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An excerpt from the February 2012 issue of Debtfree DIGI:

 

THE CONSUMER PROTECTION ACT 68 OF 2008: PART TWO

It is important to note that the CPA does not apply to every party.  As in all acts, exemptions were included in the CPA such as the following entities:

 

  • The State – supply of goods and services in terms of section 5(2) (a).

 

  • Big Business – sales and services exceeding R2 000 000 to juristic persons such as companies, closed corporations etc) and who is not a sole proprietor – see section 5(2)(b).

 

  • Credit agreements – no credit agreement can be challenged under this act – see section 5(2)(d).

 

  • Auctions – goods purchased at auctions are not subject to this act but the actions by the auctioneer are subject to the rules of this act.

 

  • Employment services – are not subject to this act – see section 5(2)(‘e).

 

  • Collective Bargaining Agreements – are exempted in terms of the Constitution and Labour Relations Act – see section 5(2)(f).

 

  • Exemptions by the Minister – see sections 5(2)(‘c), 5(3)(a) and 5(4).

The main aim of the CPA is to protect consumers against ruthless suppliers and credit providers. One could therefore argue that South Africa has become a leader in consumer protection.  Today it is a requirement for consumers to be able to visually inspect goods; that all agreements must be in writing; that consumers must be given notice of legal action against them, this includes the rendering of services by attorneys  – many never thought this would be included, in the Act but the definition of ‘services and goods’ does indeed make such a provision.

The CPA also brought about some changes to “trading as” names.  In the past, one could just buy a company off the shelf and go into business. Now however, should you have a company or close corporation e.g. EXPRESSO CC trading as HARMONY GOLD PROPERTY, then the name “HARMONY GOLD PROPERTY” must now also be registered.

Companies need to be aware that their refund and marketing policies need to be revisited to meet the criteria of the CPA, e.g. competitions must now be structured according to the Act to ensure consumers are not “exploited”.  So, common adverts such as ‘make a call at R1.50 and win a car’ have been stopped, as it implies something untrue.

Furthermore the courts are required to interpret the CPA in favour of the consumer.

The CPA has put more rights in place for consumers. Service providers have to abide with changes brought about by the Act or they stand to face the consequences thereof.

 

For more articles like this read the Feb 2012 issue of Debtfree DIGI and next months issue will also feature another article on the Consumer Protection Act.