Reform is in the air - both Government Departments and Consumer Organisations have issued a string of papers in the last few months.
Can we assume that defects which appear in goods within six months existed at the time they were bought? And should we be able to see the manufacturer’s guarantee before we get the package home and open it? In a second consultation document about the EU Directive on the Sale of Consumer Goods and Associated Guarantees attention is drawn to the right to return goods and receive a replacement, refund, free repair or a price reduction where a defect, which existed at the time of delivery, becomes apparent in the first year after delivery [but how do you prove that it existed at time of delivery? - Ed]. Price and the nature of the goods would be taken into account, so that goods with a short expectation of life would be excluded. The Department of Trade and Industry approach will be to retain the Sale of Goods Act’s implied terms which include aspects of quality, such as appearance, freedom from minor defects, safety and durability.
Consider clauses excluding from a contract anything said or promised by a salesman or agent of the company. They are the clauses which cause the most trouble. In a Bulletin issued by the Office of Fair Trading, hidden clauses are also mentioned as another cause of unfairness. Too often the consumer does not see, or have notice of, the full terms and conditions until after signing, when he receives the contract, often with the terms in very small print on the back. Other problems are one-sided penalty clauses and clauses excluding liability for every possible eventuality. Also considered unfair are clauses allowing the supplier to put up prices without warning. Usually it is the small suppliers who show least awareness of the regulations, sometimes in an attempt to apply excessive caution.
This is now available from the DTI. It lists the buyer’s rights in the UK and in Europe. The Timeshare Directive should have been implemented throughout the European Union by the end of April this year. It gives the right to a ten day cooling off period, with the automatic cancellation of any credit or credit card payment if the contract is cancelled. A brochure must be supplied, in the buyer’s own language, on request and it must contain standard information which is listed in the guide. The seller must not accept any money on anyone’s behalf during the cooling off period.
Reform of UK competition law is promised with the publication of a draft Bill excitingly entitled A prohibition approach to anti-competitive agreements and abuse of dominant position. "Present competition law is not working well. Its reform is long overdue. Consumers need a better deal", says Margaret Beckett, President of the Board of Trade. The aim is to provide a strong deterrent against cartels and abuses of market power. "There will be fines for serious abuses. Competitors and customers damaged by anti-competitive behaviour in breach of the prohibition will be entitled to seek damages It will be possible for consumers and consumer representative bodies to challenge decisions." A new Competition Commission is likely to also take on the existing functions of the Monopolies and Mergers Commission.
Lenders and brokers who use high and dual interest rates and inappropriate penalties for early settlement of debts, sometimes because of default in payment, may have their credit licences withdrawn unless they cease these practices. In many cases insufficient information is given to borrowers.
An enquiry has been started into the information provided to residents of residential and nursing homes, the contracts used and complaint procedures. If more regulation is found to be needed this will be reported to Ministers. If contracts are judged to be unfair the Director General of FairTrading will take immediate action.
Caller Beware - A new credit Helpline has been introduced by Instant Search. The recorded information has not been checked by NfCG as the three and a half minute call is charged at £1 a minute!
Click arrow for
Contents Table
Click Logo to Return to
Main Magazine Index