Khama's last Acts
Mbongeni Mguni | Friday April 27, 2018 13:38
Read together, the revised Competition Act and Consumer Protection Act provide for the establishment of the Competition and Consumer Authority, Competition and Consumer Board and Competition and Consumer Tribunal.
The new entities, empowered with investigative, search and seizure functions, will receive and adjudicate competition issues as well as consumer complaints, overseeing quality issues around goods and services and delivering relevant penalties and sanctions.
The Consumer Protection Unit, often criticised for poor visibility, feebleness and lethargy, will merge into the Competition Authority, in a move due to begin any time.
The fortified Competition and Consumer Authority will be able to directly receive complaints from individual members of the public as well as lobby groups on consumer protection issues. Where the Unit was seen as increasingly out of its depth in a world of fast-evolving consumer issues, the Competition Authority in its nine years has pioneered a responsive approach to public complaints and transparent dispute resolution, leveraging on digital channels such as the social media.
The new Authority, consumers expect, will be the new sheriff in a town where the cowboys of retail and supply enjoyed nearly unfettered room to abuse the market with a variety of tricks and gambits.
The new laws, in fact, display an in-depth knowledge of the major tricks and gambits, by detailing offences and penalties. For instance, the manipulation of the mileage in second-hand vehicles – a major trick in that industry – is now an offence under Section 5 (d) of the Act.
“I welcome new legislation regarding false advertising,” says prominent consumer rights lobbyist, Richard Harriman.
“Although the previous legislation offered some protections, it was far too weak and it’s good to see that the new Act offers us much greater protections.
I look forward to them being aggressively enforced!”
In the absence of both robust legislation and committed enforcement, Harriman’s Facebook page has grown to become the main online platform for aggrieved consumers, with at least 107,000 members at the last count.
A major complaint in the group, which the new Authority plans to brutally punish, is the proliferation of scams, particularly those which leverage on Facebook to quickly catch fire across borders, maximising harm to victims. The existing Competition Authority has highly active social media channels, which the new Authority is expected to expand to both the monitoring of online offences and the reception of complaints.
Under Khama’s last Act, operators of pyramid schemes, multiplication schemes, chain letter schemes or any other scheme declared as such by the Trade Minister face fines of up to P100,000 and/or prison terms not exceeding five years.
However, a study of the relevant section in the law, indicates that its penalties are not limited to the originators of the scam.
“A person shall not directly or indirectly promote or knowingly join, enter or participate, or cause any other person to promote, join, enter or participate in a pyramid scheme, multiplication scheme, chain letter scheme or any other scheme declared as such by the minister. “A person who participates in an arrangement, agreement, practice or scheme commits an offence and shall be liable upon conviction,” the new Consumer Protection Act reads.
Had the legislation been in place, Batswana might not have lost the hundreds of thousands of pula they did in 2013 in the Eurex pyramid scam, or at least, its perpetrators would have faced the wrath of the law. Another scam trending on Facebook last year and tackled by members of Harriman’s group was Vortex Profits, which apparently claimed a number of victims.
“The people promoting Vortex Profits claim that the company is ‘a remarkable investment platform’ with an outstanding track record of two years for delivering best of class investment solutions and endless income-generating opportunity,” wrote Harriman in a January warning to consumers.
“They suggest that investors can earn returns of between 2.5 percent and four percent every day by investing through Vortex Profits in Bitcoin, gold or oil.
“These suggested earnings are clearly impossible, given that 2.5 percent per day implies an annual equivalent of over 800,000%. Even more unbelievably, a four percent return per day equates to an annual return of over 158,000,000%.”
Khama’s last Act also covers bait advertising, where goods or services are advertised with one price, which is subsequently altered when the customer approaches to purchase.
“A supplier who engaged in any misleading or deceptive advertising commits an offence and shall be liable upon conviction to a fine not exceeding P50,000 or to imprisonment for a term not exceeding three years, or both,” the Act reads.
Officials at the Competition Authority say arrangements are underway to prepare for the new dispensation. Once the Trade Minister, Bogolo Kenewendo, issues a notice of commencement, it is expected that the new Authority will be inundated with complaints from consumers who have long waited for redress.
Yesterday, Kenewendo was unavailable for comment as the Cabinet continued its retreat.