The Consumer Protection Act 1999 (CPA) is an act with the objective to protect the consumers’ right which came into force in Malaysia on 15th November 1999. Basically, the provisions of this act cover areas not covered by other existing laws. This act provides simple and inexpensive redressal to the consumer’s grievances and relief of a specific nature for example from ‘false’, ‘misleading’ or ‘deceptive’ as to conduct, representation or practice and that they shall not be practiced by both parties (consumer and seller) whether it falls under sales, services or land.
The laws that are designed to protect the consumers’ rights can be classified into three categories which are firstly, laws to ensure that the consumers are not deprived of their basic necessities, secondly, laws to ensure physical safety of consumers and lastly, laws t...
o protect the economic interest of the consumers. Besides that, under CPA, an aggrieved consumer may refer to any dispute or claim of less than RM 10,000 to the established Consumer Redressal Tribunal.
Background of Study
The Consumer Protection Act 1999 (CPA) is needed because if no such contract exists then there would be many situations where the sellers would abuse or take advantage of their consumers. Basically, this Act shall apply in respect to all goods and services that are offered or supplied to one or more consumers in trade in order to protect the consumers’ rights. However, they are a few situations where this Act would not be applied. It is not applied:
1) To securities as defined in the Securities Industry Act 1983;
2) To future contracts as defined in
the Futures Industry Act 1993;
3) To contracts made before the date on which this Act comes into operation;
4) In relation to land or interests in land except as may be expressly provided in this Act;
5) To services provided by professionals who are regulated by any written law;
6) To healthcare services provided or to be provided by healthcare professionals or healthcare properties;
7) To any trade transactions effected by electronic means unless otherwise provided by the Minister.
As mentioned above, CPA came into force on 15th November 1999. After the date, four amendments have been made in the year of 2002, 2003, 2007 and lastly 2010. They are:
- Amendment 2002: Amendment of Subsection 17 (1) listing the types of Future Services Contract gazette by Ministry for the purpose of the section.
- Amendment 2003: increasing the TTPM’s membership to include members from judicial and legal services as well as increasing the TTPM’s award from RM 10,000 to RM 25,000.
- Amendment 2007: widening the scope to include the electronic commerce transactions.
- Amendment 2010: aims to make expand existing provisions in ensuring the Act remains relevant to the changes in current trade practices as well as providing more protection to the consumers. This amendment introduces two new parts:
1) Part IIIA: Unfair Contract Terms which defines the provisions to protect the consumers from unfair terms in a standard form contract.
2) Part XIIA: Committee on Advertisement which provides power to the Minister to establish a committee, to monitor and take necessary action against the supplier that produces false and
Part II of the Act describes the situations where how the consumers’ rights might be abused. They are misleading and deceptive conduct, false representation and unfair practice. In misleading and deceptive conduct, it refers to both goods and services. As an example, it is mentioned that no person shall engage in conduct that, in relation to goods, is misleading or deceive, the public as to the nature, manufacturing process, characteristics, suitability for a purpose, quantity or goods. After misleading and deceptive conduct, there are others under Part II of the Act and they are:
- false or misleading representation;
- false representation and other misleading conduct in relation to land;
- misleading indication as to price;
- bait advertising;
- gift, prizes and free offers.
In Part III on the other hand describes the safety of goods and services. This part describes the safety standards, compliance with safety standards, general safety required for goods, the defence, prohibition against unsafe goods and prohibition of importation of goods and services. Part IV talks about the offences, defences and remedies in relation to the previous parts, Part II and Part III. Sale of Goods Act 1957 (SOGA), an Act which relates to the sale of goods in Malaysia, somehow parts of them relates to CPA. This is so because in Part V of the CPA reproduces and modifies Section 14 to 17 of the SOGA 1957 (Revised 1989) to suit the particular circumstances of goods supplied to customers.
Due to that, these sections no longer apply to goods supplied to a consumer although non-consumer transactions remain unaffected. In
the Part V of the CPA, the implied terms are an attempt to protect consumers. It also implied terms into a contract of sale of goods but significantly, it does away with the classification of terms into conditions and warranties. When there is a breach of contract, under CPA, it is unnecessary to decide whether it is a breach of condition or warranty. Instead of classifying, guarantee is introduced with appropriate remedy to it because it simplifies the law for consumers.
1) Toys Product Safety
The Malaysian Association of Standard Users is on the mailing list of various consumer product safety enforcement and also regulatory agencies around the world including the United States, Canada, Australia, Japan and Korea but unfortunately, related government here in Malaysia do not provide similar facilities as compared to other countries. While consumers in other countries are always constantly updated of the unsafe products, no similar actions are taken in Malaysia to protect consumers from unsafe products. Most of the products which are deemed unsafe in those countries are not controlled directly under any laws or acts in Malaysia. The Malaysian Association of Standard Users has been toying with toy safety regulation since 2002.
