A new consumer protection bill provides for strict monitoring and punishment for misleading advertisements. It aims to empower consumer courts at the state and district level to disperse greater financial compensation to the consumers. The bill also has a provision for setting up an executive agency called central consumer protection authority with a mandate to carry out investigations into violations of consumer rights, recall of unsafe goods and services and discontinue unfair trade practices. The bill will replace the Consumer Protection Act of 1986.

Body:

The salient features of the Consumer Protection Bill 2018 are:

• It defines the “consumer” as a person who buys any good or avails a service for a consideration.
• The Bill covers transactions, both online and offline, and includes tele-shopping and multi-level marketing.
• Definition of “consumer rights” in the Bill exhaustively covers the right to be protected against the marketing of goods, products or services that are hazardous to life and property.
• It also focuses on the right to be informed about the quality, quantity, potency, purity, standard and price of goods, products or services, as the case may be, so as to protect a consumer against unfair trade practices.
• It also includes the right to be assured, wherever possible, of access to a variety of goods, products or services at competitive prices.
• It involves the right to seek redress against unfair or restrictive trade practices, or unscrupulous exploitation of consumers.

Significance:

• Presently Consumers only have a single point of access to justice, which is time consuming. Additional swift executive remedies are proposed in the bill through Central Consumer Protection Authority (CCPA).
• Deterrent punishment to check misleading advertisements and adulteration of products.
• Product liability provision to deter manufacturers and service providers from delivering defective products or deficient services.
• Ease of approaching Consumer Commission and Simplification of Adjudication process.
• Scope for early disposal of cases through mediation.

 Issues involved:

• The Bill does not address the fundamental problem of protracted and complicated litigation, the bane of consumer forums constituted under the Consumer Protection Act of 1986. Instead, it provides an alternative to the consumer forums, in the form of mediation.
• The Bill does provide for a regulator, but there is no proper focus on the duties of the regulator.
• Even the definition of ‘consumer rights’ in the Bill is not simple and straight forward, so that consumers at least know what their entitlements are.
• It has penalty provisions for the endorsers and on the other it is giving them a route to get away because the clause of due diligence will act in their defence
• It lags behind in tackling misleading advertisements endorsed by any celebrity
• This step will act as a deterrent for manufacturers since the liability quotient has increased

Way Forward:

• Time bound resolution of cases.
• Consumer education and proper awareness building measures.
• Several countries like Canada, Estonia have devised advertisement regulations for unhealthy foods targeted at children
• Countries such as the UK, Ireland and Belgium have specifically banned celebrity endorsement of unhealthy foods. The impact of such restrictions has been reported to be significant.

Conclusion:

The emergence of global supply chain, rise in global trade and rapid development of e-commerce have led to a new delivery system for goods and services and also provided new options and opportunities for consumers. Misleading ads, tele-marketing, multi-level marketing, direct selling and e-commerce pose new challenges to consumer protection and will require appropriate and swift executive intervention to prevent consumer detriment. This bill is the step in the right direction in addressing these issues.