The National Consumer Commission’s (NCC’s) inquiry into the timeshare and vacation ownership industry has recommended a review of the laws that apply to these contracts and the appointment of a regulator to deal with the industry.
But at the release of its much-anticipated report on its inquiry into the industry in Pretoria, MacDonald Netshitenzhe, the chief director of policy at the department of trade and industry (DTI), said law reform was not likely to happen next year with it being an election year.
In the meantime, NCC commissioner Ebrahim Mohamed encouraged consumers to lodge complaints with the consumer goods and services ombud (CGSO), who would assess the extent to which industry was “willing to allow consumers to exit contracts without penalty, in particular, the nefarious in-perpetuity contracts”.
The NCC is a statutory regulator whereas the CGSO is not, although membership of the ombud scheme is compulsory for any supplier of goods or services, as defined by the Consumer Protection Act (CPA).
CGSO ombud Magauta Mphahlele said that between January and December of this year, the CGSO had 427 timeshare-related complaints, 54% of which were resolved in favour of the consumer.
The ombud offers a free service to consumers, trying to help them resolve their complaints with suppliers by means of alternative dispute resolution.
Where the ombud is unable to resolve the matter, it is referred to the NCC to investigate. If the NCC is of the view that the supplier has breached the law, it can bring a case against the supplier to the National Consumer Tribunal (NCT). Rulings issued by the NCT carry the weight of a high court judgment.
“Where we find there was a contravention of the CPA we’ll push for cancellation, but the ombud doesn’t have decision-making powers,” Mphahlele said. “If a supplier refuses to cancel, the matter will have to escalated to the commission for a formal investigation and possible referral to the tribunal.”..