consumer rights%2c consumerism and business 1
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Consumer
Consumer Rights
Consumer
Protection
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Removal of personal relationship between
buyer and seller as a result of massmarketing methods and consumers
increased mobility. Above all, the
growing consumer awareness about theirrights, consciousness and concern for
value for money have contributed to the
emergence of universal acceptance ofthe need for protection and promotion of
consumer rights
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Consumer movement
One of the earliest systematic movement inconsumerism was largely due to Mr. Ralph
Nader, the well-known American Consumer
Rights Advocate. History of protection ofconsumer rights by law has long been
recognised as dating back to 1824. Every
year, 15th of March is observed as theWorld Consumer Rights Day.
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On that day in 1962 President John F. Kennedy
called upon the U.S. Congress to accord its
approval to the Consumer Bill of Rights. Theserights are (i) right to choice; (ii) right to
information, (iii) right to safety and (iv) right to be
heard. President Gerald R. Ford added one moreright i.e. right to consumer education. Later other
rights such as right to healthy environment and
right to basic needs (Food, Clothing and Shelter)were added. In India, 24th December is
celebrated every year as the National Consumer
Rights Day as the Consumer Protection Act, 1986
was enacted on that day.
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UNIn the history of the development of
consumer policy, April 9, 1985 is a very
significant date for it was on this day the
General Assembly of the United Nations
adopted a set of general guidelines for
consumer protection and the Secretary
General of the United Nations wasauthorized to persuade member countries
to adopt these guidelines through policy
changes or law..
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comprehensive policy
Physical safety;
Protection and Promotion of the consumer economic
interest;
Standards for the safety and quality of consumer goods
and services; Distribution facilities for consumer goods and services;
Measures enabling consumers to obtain redress;
Measures relating to specific areas (food, water andpharmaceuticals) and
Consumer education and information programme.
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These guidelines were adopted recognizing that
consumers often face imbalances in economic
terms, educational levels and bargaining powerand bearing in mind that consumers should have
the right of access to non-hazardous products
apart from promoting just, equitable andsustainable economic and social development.
These U.N. guidelines for Consumer Protection
can assist in the identification of prioritiesparticularly in the light of emerging trends in a
globalised and liberalized world economy
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Constitutionalism and Consumerism
Constitutionalism and consumerism both seem to
be twin sisters with similar objectives.
Constitutionalism, in a politically organized
society, is concerned with the protection and
promotion of an individuals rights, dignity andwelfare as a citizen Similarly, consumerism is
concerned with the protection, promotion and
welfare of the rights of the individual as aconsumer, a client and a customer. In the final
analysis, it is the individual; who is the concern of
both whether as a citizen, a consumer, a customeror as a client
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Constitutionalism provides the policy framework,
institutional mechanism, finances and functionaries for
better service and empowerment of the citizen. On theother hand consumerism provides ways and means to
demand quality goods, better services, better
protection, empowerment, welfare and value for
money. Thus, both are supplementary and
complementary to each other. Constitutionalism
promotes by way of constitutionally directed
fundamental duties of a citizen, development of ascientific temper and spirit of inquiry and consumerism
facilitates consumers to know about the products and
services in detail and in all its aspects.
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Finally, one may like to mention that
constitutionalism as well as consumerism is an
art and science for ensuring quality of life.
Therefore, promoting consumerism is directly
related to the promotion of constitutionalism. In
a more practical perspective the focus of both isgood governance in all its dimensions, i.e.,
transparency, accountability, responsiveness,
efficiency, effectiveness and economy at all levels sectoral, local, regional and national with a
vision to develop a better society guaranteeing
thereby a better life to all citizens.
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Consumer Protection -
Implications for Good GovernanceAn effective, efficient and fair implementation of the
Consumer Protection Act is one of the conditions
precedent for promoting the culture of good
governance and thereby ensuring a better promotion
and protection of the rights of consumers. If the rights
of the consumer in relation to the quality of goods and
services are assured and taken care of, then there will
be no cause for complaints. This situation wouldcertainly create an environment wherein clients,
customers and consumers would feel satisfied with the
things needed most by them.
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In this context, the concerns of good
governance need to be mentioned brieflywith a view to establish a linkage with the
concern of Consumer Protection Policies,
Laws and Institutions. Generally speaking,the thrust of good governance movement,
inter alia, is efficiency, effectiveness,
ethics, equality, economy, transparency,accountability, empowerment, rationality,
impartiality and participation
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Consumer Protection in India
It may be mentioned at the outsetthat any one interested in the
task of consumer protection
movement has to be well versed
in various laws and not merely
with the Consumer Protection
Act, 1986.
