CONSUMER PROTECTION ACT

1. In this Act Definitions

(a) “borrower” means a person who received credit; borrower
(b) “buyer” means a person who purchases goods or services on
credit and includes his agent, but does not include a person of a class
to whom this Act is declared by the regulations not to apply;
buyer
(c) “cash price” means the price inclusive of sales or other taxes
applicable;
cash price
(d) “cost of borrowing” means cost of borrowing
(i) when used in relation to variable credit, the charges that the
borrower is required to pay monthly or periodically on the unpaid
balance from time to time, and
(ii) when used in relation to a form of credit other than variable
credit, the amount by which
(A) the total sum that the borrower is required to pay if the
payments required are made as they become due
exceeds
(B) in the case of credit given by the advancement of money,
the sum actually received in cash by the borrower and by any
person on his behalf, including official fees and premiums for
insurance paid or payable by the lender at the request of the
borrower, or
(C) in the case of a sale of goods or services, the cash price of
the goods or services, official fees and premiums for insurance
paid or payable by the seller at the request of the buyer and the
sum remaining unpaid under a previous extension of credit,
where the buyer and seller agree that such amount is to be
consolidated therewith less the sums, if any, credited as a down
payment or in respect of a trade-in or in respect of any other
matter;
(e) “credit” means credit for which a borrower is required to pay and
that is
credit
(i) given under an agreement between a seller and a buyer to
purchase goods or services by which all or part of the purchase
price is payable after the agreement is entered into, or
(ii) given by the advancement of money,
(iii) given on the security of a mortgage of real property,
but does not include credit extended
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(iv) in respect of the sale of goods intended for resale, or
(v) for industrial or business purposes of the borrower or buyer,
except credit extended for principal use in fishing or farming
operations;
(f) “credit card” means a card, document or similar instrument by
which goods or services may be purchased on deferred payment, or
by means of which cash may be received;
credit card
(g) “goods” includes tokens, coupons or other documents or things
issued or sold by a seller to a buyer that are exchangeable or
redeemable for goods or services;
goods
(h) “insurance” means insurance on the life or health of a borrower
or buyer, or on property charged to secure payment of the
indebtedness of a borrower or buyer to a lender or seller;
insurance
lender (i)
“lender” means a person who extends credit;
Minister (j)
“Minister” means the Attorney General;
(k) “official fees” means fees paid or payable to a public official in
the province for the filing or registration of an instrument relating to
a credit transaction;
official fees
(l) “person” means an individual, an association of individuals, a
partnership or a corporation and includes an agent of any of them;
person
Registrar (m)
“Registrar” means the Registrar of Credit;
regulations (n)
“regulations” means regulations made under this Act;
(o) “seller” means a person who is in the business of selling goods
or services to buyers and includes his agent, but does not include a
person or class of persons to whom this Act is by the regulations
declared not to apply;
seller
(p) “trade-in” means consideration given by a buyer in a form other
than money or an obligation to pay money;
trade-in
(q) “unsolicited credit card” means a credit card receipt of which has
not been requested in writing by the person named therein;
unsolicited credit
card
(r) “unsolicited goods” means personal property, the receipt of
which has not been requested by the recipient, but does not include
personal property delivered to the recipient that the recipient knew
or ought to have known was intended for delivery to another person;
unsolicited goods
(s) “variable credit” means credit made available under an
agreement whereby the lender agrees to make credit available to a
borrower to be used from time to time at the option of the borrower,
variable credit
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Consumer Protection Act Cap.C-19 3
and, without limiting the generality of the foregoing, includes credit
arrangements, commonly known as revolving credit accounts,
budget accounts, cyclical accounts and other arrangements of a
similar nature. R.S.P.E.I. 1974, Cap. C-17, s.1; 1980, c.2, s.3; 1983,
c.1, s.6; 1983, c.7, s.1; 1985, c.3, s.1; 1985, c.10, s.1; 1993, c.29,
s.4; 1997,c.20,s.3; 2000,c.5,s.3.
