When does the CPA apply to me / my business?

The Consumer Protection Act 68 of 2008 (“CPA”) came into final effect on 31 March 2011 and the regulations under the Act came into effect simultaneously.

The Act consequently covers both goods and services delivered on or after 31 March 2011 when this was done:

  •  in the ordinary course of business  and
  • for consideration”.

You and our business will, depending on the circumstances either be a supplier of goods or services which needs to comply with the Act; or a consumer of goods and services, and as such be protected by the Act.

“Goods” and “services” are so broadly defined as to take on a whole new meaning under the CPA.

  • Goods” are defined as anything that is supplied or promoted for human consumption (i.e. human use), any tangible or intangible product, information, certain legal interests in immovable property, as well as gas, water and electricity.
  • Services” are defined to include any work or undertaking performed by one person for the benefit of another, including provision of entertainment or any similar intangible product, transport, accommodation or sustenance, access to an event or any premises, activity or facility, or access to or use of any premises or property, etc.

The Act applies to:

1. Transactions occurring in South Africa between suppliers and consumers with regard to goods/services unless specifically exempted (see below);

2.  The promotion of goods and services;

3.  The goods (for their entire lifetime) and services;

4. Goods which form the subject of an exempted transaction (therefore, even where the transaction is exempted, the goods sold under the transaction are still regulated by the CPA).

The Act does not apply when:

  1. goods or services are promoted or supplied to the State (except that it still has a strict liability claim where goods supplied to it cause harm);
  2. the consumer is a juristic person (including a partnership, body corporate, trust and association) whose asset value or annual turnover equals or exceeds R2 million (except that such a juristic person still has a strict liability claim where goods supplied to them cause harm);
  3. the transaction amounts to a credit agreement under the National Credit Act;
  4. services are supplied under an employment contract; or
  5. effect is given to a collective bargaining agreement or collective agreement in terms of South African labour laws.
  6. The security services industry, collective investment schemes industry and pension funds industry are exempted from certain provisions of the CPA and section 14 of the Act does not apply to banks.
  7. National Treasury divides municipalities into three categories: low, medium and high capacity. Low capacity municipalities are exempted from complying with various provisions of the CPA where they act as suppliers of goods or services until 30 June 2014.
  8. Financial advisory and intermediary services regulated under the Financial Advisory and Intermediate Services Act are not regarded as services under the CPA (but if information or a financial product is supplied, that is regarded as a good to which the CPA will apply).

 

 

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