Apparently there was a toy safety crisis backdrop in 2007 and the Malaysian Association of Standard Users and the Department of Standards Malaysia has pressured the Ministry of Domestic Trade and Consumer Affairs to activate some regulations regarding toy safety. After much pressure, the Association were then told by the Ministry of Domestic Trade and Consumer Affairs that regulations will be implemented end of March 2009 so that means they took 2
years to make regulations. But of course, they were disappointed because two years is a long time because of the urgency and the importance of this matter. Even today, the Malaysian Association of Standard Users still receives emails from other countries regarding the fact that they have recalled more than 180,000 toys due to possible choking hazards to children and another case whereby the US has recalled about 120,000 flip flops due to high level of lead.
The thing is maybe these same exact models are not sold here in Malaysia but they are sure that there are similar types of products sold in Malaysia so why they have not heard any complaints and is there any one testing these products? The Ministry of Domestic Trade and Consumer Affairs has overall on the CPA. Under Section 19 of the CPA states that the Minister has the power to make any safety standards mandatory and under Section 23 on the other hand, the Minister can recall or stop any sales of unsafe products. The problem is since 1999, there has not been any standards that were made mandatory and that no product recalls has been made at all.
Recommendation The Ministry of Domestic Trade and Consumer
Affairs must enforce these regulations and laws because consumers have rights to the safety of products bought as mentioned in Section 19 (2) of the CPA whereby it says the safety standard in relation to goods may relate to any or all of the following matters:
(a) the performance, composition, contents, manufacture, processing, design, production, design, construction, finish or packing of the goods;
of the goods during or after manufacture or processing;
(c) the form and content of markings, warnings and instructions to accompany the goods.
Product safety especially regarding toys’ safety is very important because toys are usually aimed at children and because children have no clear or mature judgement on what is right and what is wrong, they do not know whether their toys are safe to play with or not and this is where CPA comes into act. Due to the issue above whereby the Malaysian Association of Standard Users has mentioned that there has been no recall case of toy products whatsoever and this somehow does not in line with other countries. Maybe it is because the products manufactured are perfect with no defects or maybe it is because there is no testing on these toys!
The Ministry of Domestic Trade and Consumer Affairs must enforce testing on all the products manufactured, because if firms found to be guilty to not abide to the regulations, consumers can file reports and claims if there is something wrong with the products. I think all firms should and must carry out tests regularly because if consumers find out that something is wrong or that the toys that they buy for their children is dangerous, the aggrieved consumer may refer to any dispute or claim of less than RM 10,000 to the established Consumer Redressal Tribunal.
2) Fooled by Credit Card “Promotion” A credit card fraud victim wrote on the Star Newspaper online of how he was fooled into applying for a new credit card during a promotion at a petrol station. The reason
why he applied for a credit card at the most unlikely place, a petrol station is because he believes that the people who approached were genuine credit card promoters. This is because lately, many banks and card issuers are aggressively holding credit card promotion campaigns outside their premises. He was made to understand that such campaigns are permissible because banks and card issuers are allowed to outsource especially promoting and marketing their credit cards as long as they adhere to certain criteria.
Unfortunately, no such safeguard has been put in place as to ensure that consumers do not fall into these scams. It is because these scammers or fraudsters ask for personal details and people on the other hand are too naïve and trust them thus making the fraudsters work much easier. This person said that when he was applying for the credit card at the petrol station, it did not occur to him that these people could be fraudsters because the promotion was apparently held at a legitimate business premise. That is why he believed them and gave them his personal details such as copies of IC, driving license, credit card number and he was also asked to give his address, phone number, occupation and employer’s name. The number of people who have been falling victims in the same situation has increased over the years. Consumers’ rights are not being protected because many illegal or fake businesses has tricked them into entering such false contract.
In the Consumer Protection Act 1999, under Section 9, there is a mention of misleading conduct and this is when, no person shall engage in
conduct that- (a) in relation to service, is misleading or deceptive, or is likely to mislead or deceive, the public as to nature, characteristics, suitability for a purpose, or quantity, of the services.
Based on the Act stated above, those fraudsters definitely have misled the consumers and trick them into believing of the existence of the service which is the credit card. What is recommended to do is that law enforcers must take into high consideration of these complaints being made because the person who wrote in The Star Newspaper mentioned that his case was taken lightly and that the authority did not really take any action.
This is unfair to consumers. Consumers have right and we would want those who is responsible behind these illegal activities to be punished. So, the authorities need to carry out random checks around town to make sure there are no illegal activities. They should do so especially to stalls that are at random places such as petrol stations. They must have proper documentations with them supporting that if there are legit business or not so that the consumers do not fall into such scams. Consumers are also encouraged to report such illegal businesses to the authority to make sure that they take the right actions against them.
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