Has Cinderella’s hour arrived?

In the past two decades or so a myriad of laws have been made by different administrations to protect us consumers. One glaring shortcoming with the growth over the years of new consumer laws was the need to undertake a radical overhaul of the regulatory framework. Time and again, complaints were voiced that the regulatory authorities are poorly resourced, do not have sufficient autonomy and lack the tools to ensure compliance.

Parliament recently approved a series of laws that should radically change the regulatory landscape vis-à-vis consumer protection in Malta. These laws focus on the administrative set-up with the creation of a new consumer and competition authority – the Malta Competition and Consumer Affairs Authority – that will take over the roles of the Consumer and Competition Department and of the Malta Standards Authority and of a new appellate forum – the Competition and Consumer Affairs Tribunal with a remit that includes the determination of appeals from regulatory decisions.

The new laws only marginally touch substantive consumer law. The reason may be related to the fact that the EU has yet to approve the much debated Consumer Rights Directive. Once approved, this directive may require that member states revise their national substantive laws drastically.

Overall, these new laws are a step forward. There are, however, instances where the authorities did not go far enough or where the measures introduced are debateable. The pooling of resources under one umbrella organisation does make sense, if anything, to ensure a more coordinated approach between the various competent regulatory entities. What is puzzling is that the law empowers the different director generals who head the various offices falling under the new authority to “act independently and autonomously” in the exercise of their responsibilities. To my mind, it would have been more logical if such autonomy resided with the chairman and board of the authority being the main organ within the new set-up.

A failure when it comes to consumer protection is that the maximum administrative fines have not been drastically revised upwards. Rogue “traders” who cause harm to those who abide by the rules will continue to find it convenient to flout the law once the maximum sanctions remain low.

A long outstanding problem to which, admittedly, there is no easy solution is how to ensure that the Consumer Claims Tribunal’s final decisions are complied with where a trader is required to provide redress to the consumer.

Time and again consumers win their cases but do not enforce a favourable decision because the provisional costs of enforcing it are disproportionate to the amount won. The sanction introduced a few years back of having the Consumer and Competition Department impose fines on non-compliant traders has been removed.

Personally, I had some reservations about that measure though it did act as a lever on some non-compliant traders.

I would prefer to go for a name-and-shame procedure of repeat non-compliant traders coupled with the possibility that the tribunal will be empowered to impose daily administrative penalties proportionate to the values involved that are payable to the consumer if the trader fails to pay within a specified period after the award of a final tribunal decision. This would put pressure on the trader to pay up once s/he is confronted with a final decision.

I augur that the new authority will be in a position where it can effectively deliver.

Irrespective of what is written in the law, it is important that this authority is given adequate resources to do what is within its remit. Otherwise, much of the positive work done to date will be undermined.

Dr Micallef is a member of the Consumer Association. This contribution reflects only his views.