Amendments to the Consumer Protection Law

The Law that was finally approved had been passed in December 2007 by the Senate and contains several modifications regarding the original Bill passed by the House of Representatives some months before[1].

The new Law’s specifications keep the principal amendments of the House of Representatives’ bill (punitive damages, penalties for direct damage, class actions, cost-free trial for all plaintiffs, etc.) but eliminate the controversial inclusion of the liberal professionals in the suppliers subject to the fulfillment of the law, among other modifications.

The new Law’s main amendments are as follows:

       a. It broadens the purpose and definitions of user/consumer: it refers to goods (and not to “things” as before), including cost-free goods;

       b. It broadens the definition of supplier: it includes contracts for used goods; it also now includes those who carry out activities related to design, creation, development and use of a trademark;

       c. It defines the consumer relationship as the tie between supplier and consumer or user;

       d. It establishes the priority of the Consumer Protection Law No 24,240 (“CPL”) over any other specific laws;

       e. It includes the duty to inform of the essential terms of sale, the name and address of the manufacturer and additional costs. The information must be provided to the consumer freely;

        f. It establishes a new article referring to humane treatment and fairness to consumers and users and abusive practices: It forbids price differences for foreign consumers and the utilization of means that make an “out-of-court” claim’s appearance similar to a judicial claim. Such behavior may be subject to a civil fine;

       g. For home services, it provides the possibility for the user to rescind the contract in the same way that it was entered (by telephone, electronically, etc.). It eliminates the exclusion of these services from the scope of the CPL and prescribes a new proceeding that grants more protection to the consumer in case of errors in the confection of invoices;

       h. It extends most of the terms in favor of the consumer: the guarantee for defects or malfunction has changed from three to six months; the term to go back on long-distance sale extends from five to ten days;

        i. It includes financial operations and consumer credits, and modifies the sanction of nullity for these operations;

        j. Punitive damage is relocated in the new article 52 bis. The legal text is the same as had been proposed in the House of the Representatives’ bill, with the only difference that the “civil fine” (new punitive damages’ name) may only be applied at the victim’s request, whereas before the judge could apply this fine ex-officio;

       k. It includes compensation for direct damages, up to a maximum of 5 times the value of the “Total Basic Food Basket for Home #3” published by the official statistics department, the INDEC. According the last available information from the INDEC in February 2008 the maximum would be Ar$5,278.45;

        l. It modifies the administrative proceedings, adding a mandatory conciliatory stage (not only for actions filed by individuals as in the previous bill), the only preventive measure mentioned is the cease of the misdemeanour (while before there were preventive measures in general), the supplementary procedural Laws to be applied are Administrative Procedure Law and the Civil Procedure Code (when in the House of the Representatives Law the supplementary law was the Criminal Procedure Code), a twenty day term is re-established for the Administration to dictate a resolution, etc.;

       m. It eliminates the court fines (“astreintes”) of article 47 of the House of the Representatives’ bill, as an additional sanction;

       n. In class actions the judge must evaluate the legitimacy of the consumer or users associations before they may take part in a judicial process as parties;

       o. it eliminates article 52 of the bill, the duty of the judges to take into account the parties’ financial capacity upon the regulation of court fees and costs;

       p. Although the rule continues to be the summary and urgent trial, the judge can modify the type of process with a founded decision;

       q.  It includes judicial actions within the three year statutes of limitation set forth in the CPL, and in case of doubt, the term most beneficial to the consumer will prevail;

        r. It re-establishes a cost-free trial for all plaintiffs. Those who are have been reported may demonstrate the solvency of the consumer through an ancillary proceeding (which reverses the burden of proof);

       s.  It provides the theory of dynamic burden of proof, demanding the suppliers to bring to trial all the elements of proof they have;

        t.  It provides for the creation of courts in the City of Buenos Aires and in all the provincial capitals;

       u.  It provides for the new LPC to be incorporated into the syllabus all educational levels.