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PUBLIC CONSULTATION ON THE KZN CONSUMER PROTECTION BILL 2010 DEPARTMENT OF ECONOMIC DEVELOPMENT AND TOURISM INDUSTRIAL DEVELOPMENT & BUSINESS REGULATIONS.

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Presentation on theme: "PUBLIC CONSULTATION ON THE KZN CONSUMER PROTECTION BILL 2010 DEPARTMENT OF ECONOMIC DEVELOPMENT AND TOURISM INDUSTRIAL DEVELOPMENT & BUSINESS REGULATIONS."— Presentation transcript:

1 PUBLIC CONSULTATION ON THE KZN CONSUMER PROTECTION BILL 2010 DEPARTMENT OF ECONOMIC DEVELOPMENT AND TOURISM INDUSTRIAL DEVELOPMENT & BUSINESS REGULATIONS BUSINESS REGULATIONS UNIT: CONSUMER PROTECTION SERVICES 1

2 Table of content Introduction Background CPA and Expectations on Provinces KZN Consumer Protection Bill Chapters of the Bill Discussions 2

3 Introduction The history of South Africa and its discriminatory laws of the past have burdened the nation with unacceptable high levels of poverty, illiteracy and other forms of social and economic inequalities; Consumers in South Africa are amongst the most vulnerable in the World As a result it was necessary to develop and employ innovative means to fulfill the rights of historically disadvantaged persons Promote their full participation as consumers 3

4 Introduction continues Protect the interest of all consumers in the Province Ensure accessible, transparent and efficient redress for consumers who are subjected to abuse or exploitation in the market place To give effect to internationally recognized consumer rights as one of the major tourist attraction Province To promote an economic environment that supports and strengthens the culture of consumer rights and responsibilities 4

5 Background Consumer Protection is an area of concurrent competency between the National and Provincial Government. (Constitutional mandate) The National Office (NCC) has the responsibility of setting the norms and standards to be followed by Provinces At the National level we had the “Unfair Business Practices Act, No. 71 of 1988” Most Provinces developed legislation which was the mirror image of the Unfair Business Practices Act The Act was more enabling and allowed for the general investigations of unfair business practices 5

6 Background continues The focus was mainly on the unfair business practices rather than giving consumers access to redress KZN, NW,EC and NC were some of the Provinces which did not have consumer Protection legislation. The Provincial legislations in the other five Provinces allowed for the establishment of the office of the Consumer Protector as well as consumer Tribunals KZN had a draft bill which was not initially aligned to the necessary procedures as is required in terms of the National Consumer protection Act. 6

7 Background continues Developments in the consumer protection saw the promulgation of the National Credit Act, No. 34 of 2005, which established the of the National Consumer Tribunal to deal with consumer and credit related matters One of the major and significant changes in consumer protection came with the enactment of Consumer Protection Act, No.68 of 2008 The enforcement of which had been deferred to the beginning of April The CPA imposes an obligation on all spheres of Government to work together in the spirit of cooperation 7

8 CPA and Expectations from the Provinces CPA, as a National legislation is applicable throughout the Republic A consumer protection authority has jurisdiction within its Province Issue compliance notices on behalf of the National Consumer Commission (NCC) Facilitate the mediation or conciliation of disputes arising in terms of the CPA (ADR agents) Refer dispute to the Provincial Consumer Court/ Tribunal Request the NCC to initiate complaints on prohibited conduct. 8

9 Promotion of Legislative Reform Section 94 (a) and (b) – In order to better achieve the purposes of this Act (CPA) in relation to laws that govern matters affecting consumers, the NCC must identify any national or provincial legislation, or other public regulation, that – affects the welfare of consumers; and is inconsistent with the purposes of this Act; including Consumer Protection legislations in the Provinces to ensure alignment. The NCC must consult with relevant provincial consumer protection authorities to ensure alignment and also ensure that they will be a position to enforce the CPA together with their Provincial legislations. The Discussions between the NCC and the Provinces are underway 9

10 Schedule 2 item 7 (Transitional Arrangements) Until provincial legislation has been enacted in a province establishing for that province a provincial consumer protection authority as contemplated in this Act, the Minister, by notice in the Gazette, may delegate to the relevant member of the Executive Council (MEC) of that province, any or all of the functions of the National Consumer Commission to be exercised within that province and in accordance with this Act. 10

11 KZN CONSUMER PROTECTION BILL, 2010 To provide for the establishment of the Office of the Consumer Protector, the establishment of the Consumer Tribunal, and to provide for matters connected therewith to determine the objects, powers, duties and functions of the Office of the Consumer Protector, to provide for the investigations of consumer complaints, providing access to redress for consumers, consumer education and create awareness about consumer rights and responsibilities, 11

12 Purpose and Policy of the KZN Consumer Protection Bill 2010 To promote and advance the social and economic welfare of all consumers in the Province by - establishing a legal framework for the achievement and maintenance of a consumer market that is fair, accessible, efficient, sustainable and responsible for the benefit of consumers generally; reducing and ameliorating (improve) any disadvantages experienced in accessing any supply of goods or services by consumers – (a)who are low income persons or persons comprising low income communities; (b)who live in remote, isolated or low density population areas or communities; (c) who are minors, seniors or other similarly vulnerable consumers; (d)People with low literacy level 12

13 CHAPTERS IN THE BILL Chapter 1 – Definitions Chapter 2- Objects of Act, Exemptions and functions of the responsible MEC Chapter 3 – Agencies for Consumer Protection in KZN Chapter 4 - Realization, Protection of Consumer Rights Chapter 5 - Arrangements negotiated by the office of Consumer Protector Chapter 6 – Law enforcement and Judicial Proceedings Chapter 7 – General Provisions 13

