a commercial arrangement during the course of an agreement, and once it has expired.

The bill establishes the consumer's right to cancel a fixed-term agreement, limits the rights of suppliers to impose cancellation charges, and sets out rules governing the expiring of such agreements.

The right to choose also includes the right to cancel advance reservations or bookings. Suppliers may however charge advance deposits and impose reasonable cancellation penalties.

The right to disclosure aims to ensure that consumers understand the terms and conditions of the transactions or agreements they enter into and are able to make informed choices about the products and services they consume.

A number of specific marketing and selling practices are prohibited, including bait marketing, negative options and referral selling.

The bill also regulates loyalty programmes and prohibits offering prizes with the intention of not providing them.

There is also a ban on overselling and overbooking, which requires a supplier not to accept consideration for any goods or services unless they reasonably expect to have capacity to supply them, or intend to provide goods or services that are materially different.

Good quality

The bill provides for consumers to receive goods of good quality, reasonably suitable for the purpose for which they are intended, in good working order, free of defects, useable and durable for a reasonable period of time.

Suppliers are obligated to accept the return of waste goods that may not be accepted in the common waste collection system.

Prepaid certificates, credits and vouchers will remain negotiable for up to five years, and the supplier is obligated to honour them when presented.

The bill now goes to the National Council of Provinces for concurrence.

Sapa