HM Medical Clinic

Consumer protection law body

A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
UGANDA LAW REFORM COMMISSION A STUDY REPORT ON SELECTED
TRADE LAWS - CONSUMER
(LAW COM PUB. NO. 27 of 2004)

UGANDA LAW REFORM COMMISSION
The Uganda Law Reform Commission offices are located at –Workers House, 8th Floor,Plot 1, Pilkington Road,Kampala, Uganda.
The address for correspondence is –
Uganda Law Reform CommissionP. O. Box 12149,Kampala, Uganda

A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
The Government of Uganda, basing on the findings of the Commercial JusticeReform Programme (CJRP) baseline study and in consultation withstakeholders developed a four year detailed strategy for the reform of thecommercial justice system. The strategy focused on four essential areas; thecommercial courts, the commercial registries, the legal profession, thecommercial regulatory environment and commercial laws.
In furtherance of the programme, the Uganda Law Reform Commission(ULRC) with the support of the Justice, Law and Order Sector (JLOS)proposed to reform key selected commercial laws that affect the basicoperating environment of businesses to promote private sector businessoperations.
It should be noted that the commercial justice system in Uganda has faredbadly because commercial life has been encumbered for several decades.
This has caused inadequacy in Government delivery and led to the slowdevelopment of the private sector.
The commission, having appreciated the fact that law cannot be adequatelyreformed without appreciating the political, cultural and socio-economiccontext in which it operates and as a measure towards operationalising thepeople's constitutional right to participate in the law making process carriedout wide consultations with the relevant stakeholders and individuals witha wide range of expertise on policy and business issues. As a result of theseinvolving endeavours, many Bills have been made.
The commission appreciates the responses from the participation of allstakeholders and is indeed confident that the recommendations containedin this report and Bill will, due to the fact that the public have had an input,be easily enforceable in our society.
The commission acknowledges with special appreciation the work of theconsultants, Barugahare & Co. Advocates and the financial support giventhrough the Justice Law and Order Sector.
Professor Joseph M.N. Kakooza,
Chairman, Uganda Law Reform Commission.

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TABLE OF CONTENTS.
Table of contents List of Acts, Conventions and Cases . v EXECUTIVE SUMMARY . xvii Background . xvii Objectives of the study . xvii Methodology . xix Study recommendations . xxi CHAPTER 1 THE FAIR TRADE LAWS CLUSTER Objectives for introducing a consumer protection law . 3 Justification for Change . 5 Guiding Principles . 7 CHAPTER 2 CONSUMER PROTECTION LEGISLATION . 14 ANNEX 1 DRAFT CONSUMER PROTECTION BILL . 35 ANNEX 2 PUBLICATIONS OF THE UGANDA LAW REFORM

A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
LIST OF ACTS, CONVENTIONS & CASES.
1. Adulteration of Produce Act , Cap. 27.
2. Bank of Uganda Act, Cap. 51.
3. Business Names Registration Act, Cap. 109.
4. Constitution of the Republic of Uganda.
5. Contract Act, Cap. 73.
6. Customs (Dumping and Subsidies) Act, Cap 26 of the Acts of the Community (formerly legal notice No.3 of 1959).
7. Customs (Dumping and Subsidies: Rates) Act, Cap. 336.
8. Customs Management Act.
9. East African Common Services Organisation; East African Customs & Transfer Tax Management Act, Cap. 27.
10. Financial Institutions Act, Cap. 54.
11. Food and Drug sAct, Cap. 278.
12. Income Tax Act, Cap. 340.
13. Insurance Act, Cap. 213.
14. Land Act, Cap. 227.
15. Liquor Act, Cap. 93.
16. Local Governments Act, Cap. 243.
17. National Drug Policy and Authority Act, Cap. 206.
18. Patents Act, Cap. 216.
19. Public Enterprise Reform and Divestiture Act, Cap. 98.
20. Public Health Act, Cap. 281.
21. Registration of Titles Act, Cap. 230.
22. Sale of Goods Act ,Cap. 82.

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23. Trade (Licensing) Act, Cap. 101.
24. Uganda Communications Act, Cap. 106.
25. Uganda National Bureau of Standards Act, Cap. 327.
26. Value Added Tax Act, Cap. 349.
27. Weights and Measures Act ,Cap.103.
LEGISLATION - OTHER COUNTRIES.
1. Distribution and Price of Goods Act 1964.
2. East African Excise Management Act, Cap. 28.
3. Mauritius - the Export Service Zones Act 1981.
4. Supply of Goods Act, (1994) U.K.
5. Unfair Contracts Act, 1977.
6. Zanzibar Free Economic Zone Authority (ZAFREZA).
1. Australian case of Australian Knitting Mills Ltd V. Grant [1933] 50 CLR.
2. Grant v. Australian Knitting Mills Ltd [1936] A.C.85 H.L.(U.K.).
3. Henry Kendall & Sons v. William Lillico & Sons Limited.
4. Karshamns Oljefabriker v East Port Navigation Corp, The Elafi (1982) 1 All ER 208, (1982)2 Lloyds Rep 679.
5. Norman v. Overseas Motor Transport Ltd [1959] E.A.131 C.A. (EA).
6. Priest v. Last [1903] 2 K.B.148 (C.A.) (U.K.).
7. Wait and James v. Midland Bank (1926) 24 L1 L Rep 313.
1. Berne Convention for the Protection of Literary and Artistic Works.
2. Common Market for Eastern and Southern Africa (COMESA).
3. GATT 1947.

A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
4. Subsidies and Countervailing Measures Agreement.
5. Tokyo Round (1973-79) Code.
6. UNCTAD, Set of Multilaterally Agreed Principles and Rules for the Control of Restrictive Business Practices.
7. World Trade Organisation (WTO).
8. WTO Agreement on Agriculture.
9. WTO Anti-Dumping Agreement.
1. Deregulation Project, Briefing Paper for the Uganda Law Reform Commission Licensing Report (MFPED), April 2001.
2. Land Sector Strategic Plan (LSSP).
3. Modernization of Agriculture (PMA).
4. Namanve Management and Development Company, (NMDC).
5. National Environment Management Policy, 1994.
6. National Gender Policy 1997.
7. Plan for Modernisation of Agriculture (PMA).
8. Poverty Eradication Action Plan (PEAP).
9. Report by Reid & Priest on Consumer Protection, 1998.
10. Report by Reid & Priest on the Sale of Goods, 1997.
11. Uganda Law Reform Commission Consultation paper,on Sale of Goods 12. Report by Reid & Priest on Consumer Protection, 1998.
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ACRONYMS.
Agro Export Zone.
Cost Insurance and Freight.
COMESA Common Market for Eastern and Southern Africa.
DEEC Duty Exemption Entitlement Certificate.
Duty Entitlement Passbook Scheme.
Duty Exemption Scheme.
Duty Free Replenishment Certificate.
Duty Remission Scheme.
Domestic Tariff Area.
Electronics Hardware Technology Park Scheme.
Export Oriented Scheme.
Export Oriented Unit.
Export Processing Zones.
Foreign Direct Investment.
Free on Board.
Free Trade Zones.
Industrial Parks.
Letter of Intent.
Letter of Permission.
Minimum Export Price.
Manufacturing Under Bond.
Net Foreign Exchange.
Net Foreign Exchange as Percentage of Exports.
Namanve Management and Development Company.
National Resistance Movement.
Special Economic Zones.
Software Technology Parks.
Tourism and Entertainment Parks.
Technology Parks.
Uganda Investment Authority.
World Trade Organisation.
ZAFREZA Zanzibar Free Economic Zone Authority.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Establishment of the Uganda Law Reform Commission.
The Uganda Law Reform Commission was established in 1990 by the UgandaLaw Reform Commission Act, Cap. 25. Prior to this enactment, law reform wasthe responsibility of the department of law reform and law revision of the Ministryof Justice, which had been set up in 1975. In 1995, with the promulgation of theConstitution, the commission became a constitutional commission by virtue ofarticle 248 of the Constitution.
Composition of the commission.
Under section 3 of the Uganda Law Reform Commission Act, Cap. 25, thecommission consists of a chairman and six other commissioners, all of whomare appointed by the President on the advice of the Attorney General.
The chairperson and four of the commissioners are lawyers who are retired orsitting judges of the Court of Appeal or High Court of Uganda; or are lawyersqualified to be appointed as judges of the Court of Appeal or High Court ofUganda; or are senior practising lawyers or senior teachers of law at a universityor similar institution of law in Uganda. The remaining two commissioners, asset out by section 4(2), are non-lawyers but persons who have distinguishedthemselves in disciplines relevant to the functions of the commission.
Additionally, section 12 empowers the Attorney General, on the advice of thecommission, to appoint experts or consultants in any specific aspect of lawreform undertaken by the commission.
The commission is serviced by a secretariat composed of an executive secretaryand other staff.The commission has three departments which are: the lawreform department, the law revision department, and the department offinance and adminstration.The staff of the commission consists of lawyersand non-lawyers appointed by the Attorney General from among personswho are either public or non-public officers.
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Functions of the commission.
The main function of the commission as set out under section 10 of the UgandaLaw Reform Commission Act, Cap. 25 is to study and keep under constantreview the Acts and other laws of Uganda with the view to makingrecommendations for their systematic improvement, development,modernisation and reform with particular emphasis on- the elimination of anomalies in the law, the repeal of obsoleteand unnecessary laws and the simplification and translation ofthe law; the reflection in the laws of Uganda of the customs, values andnorms of society in Uganda as well as concepts consistent withthe United Nations Charter for Human Rights and the Charterof Human and Peoples' Rights of the African Union; the development of new areas in the law by making the lawsresponsive to the changing needs of the society in Uganda; the adoption of new or more effective methods or both for theadministration of the law and dispensation of justice; and the integration and unification of the laws of Uganda.
Powers of the commission.
In the performance of its functions, the commission may- receive, review and consider any proposals for the reform ofthe law which may be referred to it by any person or authority; prepare and submit to the Attorney General, from time to time,for approval, programmes for the study and examination of anybranch of the law with a view to making recommendations forits improvement, modernisation and reform; and thoseprogrammes shall include an estimate of the finances and otherresources that will be required to carry out any such studies andthe period of time that would be required for the completion ofthe studies; A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
undertake, pursuant to any such recommendations approved bythe Attorney General, the formulation of draft bills or otherinstruments for consideration by the Government and Parliament; initiate and carry out, or, with the approval of the AttorneyGeneral, direct initiation and research necessary for theimprovement and modernisation of the law; provide, at the instance of the Government, to Governmentministries and departments and other authorities concerned,advice, information and proposals for reform or amendment ofany branch of the law; encourage and promote public participation in the process oflawmaking and educate and sensitise the public on lawmakingthrough seminars, publications and the mass media; and appoint or empanel committees, in consultation with the AttorneyGeneral, from among members of the commission, or fromamong persons outside the commission, to study and makerecommendations to the commission on any aspect of the lawreferred to the committees by the commission.
Profile of the commission.
The vision of the commission is to promote, in Uganda, a legal system withjust and up-to-date laws, easily accessible to all.
To contribute to sustainable development, an equitable and just legal systemthrough revision, harmonisation, development and reform of the law.
Values of the commission.
seeks to be impartial at all times in all its dealings with clients, UGANDA LAW REFORM COMMISSION
endeavours to operate with integrity and in a professional way, is committed to equity and pragmatic diversity in the workplace, respects and values the contribution of the people, and endeavours to communicate consistently and effectively with ourstakeholders in all its projects.
"Law reform for good governance and sustainable development".
Justification for legal reform.
The Ugandan society, like all societies, is in a constant state of change causedby political, social and economic factors yet there have been few changes inthe law since the inception of English law in Uganda in 1902. In addition,there are emerging cultural patterns and gender relations, new Governmentpolicies such as decentralisation, privatisation, economic liberalisation, povertyeradication, private sector development and the modernisation of agriculture.
However, there have been few changes in the law, yet the law, at any giventime, has to effectively respond to social changes and to the aspirations of thepeople. There is need for extensive research including the need for wideconsultations with stakeholders when proposing reforms in any area of thelaw.
Current members of the Uganda Law Reform Commission.
1.
Professor Joseph Moll Nnume Kakooza.
Professor Kakooza is a holder of the degrees of B.C.L. and LL.B. of theNational University of Ireland, Dublin; LL.M. (Harvard); M.Litt. and aPostgraduate Diploma in Anthropology of the University of Oxford; Certificatein International Relations, of the University of Oslo; Barrister-at-Law, of theInner Temple, London and Advocate of the High Court, Uganda.
Professor Kakooza served as a lecturer at the Faculty of Law, UniversityCollege, Dar-es-Salaam, as a senior lecturer and founding head (later twicedean) and finally Professor of Law at Makerere University. He has been avisiting scholar at Harvard Law School; guest lecturer at the college of criminal A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
justice, Northeastern University Boston and visiting professor, College of Law,
University of Florida. He is currently teaching law at Kampala International
University and medical jurisprudence in the Faculty of Medicine, Makerere
University, part-time. He is widely published, particularly in criminal justice
and family law and he is a member of many professional organisations. He is
listed in the international publication of WHO IS WHO in Education and
was given the award of MAN OF THE YEAR, 2003, by the American
Biographical Institute, Inc.
Professor Kakooza has, among other spells of public service, served as Ag.
Judge of the High Court of Uganda, Ag. Solicitor General, President of UgandaIndustrial Court; and commissioner of law reform. He was acting chairman ofthe commission from 2000 to 2002 when he became its chairman.
He has been in charge of the Domestic Relations Law Project and LabourLaws Project. He is currently in charge of the Intellectual Property Law Project,the Reform of the Accountants Act Project, the Living Law Journal Project,the Sentencing Legislation Reform Project and Community Law ReformProgramme.
Ms. Percy Night Tuhaise.
