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Background and Overview of the Consumer Goods and Services Industry Code of Conduct  

The Consumer Goods and Services Industry Code of Conduct (the Code) was officially launched on 29th May 2015 at a function in Midrand, Gauteng. The Code is an important component of the Department of Trade and Industry (dti)’s strategy to promote a fair, accessible and sustainable marketplace for consumer products and services (the introductory wording to the Consumer Protection Act 68 of 2008 (the CPA)). The prescription of the Code with effect from 29 May 2015 by Minister of Trade and Industry Rob Davies marked the culmination of a comprehensive process of consultation between industry representatives, spearheaded by the Consumer Goods Council of South Africa, and the National Consumer Commission and the dti. Earlier drafts of the Code were published for public comment as required by the CPA and the comments that were received were taken into consideration in drafting the final version of the Code. Simultaneously with the prescription of the Code, the Minister accredited the Consumer Goods and Services Industry Ombud (CGSO) as the official alternative dispute resolution scheme for the entire consumer goods and services industry, excluding the automotive industry and any other sub-sector regulated elsewhere. This move, which reflects the importance ascribed by the Minister to ADR Schemes and the access to redress by consumers, has considerably broadened the reach of the CGSO. It previously operated on a voluntary participation basis and had to turn away many complaints but now has jurisdiction over a broad cross section of industry sub- sectors, from cellular telephone providers to wedding planners. Eligible companies are now compelled to participate in, fund and cooperate with the CGSO scheme. The Code carries the weight of law: A failure to comply with it amounts to a contravention of the CPA. Further, any failure to cooperate with the CGSO may be taken into consideration as an aggravating factor by the NCC and the Tribunal when issuing a compliance notice or proposing or determining an administrative fine. From a consumer’s perspective, the benefits of the Code include the obligation imposed on suppliers to have in place proper complaint handling processes that resolve complaints and disputes in accordance with the law, the spirit and provisions of the Code and the CPA. Consumer complaints must be dealt with timeously, within 15 business days. If suppliers are unable to resolve a complaint to the reasonable satisfaction of a consumer within that time frame, they must inform the consumer of their right to refer the complaint to the CGSO and provide them with the contact details of the CGSO. Small businesses also benefit from the passing of the Code and the accreditation of CGSO. Those with a turnover of less than R1 million are exempted from paying fees to CGSO and those that are juristic persons with a turnover or assets of less than R2 million may use CGSO’s services in the same way as ordinary consumers.