Serious concerns have arisen about new consumer laws the government wants to enact this year to comply with free trade initiatives.
Critics say the Bills – as presently drafted – will dilute due process And politicise the marketplace by giving politicians the right to act as Judge and jury over trade disputes.
The proposed laws set impractical standards for the supply of goods and services, they say, while exempting the public sector from similar scrutiny. That alone should be enough to make them a laughingstock.
According to the Chamber of Commerce: “The overriding concern is the power granted to a single person (the minister), while attempting to limit the power of the courts (which distorts) the democratic system.
“While we do not dispute governments' legitimate role as regulator, we Have serious concerns about the economic and legal consequences. Government services should be included along with a judicial appeal process and the right to sue the government for libel and/or damages.”
And just who is the minister pushing this particular agenda and who will act as judge and jury? None other than Leslie Miller, the proprietor of Sun Burst Paints.
The legislation seeks to apply comprehensive rules to all types of businesses – including professionals like architects, lawyers and doctors. By attempting to resolve all transaction issues, critics say the new laws will create “a nightmare of interpretation and enforcement.”
In a review posted on its web site the Bahamas Chamber of Commerce says the focus should be on enforcement of existing laws to deal with business disputes: “If there is a perceived problem with the court system, this should be fixed rather than trying to circumvent the system.”
Although private sector representatives have been reviewing the draft laws for months and written proposals were submitted to the government weeks ago, it seems clear from his public comments that Trade Minister Leslie Miller has not even read the submissions.
More recently the private sector committee (representing hoteliers, insurance groups, wholesalers, small businesses and auto dealers, among others) met with officials at the Ministry of Trade and Industry. They say some of the objections will be forwarded to the Attorney-General’s office for review.
Here are just a few of the more egregious examples of what the laws call for:
•vendors must provide consumers with a replacement product of equal value on loan should a product they purchase break down
•vendors must ship a broken or defective product back for repair at their own cost
•consumers are entitled to 10 per cent interest a week on purchase deposit if delivery is delayed (this is reverse usury)
•vendors must provide written estimates for anything that requires repair (from a watch to a car)
•pre-formulated contracts are banned – all terms must be open to negotiation
•vendors must recite product operating manuals to all customers
•goods must be tested to determine if they will cause harm (tested by whom)
•the minister has full discretion to stop or restrict the import of goods
•the minister can force the recall, replacement or refund of goods without reference to any warranty
•”as is” sales are not provided for
•the liability of vendors for injury or loss, irrespective of contributory negligence, is significantly widened
“We have no problem with the idea that consumers should get value for money,” one source close to the negotiations told Tough Call. “But we can’t accept poorly written laws that make it almost impossible to do business. We will have law suits coming out of our wazoo with this legislation and the resultant costs to both business and the consumer will be huge.”
Critics say that while there may be no malicious intent, the laws as written are punitive to the business community and get into specifics about how a business is run – matters that should not come within the purview of lawmakers.
“Rather than supporting ethical business standards, these Bills just make doing business very difficult,” the source said, “and that will produce a knock-on effect in the economy.”
The initiative is said to be based on 30-year-old United Nations guidelines that call on member states to implement policies to protect consumers from health and safety hazards, unfair contracts, and lack of product information and legal redress.
But the real impetus comes from the Caribbean Community, which is supposed to be implementing a regional free trade pact known as the Single Market and Economy in December of next year.
Despite scepticism about this deadline, Barbados Prime Minister Owen Arthur recently said that Barbados, Jamaica and Trinidad would move ahead of other territories to implement the single market at the start of 2005.
Caricom leaders have also decided to increase from five the number of categories of workers who will be allowed to live and work in any Caricom state. There is no indication of how many new categories will be added in the planned expansion, but Dominican leader Roosevelt Skerrit has been given responsibility to work with the regional labour movement on this issue.
The revised Caricom treaty (which the Bahamas has not yet signed onto) calls for goods and services provided regionally to “satisfy regulations standards codes and licensing requirements established or approved by competent bodies.”
To promote free trade, the Caricom treaty also prohibits “discrimination against producers and suppliers of goods in the community and against service providers who are nationals of other member states of the community.”
Our national investment policy currently reserves a number of industries (like fishing and the media) for Bahamians only.
As part of this process, consumer protection laws were recently passed in several Caribbean countries. And according to Jamaica’s Consumer Affairs Commission, “the laws will be invaluable when unrestricted movement is allowed under CSME and the volume of activities among member countries increases.”
The laws are aimed at protecting consumer rights and promoting a free and competitive marketplace. They set up enforcement commissions to regulate industry practices, including professional fee structures. It is not clear how local professionals will be affected by the increase – although the Bahamian draft laws apply to all service providers, there is no definition of what a “service” actually is.
But, for example, the Barbados Fair Trade Commission recently held a review of fee setting by accountants, architects, engineers, realtors, appraisers, insurance and financial advisors, surveyors, lawyers, doctors and dentists.
Its report said there was “no link between fee setting and the maintenance of quality standards” and that fee setting was unnecessary to develop or enforce professional standards reasonably necessary for the protection of the public.
It also said the maintenance of minimum fee scales “does nothing to protect the public, but can prevent efficient providers from passing on cost savings to the consumer, while shielding inefficient members within the profession from competitive pressure.”
The Barbados commission also regulates utilities, which in the Bahamas are subject to the existing Public Utilities Commission. And it is not clear from the draft Bills just how the regulatory lines will be drawn for public monopolies.
But the consensus is that the Bahamian legislation is seriously flawed. And that is largely because the government has not thought the matter through. Rather it is making a poor imitation of our “geopolitical allies” as Foreign Minister Fred Mitchell likes to think of Caricom.
This is an example of “creeping regionalisation”, despite the fact that Our elected representatives have yet to articulate a clear policy on if, why and when we should join the CSME.
We seem to be rushing through laws that are driven by political elites And that have little to do with the realities on the ground here.
If this government thinks the policies that these laws support are so crucial to our economy and society, then perhaps it should learn from the experiences of the previous government.
That means taking the time and effort to articulate those policies clearly and to produce proposals that are not counteproductive.
In other words, they should earn their pay instead of flying off to talking shop meetings eleswhere at our expense.
The column 'Tough Call' by Larry Smith is published in The Tribune every Thursday and is reprinted here as a courtesy. Mr. Smith founded and successfully grew an advertising agency over 20 years. Under his direction Media Enterprises diversified into short-run commercial printing and publishing, and is now the largest non-fiction book wholesaler in the Bahamas. He has 30 years experience as a journalist and publicist and has contributed numerous articles and columns to the Bahamian press. A former reporter at the Nassau Guardian, local correspondent for Reuters and editor at the Bahamas News Bureau, he conceived and edited the Bahama Almanac (published 2000 by Media Enterprises), wrote the commentary for Mike Toogood's Portrait of an Archipelago (published 2004 by Macmillan Caribbean), and edited the Bahamas Environmental Handbook (published 2002 by the government). In 2003 he took a year's leave of absence from Media Enterprises to lead a transition management team at the Nassau Guardian after the paper was acquired by local investors. After leaving the Guardian he was contracted by the Tribune as online manager/editor and columnist. He has a degree in political science and journalism from the University of Miami. Mr. Smith can be contacted at: email@example.com