CONSUMER AFFAIRS AUTHORITY ACT

Arrangement of Sections

1. Short title.

PART I

ESTABLISHMENT OF THE CONSUMER AFFAIRS AUTHORITY

2. Establishment of the Consumer Affairs Authority.

3. Constitution of the Authority.

4. Chairman and full time members.

5. Director-General to act as the Secretary to Authority.

6. Delegation of powers to public.

7. Objects of the Authority.

8. Functions Authority.

PART II

REGULATION OF TRADE

9. Authority may undertake studies on the distribution of goods and services.

10. Authority to issue directions to manufacturers or traders in respect of price marking, labelling and packeting of goods.

11. Selling or offering to sell above the marked price.

12. Determining standards and specifications relating to goods and supply of services.

13. Authority to inquire into complaints.

14. Agreement to provide for maximum price of goods.

15. Refusal to sell goods to be an offence.

16. Denial of possession of any goods for purposes of trade or the sale of such goods subject to any condition to be an offence.

17. Hoarding of goods by any trader or person to be an offence.

18. Increase of retail or wholesale price of certain goods and certain services.

19. Director-General to refer matters to the Council.

20. Investigation into a reference made under section 19.

21. Undertaking to be given on a reference made.

22. Members of the public, associations or organisations to refer certain matters to the Director-General.

23. Advisory reference.

24. Authority to review questions relating to prices of goods.

25. Publication of a report made under this Act.

26. Trader to display price list.

27. Registration of traders.

28. Trader to issue receipts to purchasers.

29. Trader to furnish notice board.

30. Misleading or deceptive conduct.

31. False representation.

32. Warranties in relation to the supply of goods or services.

33. Public efficiency reports.

PART III

PROMOTION OF COMPETITION AND CONSUMER INTEREST

34. Authority to carry out investigation into anti-competitive practices.

35. Anti-competitive practice.

36. Provisions relating to an investigation under section 34.

37. Authority to make an application to the Council.

38. Council to entertain applications made by any person or association of traders.

PART IV

CONSUMER AFFAIRS COUNCIL

39. Establishment and constitution of a Consumer Affairs Council.

40. Function of the Council.

41. Order to be made by the Council.

42. Publication of an order made under section 41.

43. Power to issue notices to witnesses.

44. Evidence.

45. Failure to obey a notice issued or to give evidence.

46. Punishment for offence of contempt.

47. Privileges of witnesses.

48. Procedure to be laid down by the Council.

PART V

FUND OF THE AUTHORITY

49. Fund of the Authority.

50. Financial year and the audit of accounts.

51. Application of Part II of the Finance Act, No. 38 of 1971.

PART VI

STAFF OF THE AUTHORITY

52. Director-General of the Authority.

53. Appointment of officers, servants and advisers to the Authority.

54. Appointment of public officers to the staff of the Authority.

PART VII

GENERAL

55. Power of authority to send warning.

56. Power to require maintenance of records and the furnishing of returns.

57. Power of Authority to call for information.

58. Power of entry, inspection and search.

59. Sale of perishable goods.

60. Offences and Penalties.

61. Obtaining samples for purposes of ensuring compliance with standards and specifications.

62. General forfeiture.

63. Priority to be given for cases under section 61.

64. Protection for action taken under this Act.

65. Expenses to be paid out of the Fund.

66. Members of the Authority and the Council and officers and servants of the Authority deemed to be public servants.

67. The Authority and the Council deemed to be Scheduled Institutions within the meaning of the Bribery Act.

68. Principal liable for offences or agents and servants.

69. Rewards to certain persons.

70. Offences to be cognisable offence.

71. Certain officers to be peace officers.

72. Regulations.

73. Repeal of Consumer Protection Act, No. 1 of 1979, Fair Trading Commission Act, No. 1 of 1987, Control of Prices Act, and savings.

74. Reference for "Price Control Inspector” to be a reference to relevant officer in the Authority.

75. Interpretation.

76. Sinhala text to prevail in the event of any inconsistency.

77. Exemption of existing agreements.

SCHEDULE

9 of 2003.

AN ACT to provide for the establishment of the Consumer Affairs Authority for the promotion of effective competition and the protection of consumers; for the regulation of internal trade for the establishment of. A Consumer Affairs Council for the repeal of the consumer protection Act, No. 1 of 1979, the Fair Trading Commission Act, No. 1 of 1987 and the control of prices act and for all matters connected therewith or incidental thereto.