Ms.Tuhaise is a holder of the degrees of LL.B and LL.M of MakerereUniversity, Kampala; a Postgraduate Diploma in Legal Practice of the LawDevelopment Centre, Kampala. She also holds various certificates in humanrights teaching and research (Ottawa Canada 1991), (Strasbourg, France,1995). She is the deputy director and a principal lecturer of the LawDevelopment Centre, Kampala. She is also an advocate of the High Court ofUganda. Ms Tuhaise was appointed a part-time commissioner in 1995. Sheassisted commissioner Kibuka in the Rape and Defilement Project. She hasbeen in charge of the Business Associations cluster of the Commercial LawProject and Succession Law Project, and is currently in charge of theCodification of the Contracts Law Project under the Commercial Law ProjectII and Simplification of the Penal Code Act Project. She is also a member ofthe editorial board for law revision.
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Mr John Mary Mugisha.
Mr. Mugisha holds the degree of LL.B of Makerere University and aPostgraduate Diploma in legal practice, LDC. He was appointed a part-timecommissioner in 1999. He is a principal lecturer at the Law DevelopmentCentre, Kampala and an advocate of the High Court of Uganda. Mr. Mugishais a former President of Uganda Law Society; Vice President of the EastAfrican Law Society; lead counsel for the Constitutional Review Commission;and deputy secretary general in charge of Eastern Africa, International BarAssociation (IBA). He is also a member of the Law Council representing theUganda Law Society. Mr. Mugisha has been the commissioner in charge ofSecured Transactions and Fair Trade Clusters of the Commercial Law ReformProject. He is currently in charge of subsidies and countervailing measures,under the Commercial Law Reform Project II and Trial Procedures ReformProject under the Criminal Law Reform Project I.
Dr. Lillian Tibatemwa-Ekirikubinza.
Dr. Tibatemwa-Ekirikubinza is a holder of a PhD in law from the Universityof Copenhagen, Denmark; an LLM in Commercial Law from the Universityof Bristol, UK; an LL.B (Hons) degree from Makerere University and aPostgraduate Diploma in Legal Practice from the Law Development Centre,Kampala. She was the deputy dean of the Faculty of Law, MakerereUniversity and is currently the Deputy Vice Chancellor in charge of academicaffairs at Makerere University and a part time commissioner of the commissionsince 1999.
Dr. Tibatemwa-Ekirikubinza is widely published in areas of women's law;children's rights and constitutionalism. Her publications include "Women'sViolent Crime in Uganda: More Sinned Against Than Sinning" (1999). Herlatest publication is entitled "Gender and Human Rights: A Case Study ofPolygamy Among the Basoga of Uganda" (2003).
Apart from being a commissioner of the Uganda Law Reform Commissionwhere she has been in charge of various projects namely: the Insolvency Clusterof the Commercial Law Reform Project I, the Domestic Violence Project, theE-Commerce, Computer Crime and E-Evidence Project under the CommercialLaw Reform Project II. Dr Tibatemwa-Ekirikubinza has also held otherpositions of responsibility among which are: board member of the Uganda A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
National Bureau of Standards, member of the academic board of MakerereUniversity Business School, Nakawa and a complimentary member of theBritish Institute of International and Comparative Law.
Former members of the Uganda Law Reform Commission.
Justice Sir Harold G. Platt.
Justice Sir Harold Platt is a holder of MA of Oxford University after his firstdegree in India. He retired but was actively involved in various aspects ofthe legal field. He served in various capacities in East Africa including: ChairmanUganda Law Reform Commission 1994 -2000, where he was in charge ofthe Commercial Law Project among others; judge of the Supreme Court ofUganda 1989-1994, judge of the High Court and Court of Appeal Kenya1968-1989; Government service, provincial magistrate Tanzania1962-1972,colonial legal service Tanganyika 1954 -1962 and in legal practice 1951-1954. Justice Sir Harold Platt was called to the Bar in 1952 after serving inthe royal air force from 1942-1947.
Professor Eric Paul Kibuka.
Professor Kibuka holds a B.A and PhD of Makerere University. He was adirector of the United Nations African Institute for the Prevention of Crimeand Treatment of Offenders, Kampala. He was appointed a part-timecommissioner in 1995. He is a retired lecturer of sociology at MakerereUniversity. Professor Kibuka was in charge of the Rape and Defilement LawProject. He was also in charge of the Decriminalisation of Petty OffencesProject as well as the Contracts Law Project.
Ms. Hilda A. Tanga.
Ms. Tanga is a holder of a B.A degree in education and a postgraduate diplomain Human Resources Management. She has been a graduate teacher at KololoS.S.S; lecturer in business communication at the National College of BusinessStudies; Ag. registrar and deputy academic registrar at the Uganda PolytechnicKyambogo. Ms. Tanga has also been an adhoc consultant with Management UGANDA LAW REFORM COMMISSION
Training and Advisory Centre (MTAC) on management and training of trainers.
She is currently an examiner with the Uganda National Examinations Board(UNEB) and National Business Examinations Council (Nakawa).
Ms. Filda Mary Lanyero Ojok.
Ms. Mary Lanyero was a senior lecturer and dean of the Faculty of Arts,Institute of Teacher Education, Kyambogo. She is also involved with variousnon-governmental organisations in various capacities. Ms. Lanyero holdscertificates from the American Studies Winter Institute, USA. She holds amasters degree in international relations, Carleton University Ottawa, Canadaand a B.A of Makerere University majoring in history and literature in English.
Ms. Lanyero was a teaching assistant, University of Carleton, Ottawa Canada.
Mr. Francis Butagira.
Mr. Butagira was appointed commissioner on 22nd January 1996. He holdsthe degrees of LL.B Makerere University and LL.M (Harvard). He is anadvocate of the High Court of Uganda and former principal lecturer at theLaw Development Centre.
Mr. Richard Aboku Eryenyu.
The late Richard Aboku Eryenyu served as commissioner from 19th January1996 until his death on 7th April 1999. He was an LL.B graduate of MakerereUniversity and a chief magistrate.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
The Uganda Law Reform Commission has undertaken a major review of commerciallaws. Funded by the Justice Law and Order Sector of the Ministry of Justice andConstitutional Affairs, the Commission has commissioned studies of which this studyforms a part, with a view of reviewing existing laws and drafting new ones. The overallobjective is to improve the country's commercial laws so as to improve the environmentthat will attract foreign investment into the country. A team of consultants wascontracted to undertake preparation of and finalisation of background papers, reportsand draft Bills to cover a review of policies and laws governing fair trade laws. Thesewere Competition law, Consumer protection, Anti-dumping (and CountervailingDuties), Special Economic Zones, Sale of goods and Trade Licensing law.
To enhance the national and international competitiveness of Uganda's products andservices, it is necessary to continue restructuring and improving commercial law flexiblyto reflect social and economic changes. This process of reform is global and even developedcountries and in Africa, industrially advanced countries such as South Africa have alreadylargely reformed their commercial laws to improve their international competitiveness.
This study was undertaken as part of that process of reform to modernise Uganda's laws,some of which like the law on Sale of Goods have remained virtually unchanged since theywere introduced in the late 19th Century by the colonial Government. It was also increasinglyapparent that Uganda lacks laws to deal with new commercial needs especially thoserelated to global competition. It was to meet this need that the consultants were requestedto examine the need for laws such as those relating to competition, consumer protection,anti-dumping and subsidies and special processing zones.
Objectives of the study.
The objectives of the study were to- examine, investigate and suggest reforms to the laws relating toconsumer protection; UGANDA LAW REFORM COMMISSION
participate in the preparation of and finalisation of background papersto cover a review of the relevant existing laws that have a bearing onidentified laws as well as proposals from various ministries andorganisations including where they exist, draft Bills; peview the above in line with international and regional commitmentsand undertake a comparative analysis of laws and policies of otherjurisdictions including countries whose economies are under transition; identify out modelled consumer protection provisions and modifythem so that they facilitate modern business enterprises operating ina liberal environment; prepare a working paper on the proposed laws; prepare for and guide the consultative meetings with taskforcemembers; participate in the consultation workshop; propose recommendations; in consultation with draft persons, prepare a draft Bill or amendmentBills; prepare a final report incorporating all the work done under the study;and carry out any other relevant tasks as may be required by thecommission.
The objectives were to be carried out while bearing in mind other nationalobjectives such as poverty eradication, the competitiveness of business entities,an attractive regime for overseas businesses, a proper balance of interest forall those concerned, cost effective, fair regulation and the promotion ofconsistency, predictability and transparency for business entities especiallycompanies.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
The Commission identified persons from relevant Government departments,the private sector, academic community and individuals with a range ofexpertise and with access to the relevant networks of other experts to constitutea task force.
They were chosen from the following institutions- Deregulation project Ministry of Finance; Judiciary- Commercial Court; Ministry of Energy and Mineral Development; Ministry of Finance, Planning and Economic Development; Ministry of Foreign Affairs; Ministry of Justice and Constitutional Affairs; Ministry of Tourism Trade and Industry; Peat Marwick, KPMG; Private Sector Foundation; Uganda Clearing and Forwarding Agency; Uganda Consumer Protection Association; Uganda Investment Authority; Uganda Law Society; Uganda Manufacturers Association; Uganda National Bureau of Standards; Uganda National Chamber of Commerce and Industry; Uganda Revenue Authority; and USAID Private Sector Capacity Building.
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The commission proposed the following terms of reference for the task force- to assist in identifying issues relevant to the stakeholders in the cluster; to comment on the review of the existing law and study proposals from various Ministries and organisations done by the consultants; to present the views of the different sectors they represent on the to participate in deliberations and reach consensus on the working papers and draft Bills; to discuss the proposals and recommendations to be presented at the consultative workshop; to participate in the consultative workshop; and to discuss the final report within a timetable to be agreed upon.
The commission contracted a team of consultants, Barugahare and Co.
Advocates to undertake the study. It was carried out in Kampala thoughbasing on findings from stakeholders nationwide. Among the nationalrepresentatives of stakeholders interviewed and whose reports the consultantconsidered were- Deregulation Project in the Ministry of Finance, Planning andEconomic Development; Ministry of Energy and Natural Resources; Ministry of Foreign Affairs; Ministry of Trade and Industry; Private Sector Foundation; Uganda Consumer Protection Association Uganda Law Reform Commission; and Uganda Manufacturers Association.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Consultative meetings were held with the above stakeholders and othersmentioned in 3.2 during the study with the main aim of establishing existingfacts and consensus on the way forward. These stakeholders formed ataskforce that made proposals for the consultants to consider and then reviewedthe consultant's recommendations.
Focus group discussions were held under the auspices of the commission.
The discussions involved key policy makers and interested parties fromGovernment and non-governmental organisations. Officials from relevantGovernment departments presented position papers or official positions whererelevant.
Literature review was conducted by the consultant on the existing statutorylaw, international and regional instruments ratified by Uganda, case law,comparative studies from other jurisdictions as well as local research.
Finally, a three-day residential stakeholder workshop was held to discuss the findings of the study and seek views on the draft recommendations.
There is at present no legislation in Uganda which deals specifically withconsumer protection. There is, however, legislation which deals with certainaspects of consumer protection. Examples of these are certain provisions of: (1) The Sale of Goods Act dealing with the quality of goods (Ss.13 (2) The Customs Management Act (incorporating the E.A. Customs and Transfer Management Act Cap.27, Laws of the E.A. Commu-nity); dealing with prohibited or restricted imports (ss.14-16); (3) pre-shipment inspection (S.28(5),(6));(4) smuggling and dumping (ss.128-139) and(5) The Uganda National Bureau of Standards Act, Cap. 327 – relating to the quality of goods imported into the country. Other legislationsuch as the Financial Institutions Act, Cap. 54 Bank of Uganda Act,Cap. 51 and the Insurance Act , Cap. 213 regulate banking andinsurance activities and have a bearing on consumer protection.
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Definition and purpose.
Consumer protection measures aim at equipping consumers with knowl-edge about products and services they buy so that they can make in-formed decisions about their purchases. Consequently, any consumerprotection legislation should assist consumers to avoid deceptive or unfairtrade practices in trade and commerce in Uganda. In this vein suchlegislation is expected to guide sellers on how to conduct their business;and provide information to consumers on the goods and services they arebuying and remedies to consumers who are injured by unfair or deceptivepractices (Reid & Priest (1998) p.1).
Reid & Priest (1998) have proposed the promulgation of a Consumer ProtectionAct whose objective is to provide sufficient breadth in its application in orderto curtail innovative business fraud schemes that could occur in the future.
Nevertheless, it is restricted to the prohibition of fraudulent and deceptivepractices and does not regulate the quality of goods of the prices charged forthem. The public concerns about substandard goods which are excessivelypriced, are more appropriately dealt with under consumer product safetylegislation while the quality of products is governed by the Sale of Goods Act.
Prices of consumer goods are regulated by the market and healthy competition.
Nevertheless, the proposed Consumer Protection Act (CPA) prohibits unfaircompetition by banning fraud and deception which forestall consumers fromaccess to adequate and accurate information about the products they buy.
The proposed CPA deals broadly with six (6) aspects that are consideredbelow briefly in comparison with the Uganda Consumers ProtectionAssociation (UCPA) proposed bill.
Implementation of the Act.
It is proposed that a commission be set up consisting of five mem- bers, two from the Uganda National Bureau of Standards, two from theUganda Consumer Protection Association and a member from theUganda National Chamber of Commerce and Industry. Such membershipis expected to provide both standard expertise while catering for con- A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
sumer interest (Reid & Priest (1998) pp.2-3, 31). This proposal con-trasts with the UCPA's proposal for a Uganda Protection Council consist-ing of 19 members (clause 9(3) of the draft UCPA Bill 1999).
(b) (i) Concepts of unfair practice, deceptive practice relative to
consumer.
Underlying the proposed CPA is the need to combat unfair practice, deceptivepractice with a view to protecting the consumer. A central feature of thiseffort is to gauge whether an unfair practice inflicts substantial injury toconsumers. To balance this, it is necessary to consider whether the practiceis not outweighed by any countervailing considerations and that it could nothave been reasonably avoided. The standard for gauging whether a practiceis deceptive is whether it tends to or is capable of deceiving the consumerwho is the final purchaser of a good or service (Reid &Priest (1998), p.3).
