Consumer Protection Bill, 2015

Why in news?

The government has initiated a series of steps to strengthen consumer protection mechanisms and also bring new comprehensive legislation to address various other issues.

What is consumerism?

• It is a social movement aimed to inform and protect the consumers from unfair and unhealthy restrictive trade practices by the manufacturers and suppliers.
• It is done by requiring practices such as honest packaging and advertising, product guarantees, and improved safety standards.

What is the need for the bill?

• About 40% of the Indian population will live in urban areas by 2025, accounting for more than 60% of the total consumption. India’s rural market is also huge. To tap this huge market potential large numbers of companies are operating in various sectors.
• Most of these companies are successful in terms of profitability, market share, and growth rates. The high growth of business also brings with it more issues concerning the consumers such as unfair pricing, product safety, and quantity and quality assurance.

What is in the bill?

The Consumer Protection Bill, 2015, was introduced in LokSabha on August 10, 2015, and is yet to be passed in both the houses of the Parliament.

• The Bill replaces the Consumer Protection Act, 1986.
• Definition of the customer – It defines the consumer as any person who buys/uses a good or hires a service. This does not include one who obtains the good for resale or commercial purposes.
• Medium of the transaction – It covers transactions through all modes including offline, online through electronic means, teleshopping, or multi-level marketing.
• The rights of consumers include the right to
• Right to be protected against the marketing of goods and services which are hazardous to life and property.
• Right to be informed of the quality, quantity, potency, purity, standard, and price of goods or services.
• Right to be assured of access to a variety of goods or services at competitive prices.
• Right to seek redressal against unfair or restrictive trade practices.
• The bill creates Central Consumer Protection Authority (CCPA)to promote, protect and enforce the rights of consumers.
• The bill also creates Consumer Grievance Redressal Commissions (GRC) at the district, state, and national levels.
• The function of the GRC is to receive complaints from customers whereas the CCPA will inquire into violations of consumer rights, investigate and take measures like launching prosecution, passing orders for recall of goods or discontinuation of unfair trade practices, and issuing safety notices.
• Liability – If defects of a product result in any personal injury or property damage to a consumer, the manufacturer is liable in a product liability action.
• The Bill introduces mediation as a mode of consumer dispute resolution. Consumer Mediation Cells will be established for this purpose.
• Penalty – Any person who fails to comply with an order of GRC and CCPA would be liable for imprisonment up to three years, or with a fine of up to 50,000 rupees.
• The CCPA can take Suo Motu action if products and services are not up to the standard.
• It also enables people to file complaints in Consumers Courts online from any place in the country.

Other measures to strengthen Consumer Rights

• India is spending about 30-50 million US dollars on consumer protection annually and has initiated a number of consumer-centric schemes.
• A portal called ‘Grievance Against Misleading Advertisements (GAMA)’ is launched to handle complaints of consumers relating to misleading advertisements, issuance of guidelines on direct selling, online case monitoring system in the Consumer Fora.
• Precious metals like gold and silver shall have to wear hallmarking for the larger interests of consumers. The New Bureau of Indian Standards Act has been enacted for this purpose.