Following our previous article titled 'Do you have to comply with the Consumer Goods and Services Industry Code of Conduct' see below – the Minister of Trade and Industry has prescribed the Consumer Goods and Services Industry Code of Conduct ("the Code") as an Industry Code and accredited the Consumer Goods and Services Ombud as an accredited industry Ombud with effect from 29 April 2015.

All Consumer Goods and Services Industry Participants must comply with the Code from the effective date. A failure to comply with the Code amounts to a contravention of the Consumer Protection Act, 68 of 2008.

Do You Have to Comply with the Consumer Goods and Services Industry Code of Conduct – update from the Corporate & Commercial Law Department

On 3 October 2014, the Department of Trade and Industry (DTI) published the draft Consumer Goods and Services Industry Code of Conduct ("the Code") for public comment. 

The Code, which was prepared and submitted to the DTI by the Consumer Goods and Services Ombud ("CGSO"), contains essentially the same provisions as the CGSO's existing code of conduct with which suppliers of goods and services may voluntarily comply. 

The Code, if approved by the DTI as an "industry code" in terms of section 82 of the Consumer Protection Act, 2008, will apply to all suppliers in the goods and services industry in South Africa, including retailers, wholesalers, distributors, manufacturers, producers and their agents.  These suppliers will not only have to comply with the Code, but will also be required to register with the CGSO via its website at www.cgso.org.za, and contribute towards the funding of the CGSO in accordance with the funding model set out in the Code.

Annexure B to the Code provides a list of some of the wholesale, retail, manufacturing, distribution and trade sectors of the goods and services industry to which the Code will apply.  Included in this list are suppliers of food, tobacco and beverages, pet food and pet products, electrical appliances, general merchandise, home-care products, furniture, textiles, building material, hardware supplies, jewellery, cosmetics, toiletries and fragrances, LP gas, clothing and footwear apparel, as well as toys and stationery.

Participants in the automotive, banking and insurance, credit, broadcasting, debt counselling, electricity, petroleum, estate agency and leasing industries, amongst others, will not have to comply with the Code if it is approved. 

The main objective of the Code is to establish fair business practices in the industry.  This is achieved by setting minimum standards of conduct expected from suppliers in the industry when engaging with consumers, and prescribing procedures for resolving disputes between consumers and suppliers which comply with the Consumer Protection Act. 

A consumer who is aggrieved by a supplier's breach of the Code or the Consumer Protection Act must lay a complaint with the supplier concerned as soon as is practically possible.  Every supplier must establish an internal complaints handling process to deal with complaints it receives and must ensure that its customers are made aware of such process.  In certain circumstances, the CGSO (which is responsible for implementing the code) may make recommendations to the parties on how complaints should be settled.  Complaints may only be referred to the CGSO for resolution within twelve months of the complaint arising.

In the Guidelines for the Development of Industry Codes of Conduct published by the National Consumer Commission, industry groups are encouraged to draft and submit industry codes for approval.  The DTI has recently approved an industry code for the automotive industry which came into effect on 17 January 2015.  It is likely that we will see an increase in the number of proposed industry codes, particularly in those industries to which this Code will not apply.