This conceptual approach is captured in Clauses 11 to 21 of the CPA. Clause11 prohibits bait or false advertisement while clause 12 prevents misleadingadvertisement as to the grade, quality or characteristics of a product oralternatively advertises a false product with a view to inducing the customerto buy another product. Similarly, a seller is prohibited from discouraging abuyer of an advertised product or service as part of a bait or trick to sell tohim or her another product (clause 13). Furthermore, following a sale theseller is prohibited from prejudicing the sale with a view to selling to the buyeranother product or service. Examples of such prejudice include accepting adeposit for the advertised product and then switching the buyer to a higherpriced product or service or failing to deliver the advertised product within areasonable time or making a refund (Clause 14). Dealers are also preventedfrom engaging in defective advertising through incomplete representationsabout goods or services (Clause 15).
The advertisement of reconditioned goods as new is also prohibited with arequirement that the seller shall clearly indicate that such goods are beingsold "as is" (Clause 16). Door to door sales are also closely regulated interms of their nature and the importance of the buyer's right to cancel thesale supported by a receipt and a form bearing "a notice of right to cancel"(Clauses 17 and 18). The aim is to prevent high pressure sales with a view to UGANDA LAW REFORM COMMISSION
allowing the buyer a "cooling off" period to reflect on the transaction. Pyramidschemes in which, under the guise of selling a product, one is actually beingsold a membership in the pyramid are prohibited (Clause 19).
Finally, the proposed CPA creates an offence in respect of a seller whogives misleading price indications by making the consumer to believe that theprice of certain goods or services is less than the actual price. This occurswhen full facts about the value of the goods or services are not given to theconsumer (Clause 21).
By way of comparison, the draft UCPA Bill, 1999 addresses the issue ofadvertising in the context of the need to provide accurate information by thesupplier (Clauses 31 and 32) controlling promotional advertisement (clause34), prohibiting abusive advertisement (Clause 33) and providing forcompensation for a consumer adversely affected by abusive advertisement Exempted practices and entities.
The proposal by Reid and Priest excludes certain practices andentities from the application of the proposed CPA (Reid & Priestpp 3-4, 30).These are- (i) the sale or rental of real estate, banking, utilities or the sale of in- (ii) the owner or publisher of a publication or printed matter in which any advertisement appears; (iii) the owner or operator of a television or radio station which dis- seminates the advertisement.
The rationale for this is that such activities and entities are regulated by otherlegislation including the Financial Institutions Act, Cap. 54; Bank of UgandaAct, Cap. 5; Insurance Act, Cap. 213; Electricity Act, Uganda Communi-cations Act, Cap. 106; Land Act, Cap. 227 and Registration of Titles Act,Cap. 230.
In contrast the draft UCPA Bill intends to regulate financial transactionsincluding general insurance, heath insurance, hire purchase, mortgages, etc A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
(Clause 21) as well as consumer credit contracts primarily involving the sup-ply or sale of goods, services or technology (Clauses 21-30, pp 17-20).
The draft UCPA Bill also addresses issues of unfair contracts (Clauses 19and 20, pp.16-17) that as already observed should perhaps be the subjectof separate legislation in line with trends in other jurisdiction. Reid &Priest'sproposal also deals with this aspect (Clause 22, pp 10-11, 38).
Reid & Priest's proposed CPA stipulates a fine of up to shillings 1 million or imprisonment of up to six months or both for violating provisionsof the proposed law (Clause 23(1)). In addition the Court may order theperson to pay: (i) compensatory damages;(ii) advocate's fees; or any other damages deemed fit by the Court (Clause 23(2)).
The consumer is also permitted to retract, within seven days from the signa-ture of a contract or the receipt of the good or service, when the contracthas been entered into outside the supplier's place of business especiallythrough telephone or at the consumer's domicile (clause 23(3)).
The draft UCPA Bill 1999 provides for representative or class actions toenforce consumer rights (Clause 37 and the setting up of Small Claims Courts(Clauses 39-42, pp.23-26)). The Reid & Priest's proposed CPA envis-ages enforcement through the commission.
Following a request by the commission, Reid & Priest included a provisionon guarantees in the draft CPA (Clause 22(2)) to the effect that the use ofthe terms "guarantee", "guaranteed" or "warranted" or "warranty" should only beused to indicate the extent of the warranty or guarantee as well as the conditions, manner,term and place in which they can be made effective by the consumer. In addition, the termsof the warranty or guarantee should be clear and accurate as to duration, conditions anddescription of persons issuing the same (Clause 22(3)).
UGANDA LAW REFORM COMMISSION
(b) (v) Definitions.
Reid & Priest's proposed CPA defines advertising; bait advertising, consumer,deceptive advertising and door-to-door sale, price, pyramid sale and seller.
(Clause 3) The draft UCPA Bill 1999 is wider ranging in its choice ofdefinitions; which inter-alia define aspects such as "appropriate laboratory,business records, consumer contract, defect, trade practice, service", etc.
Type of legislation.
The approach in Reid & Priest's proposed CPA is preferable to that of theUCPA. The draft UCPA Bill is rather amorphous and unfocused particularlywith respect to its range of coverage which includes supply and sale of goods,unfair contract terms and regulation of entities already covered in otherlegislation. The drafting of the UCPA Bill also requires tightening up; clauses3 to 8 which deal with consumer rights, responsibility of Government, supplieror trader, consumer and beneficial interpretation are perhaps more appropriatein a constitutional context rather than legislation meant to address a particularproblem.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
CHAPTER 1
THE FAIR TRADE LAWS CLUSTER
Government has committed itself to revising the commercial laws of theRepublic of Uganda in order to support private sector development andencourage private investment.
Government through the Uganda Law Reform Commission (ULRC) hasembarked on the implementation of the Commercial Justice ReformProgramme (CJRP). The CJRP is a component of a Sector Wide Programmethat brings together all institutions within the Justice Law and Order sectoraimed at improving institutional efficiency and service delivery. Thisprogramme is generally intended to fit in the Government's macro planningframework for poverty eradication. Its implementation is guided byGovernment's avowed policies including those on economic liberalisation andprivatisation.
Under the CJRP, Government aims at putting in place legal and policy measuresthat ensure that the private sector operates efficiently and within anenvironment in which both commercial transactions and commercial justiceare respected. This is because Government recognises that the ability to enforcecontracts is a fundamental requirement for private sector development. Oneof the components of the CJRP is the reform and modernisation of commerciallaws including those that govern companies, cooperatives, joint ventures aswell as partnerships.
Commercial law reforms begun in 1996 as a sub-component under the legalsector component of the Uganda Institutional Capacity Building Project. Theproject engaged an American Consultancy firm, Reid and Priest based in theUSA who reviewed the laws under their terms of reference includingCompetition law and policy, Sale of Goods and Supply of Services, ConsumerProtection, Anti-dumping and reform of licensing procedures and producedreports and proposed amendments to the laws where they deemed it appropriate.
Draft Bills were also produced.
UGANDA LAW REFORM COMMISSION
Much as the consultants did significant work, the commission was of the viewthat further consultations with stakeholders on the proposed laws and policyformulation as well as completing the background papers to the laws werenecessary.
The commission accessed funding from the Justice Law and Order Sector ofthe Ministry of Justice and Constitutional Affairs in January 2001 to completethe reform of commercial laws. Before this, a working group under the sectoridentified priority areas of the law for reform.These included the fair tradelaws, under the fair trade cluster including competition law, sale of goods,consumer protection, trade licensing, anti-dumping and finally special economiczones.
Consumer protection laws play a very important role in laying down andenforcing rights of consumers. Laws on consumer protection prohibit unfairor misleading trade practices such as use of false weighing or measuringequipment, deceptive advertising, etc. They also set standards for the quality,safety and reliability of many goods so that failure to comply with thesestandards can result in legal action against the seller. Presently there are anumber of legislations that have provision for consumer protection. Theseinclude the Weights and Measures Act, Cap. 103; the Public Health Act, Cap.
281; the Food and Drugs Act, Cap. 278 and the National Drug Policy andAuthority Act, Cap. 206. The aim of the introduction of a consumer protectionlaw is to have a comprehensive Act that covers consumer protection only.
The key objective of reform of fair trade laws is to have modern laws supportinga competitive economy in a coherent and accessible form, providing maximumfreedom for participants to perform their proper functions but recognizing thecase for high standards and ensuring appropriate protection for all parties.
Account needs to be taken of current changes particularly globalisation,harmonization of laws in the region, modern patterns of regulation andownership, changing assets structures and the importance of small and closelyheld businesses.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Objectives for introducing a consumer protection law.
Modern law.
"Modern law" means law well fitted to meet current and foreseeable futureneeds. A new era has arrived. Time has run out for businesses that supplypoor quality products and those which come together to fix prices or rig marketsor take unfair advantage of a dominant market position. There is now a shiftfrom protection of industries to prevention of injury to the industry. To createan industrial economy that can stand the test of international competitiveness,a framework for the establishment of local industries, with the backing offoreign investment has to be introduced. Economic efficiencies are now theprime objects of trade laws and not the vague promotion of public interest aswas before.
Law for a competitive economy.
This is the predominant objective. The commission aims at pursuing policiesto facilitate productive and creative activity in the economy in the mostcompetitive and efficient way possible for the benefit of everyone, that is bymaximizing output and contribution to prosperity at minimum cost rather thansimply efficiency in the popular cost. This entails freedom for managers andothers controlling companies, cooperatives, joint ventures and partnerships,ensuring that to maximize wealth and welfare they are enabled to maximizetheir proper function in managing resources. It is not for the law to substitutefor business judgments involved but to provide optimal conditions for theirproper exercise. The commission recognises for example that the limitedcompany form has proved over the last 150 years an outstandingly successful,means for organizing productive activity, deploying and protecting investmentand allocating risks. It is critically important that the success should be preservedand indeed enhanced in the modern context; there is clearly room forimprovement.
UGANDA LAW REFORM COMMISSION
Opening up of the economy.
New approaches have been introduced to enable the country to achieve amore competitive economy. Some of these are liberalisation, prevention ofinjury rather than protectionism of industry and deregulation.
Government is committed to putting in place a policy and regulatoryenvironment that supports the operations of a modern competitive privatesector. This means delivering changes that reduce time and money thatbusinesses spend on regulatory activity and that give businesses maximumflexibility to take advantage of competitive opportunities.
Government's purpose of doing this is to improve the potential of Ugandabusiness to prosper and grow so that they can deliver more jobs and higherstandards of living to Ugandans. The reforms will open the Ugandan economyto competitive international levels in terms of skilled manpower andinformation technology.
Freedom and abuse.
This does not mean that the law should merely facilitate and secure freedomfor management and controllers of business entities. There is a trade offbetween freedom and abuse and between freedom and efficiency. Abusedamages efficiency and the credibility of business and of productive system.
The commission seeks to ensure that appropriate high standards of conductare maintained. Such standards are important components in promotingcompetitiveness and efficiency.They give rise to demands on managementwhich must be recognised both internally from shareholders, partners andexternally, ensuring that business activity responds also, to the maximumextent it efficiently can, to wider economic, environmental and social needs.
Consideration has to be given to the fact that specialised legislation such asemployment laws, health and safety laws, consumer protection andenvironmental laws etc have a bearing on the relations between members orpartners, creditors and directors. The law should have a place in securingbusiness entities are operated in a way that wide ranges of interests are met.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Comprehensive and coherent reform.
The purpose of reform is to produce a coherent framework through acomprehensive reform process. Comprehensive reform is in fact essential toproduce a competitive and efficient outcome. The present laws have manystrengths and benefits but fail in terms of responsiveness to the shape ofmodern businesses and in the accessibility of the language in which they areexpressed relevant provisions sometimes being hard to find and understandand expensive to administer. Anti-abuse provisions may take the form of anunduly wide prohibition, sometimes introduced for broad or now supercededreasons, overlaid with complex exemptions, to which are attached a furtherlayer of conditions and safeguards. The purpose may be reasonably clear intheory but may bear little relationship to modern commercial reality particularlyin the context of the wide range of purposes to which the law is put. Underthe company law provisions for example, elaborate prescriptive structuressuch as the capital maintenance doctrine, have built up on the back of theorieswhich may now have only limited relevance.
Justification for change.
These problems are exacerbated by more general changes. Today's marketsand businesses are characterized by the following key trends.
Uganda's economy is less insulated from wider influences. The increasingopenness of regional and international trading relationships reinforces the needfor a low cost, speedy and efficient method of organisation of commercialactivity, attractive to foreign undertakings and providing an optimalinfrastructure for indigenous ones. The increasing international mobility ofbusiness and capital and the ability of firms to operate internationally, withoutlocal incorporation, also raises the need to review systems for regulatingoverseas businesses operating within Uganda.
UGANDA LAW REFORM COMMISSION
Uganda's membership in the East African Community (EAC) and the CommonMarket for East and Southern Africa (COMESA) has two relevantconsequences. First, the increasing openness of Ugandan markets and that ofits partners is part of the globalisation process. Secondly, Uganda has becomeparty to the EAC legal harmonisation programme which is part of the singlemarket enterprise.
Competition law for instance depends on, and in ultimate output very largelyconsists of, the accumulation and communication of information. The newsystems for electronic communication and information management have thepotential to transform the processes and the substantive relationships involved.
The trend is now towards paperless transactions.
The modern asset mix.
The pattern of productive activity in many sectors of the economy is shiftingto become increasingly human resource and knowledge based. Assets structuresare changing and becoming increasingly "soft" in the sense that a significantproportion of the value or capacity of the business is to be found in intangiblesrather than in tangible assets such as buildings and machinery. The skills ofthe work force are particularly important labour now being a resource whichrequires specific training, development and mutual commitment.
More recently developed forms of intangibles such as marketing and otherreputational activity can create an ethos and brand image which conferscompetitive advantage. Global brands are major assets which can changehands at very high prices. In some sectors regulatory expertise or internationalexperience may be a key hard won advantage. Even businesses with a highfixed and tangible asset component depend on effective deployment of such"soft" assets. The Ugandan law as it is now fails to capture such assets, toenable assessment by investors and others, or to ensure accountability ofmanagement for stewardship. Traditional reporting requirements focus onhistoric experience and tangible assets and not prospective opportunities risks,human and intellectual investment.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
1.4.1 (i) Economic liberalisation.
