Spring to be 'administering agency' against errant retailers

Singapore

THE Ministry of Trade and Industry (MTI) has proposed two key amendments to the Consumer Protection (Fair Trading) Act (CPFTA) to ensure greater protection for consumers and strengthen measures against errant retailers that persist in unfair trading practices.

One of the proposed amendments is to appoint Spring Singapore as an administering agency with investigation and enforcement powers to gather evidence, file timely injunction applications and ensure that errant retailers comply with the injunction orders.

Secondly, the courts may impose additional measures on errant retailers as part of injunction orders. These may include the requirement to publicise that they are under injunction and notify consumers prior to any transactions, as well as to inform the administering agency of changes to their entity and/or employment status.

"Taken together, the proposed measures will allow for tougher action to be taken against errant retailers and ensure that Singapore remains an attractive shopping destination for locals and tourists," MTI said in a statement on Sunday.

"The proposed amendments are targeted at the small number of persistent errant retailers who will be subjected to the strengthened measures that may be taken against them."

A review on the existing framework commenced last year amid growing calls from the industry and public for stronger action to be taken against persistent errant retailers.

The unfair practices of some retailers came to the fore when a Vietnamese tourist was captured on social media going on his knees and pleading for a refund late last year in Sim Lim Square, after he was conned into paying an exorbitant sum for an iPhone.

MTI said that it has looked into the legislation in Australia and Hong Kong, which have similar business environments. It also consulted key industry stakeholders such as the Consumer Association of Singapore (Case), the Singapore Retailers Association (SRA), Sim Lim Square Management Committee (SLSMC) as well as individual retailers. Interested parties can provide their views and comments on the proposals by June 15.

"Case, SRA and SLSMC were supportive of the proposed amendments," MTI said. "They will also work closely with Spring, as the appointed administering agency, to deal with errant retailers."

The CPFTA was introduced in March 2004 and provides for civil actions to be taken against errant retailers. The current framework encompasses a spectrum of measures to deal with errant retailers. While Case and the Singapore Tourism Board (STB) can file injunction applications with the courts against errant retailers, they have no investigation and enforcement powers.

Under the proposed changes, Case and STB will remain the first points of contact for consumers and tourists, and assist them to obtain redress or compensation through negotiation, mediation or voluntary compliance agreements (VCA). Retailers who persist in unfair practices will be referred to Spring for further investigations.

As the administering agency, Spring would have the power to enter premises under and without warrant, require the production of documents and seize goods. It may take errant retailers who do not comply with injunction orders to court for contempt of court, which is considered a criminal offence and punishable by imprisonment and/or a fine.

Egregious cases involving criminal offences such as cheating will continue to be handled by the police.

Hailing the proposals, Case president Lim Biow Chuan recalled how the association's "hands were tied two years ago" when it could not take further action against the errant retailers in Sim Lim Square.

There was also a "repetitive cat and mouse game" between Case and errant retailers which, having been sued, closed down their shops and set up another company under a different name, he said. The owners of the new company then repeated the same unfair practices until Case asked them to sign a new VCA or took an injunction against them.

"Case, STB and Spring will work together to ensure that businesses engaging in unfair practices will be dealt with according to law, and that consumers will be able to obtain fair recourse," Mr Lim said. "We will review the proposed amendments to the CPFTA during the public consultation and push for better protection for consumers."