Summary of Consumer Protection Laws

Consumer laws were created so that products and services provided by competitors were made fairly to consumers. Consumers are normally seen to be ‘acting in the course of a business’ or are ‘dealing as customer’. Consumer laws are also known as consumer protection laws, are incorporated into the law to prevent deceitful activities, or unfair business practices. These laws to an extent serve as protection for weaker parties, often not able to handle these matters themselves. The legislation regarding consumer protection, comes from the governments in order to function as a safeguard to protect consumers. In this regard, the laws may require a specific business to provide information regarding their products or services, especially in industries, where public and personal safety or health is concerned, like the food industry.

The concept of consumer protection comes from the belief in another concept; that of consumer a right, which is the belief that consumers have a wide variety of rights, regarding the products and services they consume. To this end a variety of organizations have been founded, in order to assist consumers in getting informed, and be able to make intelligent choices based on this information.

The definition of a “consumer” is a person, who obtains products or services, in order use it, or own it, instead of purchasing it in order to resell, or use it as a part or ingredient to manufacture other products, goods or services.

Besides consumer laws, efforts to advocate competition between organizations in the area of consumer protection, can also serve to further guard the interests of consumers, but this falls under another law, which is referred to as the competition law, which lies beyond the scope of this article.

The area of consumer laws, are part of the private law legislation, that regulate the relations between consumers and producers and businesses, that market their products and services, The consumer protection law, covers a broad scope of subjects, among them the right to privacy for consumers, in order to restrain marketing efforts to a point that it would fall under harassment and liability, in order to force manufacturers, to uphold a certain quality of their products and services. The laws also protect consumers against unethical business practices, and a wide variety of other topics involving consumer to producer activity.

The legislation regarding consumer laws, deals with matters like the safety of products, credit repair or debt management companies, provided services and contracts between consumers and businesses, among many other topics, involving interactions between consumer and businesses. However, this is limited to personal use on the side of the consumer. Business to business activities, fall under an entirely different set of laws.

Besides consumer protection laws, another means to obtain protection for consumers, is through non government entities, that specialize in consumer activism, or individually by consumers themselves.

• Arguably consumer law was created because of the imbalance of powers.
• It avoids consumer exploitation at the pre-conceptual stage

It can be argued that consumer law does protect consumers because different legislation was passed in order to avoid bad business practices towards consumers. For example:    The sales of goods act 1979 is a legislation developed and edited in the 1979 act in transactions involving goods. The areas in the act, seen to be specifically designed to be protecting consumers, is the implied terms within the SGA 1979 involving description, quality and fitness for purpose. The sale of goods act 1979, s.13 (1) , says that goods that haven’t been looked at or identified are ‘goods sold by transactions’.

This act comes in to force if the product bought doesn’t match the description, or is faulty, not fit for what you bought it for and also if the quality is not good e.g. damaged, scratched etc.

An example of a situation would be, a woman bought a car from carcraft Sheffield, the contract was made. As she drove the car off the premises, the car seemed faulty as the engine warning light began to flash off and on. As the contract was made the car did not state that there was nothing wrong with it. This can also be seen as the trade’s decription act, as there was a false decription given on the car.

A claim could be made on this case under these two acts.

Trades description Act 1968

Any seller who gives a false trade description of goods or suppliers or offers to supply goods, which are wrongly described, is guilty of an offence. This includes the following:

• Selling goods that are wrongly described by the manufacturer.
• Implied descriptions- a picture or illustration, which is seen to give the false impression.
• Quality, size, composition and method of manufacturer e.g. this Act could fall in place if a packaging of goods does not display the weight and must be accurate.

Also the contents of the product have to be displayed on packets/tins.

Also firms are not allowed to force retail outlets to charge a price fixed by them.

(See sales of goods act for situation)

Unsolicited goods & services Act 1971

This act protects consumers by inertia selling. Consumers did not have to pay for goods that they did not order, but had not bothered to return.

Consumers may keep the product after a certain number of days if the company who sent it to you does not pick up the product.

An example of a situation would be a sales man called at my door, he sold me kitchen equipment, but did not provide me with a contract or receipt, under this act I have now the right to cancel the contract in anytime, until a copy of the copy of the contract or receipt is provided.

Consumer credit Act 1974

This act protects consumers as it lays down the regulations of purchase on credit for goods.