[Date of Commencement: 17th March, 2003]

1. Short title.

This Act may be cited as the Consumer Affairs Authority Act.

PART I

Establishment of the Consumer Affairs Authority.

2. Establishment of the Consumer Affairs Authority.

(1) An authority called the Consumer Affairs Authority (hereinafter referred to as the "Authority”) is hereby established which shall consist of the persons who are for the time being members of the Authority under section 3.

(2) The Authority shall, by the name assigned to it by subsection (1), be a body corporate and shall have perpetual succession and a common seal and may sue and be sued in such name.

3. Constitution of the Authority.

(1) The Authority shall consist of a Chairman and not less than ten other members who shall be appointed by the Minister from among persons who possess recognised qualifications, have had wide experience and have distinguished themselves in the field of industry, law, economics, commerce, administration, accountancy, science or health.

(2) The Chairman and three of the members, selected by the Minister from among the members appointed under subsection (1), shall be full time members (hereinafter referred to as "full time members of the Authority”).

(3) The members of the Authority other than the Chairman and the three full time members of the Authority shall be paid such remuneration as may be determined by the Minister in consultation with the Minister in charge of the subject of Finance.

(4) The provisions of the Schedule to this Act, shall have effect in relation to the term of office of the members of the Authority, the meetings and seal of the Authority.

4. Chairman and full time members.

The Chairman and the full time members of the Authority shall each hold office for a period of three years from the date of their respective appointments, and shall be paid for their services such remuneration as may be determined by the Minister in consultation with the Minister in charge of the subject of Finance.

5. Director-General to act as the Secretary to Authority.

The Director-General of the Authority appointed under section 52 shall act as the Secretary to the Authority.

6. Delegation of powers to public.

The Authority may for the purpose of discharging its functions under this Act, delegate to any public officer by name or office such functions vested in, or imposed upon, or assigned to the Authority by or under this Act, on such terms and conditions as may be agreed upon between such officer and the Authority.

7. Objects of the Authority.

The objects of the Authority shall be—

(a) to protect consumers against the marketing of goods or the provision of services which are hazardous to life and property of consumers;

(b) to protect consumers against unfair trade practices and guarantee that consumers interest shall be given due consideration;

(c) to ensure that wherever possible consumers have adequate access to goods and services at competitive prices; and

(d) to seek redress against unfair trade practices, restrictive trade practices or any other forms of exploitation of consumers by traders.

8. Functions Authority.

The functions of the Authority shall be to—

(a) control or eliminate—

(i) restrictive trade agreements among enterprises;

(ii) arrangements amongst enterprises with regard to prices;

(iii) abuse of a dominant position with regard to domestic trade or economic development within the market or in a substantial part of the market; or

(iv) the times during which and the places at which, such goods may be sold; and

(v) any restraint of competition adversely affecting domestic or international trade or economic development;

(b) investigate or inquire into anti-competitive practices and abuse of a dominant position;

(c) maintain and promote effective competition between persons supplying goods and services;

(d) promote and protect the rights and interests of consumers, purchasers and other users of goods and services in respect of the price, availability and quality of such goods and services and the variety supplied;

(e) to keep consumers informed about the quality, quantity, potency, purity, standards and price of goods and services made available for purchase;

(f) carry out investigations and inquiries, in relation to any matter specified in this Act;

(g) promote competitive prices in markets where competition is less than effective;

(h) undertake studies, publish reports and provide information to the public relating to market conditions and consumer affairs;

(i) undertake public sector and private sector efficiency studies;

(j) promote consumer education with regard to good health, safety and security of consumers;

(k) promote the exchange of information relating to market conditions and consumer affairs with other institutions;

(l) promote, assist and encourage the establishment of consumer organisations;

(m) charge such fees in respect of any services rendered by the Authority;

(n) appoint any such committee or committees as may be necessary to facilitate the discharge of the functions of the Authority; and

(o) do all such other acts as may be necessary for attainment of the objects of the Authority and for the effective discharge of the functions of such Authority.

