‘Consumer Bill lacks protection’

Opposition spokesman on consumer protection Silvio Parnis said in Parliament that while the Malta Competition and Consumer Affairs Authority Bill was a step in the right direction to widen consumer rights, it did not offer concrete and holistic protection.

The opposition always insisted consumer rights were of utmost importance and this was why it always placed the consumer first even with regards to issues such as the privatisation of gas.

Throughout his speech, Mr Parnis emphasised the need to create a one-stop-shop where consumers could refer for their needs at one place. Such an office would ensure consumer rights were protected in all areas.

This was an idea Labour had widely embraced and it was disappointed that the government did not included such an idea in the Bill and the opposition would be presenting amendments during committee stage.

Referring to medicines, Mr Parnis praised Parliamentary Secretary Chris Said for trying to reduce the price of certain products. He pointed out, however, that the government had failed to include the Medicine Authority in this new entity.

The Bill did not state that executive powers would be given to this new authority to control the price of medicines. He believed this new authority should be vested with the power needed to monitor and regulate the price of pharmaceuticals.

Marie Louise Coleiro Preca called on the government to emulate former Labour governments and be more proactive with regards to consumer protection. She recalled the progressive stand Labour had taken in 1974 when it pioneered consumer rights.

In 1982, the Labour government had introduced the Consumer Protection Act which was followed by the Doorstep Selling Act and the Trade Description Act.

Under a Nationalist government, 2000 brought about the introduction of a series of pieces of legislation in line with EU directives where one would certify the safeguarding consumers’ protection in line with the acquis. The government had proposed a new structure consisting of two departments – Consumers’ Rights and Fair Trading – where it had emphasised the importance one should give to human resources and training. But both departments did not have any trained staff. Would the new authority train its staff? A 1990 report by former Minister George Bonello DuPuis spoke about the appointment of 10 training enforcement officers. That promise was not honoured.

She deplored the fact that the only person who did receive training, in metrology, was now not doing the same job.

Dr Coleiro Preca emphasised the need of political will for this Bill to be effective. One could not continue doing what was previously done. Following the 1990 ordinance, only one director was appointed – a case, she said, of having a chief and no Indians.

Were consumers getting value for money, she asked? The international consumer rights body, Consumer International, had increased the number of consumer principles to 10. One needed to evaluate each of these principles individually.

Today’s situation was such that Maltese families were unable to cope with utility bills. This was going against the right to satisfaction of basic goods. The 2002 EU-led study by the Foundation for Working and Living Conditions had established benchmarks of how poverty was calculated and implied that Maltese families could then be considered to live in poverty as they could not keep up with utility bills. There were still questions to be answered in this regard.

Was this a serious Bill? Did the government have the political will to protect consumers’ rights? How was the government putting the principles in practice?

A case in point, she said, was the principle to protect consumers against hazardous products. How was this right being safeguarded when the power station was run on hazardous fuel? Were consumers enjoying their right to be informed? Was the government ready to strengthen its communication methods in this regard?

Referring to a parliamentary question by Labour MP Silvio Parnis last September regarding school uniforms, she said that the contractors looked like being the same. Why was the Prime Minister’s response one that avoided providing the information requested by her colleague?

Malta needed to look at the UK and other Nordic countries’ best practices. Despite its large size the, UK conducted a study on the grocery market through its Office of Fair Competition to ensure there was no distortion of its principles. Why did our local office never conduct studies despite the small size of our market?

How were monopolies and duo-polies being avoided to protect consumers’ right to choose?

The right to be heard could only be respected by having consumers represented within Malta Council for Economic and Social Development.

Dr Coleiro Preca said the principle of the right to redress and compensation was yet another notion that was questionable in Malta. There were consumers who were being “robbed”. The 2006 legal notice required one to resort to arbitration. Arms Ltd said it was being pretentious as it acknowledged that one could not refer to a tribunal for free.

Labour deputy leader Anġlu Farrugia called for separate tribunals to deal with cases involving consumer protection and fair competition but one board of appeal under the new Malta Competition and Consumer Affairs Authority was to be set up.

Speaking during the debate in second reading of the Bill setting up the authority, Dr Farrugia called for clear policies and the publication of a procedural manual to guide lawyers and the public in dealing with the new entity.

He acknowledged that the Bill made a genuine attempt to address consumer issues, saying there were serious problems on enforcing the principles of the right of fair competition in a small island state economy.

Dr Farrugia criticised the Bill for the labyrinth procedures which only the legislator could fully understand.

He recognised that the bill was intended to provide effective protection to consumers with expediency. It did not, however, have clear safeguards to guarantee that everyone could follow the legal procedures as otherwise these would put sections of the population at a disadvantage.

Labour MP Jose Herrera said the Bill was a step forward, but one needed to look at the Bill from a juridical perspective as it had become increasingly difficult to protect consumers. In Malta, even more than in other countries, fair competition should be given more importance due to its size and limited competition.

Dr Herrera questioned the feasibility of the current structure, where commerce and consumers were conflicting aspects and yet they were being placed under one authority. One could not prioritise the interests of businesses and consumers at the same time.

The commission looked at people from a commercial aspect, while the Consumer Affairs Tribunal within the Consumers Department was an ad hoc tribunal with limited power. From a legal standpoint, there were no enforcement problems as far as fair competition was concerned.

The year 1992 saw the introduction of price orders to protect the consumer and cap profits through the Price Control Tribunal, manned by persons who were not members of the judiciary. This was later annulled as it served as a criminal court, and was, therefore, anti-constitutional. The law protected consumers when it came to services, but what about moral damages?

There should be more than six part-time members heading the authority.

The Commission for Fair Trading had powers to affirm cases of fair trade. The Bill stated that the executive power was transferred to the Director General. Was this director given juridical powers now that this person’s decision would fall under the Competition and Consumer Appeals Tribunal? The consumer aspect was being neglected.

Why was the €500 fine removed when it served as a deterrent should one not respect its decision?

Dr Herrera deplored the government’s decision to give banks the role of brokers to the detriment of gullible persons who lost their life savings after buying shares. One needed to emphasise the importance of fair competition.

Why were people travelling and purchasing online to the detriment of local businesses? The Bill was a step forward. Commerce in Malta was a delicate matter and consumers needed protection through juridical mechanisms as well as further legislation. Consumers deserved to be protected against dominant positions, cartels, discrimination and high prices, Dr Herrera said.