14 Chapter 1 This Chapter deals with all the definitions in the act In order to ensure alignment with the CPA, as well as to ensure greater protection for consumers in the Province, most definitions as the same as those in the CPA. A definition of a consumer has been expanded by including users, beneficiaries or recipients of goods and services so as to extend redress Including to third parties especially with regards to product liability; This will also include the franchisee who has in the past were excluded from the definition of the consumer 14

15 Chapter 2 This chapter deals with the Objects of the Act, which is to “to provide for a consistent, predictable and effective regulatory frame work of consumer complaints in the Province. Foster consumer confidence Promoting performance & competitiveness in the market place It also provides that the responsible MEC has to develop Provincial policy and norms and standards pertaining to consumer matters within 12 months after the coming into effect of the Act. (Regulations) 15

16 Chapter 2 continues Exemptions CPA exemptions Goods/services promoted or supplied to the state; Consumer is a juristic person- body corporate, partnership, association or trust (threshold); Industry-wide exemption granted to regulatory authority; Credit agreements i.t.o. NCA but not to the goods or services; Services under employment contract; Agreements giving effect to bargaining agreement i.t.o. sec 213 of LRA ; Provincial exemptions An officer as defined in section 1(1) of the Customs & Exercise Act Sheriff or any officer of the Court acting in terms of the Court order Judicial officer acting in the performance of their function 16

17 Chapter 3 This chapter deals with the establishment of the Office of the Consumer Protector. The office of the consumer will be an office within the Department The responsible MEC is empowered to appoint a consumer Protector in terms of the Public Service Act The Consumer Protector will be responsible for ensuring that the office fulfils it objectives and mandate in terms of the Act. The chapter also deals with the establishment of the Consumer Tribunal. The tribunal members will be appointed by the MEC to adjudicate on all matters bought before them by the the office of the consumer Protector 17

18 Chapter 3 continues The tribunal may award costs orders in their judgments The tribunal will consists of between 6 and 8 members appointed by the MEC Like other tribunals there are persons prohibited from being appointed as members of the tribunal like, a person who has been convicted, under curatorship, unrehabilitated insolvent or a person who has been declared to be of an unsound mind by a competent Court. Members will be appointed for a period of 5 years or less as determined by the MEC 18

19 Chapter 3 continues Remuneration of the members will be determined by the MEC The tribunal may appoint experts in certain matters to assist the members of the tribunal at an agreed fee if it deems it necessary in order to assist them in the exercise and performance of its powers, duties and functions. Proceedings in the tribunal to be initiated by summons issued by the Consumer Protector Tribunal will have the powers to subpoena any person to appear before it. 19

20 Chapter 4 This chapter deals with the realization, protection and enforcement of 8 International Consumer Rights, and the 9 th one in South Africa, which are: Right to equality (Charge different prices to different categories of consumers) Right to privacy (to pre-emptively block) Right to choose ( Fixed term agreements must not exceed the prescribed maximum periods 24 months) and pre- authorization. Right to disclosure and information (Plain and understandable Language) 20

21 Chapter 4 continues Right to fair and responsible marketing (Bait marketing) Right to fair and honest dealing (cohesion, bulling tactics) Right to fair, just and reasonable terms and conditions (Tribunal to determine this) Right to fair value, good quality and safety (Goods that comply with standards i.t.o. Standards Act) Suppliers accountability to consumers ( lay bye’s reasonable and may not exceed 1% of the full purchase price of the good). 21

22 Chapter 4 continues Any person may seek to enforce any rights in terms of this act Complaints will be investigated and be resolved through Alternative dispute Resolution methods Complete negotiated settlements between parties If there’s no amicable resolution then may be escalated to the Tribunal for determination The Consumer Protector has the powers to appoint investigators in terms of the Act. The MEC will appoint a Review panel situated within the Department to deal with any reviews from consumers or business 22

23 Chapter 5 For enforcement purposes all negotiated settlements by the office of the consumer Protector may be confirmed by the National Consumer Tribunal or the High Court A confirmation from the High Court must be published in the Government Gazette The High Court may also set aside a negotiated settlement in order to give the other party an opportunity to be heard if it is satisfied that the settlement will not ensure the discontinuance or avoidance of the business practice which gave rise to the consumer complaint. 23

24 Chapter 6 In terms of this chapter no member of staff of the office of the consumer Protector performing their function may disclose any information acquired in the exercise of their duties in terms of the Act. (confidentiality) No person including the state will be liable in respect of anything done in good faith under this Act (liability) No provisions of this Act may be construed as depriving any person of any civil remedy or right to institute any criminal prosecution. (waiver of benefits) Penalties for offences and contraventions of this Act will be determined by the MEC in the Regulations. 24

25 Chapter 7 This Chapter deals with Regulations The MEC may make regulations regarding any matter in terms of this Act is required or permitted to prescribe, including; 1.Any payments and amount of fees payable 2.Manner and forms of service, delivery or dispatch of summons, notice or any other document required to be served 3.Procedures to be followed dealing with a business entity 4.Tariffs of witness fees payable 5.Fees or any other money to be paid herein. 25

26 Written Comments The last day for submitting the written comments will be 15 July 2011 c/o The Senior Manager: Consumer Protection Services Department of Economic Development & Tourism 270 Jabu Ndlovu Street, Pmb or by 26

27 THE END THANX PREPARED BY LEHLOHONOLO LUCKY RABOTAPI SENIOR MANAGER: CONSUMER PROTECTION SERVICES 27


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