2. The Lieutenant Governor in Council may appoint a person to be
Registrar. R.S.P.E.I. 1974, Cap. C-17, s.2.
Registrar
3. It is the function of the Registrar and he has power to Powers and
functions of
Registrar (a)
investigate complaints regarding credit granting and persons
engaged in business as lenders;
(b) conduct studies, inquiries and surveys for the purpose of
obtaining information as to who are lenders in the province,
concerning their methods and practices of carrying on business, and
to keep himself informed of developments or changes in the
business of credit granting;
(c) consult with and cooperate with lenders and other interested
persons and organizations to assist in the attainment of the purposes
of this Act;
(d) disseminate information respecting methods of obtaining or
granting credit, the practices of lenders, the costs of borrowing, the
facilities available for obtaining loans or credit, and such other
information as he considers desirable for the purpose of creating an
informed public;
(e) perform the duties and exercise the powers imposed or conferred
upon him by this Act or the regulations;
(f) perform such other functions as are prescribed by the regulations
by the Lieutenant Governor in Council. R.S.P.E.I. 1974, Cap. C-17,
s.4.
4. For the purpose of exercising his functions under this Act the
Registrar has all the powers, privileges and immunities of a
commissioner appointed under the Public Inquiries Act R.S.P.E.I. 1988,
Cap. P-31. R.S.P.E.I. 1974, Cap. C-17, s.4.
Power of a
commissioner
5. The Registrar or a person authorized by him for the purpose may enter
the premises of a lender or any person who he has reasonable grounds to
believe is carrying on the business of a lender and inspect the records
and files of the lender or person and make copies of or take extracts from
any books, records or documents on those files. R.S.P.E.I. 1974, Cap. C-
17, s.6.
Inspection of
records and files
6. To assist the Registrar in performing his functions there shall be
appointed in accordance with the Civil Service Act R.S.P.E.I. 1988, Cap.
Appointment of
assistants
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C-8 such auditors, accountants, inspectors, clerks and other persons as
are necessary. R.S.P.E.I. 1974, Cap. C-17, s.7.
7. With the approval of the Lieutenant Governor in Council the Registrar
may engage solicitors, accountants, actuaries, and other professionally or
technically qualified persons. R.S.P.E.I. 1974, Cap. C-17, s.8.
Technical persons,
employment of
8. (1) The Lieutenant Governor in Council may appoint advisory
councils to assist and advise the Registrar in the performance of his
functions.
Advisory councils
(2) Separate advisory councils may be appointed to assist and advise
respecting transactions relating to different types of money lending and
credit granting.
Types of advisory
councils
(3) A provincial advisory council may be appointed from among the
members of separate advisory councils to assist in coordinating the
recommendations of separate councils.
Provincial advisory
council
(4) Each advisory council shall consist of such number of persons as
the Lieutenant Governor in Council determines. R.S.P.E.I. 1974, Cap. C-
17, s.9.
Composition
Sections 9 to 13 are repealed by 1994, c.48, s.7.
14. Where any person is making false, misleading or deceptive
statements relating to the extension of credit in any advertisement,
circular, pamphlet or similar material, the Registrar may order the
immediate cessation of the use of such material. R.S.P.E.I. 1974, Cap. C-
17, s.15; 1994, c.48, s.7.
Effect of using false
statements, etc.
15. (1) Every contract for the sale of goods on credit in which the
purchase price, excluding the cost of borrowing, exceeds $50 that is
made elsewhere than on the premises of the seller shall be in writing and
shall contain
Disclosures in
contract for sale of
goods on credit
(a) the name and address of the seller and the buyer;
(b) a description of the goods sufficient to identify the goods with
certainty;
(c) the price of the goods and a statement of the terms of payment;
(d) a statement of any security for payment under the contract,
including the particulars of any negotiable instrument, conditional
sale agreement, chattel mortgage or any other security;
(e) any warranty or guarantee given by the vendor applying to the
goods, which warranty or guarantee may be contained in or attached
to, or form part of the contract; and
(f) any other matter required by the regulations.