PART II

Regulation of Trade

9. Authority may undertake studies on the distribution of goods and services.

The Authority may—

(a) undertake such studies in respect of the sale or supply of any class of goods and services as would ensure the availability to the consumer of such goods and services of satisfactory quality at reasonable prices and in adequate quantities;

(b) promote, assist and encourage the State or other organisations including organisations of consumers, for the purposes described in paragraph (a); and

(c) assist and encourage associations of traders to enter into agreements with the Authority for the purposes described in section 14.

10. Authority to issue directions to manufacturers or traders in respect of price marking, labelling and packeting of goods.

(1) The Authority may, for the protection of the consumer—

(a) issue general directions to manufacturers or traders in respect of labelling, price marking, packeting, sale or manufacture of any goods; and

(b) issue special directions to any class of manufacturers or traders, specifying any oilier conditions as to the manufacturing importing, marketing, storing, selling and stocking, of any goods.

(2) Every direction issued by the Authority under subsection (1) shall he published in the Gazette and in at least one Sinhala, one Tamil and one English newspaper.

(3) Any manufacturer or trader who fails to comply with any direction issued under subsection (1) shall be guilty of an offence under this Act.

(4) Any person who removes, alters, obliterates, erases or defaces any label, description or price mark on any goods in respect of which a direction under subsection (1) has been issued, or sells or offers for sale any such goods from or on which the label, description or price mark has been removed, altered, obliterated, erased or defaced, shall be guilty of an offence under this Act.

11. Selling or offering to sell above the marked price.

Any person who sells or offers to sell any goods the price marked on the goods in accordance with a direction issued under section 10, shall be guilty of an offence under this Act.

12. Determining standards and specifications relating to goods and supply of services.

(1) The Authority may for the purpose of protecting the consumer and ensuring the quality of goods sold or services provided, by Notification published in the Gazette, from time to time, determine such standards and specifications relating to the production, manufacture, supply, storage, transportation and sale of any goods, and to the supply of any services.

(2) The Authority may by Notification published in the Gazette adopt such standards and specifications. prescribed by the Sri Lanka Standards Institution established by the Sri Lanka Standards Institution Act, No. 6 of 1984, relating to the production, manufacture, supply, storage, transportation and sale of any goods, and to the supply of any services, as standards and specifications, to be determined under subsection (1).

13. Authority to inquire into complaints.

(1) The Authority may inquire into complaints regarding—

(a) the production, manufacture, supply, storage transportation or sale of any goods and to the supply of any services which does not conform to the standards and specifications determined under section 12; and

(b) the manufacture or sale of any goods which does not conform to the warranty or guarantee given by implication or otherwise, by the manufacturer or trader.

(2) A complaint under subsection (1) which relates to the sale of any goods or to the provision of any service shall be made to the Authority in writing within three months of the sale of such goods or the provisions of such service, as the case may be.

(3) At any inquiry held in to a complaint under subsection (1), the Authority shall give the manufacturer or trader against whom such complaint is made an opportunity of being heard either in person or by an agent nominated in that behalf.

(4) Where after an inquiry into a complaint, the Authority is of opinion that a manufacture or sale of any goods or the provision of any services has been made which does not conform to the standards or specifications determined or deemed to be determined by the Authority, or that a manufacture or sale has been made of any goods not conforming to any warranty or guarantee given by implication or otherwise by the manufacturer or trader, it shall order the manufacturer or trader to pay compensation to the aggrieved party or to replace such goods or to refund the amount paid for such goods or the provision of such service, as the case may be.

(5) An order under subsection (4) shall be made in writing and be communicated to such manufacturer or trader by registered post.

(6) Where any manufacturer or trader fails or refuses to comply with an order made under subsection (4) of this section, such manufacturer or trader shall be guilty of an offence under this Act, and the sum of money due on the order as compensation or refund may, on application being made in that behalf by the Authority to the Magistrate's Court having jurisdiction over the place of business or residence of such manufacturer or trader as the case may be, be recovered in like manner as a fine imposed by such court, notwithstanding that such sum may exceed the amount of a fine which that court may, in the exercise of its ordinary jurisdiction, impose.

14. Agreement to provide for maximum price of goods.

(1) The Authority may enter into such written agreements as it may deem necessary, with any manufacturer or trader or with any association of manufacturers or traders to provide for—

(a) the maximum price above which any goods shall not be sold;

(b) the standards and specifications of any goods manufactured, sold or offered for sale;

(c) any other conditions as to the manufacture, import, supply, storage, distribution, transportation, marketing, labelling or sale of any goods.

