INTRODUCTION

The National Consumer Commission (NCC) is pleased to present this Fact Sheet on Direct Marketing - Cooling off periods, Opt out register and prescribed times of contact in terms of the Consumer Protection Act (CPA).

The mandate of the National Consumer Commission is to administer the Consumer Protection Act No 68 of 2008. The primary purpose is to prevent exploitation or harm to consumers and to promote their social well being.

COOLING OFF (SECTION 16)

In terms of section 16 the of CPA, a consumer may rescind a transaction resulting from any direct marketing without reason or penalty, by notice to the supplier in writing, or another recorded manner and form, within five business days after of the later of the date on which the transaction or agreement was concluded, or the goods that were the subject of the transaction were delivered to the consumer.

WHAT IS A COOLING-OFF PERIOD?

Consumers have the right to get out of a direct marketing contract in certain circumstances - this is called a "cooling-off period".

The Act provides for a 5 business day cooling off period in instances where transactions resulted from direct marketing, in other words, transactions which were not initiated by the consumer.  The five business day period will commence on the latter of the day on which the transaction or agreement was concluded, or the day on which the goods or services were delivered to the consumer.

It should be noted that it is not a requirement for the transaction to be concluded at the home of the consumer for the cooling off period to apply (as is the case in the National Credit Act). The cooling off period will apply to all transactions that resulted from direct marketing.

DIRECT MARKETING

Direct Marketing is defined in the CPA as follows:

To approach a person, either in person or by mail or electronic communication, for the direct or indirect for the purpose of:

• Promoting or offering to supply, in the ordinary course of business, any goods or services to the person , or

• Requesting the person to make a donation of any kind for any reason".

The term "electronic communication" is widely defined as including "communication by means of electronic transmission, including by telephone, fax, SMS, wireless computer access, email or any similar technology device.

CONSUMER RIGHTS IN TERMS OF THE CPA

The consumer's right to restrict unwanted direct marketing

• The Act specifically provides for a right to privacy within the context of direct marketing.

• To facilitate the realisation of each consumers right to privacy and to enable consumers to efficiently protect themselves against these types of activities, a person who has been approached for the purpose of direct marketing may demand during or within a reasonable time after that communication that the person responsible for initiating the communication desist from initiating any further communication.

In summary, the consumer's right to privacy in terms of CPA is limited in its operation only insofar as the relationship between the consumer and supplier falls within the definition of "direct marketing".

This right is embodied in the right of every person to:

• refuse any approach or communication from a direct marketer;

• require "another person to discontinue" the approach or communication; and

• "pre-emptively block" the approach or communication concerned.

Furthermore, a person authorising, directing or conducting any direct marketing is required to:

• implement appropriate procedures to facilitate the receipt of a request to stop sending marketing material and have an appropriate register to record such request;

• Refrain from directing or permitting any person associated with that activity from directing or delivering any communication for the purpose of direct marketing to a person who has made such a demand or registered a relevant pre-emptive block.

The Commission may establish or recognise as authoritative a registry in which any person may register a pre-emptive block, either generally or for specific purposes against any communication that is primarily for the purpose of direct marketing.
Consumers may not be charged a fee for making or for the implementation of a request for a pre-emptive block or for registering such pre-emptive block.

Regulation of time for contacting consumers

• The right to privacy is taken further within the ambit of direct marketing by empowering the Minister of Trade and Industry to issue regulations prescribing specific days, dates, public holidays or times of day which are "prohibited periods" for direct marketing.

• Once the regulations in terms of which these periods are prescribed become effective, no direct marketing during the prohibited periods will be allowed where direct marketing is directed to a consumer at home for any promotional purpose, except to the extent that the consumer has expressly or implicitly requested or agreed otherwise.

a)	Sundays or public holidays contemplated in the public holiday Act, 1994 (Act No 36 of 1994)
b)	Saturdays before 09h00 and after 12h00, and
c)	All other days between the hours of 19h00 and 08h00 the following day.