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Consumer Protection Act Cap.C-19 5
(2) Immediately after the execution of a contract under subsection (1)
the seller shall deliver a true copy of the contract to the buyer. R.S.P.E.I.
1974, Cap. C-17, s.16.
Delivery of true
copy
16. (1) Where a lender makes to a borrower a loan, the cost of borrowing
in relation to the loan, expressed as an annual percentage rate, shall be
disclosed by the lender to the borrower in a separate statement in the
form prescribed in the regulations.
Disclosure of cost
of borrowing
(2) Where a loan referred to in subsection (1) is subject to variations in
the annual percentage rate, the lender shall
Variable rate loans
(a) at the time of the loan, disclose
(i) the cost of borrowing, expressed as an annual percentage rate
or the manner of determining the annual percentage rate,
(ii) that the rate is liable to change and the basis on which the
change will occur,
(iii) the manner of calculating the cost of borrowing;
(b) upon a change in the rate, within five weeks of the change, notify
the borrower in writing of
(i) the revised rate,
(ii) the effective date of the change,
(iii) any other modifications to the loan consequent on the change
in rate;
(c) annually issue to the borrower a written statement showing
(i) the number and total amount of payments made during the
year,
(ii) the amount applied to the cost of borrowing,
(iii) the amount of principal repaid,
(iv) the amount of principal outstanding.
(3) Where a loan referred to in subsection (1) is not subject to
variations in the annual percentage rate, the lender shall
Fixed rate loans
(a) at the time of the loan, disclose to the borrower
(i) the cost of borrowing, expressed as an annual percentage rate
or the manner of determining the annual percentage rate, and
(ii) the manner of calculating the cost of borrowing; and
(b) annually issue to the borrower a written statement containing the
information set out in subclauses (2)(c)(i) to (iv).
(4) Where a lender extends variable credit by use of a payment, credit
or charge card, the lender shall disclose to the borrower
Variable credit,
charge cards
(a) the maximum aggregate amount of credit available through use
of the card;
(b) the term of each period for which a statement of account is
furnished;
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(c) the amount in dollars and cents of any service, transaction or
activity charge and the manner in which it is calculated;
(d) the manner, if any, in which the borrower may discharge his
obligations without incurring any cost of borrowing;
(e) the cost of borrowing expressed as an annual percentage rate;
(f) the maximum liability of the borrower in the event the card is lost
or stolen;
(g) the manner in which the cost of borrowing is calculated,
and shall
(h) not less frequently than every five weeks, furnish the borrower
with a clear statement in writing showing, in respect of the period
covered by the statement, the opening and closing balances, the
amount of each extension of credit, sums credited to the account and
the cost of borrowing expressed in dollars and cents;
(i) give advance notice to the borrower of any variation in the terms
referred in clauses (b) to (g) at least thirty days before the variation
becomes effective. R.S.P.E.I. 1974, Cap. C-17, s.17; 1985, c.10, s.2.
17. (1) No person shall issue or deliver unsolicited credit cards or deliver
unsolicited goods to a person who has not requested such credit card or
goods.
Unsolicited credit
cards
(2) A credit card that renews or replaces another credit card previously
used or requested by the person receiving the same shall not be
considered to be an unsolicited credit card within the meaning of this
section. R.S.P.E.I. 1974, Cap. C-17, s.19.
Renewals not
included in ss(1)
18. (1) Where a loan is prepaid before its due date, the lender shall not
impose any charge or penalty in relation to the prepayment.
Prepayment without
penalty
(2) Subsection (1) does not apply to a loan secured by a mortgage of
real property. R.S.P.E.I. 1974, Cap. C-17, s.20; 1985, c.10, s.4.