(2) Every written agreement entered into under subsection (1) between the Authority and any manufacturer or trader or with any association of manufacturers or traders, shall be binding on every authorised distributor of such manufacturer or trader and every member of such association, as though he was a party to such agreement and whether or not he was a member at the time of entering into the agreement.

(3) Every manufacturer or trader or any authorised distributor of such manufacturer or trader or any association of manufacturers or traders or any member thereof, who contravenes any provision of any agreement entered into with the Authority under subsection (1), shall be guilty of an offence under this Act.

(4) Every agreement entered into with the Authority under subsection (1), shall be registered with the Authority and shall contain a schedule giving the name and description of each authorised distributor of such manufacturer or trader or members of such association, as the case may be.

(5) Every agreement entered into with the Authority under subsection (1), shall come into force from the date of such agreement, unless such agreement provides that the agreement shall come into force on any subsequent date.

(6) Where the Authority thinks fit, it may cause any agreement made under this section to be published in the Gazette. Where an agreement is published in the Gazette, the production of a copy of the Gazette in which such agreement is published shall, until the contrary is proved, be proof of the contents of such agreement.

(7) For the purpose of any prosecution under this section, a certificate given by the Authority that any person is an authorised distributor of any manufacturer or trader or is a member of any association of traders or manufacturers shall be admissible and be prima facie proof in a court of law that such person is an authorised distributor of such manufacturer or trader or a member of such association.

15. Refusal to sell goods to be an offence.

(1) No trader who has in his possession or custody or under his control any goods for purpose of trade within Sri Lanka, shall refuse to sell such goods.

(2) In any prosecution of any trader for the contravention of the provisions of subsection (1) it shall be a sufficient defence for the accused to prove that—

(a) on the occasion in question, he supplied a reasonable quantity of the goods, or had not a sufficient quantity in his possession to supply the quantity;

(b) he carried on business in the goods as a wholesale trader only, and that the sale of, the quantity demanded by the buyer would have been contrary to the normal practice of a wholesale business; or

(c) the sale of the goods on that occasion in question would have been contrary to any provisions of any written law or any general or special direction issued to him by the Authority under section 10.

16. Denial of possession of any goods for purposes of trade or the sale of such goods subject to any condition to be an offence.

No trader who has in his possession or custody or under his control any goods for purpose of trade within Sri Lanka, shall

(a) deny the possession of such goods; or

(b) offer such goods for sale subject to a condition requiring the purchase of any other goods or the making of any payment in respect of any service or to any other condition, other than the condition that the buyer shall pay the price of such goods forthwith.

17. Hoarding of goods by any trader or person to be an offence.

(1) No trader shall conceal in his place of business or in any other place, any goods in such quantity as is in excess of the normal trading requirements of such trader.

(2) No trader shall have in his possession or custody or under his control in his place of business or in any other place any goods in such quantity in excess of—

(a) the quantity required for his personal consumption and of the members of his household; or

(b) the requirements of the normal trading activities of such trader.

(3) No person other than a trader shall have in his possession or custody or under his control any goods in such quantity in excess of the normal personal requirements of such person.

18. Increase of retail or wholesale price of certain goods and certain services.

(1) Where the Minister is of opinion that any goods or any service is essential to the life of the community or part thereof, the Minister in consultation with the Authority may by Order published in the Gazette prescribe such goods or such service as specified goods or specified service as the case may be.

(2) No manufacturer or trader shall increase the retail or wholesale price of any goods or any service specified under subsection (1), except with the prior written approval of the Authority.

(3) A manufacturer or trader who seeks to obtain the approval of the Authority under subsection (2), shall make an application in that behalf to the Authority, and the Authority shall, after holding such inquiry as it may consider appropriate—

(a) approve such increase where it is satisfied that the increase is reasonable; or

(b) approve any other increase as the Authority may consider reasonable, and inform the manufacturer or trader of its decision thirty days of the receipt of such application.

(4) Where the Authority fails to give a decision within thirty days of the receipt of an application as required under subsection (3), the manufacturer or trader who made the application shall be entitled to, notwithstanding the provisions of subsection (1), increase the price:

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