Maximum duration for fixed term consumer agreement.

For purposes of section 14(4)(a) of the Act, the maximum period of a fixed term consumer agreement is 24 months from the date of signature by the consumer, subject to sub regulation (3) and unless differently provided for by regulation in respect of a specific type of agreement type of consumer, sector or industry.

 

For the purposes of 14(3), a reasonable credit or charge as contemplated in section 14(4) (c) may not exceed 10% of the amount which would have been payable by the consumer to the remainders of the intended fixed term excluding interest, if any.

IDENTIFICATION

Whenever a person is engaged in direct marketing in person at the premises of a consumer or potential consumer, or performing any services for a consumer at any such premises, or delivering any goods to or installing any goods for a consumer at any such premises, that person must:

• visibly wear or display a badge or similar identification device that satisfies "any prescribed standards"; or

• provide suitable identification on request by the consumer.

The "prescribed standards" are not yet in existence. The Minister of Trade and Industry may still issue regulations setting out requirements for these means of identification. Suitable identification will in all probability include:

• the full business name of the supplier of the goods or services;

• its registration number;

• contact details;

• logo (if any),

• the signature of the marketing manager or CEO;

• details of the goods or services being promoted; and

• the full name, identity number and a current photo of the person employed to undertake the promotion.

This requirement only applies where direct marketing takes place at the premises of the consumer which it is submitted could also refer to business premises where a business is being targeted, and the residence of an individual being targeted.

WAYS OF DIRECT MARKETING

a)	Direct mail One of the most commonly used mediums in direct marketing is direct mail. Direct mail can include envelope mailers, catalogues, self-mailers, snap mailers, dimensional mailers, brochures, and postcards.
b)	Unsolicited goods If after any direct marketing of any goods the marketer has left any goods with the consumer without requiring or arranging payment from them, those goods will constitute unsolicited goods for purposes of the Act.
c)	Exceptions The provisions in respect of direct marketing will not apply in the following situations: where the goods or services that are being promoted, are not promoted in South Africa and will not be provided in South Africa; where the promotion is to a consumer, which is a juristic person whose total asset value or annual turnover equals or exceeds a threshold value yet to be determined by way of regulation by the Minister of Trade and Industry. In practice, however, it will usually be impossible to ensure that a promotion is exclusively marketed to big business, so as to escape the provisions of the Act.
d)	Telemarketing Telemarketing is a direct marketing sales technique that has the advantage of speed in a marketing campaign.
e)	E-mail The most common medium today for direct marketers is e-mail because of its low cost, and because customer responses can be generated rapidly.
f)	Direct response In direct response marketing the customer responds to the marketing message directly. An example, of this would be infomercials, where prospects view a television presentation of a product offering, and can make a purchase with a credit card over the telephone or internet.
g)	Personal selling Personal sales are another technique of direct marketing.

OPT OUT REGISTER

This register allows consumers who contact their telephone line operator to record a preference to opt-out of direct marketing in the National Directory Database (NDD).

The National Directory Database lists all phone numbers printed in public directories or available through directory enquiries and is used to list the preference of subscribers not to receive such unsolicited marketing calls or faxes. This facility is open to both residential and business phone subscribers and is a free service. It applies to voice calls and, for business subscribers, to faxes. The main aim of the register is to stop unsolicited marketing messages and it only applies to calls made from within this state.
This facility is open to both residential and business phone subscribers.

• It is a free service.

• It applies to voice calls and, for business subscribers, to faxes.

• Its aim is to stop unsolicited marketing messages.

• Phone companies will pass on their customers’ preference to the NDD in accordance with regulatory obligations.

• Within 28 days of opting out, no cold calling should occur.

• Marketing companies who break the rules face prosecution by the DPC.

• All ex-directory numbers automatically entered onto the register.

 

ENQUIRIES