The liberalisation of especially commodity marketing, export trade and foreignexchange has resulted in competitiveness which has been associated withefficiency in the marketing systems, improved farm level prices and generallyincreased incentives for farmers and the investing population to increaseproduction and improve on service delivery. On the export trade side, internationaltrade especially in agro- produce has increased while the industrial sector hasregistered tremendous increases in agro-based industrial establishments.
However the limitations of liberalisation are largely due to lack of properimplementation arrangements and less to do with the policy its self.
1.4.1 (ii)
The divestiture of public enterprises has resulted in increased efficiency inthe area of investment and marketing of produce. The Public Enterprise Reformand Divestiture Act, Cap. 98 provides for the implementation of Governmentpolicy of privatisation of public enterprises. It provides for the reform anddivestiture of public enterprises and it establishes a committee to implementthe law and policy on privatisation.
Under the PERD Act, public enterprises are categorised into five classes.
Class I covers Public Enterprises in which Government is to retain 100%shares. Class II has Public Enterprises in which Government is required toretain the majority shares. Class III has Public Enterprises in which Governmentis to retain minority shares. Government is to fully divest from those PublicEnterprises in Class IV while those in Class V are to be liquidated.
The Act provides for the subscription for and acquisition of shares in a publicenterprise in which the State is required to hold shares as well as for theregistration of public enterprises as public companies outside the rubric of theCompanies Act. In this connection, this law states that in the divestiture ofpublic enterprises, the Companies Act is subject to the PERD Act and that inthe event of a conflict, the PERD Act prevails.
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1.4.1 (iii)
Poverty Eradication Action Plan (PEAP).
This has been the over riding Government policy since 1997. It is linked to along term vision to reduce absolute poverty to less than 10% by 2017. ThePEAP provides the strategic framework that guides the preparation of theMedium Term Expenditure Framework (MTEF) and the annual budget.ThePEAP which was prepared in close consultation with the civil society is basedupon in-depth studies of the nature of poverty and the way poor peoplethemselves perceive it.
The PEAP has four pillars, linked to four overarching goals-Goal 1: Rapid and sustaining economic growth and structural transformation,Goal 2: Governance and security,Goal 3: Increased ability of the poor to raise their incomes, andGoal 4: Enhanced quality of life of the poor.
All other sector and non-sector policies are designed to contribute to structuraltransformation of the population particularly the rural poor who constitute thebulk of the population and who are the most affected by abject poverty. As astrategy for implementing the policy, Government has transformed the policystatements into a comprehensive and holistic plan- the Poverty EradicationAction Plan (PEAP).
1.4.1 (iv)
Plan for Modernisation of Agriculture (PMA).
Cognisant of the fact that the agricultural sector is the major source of livelihoodfor the peoples of Uganda, Government has enlisted the structuraltransformation of the agricultural sector as a major strategy for eradicatingpoverty. The Plan for Modernisation of Agriculture has been designed as acomprehensive and holistic strategic framework for eradicating rural and urbanpoverty through structural transformation of agriculture. PMA aims ataddressing poverty through complementary, sustainable and relevantinterventions that are location specific and inclusive in targeting and mindfulof pressures on all members of the household.
Within the framework of PEAP, the PMA has four objectives: to increaseincomes and quality of life of the poor through increased productivity, to A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
improve household food security through the market, to increase farm andnon-farm employment through secondary processing and services and topromote sustainable use and management of natural resources.
1.4.1 (v)
Government has put in place a favourable policy for attracting both domesticand foreign investment. This has been through attractive tax regimes, etc.
1.4.1 (vi)
Decentralisation of public service delivery was intended to bring servicesclose to service delivery points. Services relating to the agricultural sectorinclude provision of extension services, decentralization of agricultural research,revenue collection and utilization and development of rural infrastructure suchas feeder roads, markets and telecommunication systems, among others.
1.4.1 (vii)
Gender policy and action plan for women.
Government has, since 1986, pursued a deliberate policy of mainstreaminggender issues in all development programmes. This has been implementedthrough affirmative action in governance, education and other areas. In thetrade and agricultural sectors, however, the gender imbalances still remain,yet the women constitute the majority of agricultural producers in the country.
The National Gender Policy 1997, in line with the Constitution and the LocalGovernments Act, provide a policy framework for addressing the genderimbalances that arise from unequal opportunities and access to control overproductive resources. The national action plan on women details the variousissues to be addressed to improve the economic and social status of womenand youth and the strategies for addressing them. Key issues consistent withPMA include improving household nutrition, food security and householdincome; developing entrepreneurial capacity of women and encouraging womento establish small and medium enterprises (SMEs) as well as large scalebusiness units; encouraging women to own or co-own property, join cooperativegroups; reducing the workload of women; and supporting the introduction anduse of energy and labour saving technologies.
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1.4.1 (viii)
Local Government Development Programme (LGDP).
This is a medium to long-term multi-objective development framework forthe institutional development of local governments. It will provide a systemthrough which service delivery at local level will be implemented. The PMAgrant to districts and subcounty levels will be channelled through the LGDP.
However, there are likely to be complications in accountability as the localgovernments are under the local government accounting system while somePMA resources may require compliance with specific donor or Governmentaccounting regulations which may differ in some respects 1.4.1 (ix)
Medium-Term Expenditure Framework (MTEF).
This provides a budgetary framework in which all publicly funded programmeshave to be implemented. The MTEF imposes budget ceiling in the mediumterm (3 years) and the particular sectors have to plan and implement theirprogrammes within that arrangement. Whilst it imposes constraints, the MTEFcompels sectors to rationally plan for resources, by setting priorities and makingrealistic budget milestones.
1.4.1 (x)
Medium Term Competitiveness Strategy (MTCS).
The private sector has a central and significant role to play in thecommercialisation of the agricultural sector. The MTCS is intended to providea strategic framework for creating an enabling environment for the privatesector to fully participate in agricultural production, processing and marketing.
It is aimed at putting in place, mechanisms that attract and increase privateinvestment and saving and increase competitiveness of Uganda's privateentrepreneurs in regional and international markets. The priority actions,consistent with the PMA, are summarized thus- expanding infrastructure and utilities which will result inreduced production costs, increased access to marketsand improved quality of services; strengthening the financial sector (commercial anddevelopment banks, micro-finance institutions (MFIs)) andimproving access to financial services; A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
improving efficiency and effectiveness in the delivery of publicservices (extension, justice, road maintenance, revenuecollection and utilization); strengthening regulatory services for environmentalmanagement, quality control in industry and business, etc.); developing human capital in local and central Government,NGOs and private sector in areas of production, businessmanagement and governance; and removing impediments to export sector growth.
1.4.1 (xi)
Land policy and land use policy.
Government is in the process of putting in place a comprehensive land policy andintegrated land use policy to operationalise the Land Act, Cap. 227. The implicationsfor the current land policy proposals for the implementation of the PMA, will becritically examined and appropriate recommendations made. However, theconsultants shall be restrictive on particular key legal and policy issues that relateto the production, processing and marketing of agricultural produce (crop, livestock,tree products) as raised in the PMA. The team intends to work closely withconsulting team specifically dealing with the land sector issues.
1.4.1 (xii)
The Land Sector Strategic Plan (LSSP).
The LSSP is aimed at providing the long-term implementation framework forthe Land Act. Its strategy is to improve the livelihoods of the poor throughmore effective use and management of land resources. The policy and legalissues include more equitable distribution of land access and ownership andgreater tenure security for vulnerable groups (women, squatters, orphans).
Special categories will include pastoralists, those who depend on forestresources and others who lease community, state or other land including forests,wildlife reserves and rangelands.
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The strategic objectives of the LSSP are- to create pro-poor policies and legislation for the land sector; to allocate land resources to more productive uses and users to ensure a more equitable distribution of land access andownership and greater tenure security for vulnerable groups(women, squatters, orphans, widows, landless) to create and disseminate information on land use and landrights to establish more effective institutions and systems fordelivery of land services (resolution of disputes, surveyingand mapping,) to mobilize public and private sector resources fordevelopment of the land sector 1.4.1 (xiii)
There is an inextricable link between population and the attainment of povertyeradication goals outlined in the PMA. The growth rate of population anddemographic characteristics of a country's population have implications foravailability and management of resources (land, water,) and impose varyingconstraints on public services delivery systems (for example education, health,water and sanitation, etc). For instance, there is high positive correlationbetween population density and land fragmentation as evidenced in Kigezi,Bugisu and parts of the Lake Victoria basin.
The National Population Policy 1995, outlines Government strategies forattaining a well balanced population growth by, among others, improvingnutrition, educating the girl child and making reproductive health servicesavailable and affordable to the poor. The policy recognizes a need for multi-disciplinary approach to population development and has enlisted inter-sectoralapproaches to implementation, involving agriculture, labour, environment andeducation sectors.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
1.4.1 (xiii)
National Environment Management Policy, 1994.
This relates to the sustainable use of natural resources, so as to preserve thequality of the environment. It also seeks mechanisms that promoteenvironmentally sound commercial and industrial establishments as well asin other areas such as education and population.
The National Environment Action Plan (NEAP) that was formulated in 1995to operationalise the policy is overdue for review as provided for in the policy,having been in place for five years.
1.4.1 (xiv)
Needs, consequences and facts.
If the review is to achieve efficient outcomes, then it must avoid the piecemeal,issue driven and self-referential approach. It should be driven by factualresearch into the mismatch between existing rules and practices and bycommercial needs and by a fact based economic assessment of the likelyconsequences of the various options. The cost of reform is in itself an importantfactor which may well rule out proposals which look attractive in the abstract.
It is therefore better to ensure that people with a range of expertise and withaccess to relevant networks of other experts and thus with access to empiricalmaterial, participate in appropriate working groups.
1.4.1 (xv)
International competitiveness and comparative
approach.
Wide ranges of company law reform projects have been conducted in recentyears in the Common Wealth, North America and Continental Europe. It istherefore essential to learn all that we can from these initiatives. Thecommission has been fortunate to have experts in foreign systems working onthis project. However care must be taken to avoid unthinking adoption ofideas which depend for their effectiveness on the environment in which theyhave been developed. Alot can also be learnt from the failures of otherjurisdictions.
1.4.1 (xvi)
Uganda's membership in the East African Community entails the work tobear in mind the need for harmonization of the laws in the East African Region.
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CHAPTER 2
CONSUMER PROTECTION LEGISLATION.
Consumer protection refers to the protection afforded to a consumer not onlyagainst fraud and dishonesty in commercial dealings but also oppressivebargains and qualitatively deficient goods and services. Consumer protectionis an ancient law, yet little has been done in this regard in this country.
Regulatory systems and machinery does exist but this is unsophisticated,incomplete and insufficient. This leads to confusion and places consumers inweaker positions than those with whom they deal, depriving them of theirmoney's worth and product value. Consumer protection laws play a veryimportant role in laying down and enforcing rights of consumers. Laws onconsumer protection prohibit unfair or misleading trade practices such as useof false weighing or measuring equipment, mislabelling, etc. They also setstandards for the quality, safety and reliability of many goods so that failure tocomply with those standards can result in legal action against the seller.
Consumer protection in Uganda.
There is at present no legislation in Uganda which deals specifically withconsumer protection. There are, however, legislations, that deal with certainaspects of consumer protection. Examples of these are the Sale of GoodsAct, dealing with the quality of goods, the Customs Management Act,(incorporating the East African Customs and Transfer Management Act,Cap.27, Laws of the East African Community); dealing with prohibited orrestricted imports, the Weights and Measures Act, Cap. 103 as amendedregulating weighing and measuring, pre-shipment inspection (CMA.s.27(5)and(6)), Adulteration of Produce Act, Cap. 27 ensuring produce of goodquality products that are free of defects, National Drug Policy and AuthorityAct, Cap. 206 regulating consumption of drugs, Food and Drugs Act, Cap.
278 regulating the prevention of adulteration of food and drugs, Public HealthAct, Cap. 281 regulating the security and maintenance of health; and theUganda National Bureau of Standards Act, Cap. 327 – relating to the qualityof goods imported into the country.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Contract Act, Cap. 73
The Contract Act is not a law of contract specific to Uganda but only statesthat the English common law will apply to Uganda subject to modifications tomake it locally suitable. Up to date, the Contract Act has not been amendedor updated to suit local circumstances or to incorporate developments in thelaw of contract generally or consumer protection in particular. This meansthat where a consumer is cheated and he or she takes the matter to court, theUgandan courts will use the English common law relating to contracts butsimply modify it to suit the particular case.
It is important to note that the United Kingdom has since enacted a number oflaws to protect its consumers. These include the Unfair Contracts Act andthe Consumer Protection Act. There is therefore a need to enact a newcontract Act to cater for the numerous problems that Ugandan consumersencounter on the market each day.
The Sale of Goods Act, Cap. 82
Similar to the Contract Act, the Sale of Goods Act provides for basic principlesof general contract law and focuses on transactions involving the sale of goods.
The Sale of Goods Act addresses the unequal status among parties to contractsby enacting exceptions to the general rule of freedom of contract. Under thedoctrine of caveat emptor (buyer beware), it cautions consumers to rely ontheir own resources and devices when contracting. Under the Act, there isalso an implied condition that the goods will be fit for the purpose for whichthey are purchased "where the buyer makes known to the seller the particularpurpose for which the goods are required". Another implied condition is thatthe goods will be merchantable or commercially viable.
The Act has a number of weaknesses. For example section 54 permits partiesto contract out of the provisions of the Act by stipulating that "where anyright, duty or liability would arise under a contract of sale by implication oflaw, it may be negatived or varied by express agreement or the course ofdealing between the parties, or by usage, if the usage be such as to bind bothparties to the contract." In practice, most vendors and suppliers make UGANDA LAW REFORM COMMISSION
consumers accept the exclusion or limitation of the protective provisionsembodied in the Act.
