Better consumer protection
THE SECOND DRAFT OF AMENDMENTS TO THE Law on the Protection of Consumer Rights and Interests was submitted to the Standing Committee of the National People’s Congress on Monday for review. Compared with the first draft, it offers better protection to consumers because of its harsher terms in their favor.
The latest draft requires business owners to pay compensation of up to three times the price of any substandard products or services sold to consumers, compared with the two times compensation ceiling proposed in the former draft.
The country’s existing law on consumer rights, which was enacted in 1993, stipulates that companies should pay compensation equivalent to the price of any flawed products or services sold intentionally. This has been widely criticized as being too low to deter people from producing fake or shoddy goods. The meager compensation has also dampened consumers’ enthusiasm to go through the necessary procedure to claim compensation.
Even raising the compensation ceiling to twice the monetary loss of a consumer was considered insufficient to protect consumers.
A harsher penalty for commercial fraud means a bigger step toward safeguarding the rights and interests of consumers, especially at a time when the number of disputes between consumers and producers is rising.
As in the first draft, the latest amendment also extends to shoppers the right to unconditionally receive a full refund if they return purchases within seven days of the goods being received, but this time it is more specific about the exceptions to this, listing custom-tailored and fresh products, as well as software, audio-visual products, newspapers and periodicals that were unsealed by consumers themselves. At the same time, it also stipulates that sellers do not have to pay the transportation fees, a move that will help avoid the unrestrained return of goods by some consumers.
The new draft also stipulates that advertising spokespersons will share liability for deceptive advertising, a clause that is badly needed. The sharing of liability will make celebrities think twice about the products they endorse.
At a time when its economic growth driven by investment and exports is running out of steam, China is striving to make the transition to a consumption-led economy. Undoubtedly, the pro-consumer draft amendment will help facilitate this.