Microsoft_Word_-_consumer_protection_lecture_note - 1...

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O.H Akinladejo, Lecturer School of Business Administration, UTech. 1 1 BUSINESS LAW UNIT III CONSUMER PROTECTION Fair Competition Act The Fair Competition Act of Jamaica 1993 (FCA) is one of the key legislation that focuses on protecting the consumer against unfair practices of vendors. The objective of this Act is to promote competition in markets within Jamaica. The major advantage of this legislation is that it provides an avenue by which vendors can be prosecuted for clearly defined offences under the Law in addition to legal action that may be pursued by purchasers for breach of terms of contract. The Fair Competition Act established the Fair Trading Commission (FTC) which is an administrative body appointed by the Government and which is responsible for implementing the FCA. The FTC has power to summon and examine witnesses, Call and examine documents, administer oaths and to take legal action in the Supreme Court against any business or individual found guilty of uncompetitive practice. The functions of the commission include: 1. Investigating conduct of business in Jamaica in order to determine whether an enterprise is engaged in business practices in contravention of the Act. 2. Taking necessary action in relation to its findings. 3. Informing and advising on matters relating to competition. 4. Assisting in the development of standards consistent with the FCA. 5. Granting authorizations for business practices, which are normally prohibited by the FCA. The following issues are addressed by the Fair Competition Act: Uncompetitive Practices Abuse of dominant position Collective and Individual Resale Price Maintenance Prohibited Practices Offences against Competition Uncompetitive Practices The Act renders unenforceable any provision in an agreement which has the purpose of substantially lessening competition in a market or which is exclusionary. Agreements which contain provisions that directly or indirectly fix purchasing or selling prices; or provisions that limit or control production are likely to be considered unenforceable under the law for being uncompetitive. Provisions in agreements which are meant to prevent, restrict or limit supply or acquisition of goods and services from any particular person or class of persons are void for being exclusionary if the agreement is between persons or businesses that are in competition with each other.
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O.H Akinladejo, Lecturer School of Business Administration, UTech. 2 2 Abuse of Dominant Position A business holds dominant position if it controls the market in that it has enough economic strength to enable it to operate in the market without effective constraints from competitors. The FCA does not view dominant position as harmful if it improves the production or distribution of goods and services, promotes technical or economic progress, results in cheaper prices for consumers, or if the dominant position is achieved by superior performance. However, where dominant position is achieved by
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