Mortgages
19. (1) Notwithstanding subsection 18(2) or any stipulation to the
contrary, where a mortgagor is entitled to redeem a mortgage or where
the mortgagee demands payment of a mortgage by the mortgagor, the
mortgagor, upon payment of any balance outstanding in respect of the
mortgage, may require the mortgagee, instead of giving a release of the
mortgage, to assign the mortgage to such third person as he directs, and
the mortgagee is bound to assign accordingly.
Assignment,
obligation of
mortgagee
(2) The fee imposed by a mortgagee for the assignment of a mortgage
pursuant to subsection (1) shall not exceed $25 or such greater sum as
the Minister may specify by notice published in the Gazette.
Fee
Application
(3) This section does not apply if the mortgagee is or has been in
possession. 1987, c.12, s.1.
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Consumer Protection Act Cap.C-19 7
20. (1) No lender shall publish or cause to be published, whether in print
or by radio or television broadcast or otherwise, any representation of a
charge for credit that does not disclose the full cost of borrowing, stated
as an annual percentage rate expressed in the manner required by section
16.
Advertising charge
for credit
(2) Unless permitted by the regulations where a lender represents or
causes to be represented in a printing, broadcast or other publication, any
terms of a credit transaction other than a charge for credit, the lender
shall also include or cause to be included all other relevant terms of the
credit transaction including
Disclosure of terms
in advertising
(a) the sum to be actually received in cash by the borrower or the
actual cash price of the goods;
(b) the amount of the down payment, if any;
(c) the amount of each instalment; and
(d) the number of instalments required to repay the total
indebtedness including the cost of borrowing.
(3) No lender shall represent his charge for credit or cause such charge
to be represented unless the representation includes the full cost of
borrowing and is expressed in the manner required by section 16.
R.S.P.E.I. 1974, Cap. C-17, s.21.
Disclosure of full
costs of borrowing
21. This Act applies notwithstanding any agreement or waiver to the
contrary. R.S.P.E.I. 1974, Cap. C-17, s.22.
Application of Act
22. Except as otherwise provided in this Act, the assignee of any rights
of a credit grantor in any transaction to which this Act applies has no
greater rights than, and is subject to the same obligations, liabilities and
duties as, the assignor, and this Act applies equally to such an assignee,
but the liability of the assignee is limited to the total amount owing under
the agreement at the date of assignment. R.S.P.E.I. 1974, Cap. C-17,
s.23.
Assignee, rights
23. The rights of a buyer or borrower under this Act are in addition to
any rights of the buyer or borrower under any other Act or by the
operation of law and nothing in the Act shall be construed to derogate
from such rights. R.S.P.E.I. 1974, Cap. C-17, s.24.
Rights under this
Act are additional
24. (1) Every person who violates or fails to comply with any provision
of this Act or the regulations or an order or direction given under this Act
or the regulations and every director of a corporation who knowingly
concurs in a violation or failure to comply with any provision of this Act
or the regulations or an order or direction given under this Act or the
regulations is guilty of an offence and liable on summary conviction to a
Penalties
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8 Cap.C-19 Consumer Protection Act
penalty of not more than $2,000 or to imprisonment for a term of not
more than one year, or both.
(2) Where a corporation is convicted of an offence under subsection
(1) it is liable to a penalty of not more than $25,000. R.S.P.E.I. 1974,
Cap. C-17, s.25.
Corporation
convicted
25. Notwithstanding any other Act, any information for an offence under
this Act may be laid at any time within three years from the time when
the offence or act was committed. R.S.P.E.I. 1974, Cap. C-17, s.26.
Information may be
laid, when
Prima facie 26. Repealed by 1994, c.48, s.7.
evidence
27. Any person aggrieved by a decision, order or direction of the
Registrar may within thirty days after receiving notice of the decision,
order or direction, appeal therefrom to a judge of the Supreme Court and
the judge on the hearing of the appeal may confirm, vary or set aside the
decision, order or direction. R.S.P.E.I. 1974, Cap. C-17, s.28; 1981, c.36,
s.4.
Appeals from
decision of
Registrar
Regulations 28.