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One should have knowledge of laws relating to
Contract, Tort, Limitation, Transport, Railways,
Telegraphs, Telephones, Post, Air Travel,
Insurance, Electricity, Water, Housing, Medicine,
Banking, Finance, Engineering, Motor Vehicles,
Hotel Industry, Entertainment, CooperativeSocieties, Tourism Agencies, Taxation, etc. There
is no limit to subjects, which may come before a
Consumer Forum /Commission for decision. Inaddition, one should also be well versed with
the laws relating to unfair trade practice and
restrictive trade practices.
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INDIAN lawsThe Indian Penal Code, 1860; Indian Contract Act, 1872;
Drugs Control Act, 1950; Industries (Development andRegulation) Act, 1951; Indian Standards Institution
(certification marks) Act, 1952; Drug and Magic
Remedies (Objectionable Advertisement) Act, 1954;
Prevention of Food Adulteration Act, 1954; EssentialCommodities Act, 1955; Trade and Merchandise Marks
Act, 1958; Hire Purchase Act, 1972; Cigarettes
(Regulation of Production, Supply and Distribution) Act,
1975; Prevention of Black-marketing and Maintenance
of Supplies of Essential Commodities Act, 1980;
Essential Commodities (Special Provisions) Act, 1981
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Multi-State-Co-operative Societies Act, 1984;
Standard of Weights and Measures
(Enforcement) Act, 1985; and Narcotic Drugs
and Psychotropic Substances Act, 1985. Some
significant consumer protection enactments of
pre-Independence time are the Sale ofGoodsAct, 1930; Agriculture Produce (Grading
and Marketing) Act, 1837 and Drugs and
Cosmetics Act, 1940 all aim at protection ofconsumers. The latest addition the list of laws
having bearing on consumer protection is
Competition Act, 2002 etc..,
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THE boss ,CPA,1986was enacted with an objective to provide better
protection of the interests of the consumers,
to make provision for the establishment of
Consumer Councils and other authorities for
the settlement of consumer disputes. This is
indeed a unique and highly progressive piece
of social welfare legislation. The Act is
intended to provide effective and efficient
safeguards to the consumers against various
types of exploitations and unfair dealings.
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Important Features of the C.P. Act(i) The Act applies to all goods and services unless
specifically exempted by the Central Government.
(ii) It covers all the sectors private, public and
cooperative.
(iii) The provisions of the Act are compensatory in nature.(iv) It provides adjudicatory authorities, which are simple,
speedy and less expensive.
(v) It also provides for Consumer Protection Councils at the
National, State and District levels.
(vi)The C.P. Act is in addition to and not in derogation of
the provisions of any other law for the time being in
force.
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Consumer Rights under the Act(a) the right to be protected against marketing of goods and services
which are hazardous to life and property;(b) the right to be informed about the quality, quantity, potency,
purity, standard and price of goods or services, as the case may be
to protect the consumer against unfair trade practices;
(c) the right to be assured, wherever possible of access to variety ofgoods and services at competitive prices;
(d) the right to be heard and to be assured that consumers interests
will receive due consideration at appropriate fora;
(e) the right to seek redressal against unfair trade practices orrestrictive trade practices or unscrupulous exploitation of
consumers; and
(f) the right to consumer education.
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In todays date, business is confronted with growthof consumerism and legislative measures to protectconsumers.
Consumer movement is growing in India.
There is growing consumer awareness about
products failing to satisfy quality requirements. Exploitation of consumers by unfair trade practices,
poor quality and spurious products and overpricing isvery widespread.
Misleading false or deceptive advertisements iscommon. At times the advertisement gives only halfthe information so as to give a different impressionthan is the actual fact.
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Misrepresentation about the quality of a product
or the potency of a drug or a medicine can be
projected without much risk. There are organizations such as Consumer
Guidance Society of India, Mumbai and Consumer
Education and Research Centre, Ahmadabad.
These organizations are active in conducting
product testing and exposing substandard quality
and adulteration. Outcome of consciousness
regarding consumer rights has led to ISIcertification of food colors now being mandatory.
Consumer organisations also play an important
role in addressing consumer greivances.
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Consumer RightsSome of the rights of consumers are:
Right against exploitation by unfair trade practices.Right to protection of health and safety from goods
and services that are available to the consumer.