The intention of this act is to prevent consumers signing to unfair contracts. And also to ensure that purchases know how much interest rates are going to be charged for the credit that they receive.

Competition Act 1980

This act protects consumers against the monopoly legislation as it prevents firms controlling more than 25% of the market without investigation.

The complaint is usually seen to go to the office of fair-trading (OFT), which then can decide on the investigation further.

An example of this situation would be Yorkshire water, as this is a monopoly because there is only one water company in Yorkshire therefore can charge any price it wants to. Now this act is in place it controls firms controlling the market of more than 25%.

Weights & measures Act 1990

This legislation protects consumers as making it illegal to sell goods below their actual weight or volume, which must be stated on the packet or bottle.

This act allows the metric measures to be used, this procedure was enforced through the trading standards office & the office of fair trading.

An example of this act in a situation would be, a customer purchased a bottle of coke from a local shop, he noticed that their was no volume of the weight on the bottle, the customer could sue the company against the weights & measures act as it is illegal for company for not to specify the weight or volume of a product.

Food & safety Act 1990

This legislation protects consumers mainly in the food sector by making it an offence for farmers and growers to sell food, which is not of the nature or substance or quality demanded by the public.

E.g. Foods past by their expiry date etc.

An example of this act in a situation would be, a woman bought some bananas, and after she had eaten them she felt a bit sick the cause was that the product had past the expiry date. The lady could sue grower’s etc against this Act, as the bananas were not safe to eat.

Consumers face many situations in which a trader has broken unfair trading regulations but they have no direct course of action, the Law Commission and Law Commission of Scotland have said. Laws that could cover consumers are too complex, they said.

Unfair trading is prohibited by the Consumer Protection from Unfair Trading Regulations, which are known as the Consumer Protection Regulations (CPRs). But action under the CPRs can only be taken by the Office of Fair Trading (OFT) and Trading Standards Departments, which can take civil and criminal actions under them.

The CPRs leave consumers without the ability to take action directly, despite calls by consumer groups in recent years and even by members of the European Parliament to give them the right to take direct action.

The Law Commissions are reviewing the law in the area and have identified many areas in which consumers are left without a direct course of action. They said that previous investigations into alternative laws under which consumers could take action, such as laws of duress or undue influence, are too difficult for consumers to use and understand so offer them no practical protection.

“Although the current laws of misrepresentation, duress, undue influence and harassment provided private remedies in some circumstances, Consumer Focus highlighted gaps in coverage,” said the Commissions’ report (42-page / 210KB PDF). “Furthermore, these causes of action were strongly criticised for being overly complex and seldom used in practice.”

The Citizens Advice organisation allowed the Commissions to use its data to find examples of consumers who were left, effectively, with no direct form of redress for unfair behaviour.

“Cases involving debt collection, utility providers, phone service providers, and vulnerable consumers featured prominently,” the report said. “We also found that pressure selling was one of the most commonly occurring unfair commercial practices involving, for example, orthopaedic beds and training courses.”

The Commissions said that second-hand car sales; mobile phone contracts; utility switching and solar panel sales were other areas in which problems were frequently reported.

“Many of the problems related to aggressive or misleading ways of obtaining payment,” said the report. “This not only included collecting contract debts but also misleading or aggressive means of threatening ‘civil recovery’ against alleged shoplifting. We were also told of aggressive and misleading practices relating to parking, towing and clamping.”

Consumer protection body Consumer Focus told the Commissions that the laws under which consumers could take direct action were not easily usable by consumers.

“Although it would appear that aggressive practices might be covered by the laws of duress, undue influence, unjust enrichment, and harassment, consumer advisers told us that in practice it is extremely difficult for consumers to succeed in these cases,” said the report. “They argued that very high thresholds apply in duress, undue influence and harassment cases, and it is difficult for consumers to provide the requisite proof. In addition, the law of unjust enrichment is complex. For example, Consumer Focus said that the common law principle of restitution presents “considerable technical difficulty” for the consumer.”

The Commissions said they had been told that private law does not provide protection in all the areas that the CPRs do, that there are “gaps within the current regime”.

The report listed specific instances of problems with sales to consumers, including the sale of supposedly diet-aiding tea; mobile phone services with poor reception; and vehicle performance.

