Incorrect Pricing and the Consumer Protection Act
The Consumer Protection Act
The Consumer Protection Act 68 of 2008 (Consumer Protection Act) aims to address challenges faced by consumers. Section 3 of the Consumer Protection Act recognises that South African consumers have rights that require protection. The Consumer Protection Act sets out several rights of consumers and obligations of suppliers, but it also creates a platform for redress in the event that those rights and obligations are not upheld. One of these sets of rights is the disclosure of process for goods and services. This essentially entails selling goods and services at the displayed price.
Disclosure of price of goods or services
Section 23 details that a retailer must not display any goods for sale without displaying to the consumer a price in relation to those goods. A price is adequately displayed to a consumer if it is written “price” and in the South African currency and is:
- annexed or affixed to, written, printed, stamped or located upon, or otherwise applied to the goods or to any band, ticket, covering, label, package, reel, shelf or other thing used in connection with the goods or on which the goods are mounted for display or exposed for sale;
- in any way represented in a manner from which it may reasonably be inferred that the price represented is a price applicable to the goods or services in question; or
- published in relation to the goods in
a catalogue, brochure, circular or similar form of publication available to
that consumer, or to the public generally, if:
- a time is specified in the catalogue, brochure, circular or similar form of publication as the time after which the goods may not be sold at that price, and that time has not yet passed; or
- in any other case, the catalogue, brochure, circular or similar form of publication is dated, and in the circumstances may reasonably be regarded as not out of date.
A supplier must not require a consumer to pay a price for any goods or services:
- higher than the displayed price for those goods or services; or
- if more than one price is concurrently displayed, higher than the lower or lowest of the prices so displayed.
If a price that was once displayed has been fully covered and obscured by a second displayed price, that second price must be regarded as the displayed price.
What is excluded by section 23
Section 23 excludes transactions where:
- a supplier has provided an estimate pertaining to that transaction, or the consumer has waived such an estimate; or
- section 43 of the Electronic Communications and Transactions Act applies to that transaction. Section 43 of the Electronic Communications and Transactions Act 25 of 2002 (Electronic Communications and Transactions Act) deals with certain disclosures that suppliers need to make on their websites. If information (i.e. prices) are displayed for a specific purpose in terms of section 43 of the Electronic Communications and Transactions Act ) regarding the offering of goods or services for sale, for hire or for exchange by way, that will not necessarily trigger section 23 of the Consumer Protection Act.
If a price as displayed contains an inadvertent and obvious error, the supplier is not bound by it after:
- correcting the error in the displayed price; and
- taking reasonable steps in the circumstances to inform consumers to whom the erroneous price may have been displayed of the error and the correct price.
A supplier is not bound by a price displayed in relationship to any goods or services if an unauthorised person has altered, defaced, covered, removed or obscured the price displayed or authorised by the supplier.