Although many of the CPA’s provisions have not yet been tested by the courts, we at RM Tucker Attorneys believe that it offers a set of valuable guiding principles for the suppliers of goods and services – and is a useful piece of legislation in the hands of informed consumers.
Why does the Consumer Protection Act exist?
The CPA exists to:
- promote a fair, accessible and sustainable marketplace for products and services,
- to establish national norms and standards relating to consumer protection,
- to provide for improved standards of consumer information,
- to prohibit certain unfair marketing and business practices and, among other things,
- to promote responsible consumer behaviour.
When does the Consumer Protection Act apply?
If you deal with consumer or franchise agreements, Section 5 of the Consumer Protection Act (CPA) covers every “transaction” for the “promotion of goods or services”, which includes the sale of goods and provision of services. There are, of course, exceptions, so once you’ve established the relevance of the CPA to your business, there are various provisions to protect the interactions/transactions between suppliers and consumers. These provisions place certain obligations on suppliers and give certain rights to consumers, and vice versa.
Some examples of the CPA’s real-world application:
Fixed term contracts have a maximum duration of 24 months (decreed by the Minister) and consumers have a 5-day cooling off period to cancel the agreement, without penalty.
Section 48 of the CPA regulates unfair, unreasonable or unjust contract terms, stipulating (among other things) that terms can’t be:
- adverse to the consumer,
- false, misleading or deceptive,
- unfair, unreasonable, unjust or unconscionable, or
- not sufficiently drawn to consumers’ attention.
The CPA requires all consumer and franchise agreements (and certain other notices and documents) to be written in “plain language and understandable”, which means that writers must take care that the Ts and Cs of these agreements can be easily understood by readers.
Various types of marketing are heavily regulated by the CPA – including ‘discriminatory marketing’, ‘direct marketing’, ‘bait marketing’, ‘negative option marketing’, catalogue marketing’, ‘promotional competitions’, ‘referral selling’, etc.
Behaviour and ethics
The CPA regulates franchise agreements, “alternative work schemes”, unconscionable conduct on the part of a supplier, false, misleading or deceptive representations made by suppliers, fraudulent schemes or offers, pyramid and related schemes, auctions, etc.
A note to consumers
RM Tucker Attorneys welcomes approaches by consumers who may require significant legal assistance in the context of the CPA. If you have a serious consumer issue, please email us.
The bottom line?
If you are a supplier of goods or services, it is important to know your obligations. At RM Tucker Attorneys we are able to demystify the Consumer Protection Act for you, to ensure that your needs are met and your organisation is protected with efficiency and professionalism.