The Commissions said that they will publish a consultation paper next spring outlining how the law should be reformed to ensure that consumers are better protected from unfair practices and can better take direct action to protect themselves against behaviour that is unlawful under the CPRs.

“[The consultation paper] will consider how the law should be reformed to provide a simpler and clearer private right of redress for consumers who are the victims of misleading or aggressive practices,” the Commissions said.

“The evidence we have been given highlights the variety of problems consumers experience. It is often difficult to state with any precision how these cases would be treated under the current law, or what remedy might be available,” they said. “We will be considering whether it would be possible to draft a new statute to apply to business to consumer transactions, which would provide simpler and clearer remedies.”

“It is not the role of the law to protect consumers from all the bad bargains they may make,” the paper said. “The challenge will be to achieve an appropriate balance between protecting consumers from unacceptable malpractices, without encouraging consumers to abdicate responsibility for the bargains they enter.”

The rules and laws on consumer rights vary depending on a number of factors. These include:

• The type of transaction;
• Where the transaction takes place;
• The parties involved in the transaction;
• The nature of the goods or services.

Here are some the basic rules that all consumers should be aware of before spending on the high street or signing on the dotted line.

Shopping On The High Street

The law governing this area is chiefly contained in the Sale of Goods Act 1979.

All goods sold must:

• Be fit for their intended purpose;
• Be of satisfactory quality; and,
• Comply with the description given by the retailer.

If goods turn out to be faulty or otherwise not to satisfy the above criteria the purchaser may be able to return the goods and get a refund. Alternatively a purchaser could request that the goods be replaced or repaired.

The purchaser must act promptly. If a fault is discovered the item should not be left in the back of a cupboard for months before taking it back to the shop. If this happens, the retailer could argue that the purchaser has “accepted the fault” and is no longer entitled to a refund or replacement.

Most retailers now offer some kind of refund or exchange scheme: if goods are brought back within a set period a refund may be given. However, there is no legal or statutory right to return an item simply because the purchaser changes their mind or decides that they no longer want it.

If faulty goods cost more than £100 and were purchased with a credit card the purchaser may also be able to claim a refund from the credit card company.

Private Sales

The Sales of Goods Act is intended to protect consumers when they buy products from businesses. Part of the purpose of the Act is to redress the balance of power between a business and an individual. It must be remembered, therefore, that the protection does not apply to private sales between two individuals.

For example, if an item is purchased from a private seller in response to a newspaper advertisement the purchaser will have very little protection if the item proves to be faulty. In these circumstances the purchaser is expected to protect their own interests by taking due care before purchasing an item.

Shopping On The Internet

Different rules apply to goods bought on the Internet or by mail order. These sales are governed by the Consumer Protection (Distance Selling) Regulations.

The law on this type of transaction states that, in most cases, a purchaser will have 7 days to change their minds and return goods or cancel the order. However, it should be noted that this rule does not apply to all goods. For example, if an item is perishable or personalised it may not automatically be returned because it will not have a resale value.

The Sales of Goods Act also applies to goods bought online therefore they must also be of satisfactory quality and fit for purpose. However, if the seller is a private individual there will be no protection under the Act.

Consumer Rights And Services

The main law governing the provision of services is the Supply of Goods and Services Act 1982. This states that services provided by a business must be:

Carried out with reasonable skill and care and in accordance with the contract agreed between the supplier and the consumer; and,

The work must also be completed within a reasonable time and for a reasonable price, (subject to anything agreed in advance).

If services do not comply with the requirements the purchaser is entitled to have the situation rectified. The customer will usually be entitled to ask the supplier to remedy the fault or pay compensation. The supplier is also likely to be liable if he has fitted or provided faulty goods.

Loans And Finance

All loans, hire purchase agreements and leasing schemes with a value of up to £25,000 are covered by the Consumer Credit Act 1974. This law offers further protection to consumers purchasing goods or services from a business. The Consumer Credit Act also covers purchases made with a credit card.

If a consumer enters into an agreement covered by the Consumer Credit Act they must be provided with a copy of the agreement which includes all the terms and conditions and clearly shows the total amount that has to be paid under the agreement. If the agreement was entered into away from the business’s premises – for example in the consumer’s home – the consumer may cancel the agreement within five days if they change their mind.