Right to be informed about the quality andperformance standards, ingredients of the products,possible adverse effects etc.
Right to be heard if there is any grievance orsuggestion.
Right to get genuine grievances redressed.
Right to a physical environment that will protect andenhance the quality of life.
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Responsibility of Consumers
Consumer should not make vague or generalcomplaints and should also have supportinginformation and proof such as a bill.
Consumer should try to understand the
viewpoint of the seller. Consumers in asserting their rights should not
inconvenience or hurt other sections of the
public ie resort to rasta roko movements, bandhetc.
Consumers should complain against a systemand not attack individuals.
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Kotler has defined Consumerism as a social
movement seeking to augment the rights andpowers of the buyers in relation to others.
Consumerism as a collective endeavor of theconsumers to protect their interests, is a
manifestation of the failure of the business,
including that of the public sector, and the
government to guarantee and ensure the
legitimate rights of the business.
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Consumer Protection For consumer protection all stakeholders
especially Business, Government andconsumers are equally responsible.
Business, comprising producers and all
elements of distribution channels have to paydue regard to consumer rights.
Producer should not charge exorbitant prices in a
sellers market.
Hoarding and black-marketing is illegal.
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Consumer Protection Government should come to the rescue of the consumer
to avoid him from being misled, duped, cheated andexploited.
As per the UN Guidelines for Consumer Protection
Role of Government in consumer protection is vital and is
through policy making, legislation and development ofinstitutional capacity for its enforcement.
Government to establish distribution facilities foressential consumer goods and services.
Encourage establishment of consumer cooperatives andrelated trading activities.
Establish legal measures to enable consumers to obtainredress through formal or informal procedures.
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Consumer Protection Consumers should accept consumerism as a means of
asserting and enjoying their rights. As per Kotler addition of long run consumer welfare asks the
businessman to include social and ecological considerations in
his product ad market planning.
NGOs have an important role in consumer protection. As per
the UN Guidelines one of the objectives is to facilitate the
development of independent consumer groups which should
have the freedom to present their views in the decisionmaking processes affecting them. Consumer organisations
should be encouraged to monitor adverse practices, such as
the adulteration of foods, false or misleading claims in
marketing and service frauds.
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Utility of Consumerism
Producers and sellers will not take the consumer forgranted.
Consumerism will provide feedback for businesses
and enable producers to understand consumer
grievances, needs and wants. Consumerism will make the Government more
responsive to consumer interests, prompt it to take
necessary measures to protect the rights of
consumers.
Help consumer and producer to get together and co-
operate to get rid of unscrupulous traders.
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Consumerism Consumerism has the following roles to play:
Consumer Education: Consumer is given
information about various consumer goods and
services in relation to prices, standard trade
practices etc. Product Rating: Agencies such as Consumer
Education and Research Society (CERS),
Ahmedabad; carry out tests and report the result
of such tests. Liaison with Government and with Producers
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UN Guidelines for Consumer Protection
Objective:
1. To assist countries in achieving or maintaining adequateprotection for their population as consumers.
2. Facilitate production and distribution patterns responsive tothe needs and desires of consumers.
3. Encourage high levels of ethical conduct for those engagedin the production and distribution of goods and services.
4. Assist countries in curbing abusive business practices by allenterprises which adversely affect consumers.
5. Facilitate development of independent consumer groups.
6. To further international cooperation in the field of consumerprotection
7. Encourage the development of market conditions whichprovide consumers with greater choice at lower levels.
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General PrinciplesGovernments should develop, strengthen or maintain a
strong consumer protection policy, taking into accountguidelines set below:
Protect consumers from hazards to their health andsafety.
Promotion and protection of the economic interests ofconsumers.
Access of consumers to adequate information to enablethem make informed choices.
Consumer education. Availability of effective consumer redress.
Freedom to organise consumer groups to present theirviews in decision making processes affecting them.
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Plight of Indian ConsumerSome of the problems faced by Indian consumers are:
Short supply of items of essential needs. Lack of effective or workable competition.
Unfamiliarity of product features results in sale ofsubstandard, inferior or even defective goods
Due to low literacy levels and unsatisfactoryinformation flows, Indian consumers are notconscious of their rights.
Consumerism in India is not organized and
developed. Laws to safeguard interests of consumers are not
effectively implemented.
