Retailers breaching new price law
6/05/2011

The Consumer Protection Act (CPA) came into effect last month. It prescribes how prices for goods must be displayed. However, it seems that some retailers are not yet aware of those provisions or complying with them.

The CPA prohibits a retailer from displaying goods for sale, unless the price for those goods is displayed at the same time. This can be done by displaying the price directly on the goods or their labels or packaging, among other things. The price can also be fixed to the shelf on which the goods are displayed.

If more than one price is displayed for goods at the same time, the retailer may not require the customer to pay a price that is higher than the lowest of the prices displayed. This means that the retailer can only charge the lower price.

A retailer may also not charge a price which is higher than the one displayed for particular goods. Often a consumer chooses goods based on the price displayed on the shelf. When the consumer gets to the till, the assistant sometimes informs him or her that the shelf price is outdated and that there is a new (higher) price. Now, under the CPA, the retailer may not insist on charging the higher price.

However, if a previous price has been covered or obscured by a second price, the second price will be regarded as the price for the goods. Also, if a displayed price contains an inadvertent and obvious error, the retailer will not be obliged to sell the goods at the incorrect price. However, that will only be the case if the retailer corrected the error and took reasonable steps to inform consumers to whom the incorrect price may have been displayed of the error and correct price.

The CPA’s provisions relating to prices should be welcomed by consumers who often have to search for prices or may be faced with unexpected price surprises at tills. At the same time, retailers should make sure that they are informed about the CPA’s provisions and take the necessary steps to comply.

Danie Strachan
Senior Associate
danie-s@adamsadams.co.za