The Consumer Protection Bill 2018 provides much more power to consumers in line with the current environment as compared to the dated Consumer Protection Act 1986
A new Consumer Protection Bill 2018 has been passed by the Lok Sabha. Once it is approved by the Rajya Sabha, it will replace the Consumer Protection Act of 1986. This Bill is expected to provide consumers and agencies with far more power than before.
For the first time, a Central Consumer Protection Authority is proposed under the Bill which will act as a regulator which can intervene when it deems it necessary for protection of consumers. The Authority can launch class action suits against companies, where all affected consumers can be beneficiaries rather than a few groups. Moreover, the Authority can also order recalls or refunds of products. This is somewhat similar to the functioning of the US Federal Trade Commission.
The Bill holds the manufacturer, producer and seller responsible for any personal injury, death or damage from defects in manufacture, construction, design, formula, preparation, assembly, testing, service, warning, instruction, marketing, packaging, or labelling of any product. Consumer mediation cells will be added to consumer commissions at all levels for dispute resolution.
Complaints against e-commerce companies can now be filed electronically or in consumer court at the consumer’s place of residence. As on date, it can only be done at the place of transaction. E-commerce firms will also have to take additional approval from customers for sharing their data through a tab on the website. Furthermore, e-commerce firms will have to provide complete details of their business details, seller agreements and how they use consumer data. They will now be considered as service providers, rather than just intermediaries. Also, platforms that bundle services like ‘flight + hotels’ will take liability for all the services they bundle.
The debate on celebrity endorsements and its impact on consumer choices has also been covered. Manufacturers and service providers who give misleading ads that go against consumer interests could face prison of up to five years and fine of upto Rs 50 lakh. Celebrities who are featured in misleading advertisements may also face penalties, but they will not face imprisonment. Frivolous complaints by consumers are also liable for penalties from Rs 10,000 to Rs 50,000.