The Lieutenant Governor in Council may make regulations
(a) - (e) repealed by 1994, c.48, s.7;
(f) declaring that this Act does not apply to a buyer or seller or class
of buyers or sellers, or to a borrower or lender or a class of
borrowers or lenders;
(g) providing for approval of forms of agreement, assignments and
other instruments and documents to be used by lenders;
(h) requiring any class of lenders to submit forms of credit
agreements, instruments and other documents used by him or them
to the Registrar for approval;
(i) requiring the use by lenders of credit agreements, instruments and
other documents that are in a form approved by the Registrar and
prohibiting the use by any class of lenders of such agreements,
instruments or documents that are not in a form approved by the
Registrar;
(j) prescribing the manner in which the cost of borrowing stated as a
percentage shall be calculated and expressed by any class of lenders
which may be different for different classes of lenders or for
different types of businesses carried on by lenders;
(k) regulating forms of advertising by lenders relating to the
extension of credit;
(l) prescribing the form and content of records relating to lending to
be kept by lenders, and the length of time for which they must be
kept;
(m) - (n) repealed by 1994, c.48, s.7;
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Consumer Protection Act Cap. C-19 9

9Consumer Protection in India

Consumer protection has been the buzz word in India for the last 25 years or so. Ever since the
introduction of the consumer protection bill of laws in western legislatures, the Indian consumers
have been excited about the prospects of improving their plight as consumers. India is perhaps
the only major economy in the world where a seller can unscrupulously plan any scam against a
consumer without the fear of prosecution by the government, the judiciary or any statutory or
regulatory agency. 23 years after the consumer protection act 1986, we continue with this
glorious tradition where politically connected scammers continue to threaten the very fabric of
this country's socialistic (read pro-consumer) framework.

Consumer experts frequently debate the impact the consumer protection act 1986 has had on the
legal, sociological and commercial ethos of our country. Across the two decades of its existence,
of course more funds have been diverted into consumer protection, more councils have been
formed and more cases and complaints have come out in the open. But besides the lipstick on the
pig, the pig is still a pig. The plight of consumers remain the same; instead of approaching the
civil court, now they need to approach a consumer forum; instead of filing a civil complaint, they
need to file a consumer complaint; only the players have changed, the game hasn't. With that
said, as we near a quarter century past the establishment of this supposedly stalwart legislation, it
is not entirely accurate to say there hasn't been any impact; haven't you threatened or heard
anyone threaten a seller with a consumer case in a consumer court? I have found myself
threatening sellers whenever I get duped, but seldom have I dared to actually file a consumer
case for the fear of the costs, the time needed to resolution, the shaky verdict or even the bribe I
have to pay the court clerk to get a case number for my consumer case! Statistics indicate that
less than 1% of the consumer disputes actually become consumer cases; yet, the consumer court
system in this country is clogged with so many disputes that will keep them occupied for the next
2-3 centuries.

So what can bring about a revolution of consumerism in our country? The answer is
INFORMATION. Leaning on the information networks of the country, the blogs, the SMS
media, the broadcasting media, the print media, the online databases and the social networking
sites, we Indians need to build a highly transparent consumer information dissipation platform
that congregates consumer generated media (CGM) across the country. A scammer who scams
one consumer must not be allowed to scam a second, because the news of the scam should
become so publicized that any credibility used to attract business is routed at bare bone. Each
and every consumer in this country needs to contribute and utilize this public network of
information which may be presented in the form of a consumer report. Each and every consumer
product company in the country needs to be indexed in this consumer report database, so that
consumers can distinguish good products from bad products.

Easier said than done, but is it possible to achieve it? We at Consumerdaddy believe it is
possible, and we have started our humble work in which we have indexed 40,000 consumer
product companies and 200,000 consumer products in India. Having started this work in June
2008, we continue our data collection work with rigor, tenacity and perseverance to this day.
Feel free to visit our website and be a part of this alliance of consumers who wish to standup
against corporate greed. Feel free to inform others of your experiences, and be informed!
Welcome to the digital age of consumer protection!