Companies are not taking the new Consumer Protection Act (CPA) seriously enough, warns industry expert Roger Knowles.
The CPA came into effect on 1 April, bringing with it wide-ranging and potentially expensive implications for all businesses that provide goods or services to consumers (including all individuals, most businesses and certain juristic entities) and small businesses.
Knowles, who is a key speaker at the upcoming Dimension Data Accelerate 2011 Executive Forum in Bryanston, believes companies may be taking the Act too lightly.
He notes that while the exact penalties for each infraction have not been published yet, penalties can be as high as R1 million.
In the IT industry, the Act could impact on areas such as the tracking of goods and services, e-mail and SMS marketing, data storage and search.
Compliance with the new Act will incur costs in terms of systems changes, redrawing of contracts and extensive staff training, he adds.
“The new Act turns 'let the buyer beware' on its head,” says Knowles. “Now the supplier needs to beware. Goods must be tracked like never before; customer service becomes a key priority; and contracts must be redrawn in plain language that anyone can understand.
“There are limits on what can be contained in those contracts, too - clever lawyers can no longer include waivers, indemnities and exemptions to place the burden of responsibility on the customer.”
The bad news for marketers is that they have to continually cross-check their mailing lists to ensure they do not communicate with anyone whose name has been added to this register, notes Knowles.
“This means all telephone, SMS and e-mail marketing flies out of the window unless companies can ensure their databases are sanitised and continually cross-checked against the register,” he points out.
Among the other provisions of the Act are that companies supplying a service must now get the consent of the customer for every additional charge that will be imposed, before the work is carried out.
Knowles will address the Accelerate 2011 Executive Forum, run in partnership with ITWeb, at The Forum in Bryanston, on 26 May.
He will elaborate on the implications of the CPA for businesses and consumers. For more information about this event, click here.
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