Lesson 5: Consumer Protection Act 2007

NOTE: The current curriculum refers to the Consumer Information Act 1978 which was the predecessor to the Consumer Protection Act 2007. Exam answers should refer to the Consumer Information Act 1978. Reference may be made to the Consumer Protection Act 2007, but such references should be clearly highlighted.

Overview of Lesson The Consumer Protection Act 2007: Established the National Consumer Agency Deals with misleading claims about goods, services and prices Deals with EU Directives on unfair, aggressive, misleading and prohibited commercial practices

Introduction The Consumer Protection Act 2007 came into effect in Ireland on 1 May 2007 It replaced the Consumer Information Act, 1978 It also replaced many older consumer laws, some of which dated from the 19th century Its main function was to establish the National Consumer Agency

Functions of National Consumer Agency The main functions of the NCA are to: Inform consumers of their rights through consumer information Promote a strong consumer culture through consumer education and awareness Help businesses comply with consumer law through its enforcement activities, and, Represent consumer interests at all levels of local and national consumer policy development through targeted research and forceful advocacy

Activities of National Consumer Agency In carrying out its functions, the NCA performs various activities, e.g. Work with and consult consumer groups Conduct or commission research into areas of consumer interest Promote public awareness and conduct consumer rights information campaigns Raise awareness of consumer rights in young people through educational initiatives (Shop Smart, quizzes) Prepare and publish guidelines for traders Perform the functions previously carried out by the Director of Consumer Affairs

Powers of National Consumer Agency In carrying out its functions, the NCA has various powers, e.g.: To advise and make recommendations on any legislation or policy which is likely to impact on consumer protection To make proposals for new legislation To appoint authorised officers to enforce consumer legislation. These officers have the right to enter premises, get documentation and other evidence in relation to any trade or business which is being investigated. They have the right to be accompanied by the Gardai, if necessary and apply to the courts for search warrants

Misleading Claims Under the Consumer Protection Act, 2007 it is a an offence for any retailer, service provider, manufacturer or advertiser to make a false or misleading claim about themselves (e.g. that they are members of a trade association when they are not), or goods, services or prices It is an offence to sell goods that have a false or misleading description It is also an offence to omit to give a consumer material information about a product or service (e.g. not telling a buyer that a car has been crashed because they didn’t ask the question)

(i) Misleading Claims about Goods Claims about ingredients, performance and weight must be truthful Examples of misleading claims about goods include: Trader selling second-hand cars which have been “clocked”, i.e. the odometer has been tampered with to show a reduced mileage Claim that a product will help remove dandruff when there is no proof that it will do so Claim that a product is “Made in Ireland” when in fact it was produced elsewhere

(ii) Misleading Claims about Services Claims about the manner, place or time in which a service is provided and claims about the effect of a service must be true Examples of misleading claims about services include: A claim that a service is provided within 24 hours if it will actually take longer, e.g. dry cleaning, photo developing A claim a service is available nationwide if it is not available throughout the country A claim that a satellite television package includes sports channels which are in fact only available at an extra subscription cost

(iii) Misleading Claims about Prices Previous prices, actual prices and recommended prices of goods must be stated truthfully Example: when a retailer advertises an item’s previous price in a sale, the item must have been on sale at that price for 28 consecutive days in the previous three months

EU Directives The Consumer Protection Act 2007 brings into Irish law an EU Directive on unfair, misleading and aggressive commercial practices In short, sellers may not use practices that may lead to consumers buying products or services that they would not buy under normal circumstances

(i) Unfair Practices An unfair practice occurs when there is a breach of good faith and a consumer is denied a reasonable standard of skill and care Example: a trader whose business is carrying out home improvement work “cold calls” potential elderly customers. He attempts to sell his services to the consumer on the doorstep and attempts to start work without permission, after telling the consumer that the roof is in need of repair when this is not the case

(ii) Misleading Practices A practice is misleading if it contains false or untruthful information or deceives the consumer Example: a bakery placing a sign in the window stating: “Our Award Winning Bread”. Unless the bread has genuinely won an award this would be a misleading practice

(iii) Aggressive Practices Aggressive in this context means the use of harassment or undue influence on the consumer Examples include: A mechanic has a consumer’s car at his garage and has done more work than agreed. He refuses to return the car to the consumer until he is paid in full for his work. The mechanic had not checked with the consumer before carrying out the extra work A trader takes consumers to a holiday club presentation at a distant location, with no apparent return journey unless consumers sign a contract to purchase another holiday

(iv) Prohibited Practices The CPA also contains 32 specifically prohibited practices including: Claiming an item is free if you have to pay more than the reasonable cost of responding to the offer or having the item delivered Commercial sellers creating an impression that they are private sellers Telling a consumer they have won a prize where payment is required in order to claim that prize Seeking payment for unsolicited goods, or the return of those goods Claiming the business is closing down when it is not

Summary of the Lesson The Consumer Protection Act 2007: Established National Consumer Agency Deals with misleading claims about goods, services and prices Deals with EU Directives on unfair, aggressive, misleading and prohibited commercial practices

Elements of the Consumer Protection Act 2007

Role Play In pairs, read the role play scenarios Choose one and prepare a likely conversation that would take place between the main parties involved Each role-play should last no longer than one minute