Section 5 of the Sale of Goods Act requires that a contract for the sale ofgoods of the value of two hundred shillings or more has to be in writing if it isto be enforceable. This provision is also very limiting first, because in Ugandatoday, two hundred shillings does not buy anything of value. Secondly, mostof the contracts for sale of goods in Uganda are not in writing. Therefore, aconsumer who buys defective goods may fail to enforce the breach in a courtof law because the contract of sale was not in writing.
The Weights and Measures Act, Cap. 103.
The main function of this Act is to provide for and to regulate the use ofweighing and measuring equipment. It seeks to ensure that a consumer ofgoods should be given the right quantity of goods and to achieve this by layingdown detailed procedures of how weighing or measuring equipment is certifiedas fit for use in trade. The Act also makes it an offence to sell or expose forsale under weight goods.
The commission has noted that one general weakness about the Weights andMeasures Act as amended is its heavy reliance on penal sanctions to enforcecompliance. Moreover the offences created throughout the Act attract verypaltry fines ranging between five hundred shillings and two thousand shillings.
These fines have never been revised upwards. A consumer who has boughtunderweight goods as a result of a trader using false equipment is not interestedin seeing the trader going to jail. A consumer's need is just to get compensatedor to be given the right quantity of goods that he or she had paid for. This Actshould be amended so as to provide for more up to date ways of appeasing acheated consumer, for example compensation or being given the right amountof goods.
The Uganda National Bureau of Standards Act, Cap. 327.
This Act establishes the Uganda National Bureau of Standards (UNBS). Themain functions of UNBS are to formulate, determine, modify, endorse andenforce standards for commodities and codes of practice. Other functions of A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
UNBS which are of specific relevance to consumer protection are to enforcestandards in protection of the public against harmful ingredients, dangerouscomponents and shoddy material; to provide for testing of locally manufacturedor imported commodities to determine whether such commodities conform tothe standard specifications.
The commission recognises the fact that the Act does not have clear avenuesfor redress of consumer complaints. For instance, there is no provision in theAct that boldly states that the UNBS may receive complaints from the consumingpublic in case a consumer is cheated or has bought substandard products.
National Drug Policy and Authority Act, Cap. 206.
This is the basic law regulating drug use in the country. Regulation of theconsumption of drugs is very important because there is no person who can dowithout drugs. Besides, drugs, if not used properly, can lead to devastatingconsequences. Under the Act, National Drug Authority is established toregulate importation, exportation and sale of pharmaceuticals in Uganda andto approve the National List of Essential Drugs.
Control of drug supply.
Under the National Drug Authority Act, no person will import or sell anydrug unless it appears on the National Drug Formulary. The National DrugAuthority Act is a recent legislation that has generally gone a long way inensuring that drug users or consumers are protected. Some of the mainchallenges to the National Drug Authority Act relate to its implementation orenforcement. One of the most glaring lacunae in the Act however is the lackof regulation of herbal medicines.
A large number of consumers in Uganda use herbal medicines. It has beendiscovered that some herbalists mix herbs with conventional drugs to treatsome ailments, for example, some of them mix herbs with anti-malaria drugssuch as chloroquine and the concoction is used to treat malaria. This poses aserious health risk to the consumer. These practices however continue unabatedand are not investigated mainly because the National Drug Authority Act does notprovide any mechanism for regulating herbal medicines and their use.
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Food and Drugs Act.
This Act makes provision for the prevention of adulteration of food and drugs.
The Act prohibits the sale for human consumption food or drugs renderedinjurious to health. Any person found selling adulterated food or drugs commitsan offence and is liable on conviction to a fine of two thousand shillings orimprisonment not exceeding three months. The Act makes it an offence forany person to display food with a label that falsely describes the food or iscalculated to mislead as to its nature, substance or quality. The Act establishesa Food Hygiene Advisory Committee with a Chairperson and membersappointed by the Minister. However, the Act does not clearly spell out thefunctions of this committee but merely says that the Minister may from timeto time refer to the committee for consideration and advice on any questionsrelating to the Act as it applies to food.
Like the Weights and Measures Act, this Act has good provisions which if
implemented, would curb the sale of adulterated food and drinks. However,
the Act also lacks effective provisions that would ensure compliance and also
relies on penal sanctions to enforce compliance and these are very low. The
Food Hygiene Advisory Committee established under the Act is not active.
Perhaps this committee was active, it would have innovated better methods
of food hygiene and also halted sale of expired and adulterated food on the
market. Some of the major challenges to enforcing the Food and Drugs Act
are poverty, lack of informed consumers, lack of adequate administration and
enforcement, etc. In a situation where the majority of consumers are very
poor, what matters to the majority of the consumers is availability of food as
opposed to the quality of food.
2.10
The Public Health Act.
The Public Health Act is intended to make provision for securing andmaintaining health. It covers a wide range of public health and consumermatters such as sanitation, housing, prevention of infectious diseases, protectionof foodstuffs, public water supplies, meat, milk and food articles.
The judicial system.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
The courts have an important role to play in providing remedial or reactiveprotection to consumers and can also provide preventive or proactive protectionwhere, for instance, an injunction is granted to restrain an impendinginfringement of consumer's rights. The courts are often institutions of lastresort after such remedies as negotiation, reconciliation, mediation, orarbitration between consumers and suppliers or providers have failed or whenadministrative tribunals fail to provide relief.
The commission has noted that the lower courts are more accessible in termsof geographical access, are less costly in terms of filing fees and representationand are relatively faster in dispensing of cases than in the higher courts.
Consumer protection in the judicial process is also compromised by the scarcityof a clear and comprehensive regime of substantive law as well as by technical,procedural and evidentiary rules which also makes it difficult for consumersto represent their own interests. Since the majority of consumers may beilliterate in law, some degree of strict liability should be imposed on sellers.
From the above analysis one can conclude that there is an urgent need toenact a consumer protection law that boldly lays down the rights of consumers,the obligations of the suppliers and the remedies open to aggrieved consumers.
There is also urgent need for the establishment of small claims courts ortribunals to quickly handle consumer complaints.
In the course of formulating proposals for the introduction of consumerprotection legislation, the commission reviewed the following literature andlegislation- (a) Consumer Protection Act, 1987 (UK); (b) Consumer Protection Law of Mongolia, 1991; UGANDA LAW REFORM COMMISSION
(c) Report by Reid & Priest on Consumer Protection, 1998; (d) Swaziland's Consumer Protection Act, 1986; (e) Uganda Consumers' Protection Association (UCPA), A Study Report on Problems faced by Consumers Under Existing Lawsin Uganda; and (f) UCPA, Proposed Draft Uganda Consumer Protection Bill A perusal of these documents has resulted in the following assessment basedon the aspects of consumer protection law addressed in these documents andthe need for material for the drafting of a consumer protection bill.
Reid & Priest have proposed the promulgation of a Consumer Protection Actwhose objective is to provide sufficient breadth in its application in order tocurtail innovative business fraud schemes that could occur in the future.
Nevertheless, it is restricted to the prohibition of fraudulent and deceptivepractices and does not regulate the quality of goods or the prices charged forthem. The public concern about substandard goods that are also excessivelypriced, are more appropriately dealt with under Consumer Product Safetylegislation while the quality of products is governed by the SGA. Prices ofconsumer goods are regulated by the market and healthy competition.
Nevertheless, the proposed Consumer Protection Bill prohibits unfaircompetition by banning fraud and deception which forestall consumers fromaccess to adequate and accurate information about the products they buy.
Reid & Priest's proposed Consumer Protection Bill defines advertising; baitadvertising, consumer, deceptive advertising and door-to-door sale, price,pyramid sale and seller. The draft UCPA Bill, 1999 is more wide ranging inits choice of definitions; which inter alia define aspects such as "appropriate A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
laboratory, business records, consumer contract, defect, trade practice,service", etc. The controversy over the definition of a "consumer" is resolvedby adopting the UCPA's comprehensive definition.
Reid & Priest's Proposed Consumer Protection Bill stipulates a fine of up toshs 1 million or imprisonment of up to six months or both for violating provisionsof the proposed law. In addition, the court may order the person to paycompensatory damages, Advocate's fees and any other damages deemed fitby the court.
The consumer is also permitted to retract from the contract within seven daysfrom the signature of a contract or the receipt of the good or service if thecontract has been entered into outside the supplier's place of business especiallythrough telephone or at the consumer's domicile. The Reid & Priest's proposedConsumer Protection Bill envisages enforcement by a consumer protectioncouncil.
The draft UCPA Bill provides for representative or class actions to enforceconsumer rights. While penalties should not be so high that they prohibittrade they should be high enough to prevent arbitrary disregard of the law.
The Consumer Protection Act should be promulgated from the provisions ofthe Consumer Protection Bill as proposed by Reid and Priest and provisionsderived from the UCPA Bill, 1999.
Analysis of the provisions of the law on consumer protection.
2.17.1 Definition and purpose.
The commission recognises that the aim of consumer protection is to equipconsumers with knowledge about products and services they buy, so that theycan make informed decisions about their purchases and where such decisionscannot be made, to ensure that the goods conform to some reasonable safety UGANDA LAW REFORM COMMISSION
requirements. Consequently, any consumer protection legislation shouldestablish reasonable safety requirements on the suppliers of goods and at thesame time assist consumers to avoid deceptive or unfair trade and commercialpractices in Uganda.
This may seem like an unnecessarily heavy burden to place on the suppliers ofgoods in addition to those burdens already placed upon them by legislationlike the Sale of Goods Act and other legislation mentioned above, howeverthis can be defended by pointing out that suppliers of goods are in many casesarmed with better technical knowledge than the consumer. Placing a checkon the supplier means that there is a higher level of quality of the goods in themarket for the customer to choose from.
In this vein, such legislation is expected to guide sellers on how to conducttheir businesses; information to consumers on the goods and services theyare buying and remedies to consumers who are injured by unfair or deceptivepractices.
In summary, the Consumer Protection Act will protect the following rights ofthe consumer; The right to be protected against marketing of goods and services which are hazardous to life and property; The right to be informed about the quality, quantity, potency, purity, standards and price of goods and services; The right to be assured, whenever needed of access to an authority of goods and services at competitive prices; The right to be heard and to be assured that the consumer's interests will receive due consideration at appropriate forums; and The right to seek redress against unfair trade practices or unscrupulous The effect of the proposed Consumer Protection Bill would be in addition toand not in derogation of the provisions of any other law.
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It is the commission's proposal to limit the application of the Act and excludesale or rental of real estate, banking, utilities, sale of insurance, publicationsor broadcasts. These are excluded because they are covered in other lawssuch as the Financial Institutions Act and the Communications Act. It isenvisaged that these other laws offer adequate protection to consumers inthose fields. To ensure protection to the consumer, the proposed law shouldcover areas that are not addressed by any other laws in Uganda. The taskforceobserved that drafting provisions in the proposed Consumer Protection Actthat are similar to other existent laws would create confusion. Where theother laws are silent, the Act would apply.
In contrast, the draft UCPA Bill, 1999 intends to regulate financial transactionsincluding general insurance, heath insurance, hire purchase, mortgages, etc aswell as consumer credit contracts primarily involving the supply or sale ofgoods, services or technology. The draft UCPA Bill also addresses issues ofunfair contracts which should perhaps be the subject of separate legislation inline with trends in other jurisdictions.
The Act shall apply, except where the law applicable is inconsistent with the Act on the provisions relating to – the sale or rental of real estate, banking, utilities or the sale of insurance; the owner or publisher of a publication or printed matter in which an advertisement appears; or the owner or operator of a television or radio station which disseminates the advertisement.
2.17.3 Definition of consumer.
The interpretation section provides definitions of key words and phrases inthe Act. The commission reviewed definitions from Consumer ProtectionActs of other countries and the model law on consumer protection of Africa.
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The definitions proposed to be included in the Act by the commission wereadopted by the taskforce without much deliberation. However regarding thedefinition of "consumer", the taskforce members wanted to know who a‘consumer' was. This was important because the consumer is the person whois protected under this Act. Some members of the taskforce wanted theproposed law to cover all kinds of consumers – consumers of raw materials;intermediate products (industrial) users; and of end products. It was arguedthat these were all consumers who should be protected under the Act. Toprotect only one kind of consumer would not be fair.
The commission however advised that the Act could not protect all kinds ofconsumers. Its emphasis was only aimed at the final consumers of products andservices. To widen the scope of the Act to include the intermediate consumers(those who use products to produce the final product) may not be enforceable.
The taskforce agreed that the proposed draft Consumer Protection Bill shouldonly apply to the end user. The intermediate and other consumers to be protectedunder the provisions of the Sale of Goods Act such as sale by description.
A consumer means the final purchaser of a good or service.
2.17.4 Administration of the Act.
The draft UCPA Bill contained provisions for the establishment of a councilto administer the Act. The council would consist of persons from varioussectoral organisations such as the Uganda National Bureau of Standards andthe Ministry of Trade. The functions of the council would be- to formulate and submit to the Minister policy and legislativeproposals in the interest of consumers, consider and examine andwhere necessary, advise the Minister on the modification, consolidationor updating of legislation providing protection to consumers in theareas covered under, or related to this Act; to create or facilitate the establishment of conflict resolution mechanisms on consumer issues, investigate any complaint received A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
regarding consumer protection and where appropriate, refer thecomplaint to the appropriate competent authority to which the complainthas been referred; to carry out, promote or participate in consumer education programs and activities, disseminate consumer issues with a view to proposingmeasures to address the issues, provide advice to consumers on theirrights and responsibilities under appropriate laws, make available toconsumers general information affecting the interests of consumers; to co-ordinate consumer protection activities; to establish and approve rules and procedures for financial and administrative matters and terms and conditions of service of staff; and to perform any other functions as are conferred upon the Council by this Act or as may be necessary for the proper carrying out of thepurposes of this Act.
The taskforce agreed with the proposal to establish a council to administerthe Act. However, the commission is of the view that the council is notnecessary because Government institutions and private organisations inexistence could perform its functions. Further more, the establishment of acouncil would mean Government resources (which are already limited) willbe needed to fund its running. The commission also noted that the Act providesfor measures for consumer redress that provide for the defence, promotionand enforcement of consumer rights under the Act. Therefore, there is noneed to have a council established under the Act.