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Government MeasuresIn India, the Government has taken a number of measures
to protect consumer interests:
Statutory Regulation:
Government of India is empowered to regulate the termsand condition of sale, nature of trade and commerce etc.
Important legislation in this respect include the CompetitionAct, Essential Commodities Act, Prevention of FoodAdulteration Act, Prevention of Black marketing andMaintenance of Supplies of Essential Commodities Act,Consumer Protection Act etc.
Growth of Public Sector was designed to enhance consumerwelfare by increasing production and making available goodsand services at fair prices, curbing private monopolies andreducing market imperfections.
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Consumer Protection Act, 1986
The Consumer Protection Act 1986 is a social welfare legislation which wasenacted as a result of widespread consumer protection movement. The
main object of the legislature in the enactment of this act is to provide for
the better protection of the interests of the consumer and to make
provisions for establishment of consumer councils and other authorities for
settlement of consumer disputes and matter therewith connected.
In order to promote and protect the rights and interests of consumers,
quasi judicial machinery is sought to be set up at district, state and central
levels.
The main object of these bodies is to provide speedy and simple redressal
to consumer disputes. It is one of the benevolent pieces of legislation
intended to protect the consumers at large from exploitation.
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Consumer Protection Councils
The Act provides for the establishment of a Central Consumer
Protection Council by the Central Government and a StateConsumer Protection Council in each State by the respective StateGovernments.
Central Council shall consist of the Minister in charge of consumeraffairs in the Central Government who shall be its Chairman .
Objective of Council: Right to be protected against marketing of goods and services which
are hazardous to life and property.
Right to be informed about the quality, quantity , purity, standard andprice of goods and services so as to protect the consumer against unfairtrade practices.
Right to be assured access to a variety of goods at competitive prices. Right to be heard and assured that consumers interests will receive due
consideration at appropriate forums.
Right to seek redressal against unfair trade practices
Right to consumer education.
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Consumer Disputes Redressal Agencies A District forum in each and every District of
the State. A State Commission in each State.
A National Commission : Established by the
Central Government in Aug 1988.A complaint where the value of the goods and
services and compensation is less than Rs 5 lakhis to be dealt with the District Forum; between5-20 lakhs by the State Commission and withmore than twenty lakhs falls within thejurisdiction of the National Comission.
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Right to Information Act 2005
An Act to provide for setting out thepractical regime of right to
information for citizens to secure
access to information under the
control of public authorities, in order
to promote transparency andaccountability in the working of
every public authority
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Ethical Responsibilities of Business towards
Consumers
The responsibility of business corporations towards their consumersare to provide the products at right quality, quantity, time, placeand the right price. Consumer is the foundation of any businessactivity. Various unfair practices like hoarding, adulteration,shoddy merchandise, unfair measurements, misleading
advertising etc. should not be allowed. Businesses should:
Produce goods according to the needs of the consumers, theirpurchasing power etc.
Offer quality goods at a reasonable price. Aim to improve the standard of living by producing goods and
services of high quality.
Treat customers fairly in all aspects of business transactions
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Ethical Responsibilities of Business towards
Consumers
Ensure that after sales services is available. Ensure the health and safety of customers
Inform and educate customers on the arrival and use ofproducts.
Be truthful in the matter of advertising and warranty.
Offer improved and new products through technicaland marketing research.
Avoid monopolistic and restrictive trade practices.
Ensure that product promotion and advertising are notmisleading.
Trust forms the basis of successful marketplacetransactions and is the most important ethical issue.
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Ethical issues relating to Product
Quality
Safety: Business should give safety the priority warranted by theproduct. Safety of a product can be ensured by monitoring themanufacturing process and periodic reviewing of the workingconditions and competence of personnel
Packaging and Branding Issues: It is the ethical responsibility ofthe manufacturer to provide clear, accurate and adequateinformation regarding the labeling and packaging of products.There should not be any misleading information regarding the
quantity and quality of products. Product Warranties: Warranties are obligations to purchasers
that sellers assume. Express warranties are the claims thatsellers explicitly state for eg: a product is waterproof etc. Impliedwarranties include the claim, implicit in any sale, that a product
is fit for its ordinary, intended use.
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Ethical issues Relating to Promotion
Companies make use of advertising andpromotional strategies to lure more customers.Advertising is considered unethical when:
It degrades the rivals product or substitute product.
The company provides misguiding and falseinformation.
It conceals information that vitally affects humanlife (eg: side effects of drugs etc).
It is obscene or immoral.