Context:

• The Lok Sabha unanimously passed the Consumer Protection Bill 2019, which seeks to wholly replace the Consumer Protection Act 1986.

About:

• The Bill with 109 clauses seeks to establish a National Level Regulator -Central Consumer Protection Authority (CCPA) to deal with consumer complaints on a proactive measure.
• The present law does not have a regulator.
• The Bill contains key provisions dealing with class actions, product liability, misleading advertisements, liability for celebrity endorsements etc.
• The Bill also addresses new age developments like e-commerce, direct selling, tele-marketing etc.

Highlights of The Bill:

Central Consumer Protection Authority (CCPA):

• CCPA is a national level regulator dealing with matters relating to violation of rights of consumers, unfair trade practices and false or misleading advertisements which are prejudicial to the interests of public and consumers.
• CCPA deals with the rights of consumers as a class.
• It will have an investigation wing headed by a Director General and has powers of search and seizure.
• It has power to order recall of goods which are dangerous, hazardous or unsafe and to direct discontinuation of practices which are unfair and prejudicial to the interests of consumers.
• It also has the power to impose penalties on manufacturers and celebrity endorsers for misleading advertisements.

Misleading Advertisements:

• The Bill contains provisions to deal with misleading advertisements.
• Misleading advertisements can attract penalty up to rupees ten lakhs from the CCPA under Clause 21.
• It is also an offence punishable with imprisonment for a term which may extend to five years and with fine which may extend to fifty lakh rupees as per Clause 89.

Liability of Celebrity Endorsers:

• The endorser can be levied with penalty up to rupees ten lakhs by the CCPA for false and misleading advertisements, under Clause 21.
• However, the endorser will not be liable if he has exercised due diligence to verify the veracity of the claims made in the advertisement regarding the product or service being endorsed by him.

Product Liability:

• A product liability action may be brought by a complainant against a product manufacturer or a product service provider or a product seller, as the case may be, for any harm caused to him on account of a defective product.

Expanded Definition Of ‘Deficiency’:

• The Bill expands the definition of ‘deficiency’ in Clause 2(11) to include:

1. Any act of negligence or omission or commission by such person which causes loss or injury to the consumer; and

2. Deliberate withholding of relevant information by such person to the consumer.

Enhanced Pecuniary Jurisdiction:

• The limits of pecuniary jurisdiction has been expanded in the following manner:
• District Forum: Rs. One Crore from Rs. Twenty Lakhs
• State Commission: Rs. Ten Crores from Rs. One Crore
• National Commission: Above Rs. Ten Crores from Rs. One Crores.

Offences:

• Misleading advertisements are made punishable.
• The Bill also addresses the menace of adulteration, by making manufacture, sale, storage of products mixed with adulterants punishable offences.