A consumer protection council shall not be established to administer the Act.
2.17.5 General safety requirement.
The commission proposes to establish a general safety requirement with whichthe suppliers of consumer goods would have to comply. This safety requirementor rather general duty is adopted from the United Kingdom's ConsumerProtection Act, section 9. This is a "catchall requirement" that is intended to UGANDA LAW REFORM COMMISSION
account for future innovations that are geared towards evasion of the operationof this bill. Hence it would be an offence if a person supplied any good orservice which failed to comply with the general safety requirement. Theoffence also includes persons who offer or agree to supply such goods; orexpose or possess any such goods for sale. The general safety requirementwill also respond to newly discovered hazards.
The section is intended to apply to "first suppliers'' but retailers will be liablewhether they knew or had reason to believe that goods failed to comply withthe general safety requirement. The section does not apply to goods suppliedfor re-export nor to second hand goods.
A provision on the general safety requirement should be included in theConsumer Protection Act. Consumer goods fail to comply with the generalsafety requirement if they are not reasonably safe having regard to all thecircumstances including- the manner in which and the purposes for which, the goods are being or would be marketed, the getup of the goods, the use of any mark inrelation to the goods and any instructions or warnings which are givenor would be given with respect to the keeping, use or consumption ofthe goods; any standards of safety published by any person either for goods of a description which applies to the goods in question or for matters relatingto goods of that description; or the existence of any means by which it would have been reasonable (taking into account the cost, likelihood and extent of any improvement)for the goods to have been made safer.
2.17.6 Restrictions on advertising and other related practices.
Underlying the Proposed Consumer Protection Bill is the need to combatunfair or deceptive trade practices with a view to protecting the consumer. Acentral feature of this effort is to gauge whether an unfair practice inflicts or A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
is likely to inflict, substantial injury to consumers. To balance this, it is necessaryto consider whether the practice is not outweighed by any countervailingconsiderations and that it could not have been reasonably avoided. The standardfor gauging whether a practice is deceptive, according to Reid & Priest iswhether it tends to or is capable of deceiving the consumer who is the finalpurchaser of a good or service.
The proposed sections if implemented will specifically prohibit unfair tradepractices. Trade practices are practices which for the purpose of promotingthe sale, use or supply of any goods or for the provision of any service, adoptany unfair method or deceptive practice including any of the followingpractices.
The practice of making any statement whether orally or in writing or by visiblerepresentation which- falsely represents that the goods are of a particular standard, quality, quantity, grade, composition, style or model; falsely represents that the services are of a particular standard , quality falsely represents any re-built, second-hand, renovated, reconditioned or old goods as new goods; represents that the goods or services have sponsorship, approval, performance, characteristics, accessories, uses or benefits which suchgoods or services do not have; represents that the seller or the supplier has a sponsorship or approval or affiliation which such seller or supplier does not have; makes a false or misleading representation concerning the need for, or the usefulness of any goods or services; and gives to the public any warranty or guarantee of the performance, efficacy or length of life of a product or of any goods that is not basedon any adequate or proper test thereof.
The commission noted that in some jurisdictions where consumer protectionlegislation has been implemented, various practices have been developed in UGANDA LAW REFORM COMMISSION
an attempt to avoid the operation of the Act. The Consumer Protection Actspecifically prohibits these activities. They include- Pyramid schemes: These are sales in which, under the guise of selling aproduct, one is actually being sold a membership in the pyramid in addition tothe product .The reason for prohibiting this particular practice is that it isalmost impossible to expect the member of the pyramid to be sure of anyrepresentations that are made in connection with the product, in addition tothis the original supplier of the product increases his or her remoteness fromany liability for negligence under tort or under the consumer protectionlegislation for any representations made to encourage a customer to purchasethe goods in question.
Bait Advertising: This refers to a situation whereby one product is advertisedwhen in actual fact another is being sold. This means that it is not possible forthe authorities to keep track of the quality of the product that is actually beingsold or even whether it is legal. An example would be a restaurant advertisedas an internet café. In this case it would be difficult for health inspectors toensure that health and sanitation requirements are maintained in the productionof the food sold in such a restaurant.
A person shall not publish an advertisement containing an offer to sell a product unless that offer is genuine and bonafide efforts have beenmade by that person to sell the advertised product.
It is the duty of every supplier of goods, technology or services to provide consumers with true, adequate, clear and prompt informationon the goods and services offered, so that they can make a better andinformed choice.
A person shall not, in an advertisement, use a statement or other representation which creates a false impression as to the grade, quality,make, value, currency of model, size, colour, usability or origin of theproduct offered; or represent the product in such a manner that on the A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
disclosure of the true facts, the buyer may be switched from theadvertised product to another.
Abusive advertising is prohibited.
A seller shall not discourage a prospective buyer of an advertised product or service as part of a bait scheme to sell another product orservice.
A seller shall not, in the event of a sale of an advertised product or service, prejudice a sale with the aim of selling another product orservice.
A person shall not, in the conduct of any business, trade or commerce or in the furnishing of any service engage in deceptive advertising.
A person selling any goods shall not represent in any way expressly or impliedly that the goods which that person is selling are new whenthey are used, reconditioned or being sold "as is".
A person shall not engage in a pyramid sale.
Where a seller sells a product through bait advertising, the consumer may return that product to the seller and claim a refund.
A person shall be guilty of an offence if, in the course of any of his or her business, he or she gives (by any means whatever) to any consumersan indication which is misleading as to the price at which any goods orservices are available (whether generally or from a particular person).
Practically, all manufactured goods reach the ultimate consumer withguarantees. It is a common practice for the purchaser of consumer goods to UGANDA LAW REFORM COMMISSION
be supplied with a printed document (guarantee) by the retailer from whomhe or she buys the goods. The manufacturer issues this document. Theguarantees perform promotional functions for the manufacturers in additionto acting as a system of quality control whereby information can be obtainedabout the performance of the product.
The typical guarantee contains undertakings by the manufacturer as to defectsin the goods sold. Minor defects that do not of themselves make the goodsunmerchantable may also be covered by the guarantee. The manufacturerundertakes to repair or replace defective parts or equipment free of chargeduring a specified time. Frequently, the buyer will be required to dispatch thedefective goods or parts at his or her own cost for repair or replacement.
The advantage of a guarantee is that it gives a remedy without the formalityof establishing a legal claim. The guarantee is usually expressed to be withoutprejudice to the statutory implied conditions and warranties, because it wouldbe an offence if the guarantee gave the impression that it superseded thestatutory rights of the buyer.
However, guarantees do not afford sufficient protection to a consumer becausethey take away some rights. Almost invariably the guarantee excludes allliability for consequential damage. This reduces the manufacturers' liabilitybecause if the product is defective, the manufacturer will not pay for the lossor damage which the consumer attains but only replace the defective parts orequipment within the time specified under the guarantee. If the time haselapsed, the buyer will not have a remedy. Guarantees may also purport tomake the manufacturer the sole judge in dispute with a consumer. In suchcase, a manufacturer may say that there is nothing wrong with the product.
Retailers are also able to avoid their legal responsibility, since a remedy ofrepair or replacement is only available against the manufacturer. Lastly all aconsumer is entitled to are the rights availed under the guarantee.
Provisions on guarantees will be included in the consumer protection Act.
Measures and mechanisms for consumer redress.
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The commission noted that one of the recurring problems was lack of consumerredress mechanisms. The judicial process under the current law was seen asexpensive, slow and subject to many legal technicalities. A consumer whowanted redress for a wrong has to go through the present litigation system inUganda that is often accused of stifling quick and efficient court process.
Most aggrieved consumers give up enforcing their claims because of theslow and expensive process in Ugandan courts.
The commission proposes that the best remedy would be to create an alternateavenue for consumer to seek redress without entering into the mainstreamjudicial system of the country. Consumer related cases would first be broughtto a form of court called the small claims courts. The commission is wellaware that the commercial division of the high court is now operational.
However the small claims courts are meant to handle consumer-related matters- faster and cheaply. They would not operate like the main judicial system ofUganda. The establishment of small claims courts would provide cost effectiveand speedy remedies to aggrieved consumers. There should be no overlap orconflict in the role of the small claims court with the commercial court.
The small claims courts should follow a simple and informal procedure.
Emphasis should be placed on the realisation of expeditious, efficient andaffordable justice. Lawyers ought to be excluded however, thoughrepresentation might make the process adversarial and expensive, legalrepresentation is a natural right provided for by the constitution. Consumerorganisations will be allowed to take legal action on behalf of consumers.
The court fees should be reasonable and minimal and possibly in the case ofpoor consumers, waived. The decision of the small claims courts should befinal to make the process faster, easier, affordable, certain, definitive anddecisive. However, these courts should only complement the ordinary courtsystem and not replace the latter. Regulations under which the monetaryceilings are stipulated for the small claims courts to operate will have to beprovided in the Act.
The commission recognises that the intention of establishing small claims courtsin every district was to bring access to justice closer to every consumer allover the country. However, whether it would be practically possible to establish UGANDA LAW REFORM COMMISSION
such courts in every district in terms of manpower and finances is an areathat needs further investigation.
The commission considered two issues on presiding over small claims courts.
Firstly who presides over the small claims courts and secondly who appointsthe presiding officers. On appointment, two options were proposed. One touse the existing judicial structure and secondly, to allow the district councils toappoint presiding officers. No consensus was reached by the taskforce andit was agreed that further discussions with the relevant authorities would haveto be undertaken on the issue. On the presiding officer – the commissionnoted that with the Family and Children Court, the presiding officer is a GradeII Magistrate. The commission recommends that the Chief Justice coulddesignate a Magistrate Grade to preside for example Chief Magistrate orMagistrate Grade I.
Any law is only as useful to the public as the remedies it offers to the public.
Hence it is important to specify certain remedies that will be available to theaggrieved consumer so that it is certain what course of conduct is to be pursuedafter a breach of the Consumer Protection Bill Act is established. The followingremedies have been proposed as directions that the court or commission maydirect the opposite party to carry out either as a single action or together withanother action to- remove the defect pointed out by the customer, or an investigation orexamination carried out by an appropriate laboratory from the goodsin question; replace the goods with new goods of similar description which shallbe free of any defect as described above; return to the complainant the price or as the case may be the chargespaid by the complainant; A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
pay such amount as may be awarded by the court or council ascompensation to the consumer for any loss or injury suffered by theconsumer due to the negligence of the opposite party remove the defects or deficiencies in the services in question; discontinue the unfair trade practice in question or restrictive tradepractice or not to repeat it; discontinue the offers of hazardous goods for sale; withdraw the hazardous goods from the market; or to provide adequate costs to parties.
The defence, promotion, enforcement of consumer rights under this Act shall be exercised or conducted through individual or collective,mediation, negotiation, arbitration or litigation.
Consumer associations created under any law being in force in Uganda and pursuant to the provisions of this Act, shall be entitled to representinterested parties in the defence of rights that this Act vests inconsumers; and may represent the consumers in court.
For the avoidance of doubt, this Act shall be regarded as complementary to the process of ensuring and enhancing consumerprotection through existing commercial, civil and criminal lawsregulating or concerning consumer protection.
There shall be established, for each district a court to be known as a small claims court .
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Court fees or other fees payable to institute or prosecute consumer complaints shall be waived or otherwise kept affordable to claimants.
The monetary jurisdiction of the court and proceedings of the court shall be determined by the Minister.
Court fees or other fees payable to institute or prosecute consumer complaints shall be waived or otherwise kept affordable to claimants.
The court shall have and exercise the penal and remedial powers provided for under this Act or any other law.
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THE CONSUMER PROTECTION BILL, 2004
Arrangement of Clauses.
PART I - PRELIMINARY.
Interpretation .
PART II - GENERAL SAFETY REQUIREMENT.
General safety requirement.
PART II - ADVERTISING.
Bait advertising.
Supplier to provide true information.
False statement as to clause.
Abusive advertising prohibited.
Switch after sale.
Condition of goods.
Duration of advertisement in necessary promotional sales etc.
Door to door sale.
Door to door deceptive practises.
Pyramid sales.
Mandatory return.
Misleading price indications.
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PART IV - GUARANTEES.
Characteristics of a guarantee.
Liability of the seller on a guarantee.
Rights under a guarantee.
Rights under guarantee not to exclude other laws.
Guarantor not to be sole authority.
Buyer's right to claim against a manufacturer or supplier.
Court may grant opportunity to guarantor to perform.
PART V - MEASURES FOR CONSUMER REDRESS AND
Representative or class actions.
Process under the Act and other laws.
Establishment of small claims courts.
Jurisdictions of the court.
Persons who may preside over the small claims courts.
Jurisdictions of commercial court not ousted.
Remedies and sanctions.
Currency point.
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THE CONSUMER PROTECTION BILL, 2004
A Bill for an Act
THE CONSUMER PROTECTION ACT, 2004.
An Act to provide for consumer's rights against fraudulent and deceptivepractices by sellers and suppliers of goods and services, to promote ethicalstandards in relation thereto and to establish small claims court and othermatters connected to, or incidental with the above.
PART I - PRELIMINARY.
This Act shall come into force on such a date as the Minister shall by statutoryinstrument appoint.
This Act applies, except where the applicable law is inconsistent with this Act, to the provisions relating to - the sale or rental of real estate, banking, utilities or the sale the owner or publisher of a publication or printed matter in which an advertisement appears; or the owner or operator of a television or radio station which disseminates the advertisement.
Notwithstanding the provisions of subsection (1), this Act applies to any other business or individual engaged in the sale or repair of goodsand supply of services to consumers not enumerated in subsection (1).
