Move to expose errant retailers

Government to strengthen consumer protection laws in Singapore

By Cheryl Faith Wee, The Straits Times, 21 Jul 2015

A significant change proposed to consumer protection laws could expose errant retailers, even if they close their shops and reopen them under a different name.

Once a court order has been taken up against them, they will no longer be able to sweep it under the carpet by reappearing in a new guise. Instead, they will be required to inform their customers about the court order - for instance, through a notice printed on invoices.

This measure is among those proposed to strengthen the Consumer Protection (Fair Trading) Act. The exercise followed the outcry over the unethical practices of some stores at Sim Lim Square last year, where a Vietnamese tourist begging a shopkeeper for a refund was recorded in a video clip that went viral.

The move could also plug a loophole perennially exploited by errant retailers.

While the Consumers Association of Singapore (CASE) and the Singapore Tourism Board can take up court orders against such retailers, some of them have dodged penalties by closing their shops and reopening them under a different name.

Revealing the latest step proposed to counter this, Mr Teo Ser Luck, Minister of State for Trade and Industry, said yesterday: "This is not a deterrent to set up businesses but a deterrent to unfair practices."

He said errant retailers hurt Singapore's reputation as a place to shop. An agency within the Ministry of Trade and Industry (MTI) will be appointed to work closely with CASE to investigate and take action against recalcitrant shops, he said.

After a public consultation on the proposed measures, MTI aims to table a Bill in Parliament by the first quarter of next year.

Enhancements to consumer rights 'will help close legal loophole'
Lawyers say the proposed changes are a step in the right direction to deter bad hats from hiding behind a 'corporate veil'.
By Ng Jing Yng, TODAY, 21 Jul 2015

Lawyers, retailers and consumers have welcomed the proposed enhancements of consumer rights as a move in the right direction to close a gap in the existing legislation and deter bad hats from hiding “behind a corporate veil”.

In particular, the proposal to extend injunction orders to individuals - whereby those who are served with one must publicise this fact - garnered support as well as raised questions they hope will be addressed in the coming public consultation sessions.

Lawyer Amolat Singh, managing partner at Amolat & Partners, said: “This proposed enhancement is specific and targeted so that these errant retailers do not run around in circles, setting up another shop and continuing their bad practices.”

Mr Robson Lee, a partner at Gibon, Dunn & Crutcher, said the proposed provision in the Consumer Protection (Fair Trading) Act would close a loophole in the law, which takes only errant businesses to task currently.

With the mooted changes, an individual "can’t camouflage behind a corporate veil”, he said.

Retailers also felt that the proposals would help to weed out bad apples in the industry. Clothing retailer Marcella Holdings co-founder Lai Chang Wen said employees who engage in unfair trading practices could then shoulder the consequences, while companies not complicit in these practices can avoid being dragged down with the errant employee.

Some consumers TODAY spoke to agreed that the suggested changes will have a deterrent effect.

But others, such as assistant warehouse manager Yeo Shuan Chee, who met a dishonest used-car dealer who went on to set up business in another location, called for more publicity about blacklisted retailers, as consumers might overlook these details.

“To better protect consumers, the authorities should suspend their businesses,” he added.

Some others hoped the amendments to the law will be fine-tuned such that individuals will have a way to end an injunction order and start afresh.

Audio retailer Atlas Sound & Vision chief executive Michael Tien pointed out that an individual with an injunction order could be a sole business proprietor: “Is it fair to say that the shopkeeper is forever liable? Is there room to explore a certain time frame?”

Lawyer Mr Lee noted that some shop owners might run separate businesses, and the unfair trading practices of one business might not have a bearing on the other. He also questioned whether an individual could be cleared of an injunction by meeting certain criteria.