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Consumer Goods & Services Ombudsman – Part 1

IMPLICATIONS FOR THE TOURISM INDUSTRY: Who or what is the Consumer Goods & ServicesOmbudsman (‘CGSO’), what are the implications, and what must the tourism industry do?

The office of the Consumer Goods & Services Ombudsman (‘CGSO’) was established (early 2015) in terms of section 82 of the Consumer Protection Act 2008 (Act No. 68 of 2008) (‘the CPA’).

Succinctly the purpose of the CGSO ombudsman is the following:

  • Guide Industry – set minimum standards of conduct re-engaging with Consumers AND assist in resolving Disputes;
  • Raise the standards of conduct;
  • Offer Guidance re compliance CPA and fair business practices;
  • Educate Consumers as to their rights and redress;
  • Provide for a scheme of alternative dispute resolution such as mediation.

The CGSO Code of Conduct (‘the Code’) is enforceable against Consumer Goods & Service Industry Participants – who are the latter?

The easiest way to explain this is to list the relevant definitions that appear, bearing in mind that any definitions, words, and phrases used will have the same meaning as in the CPA:   

‘Consumer Goods and Services Industry’ means all Participants involved in the Supply Chain that provide, market, offer to supply Goods and Services to the Consumer, unless excluded in terms of 4.4 hereof (i.e. if they are subject to another ombudsman e.g. Banking).

‘Participant’ means any entity operating within the Industry.

‘Supply Chain’ is defined in the CPA as follows:

‘supply chain’, with respect to any particular goods or services, means the collectivity of all suppliers who directly or indirectly contribute in turn to the ultimate supply of those goods or services to a consumer, whether as a producer, importer, distributor or retailer of goods, or as a service provider (thus includes intermediaries such as travel agents & tour poperators).

It’s mandatory for all Participants to do the following:

  • Comply with provisions of the Code;
  • Register with CGSO as per the procedures provided on the CGSO website from time to time;
  • Contribute towards the funding of the CGSO;
  • Establish internal complaints-handling process;
  • Monitor complaints;
  • Display on its trading premises the CGSO decal and on their website a prescribed notice that states they are Participants to Code and bound by it;
  • Make a copy of Code and/or summary thereof and its internal complaint-handling procedure available to any Consumer upon request;
  • Ensure staff and agents have adequate knowledge of CPA, Regulations issued, Code and internal complaints-handling procedure – this means that training of the CGSO and CPA per se is crucial and must be ongoing;
  • Keep records for 3 years of the Complaints received and recording that a Consumer was referred to CGSO for assistance in resolving; details of the Complaint, including details such as nature, time involved, whether it was resolved and if so the  remedy provided/not resolved;
  • Such data must be used by the CGSO to highlight recurring complaints, be shared with management, staff, and Industry;
  • Behaviour to resolve Complaints and Disputes must be in accordance with the law, the spirit and provisions of this Code and the CPA – the reference to ‘the spirit’ is important e.g. do not exclude liability for gross negligence in your T&C and/or indemnity and hope no-one will notice!

The CGSO will determine a strategy for conducting awareness and education of the Code and contents thereof by an introduction and/or facilitation and/or distribution of information brochures, guidelines and workshops, and guidance regarding compliance particularly aimed at smaller Participants via workshops, website, etc.

Disclaimer: This article is intended to provide a brief overview of legal matters pertaining to the tourism industry and is not intended as legal advice. © Adv Louis Nel, ‘Louis The Lawyer’, July 2017.