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In this Act, unless the context otherwise requires- "advertiser" includes the supplier of technology, goods or serviceswho has commissioned the publication of an advertising message; "advertising" means any form of public notice, including labelling whichis an attempt to induce, directly or indirectly, any person to purchaseor acquire an interest in a good or service; "an offer to sale" includes the exposing of goods for sale, the furnishingof a quotation, whether verbally or in writing and any other act ornotification whatsoever by which willingness to enter into anytransaction for sale is expressed; "appropriate laboratory" means a laboratory recognised byGovernment and includes any such laboratory established under anylaw for the time being in force to determine whether goods sufferfrom any defect; "bait advertising" means an offer to sell a product or service whichthe seller does not intend or want to sell to the consumer. The purposeof the product or service is to establish contact with the consumer inorder to switch the consumer from buying the advertised good orservice, in order to sell something else at a higher price or on a morebeneficial basis to the seller; "business records" includes- (a) accounts, balance sheets, vouchers, minutes of meetings, contracts, files, instructions to employees and otherinstruments; and (b) any information recorded or stored by means of a pen, typewriter, computer or other device whatsoever and anymaterial subsequently derived from information so recorded; "collective interest" means supra-individual rights or interests havingan advisable nature to which undetermined individuals are entitled; "complaint" means any allegation in writing made by a complainant that- A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
as result of any unfair trade practice adopted by a trader, the complainant has suffered loss or damage; the goods or technology mentioned in the complaint suffer from one or more defects; or the services mentioned in the complaint suffer from deficiency "consumer" means the final purchaser of a good or service andincludes a person who- purchases or offers to purchase technology, goods or services otherwise than for resale; but does not include a person whopurchases any technology, goods or services for the purposeof using them in the production or manufacture of any othertechnology, goods, services or articles for sale; receives or uses any technology, goods or service for which consideration has been fully paid or partly paid or promisedor partly promised, under any system of deferred paymentand such person includes any user of such technology, goodsor service other than the person who buys or pays for the samewhen such is made with the approval or acquiescence of thepurchaser; or hires or avails himself or herself of any technology, goods or service for a consideration which has been fully paid or partlypaid or promised or partly promised, under any system ofdeferred payment and includes any beneficiary of technology,good or service other than the person who hires or availshimself or herself of the same when the technology, good orservice is availed with the approval or acquiescence of thehirer; "consumer dispute" means a dispute where the person or businessagainst whom or which a complaint has been made; "currency point" means the value of currency point specified in theSchedule; UGANDA LAW REFORM COMMISSION
"deceptive advertising" means advertising which is misleading in anymaterial aspect; "defect" means any fault, imperfection or shortcoming in the quality,quantity, potency, purity or standard which is required to be maintainedby or under this Act or any other law in relation to any goods; "deficiency" means any fault, imperfection, shortcoming or inadequacyin the quality, nature and manner of performance which is required tobe maintained by this Act or under any law for the time being in forceor has been undertaken to be performed by a person in pursuance ofa contract or otherwise in relation to any service; "distribution" includes any act by which technology, goods or servicesare sold or supplied by one person to another person; "distributor" means any person in the supply chain whose activitydoes not affect the safety properties of a product; "door to door sale" means a sale, lease or hire of a consumer good orservice in which the seller solicits the sale and the buyer's agreementto buy is made at the place of transaction; "goods" means goods as defined in the Sale of Goods Act; "guarantee" means any document, notice or other written statement,howsoever described, supplied by a manufacturer or other supplierother than a retailer, in connection with the supply of any goods andindicating that the manufacturer or other supplier will service, orotherwise deal with the goods following purchase; "intermediate goods" means goods used as inputs in manufacturingor downstream processing; "manufacture" or "manufacturing" includes any process whichtransforms goods in order to add value to them for purpose of resale;and includes any operation of packaging or repackaging not linked toanother form of transformation within a single enterprise; "manufacturer" means a person who- manufactures the product or a component part of theproduct; A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
places a raw material or a natural product on the market; presents himself or herself as the manufacturer byaffixing to the product his or her name, trade mark orother distinctive mark; or reconditions the product; "Minister" means the Minister responsible for trade and industry; "price" in relation to the transfer, supply, provision or sale oftechnology, goods or services includes every valuable considerationwhether direct or indirect; "pyramid sale" means a sale where, in the guise of selling a good orservice, the item being sold is the right to sell the product or serviceand whereby the seller makes a profit not through the sale of theproduct but through the number of individuals whom that personencourages to buy the product or service; "retail trade" means a form of distribution by which goods arecustomarily sold to consumers rather than for the purpose of resale ormanufacturing; "sale" includes a sale, an agreement to sell or an offer for sale; "seller" means a person regularly engaged in retail trade or whoparticipates in some act or set of acts of retail; "supplier" in relation to a service or technology, includes a personwho performs a service or transfers technology and a person whoarranges the performance of a service or the transfer of technology,goods or services and does not extend to the transactions involvingthe mere sale or mere lease of goods; "trader" in relation to any technology, goods or services means anyperson who sells or distributes, supplies or provides any technology,good or service and includes the manufacturer thereof and where goodsare sold or distributed in package form, includes the packer of thegoods; "trade practice" means any practice related to the carrying on of anytrade; includes anything done or proposed to be done by any person UGANDA LAW REFORM COMMISSION
which affects or is likely to affect the method of trading of any traderor class of traders of any property, whether real or personal, or of anytechnology or service; "unfair trade practice" means a trade or business practice includingthe practice which, for the purpose of promoting the sale, use, supplyor provision of any technology, good or service that adopts any unfairmethod or deceptive practice, including the practice of making anystatement whether orally or in writing or by visible representationwhich falsely- represents that the technology, good or service is of aparticular standard, quality, grade, durability,composition, style or model; represents that the services are of particular standard,quality or grade; represents that any re-built, second hand, renovated,reconditioned or old goods are new or unused goods; or represents that any technology, good, or service hassponsorship, approval, performance characteristics,accessories, peripherals, uses or benefits; "wholesale" means a form of distribution by which goods arecustomarily sold for the purpose of resale or as inputs in manufacturingand includes any act or set of acts of sale for either of those purposeswhich is the subject of a consumer dispute or an action under thisAct; "wholesaler" means a person regularly engaged in wholesale trade,or who participates in some act or set of acts of wholesale tradewhich is the subject of a consumer dispute or an action under thisAct.
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PART II - GENERAL SAFETY REQUIREMENT.
General safety requirement.
A person shall be guilty of an offence if he or she-(a) supplies any consumer goods which fail to comply with thegeneral safety requirement; offers or agrees to supply any such goods; or exposes or possesses any such goods for supply.
For the purposes of this section, consumer goods fail to comply withthe general safety requirement if they are not reasonably safe havingregard to all the circumstances, including- the manner in which, and the purposes for which, the goods are being or would be marketed, the getup of the goods, theuse of any mark in relation to the goods and any instructionsor warnings which are given or would be given with respectto the keeping, use or consumption of the goods; any standards of safety published by any person either for goods of a description which applies to the goods in questionor for matters relating to goods of that description; and the existence of any means by which it would have been reasonable, taking into account the cost, likelihood and extentof any improvement, for the goods to have been made safer.
For the purposes of this section, consumer goods shall not beregarded as failing to comply with the general safetyrequirement in respect of – anything which is shown to be attributable to complianceimposed by or under any enactment; any failure to do more in relation to any matter than is requiredby- any safety regulations imposing requirements withrespect to that matter; UGANDA LAW REFORM COMMISSION
any provision of any enactment or subordinatelegislation imposing such requirements with respectto that matter as are designated for the purposes ofthis subsection by any such regulations.
In any proceedings against any person for an offence under this sectionin respect of any goods, it shall be a defence for that person to show- that the following conditions are satisfied, that is to say- that he or she supplied the goods, offered or agreedto supply them or as the case may be, exposed orpossessed them for supply in the course of carryingon a retail business; and that at the time he or she supplied the goods oroffered or agreed to supply them or exposed orpossessed them for supply, he or she neither knewnor had reasonable grounds for believing that thegoods failed to comply with the general safetyrequirement; or that the terms on which he or she supplied the goods, offeredor agreed to supply them or, in the case of goods which he orshe exposed or possessed for supply, the terms on which heor she intended to supply them- indicated that the goods were not supplied or to besupplied as new goods; and provided for, or contemplated, the acquisition of aninterest in the goods by the persons supplied or to besupplied.
For the purposes of subsection (4)(b) above, goods are supplied in thecourse of carrying on a retail business if, whether or not they arethemselves acquired for a person's private use or consumption, theyare supplied in the course of carrying on a business of making a supplyof consumer goods available to persons who generally acquire themfor private use or consumption.
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A person guilty of an offence under this section shall be liable onconviction to imprisonment for a term not exceeding six months or afine not exceeding five thousand currency points or both.
In this section , "consumer goods" means any goods which areordinarily intended for private use or consumption, not being- growing crops or things comprised in land by virtue of beingattached to it; water, animal feed and fertilizer; or controlled drugs or licensed medicinal products as regulated bythe National Drug Authority.
PART III - ADVERTISING.
A person shall not publish an advertisement containing an offer to sell a productunless that offer is a genuine or bonafide efforts taken by that person to sellthe advertised product.
Supplier to provide true information.
It is the duty of every supplier of goods, technology or services to provideconsumers with true, adequate, clear and prompt information on the goodsand services offered, so that they can make a better and informed choice.
False statement as to clause.
A person shall not, in an advertisement, use a statement or otherrepresentation which - creates a false impression as to the grade, quality, make, value, currency of model, size, colour, usability or origin of theproduct offered; or represents the product in such a manner that on the disclosure of the true facts, the buyer may be switched from theadvertised product to another.
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If the advertisement under this section is secured by the seller'sdeception, this section shall be violated notwithstanding that the truefacts about the product were made known to the buyer.
Abusive advertising prohibited.
Abusive advertising is prohibited.
An advertisement shall, for all purposes be understood to be abusiveor unfair or discriminatory advertising if it incites, or is likely to inciteviolence, exploits fear, profits from the lack of maturity of children,infringes environmental values or is capable of leading consumers tobehave in a manner detrimental or hazardous to their health or safety.
Where abusive advertising results in loss to the consumer, the consumershall be entitled to claim compensation at the expense of the offeror,or advertiser which compensation shall in no event be less than thebalance between the price of the technology, goods or services underpromotion or sale and its regular or ordinary price or costs ofreplacement or repair.
Where the statements made in an advertising message are consideredfalse or misleading to consumers, the respective regulatory body shallorder an amendment of the content and such amendment shall beannounced at the expense of the advertiser through the same mediaused to disseminate the offensive of infringing message.
A seller shall not discourage a prospective buyer of an advertisedproduct or service as part of a bait scheme to sell another product orservice.
The following are acts or practices considered in determining whethera seller has made a bonafide offer or a bait scheme to sell anotherproduct or service- A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
refusal to show, demonstrate or sell the product offered in accordance with the terms of the offer; the disparagement of the advertised product or of the guarantee, credit terms, availability of service, repairs of parts,or in any respect in connection with the product of service; failure to have the product available in sufficient quantities to meet reasonably anticipated demands, at all stores of theproduct advertised, unless the advertisement clearly disclosesthat the supply is limited or only available at specific locations; refusal to take an order for the advertised product to be delivered within a specified period; showing or demonstrating a product which is defective, unusable or impractical for the purpose represented or impliedin the advertisement; or penalizing or rewarding a sales person in order to discourage that person from selling the advertised product or service.
Switch after sale.
A seller shall not, in the event of a sale of an advertised product orservice, prejudice a sale with the aim of selling another product orservice.
The following practices on the part of the seller are considered indetermining whether a sale is in good faith or whether it is a ploy tosell another product or service and after switching the buyer to ahigher priced product or service - accepting a deposit for the advertised product or service and thereafter switching the buyer to a higher priced product orservice; failing to make delivery of the advertised product within a reasonable time or make a refund; UGANDA LAW REFORM COMMISSION
disparaging the advertised product or service by words or acts or disparaging the guarantee, credit terms, availability ofservice, repairs or parts, or in any respect, in connection withthe product or service; delivering a product or service that is defective, unusable or impractical for the purpose represent or implied in theadvertisement.
A person shall not, in the conduct of any business, trade or commerceor in the furnishing of any service engage in deceptive advertising.
In determining whether a particular conduct amounts to deceptiveadvertising the following factors shall be considered - any representations made by the advertisement including statements, words or any depiction; and the extent to which the advertisement fails to reveal material facts about the goods or service to which the advertisementrelates.
Condition of goods.
A person selling any goods shall not represent in any way expressly orimpliedly that the goods which that person is selling are new whenthey are used, reconditioned or being sold "as is".
Where a product is being sold "as is" the seller shall convey that factto the consumer.
Duration of advertisement in necessary promotional sales etc.
In the case of promotional services, sales or special offers, there shallbe indicated in the respective advertisement the duration thereof or as A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
the case may be, the nature or volume of the technology, goods orservices offered as well as the general conditions, warranties, guaranteeand terms of the proposed business.
When no term is fixed, nor the nature or volume of the technology,goods or services determined, the sale, promotion or offer shall beunderstood to extend for a maximum term of thirty days from the timeof the last announcement.
If the supplier of technology, goods or services in promotion, sale orspecial offer fails to comply with the advertisement, consumers mayelect: to require the compulsory compliance with obligations of the supplier, according to the general law of contract; to accept another technology or goods or the rendering of an equivalent service; to cancel the contract if there has been an advance payment by a consumer.
Door to door sale.
A sale is not a door to door sale if that sale, is made pursuant to prior negotiations in the course of the buyer's visit to a retail business having a fixed permanent address; is made pursuant to a sale made entirely by mail or over the telephone without any other contact, between the buyer and the sellers or priorto the delivery of the goods or the performance of the services; is made pursuant to a sale in which the buyer has requested that the seller or the seller's agent visit the buyer's premises to repair or performmaintenance on the buyer's property; and in the course of the visitthe seller or the seller's agent sells additional goods or services; or involves the sale or rental of real property or the sale of insurance.
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Door to door deceptive practises.
It shall be a deceptive trade practice on the part of a seller where theseller, in a door to door sale, fails to advise the buyer that the buyer may cancel the salewithin three working days of the sale; fails to furnish the buyer with a receipt or copy of any contractpertaining to such sale at the time of its execution with astatement that the buyer has the right to cancel the sale withinthree working days; or fails to provide the buyer, at the time when the buyer agreesto buy the goods, a form entitled "notice of right to cancel"or its equivalent.
The form under paragraph (c) of subsection (1) shall state that - the buyer has the right to cancel the sale within three workingdays of the sale; any payments made by the buyer shall be refunded withinten working days of the cancellation of the sale; and upon cancellation, the buyer shall avail the seller, insubstantially the same condition as received, any goodsdelivered to the buyer under the contract.
A person shall not engage in a pyramid sale.
A person who contravenes subsection (1) commits an offence andshall, on conviction be liable to a fine not exceeding five currencypoints or to imprisonment for a term not exceeding two months.
Where a seller sells a product through bait advertising, the consumermay return that product to the seller and claim a refund.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Where a seller represents that the product being sold is a new productwhen that product is actually used or reconditioned, the consumermay return that product to the seller and claim a refund.
Where a seller sells a product through deceptive advertising, theconsumer may return the product to the seller and claim a refund.
Where a consumer returns a product under subsections (1), (2) and(3), the seller shall accept the returned product and make a refund tothe consumer within fourteen days of the date upon which the productis returned.
Misleading price indications.
Subject to the provisions of this section, a person shall be guilty of an offence if, in the course of any of his or her business, he or she gives,by any means whatever to any consumers an indication which ismisleading as to the price at which any goods or services are available(whether generally or from a particular person).
Subject to the provisions of subsection (1), a person shall be guilty of in the course of any of his or her business, he or she has givenan indication to any consumers which, after it was given, hasbecome misleading; as specified in subsection (1) above; and some or all of those consumers might reasonably be expectedto rely on the indication at a time after it has becomemisleading; he or she fails to take all such steps as are reasonable to prevent those consumers from relying on the indications.
For the purposes of this section, it shall be immaterial - whether the person who gives or gave the indication is or wasacting on his or her own behalf or on behalf of another; UGANDA LAW REFORM COMMISSION
whether or not that person is the person, or included amongthe persons, from whom the goods, or services, are available;or whether the indication is or has become misleading in relatingto all the consumers to whom it is or was given or only inrelation to some of them.
A person guilty of an offence under subsection (1) or (2) shall beliable on conviction to a fine of fifty currency points.
An indication given to any consumer is misleading as to a price ifwhat is conveyed by the indication, or what that consumer mightreasonably be expected to infer from the indication or any omissionfrom it, includes any of the following- that the price is less than what it is; that the applicability of the price does not depend on facts orcircumstances on which its applicability depends; that the price covers matters in respect of which an additionalcharge is made; that a person who has no such expectation - expects the price to be increased or reduced (whether or not at a particular time or by a particular amount);or expects the price, or the price as increased or reduced, to be maintained (whether or not for aparticular period); or that the facts or circumstances by reference to which theconsumer might reasonably be expected to judge the validityof any relevant comparison made or implied by the indicationare not what they are.
An indication given to any consumer is misleading as to a method ofdetermining a price if what is conveyed by the indication, or what theconsumer might reasonably be expected to infer from the indicationor any omission from it, includes any of the following, that is to say - A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
that the method is not what it is; that the applicability of the method does not depend on facts or circumstances on which its applicability t depends; that the method takes into account matters in respect of which an additional charge will be made; that a person who in fact has no such expectation - expects the method to be altered (whether or not ata particular time or in a particular respect); or expects the method, or that method as altered, toremain unaltered (whether or not for a particularperiod); or that the facts or circumstances by reference to which the consumers might reasonably be expected to judge the validityof any relevant comparison made or implied by the indicationare not what they are.
A comparison is a relevant comparison in relation to a price or methodof determining price if it is made between that price or that method,or any price which has been or may be determined by that method and any price or value which is stated or implied to be, to havebeen or to be likely to be attributed or attributable to the goods,services, accommodation or facilities in question or to anyother goods, services, accommodation or facilities; or any method, or other method which is stated or implied to be,to have been or to be likely to be applied or applicable for thedetermination of the price or value of the goods, services,accommodation or facilities in question or of the price of valueof any other goods, services, accommodation or facilities.
Contractual clauses or stipulations shall be void and have no effectwhatsoever when they: UGANDA LAW REFORM COMMISSION
exempt, reduce or limit the responsibility of suppliers fordefects of any nature of the goods supplied or servicesrendered; imply a waiver of the rights vested in consumers pursuant tothis law or somehow limit the exercise thereof; revert the burden of proof against consumers; impose the compulsory referral to arbitration; make it possible for the supplier to change, unilaterally, theprice and other contractual conditions; authorise the supplier to unilaterally cancel the agreementexcept where this power is vested in the consumer for thecase of postal or sample sales; and any other clauses or stipulations that create unfair contractualconditions or unreasonably burdensome to consumers, orotherwise be contrary to good faith and public order.
PART IV – GUARANTEES.
Characteristics of a guarantee.
A guarantee shall - be clearly legible and shall refer only to specific goods or toone category of goods; state clearly the name and address of the person supplyingthe guarantee; state clearly the duration of the guarantee from the date ofpurchase but different periods may be stated for differentcomponents of any goods; state clearly the procedure for presenting a claim under theguarantee which procedure shall not be more difficult thanordinary or normal commercial procedure; and A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
state clearly what the manufacturer or other supplierundertakes to do in relation to the goods and what charges ifany, including the cost of carriage, the buyer must meet inrelation to such undertakings.
It shall be an offence for the manufacturer or other supplier of goods,to give in connection with the goods, a guarantee which fails to complywith this section.
Liability of the seller on a guarantee.
Where the seller of goods gives a guarantee to the buyer, irrespectiveof when or how it is given, the seller shall be liable to the buyer for theobservance of the terms of the guarantee as if he or she were theguarantor, unless he or she expressly indicates the contrary to thebuyer at the time of giving the guarantee.
Where, however, the seller, being a retailer, gives the buyer his or herown written undertaking that he or she will service, repair or otherwisedeal with the goods following the purchase, it shall be presumed, unlessthe contrary is proved that he or she has not made himself or herselfliable to the buyer under the guarantee so given.
Rights under a guarantee.
Sections 18 and 19 shall apply to any undertaking as they apply to aguarantee.
The liability of a seller to a buyer under this section is without prejudiceto the rights conferred on the buyer under section 18 (2).
Rights under guarantee not to exclude other laws.
Rights under a guarantee shall not in any way exclude or limit the buyer atcommon law or pursuant to any Act and any provision in a guarantee whichimposes obligations on the buyer that are additional to his or her obligationsunder the contract shall be void.
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Guarantor not to be sole authority.
A provision in a guarantee which purports to make the guarantor or any personacting on his or her behalf the sole authority to decide whether the buyer isentitled to present a claim by means other than those provided under this Actshall be void.
Buyer's right to claim against a manufacturer or supplier.
The buyer of goods may maintain an action against a manufacturer orother supplier who fails to observe any of the terms of the guarantee asif that manufacturer or supplier had sold the goods to the buyer andhad committed a breach of warranty.
The court may order the manufacturer or supplier to take such actionas may be necessary to observe the terms of the guarantee, or to paydamages to the buyer and in this subsection "buyer" includes all personswho acquire title to the goods within the duration of the guaranteeand, where goods are imported and "manufacturer" includes theimporter.
Court may grant opportunity to guarantor to perform.
In any case in which a guarantor is liable to an owner in damages, the courtmay at its discretion and on such terms as the court may deem just afford theguarantor the opportunity of performing these obligations under the guaranteeto the satisfaction of the court within a time to be limited by the court.
PART V - MEASURES FOR CONSUMER REDRESS ANDMECHANISMS.
Representative or class actions.
The defence, promotion, enforcement of consumer rights under thisAct shall be exercised or conducted through individual or collective,mediation, negotiation, arbitration or litigation.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Mediation, negotiation, arbitration or litigation may be conductedcollectively when collective interests or rights are involved.
Consumer associations created under any law being in force in Ugandaand pursuant to the provisions of this Act, shall be entitled to representinterested parties in the defence of rights that this Act vests inconsumers; and may represent the consumers in court.
The decisions rendered in collective procedures shall have generaleffect and accrue to all consumers except where any such decision isdismissed for want of proof in which event any other consumer havingan interest in the matter may bring a new consumer dispute or actionon the basis of facts and claims arising from the same transaction.
Process under the Act and other laws.
For the avoidance of doubt, this Act shall be regarded as complementary tothe process of ensuring and enhancing consumer protection through existingcommercial, civil and criminal laws regulating or touching on consumerprotection.
Establishment of small claims courts.
There shall be established, for each district a court to be known as asmall claims court which shall have the following characteristics: be accessible to consumers in order to provide simple, speedyand inexpensive justice; be complementary to regular court system; have evening and Saturday sessions to facilitate access aswell as to ensure expeditions determination of matters.
Jurisdiction of the court.
The court shall have the following powers - UGANDA LAW REFORM COMMISSION
to order alteration, modification, reform, rescission or reformulation of standard consumer contracts and othertransactions; to order performance of obligations under a guarantee; or to handle all matters referred to it under this Act; The monetary jurisdiction of the court and proceeding of the court shall be determined by the Minister.
Persons who may preside over the small claims courts.
The presiding officers of small claims courts shall be appointed frompersons who have appropriate qualifications or experience in consumeraffairs and expeditious delivery or redress.
Court fees or other fees payable to institute or prosecute consumercomplaints shall be waived or otherwise kept affordable to claimants.
Effective and inexpensive assistance in execution shall be availablefrom clerks and other court officials to every party who obtains ajudgement in the small claims court.
A court shall keep accurate and thorough records of all cases which come before them and the presiding officer.
Jurisdiction of ordinary courts not ousted.
The exercise of jurisdiction by the court shall not oust the jurisdiction of the courts which may try all the cases constituting an infringementof the commercial or penal law.
Parliament shall allocate funds for the establishment and maintenance of effective small claims courts.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
Remedies and sanctions.
The court shall have and exercise the penal and remedial powers provided under this Act or any other law.
Sanctions, penalties, or remedies they are authorised in this Act or any other law to exercise and accrue to consumers shall include thecancellation, rescission or revision of a contract or its clauses; the obligationto pay damages and interest; as well as the obligation to pay fines.
The small claims courts or other courts may order the destruction or prohibition of offensive technology, goods or services or decide uponthe prohibition of the sale or supply of technology, goods or servicesorder the withdrawal of the same from the market within a specifiedperiod.
A person who contravenes any of the provisions of this Act for which no penalty is provided commits an offence and is liable on convictionto a fine not exceeding eighty currency points or a term ofimprisonment for six months or both.
For the avoidance of doubt the small claims courts or other courts may, at the consumer's request order the repair or replacement of thetechnology, goods, or services, refund of the contract price, or theconsideration paid in excess of the contract price.
A court convicting a person under subsection (1) may, in addition to a sentence imposed under that subsection, order that person to pay - compensatory damages; advocate's fees; or any other damages the court may deem fit.
In addition to the remedies provided for in subsections (1) and (2), a consumer shall have the right of retraction within seven days from thesignature of the contract or the receipt of the good or service, whenthe contract shall have been entered into outside of the supplier's UGANDA LAW REFORM COMMISSION
place of business particularly if the agreement has been entered intothrough the telephone or at the domicile of the consumer. If suchright is exercised in due time, a consumer shall be entitled to have theconsideration returned with the corresponding adjustments.
The Minister may, in consultation with the Chief Justice and the council,by statutory instrument make regulations generally for the bettercarrying into effect the provisions of this Act.
Without prejudice to the generality of the foregoing, the Minister shall: prescribed the procedure to be followed in making complaintsto the court; prescribe the monetary jurisdiction for matters which maybe tried by the court; and prescribe the fees to be paid to the court.
S C H E D U L E.
One currency point shall be equivalent to twenty thousand shillings.
A STUDY REPORT ON SELECTED TRADE LAWS - CONSUMER PROTECTION LAW
PUBLICATIONS OF THE UGANDA LAW REFORM COMMISSION
A Study Report on Rape, Defilement and Other Sexual Offences.
A Study Report on the Reform of the Law of Domestic Relations.
The Sixth Revised Edition of the Laws of Uganda, 2000.
A Field Study Report on Voices of the People on Trial Procedures, Sentencingand Decriminalisation of Petty Offences.
A Study Report on Company Law.
A Study Report on Competition Law.
A Study Report on Contracts Law.
A Study Report on Cooperatives Law.
A Study Report on Copyright and Neighbouring Rights Law.
10. A Study Report on Electronic Transactions Law.
11. A Study Report on Geographical Indications Law.
12. A Study Report on Industrial Property Law (Patents, Industrial Designs Technovations and Utility Models) 13. A Study Report on Insolvency Law.
14. A Study Report on Intellectual Property - Traditional Medicine Practice.
15. A Study Report on Intellectual Property Rights - Trademarks and Service 16. A Study Report on Intellectual Property Rights -Trade Secrets Law.
17. A Study Report on Law Relating to Trial Procedure Law.
18. A Study Report on Plant Variety Protection Law.
19. A Study Report on Quadhi's Courts Law.
20. A Study Report on Reform of the Laws Relating to Chattel Securities.
21. A Study Report on Reform of the Laws Relating to Hire Purchase.
22. A Study Report on Reform of the Laws Relating to Mortgage Transactions.
23. A Study Report on Sentencing Guidelines.
24. A Study Report on the Law for Establishment of Special Economic Zones.
25. A Study Report on the Proposals for the Reform of the Accountants Act, Cap 266.
26. A Study Report on the Reform of Business Associations - Partnerships Law27. A Study Report on the Reform of Selected Trade Laws - Consumer Protection Law.
28. A Study Report on the Reform of Selected Trade Laws - Sale of Goods and Services Law.
29. A Study Report on the Reform of Selected Trade Laws - Trade Licensing Law.
30. Handbook on Making Ordinances and bye-laws in Uganda.
31. How Our Laws Are Made.
32. Report on the Background Study on the Legal Implementation of the World Trade Organisation Agreements.
33. Report on the Law Relating to Publishing Horrific Pictures and Pictures of the Dead in the Press and Pornography.

Source: http://www.ulrc.go.ug/system/files_force/ulrc_resources/Consumer%20Protection%20law%20body_0.pdf?download=1