A Quarterly EnewsLetter Vol.6, Issue No. 3, 2010

Editorial Comments

Observing the Competition and Consumer Protection Bill
It is worth appreciating and welcoming the recognition by Zambia to enhance consumer protection through the enforcement of the provisions in the Draft Competition and Consumer Protection Bill. For sometime now, consumers in Zambia have relied on the Competition and Fair Trading Act, 1994 for their protection against violations emanating from Unfair Trade Practices (UTPs). However, the Act has not been adequate in terms of explicitly protecting consumers as it has most been purported to focus more on competition issues. Critical provisions on consumer protection were left out. Chapter 12 in the entire Act is the only section that highlight some consumer protection provisions such as misrepresentation, hoarding warranties, defective products and misleading advertisements to mention a few. Thus, the scope was only limited to UTPs, when protection goes beyond such issues.

In the proposed Competition and Consumer Protection Bill, it is worth acknowledging that consumer protection statutes have been enhanced as compared to the current Act. Further, observing the proposed Act also reveals some shortcomings. The Bill recognises consumer protection only within the context of UTPs, though, as has been mentioned, the scope of it should be beyond this. A consumer protection law generally not only outlines the eight basic consumer rights, but also have provisions explaining how the law helps to ensure that such rights would be met.
It is, therefore, imperative that such issues should be taken into account if consumer protection is to be enhanced in Zambia. Once such issues are addressed, Zambia Competition Commission will have the muscle to protect consumers and legitimate businesses will have somewhere to turn to when they fall victim to these fraudulent practice
Zain Slashes Rates for International Calls
Zain Zambia – one of Zambia’s leading telecommunication company – announced the reduction in the cost of international calls after being given the go ahead by the Zambian government to manage its own international gateway. It has also been announced that that as a special incentive for Zain customers to get used to the reduced rates, the network would be offering a special discount of 20 percent off the new rates.

The go ahead to manage its own international gateway was given to Zain Zambia in mid June 2010 by the Zambia Information Communication Technology Authority (ZICTA) as part of the continued deregulation of the communication sector in Zambia.

(Source: The Post, 08.07.10)

Pirated Sweets up in Flames
Pirating is a crime which is common among traders. It is for this reason that the Intellectual Property Unit (IPU) of the Zambia Police Service has now become vigilant in destroying the pirated properties.

The sweets belonging to Himalaya Enterprises were disposed off following a court order. More than 4,292 packets of sweets bearing the label of Trade King were seized in Mwinilunga, while 18,991 packets were seized in Solewzi. The sweets were produced in India and packaged in Zambia under the label Super, the property of Trade Kings. The owners of pirated sweets will appear in the court for copyright infringement, which is contrary to Section 28 Cap 406 of the Copyright and Performance Act.

(Source: Zambia Daily Mail, 2I.07.10)

Pick n Pay Launches Shop
The government retail sector’s total investment in Zambia is expected to exceed US$200mn in 2010. The government’s efforts on trying to reduce the cost of doing business are beginning to bear fruit. The first Pick n Pay outlet in Lusaka has been opened adding to the retail sector in Zambia. The retail sector is the second biggest contributor to the gross domestic product (GDP) at 15 percent. Pick n Pay is investing US$25mn in Zambia.

The Pick n Pay Zambia General Manager has indicated that the company will work closely with the Zambia Development Agency as a point of contact for local business houses and Roseblooms a ngwerere based farm as a point of consolidation for small scale farmers together with Pick n Pay South Africa.

(Source: timeszambiapost.com, 23.07.10)

BAZ Cautions Public on Bank Cards
A lot of debit card users have lost huge sums of money especially when transacting abroad. The Bankers Association of Zambia (BAZ) has since advised customers to be watchful when using debit cards. In the past few days, some retail banking customers in Zambia have reported suspicious cases involving debit cards on their accounts to their banks. Investigations by the BAZ revealed that some cards could have been replicated or skimmed and are now being used abroad to transact on both Automated Teller Machines and points of sale machines.

A number of banks had taken preventive measures to protect customer’s funds. Consumers were to get in touch with their banks as soon as they notice any suspicious transactions on their accounts for investigations and appropriate action. The BAZ warned customers not to write their personal identification numbers on debit or credit cards or respond to emails that request them to provide information via emails.

(Source: Zambia Daily Mail, 26.07.10)

ZESCO Acquires New Transformer
Electricity is part of everyone’s life. And with the growing demand for the service, ZESCO is also trying to satisfy its clients by increasing its power generation. Recently, ZESCO Limited acquired a standby transformer for the Kafue Gorge power station costing US$600,000 to help mitigate power shortages.

The stand by transformer will enable ZESCO to switch operations within the shortest possible time in case of power failure or to facilitate maintenance work. Kafue Gorge power station is Zambia’s largest hydropower station with a generating capacity of 990Mw. To improve its customer cares services, ZESCO has also encouraged its clients to enrol for ZESCO short messaging text power which allows them to report faults and receive updates.

(Source: Zambia Daily Mail, 10.09.10)

JCTR Highlights Impact of Electricity on Cost of Living
The recent hike in electricity tariffs coupled with high cost of non-food items have eroded the positive impact of low food prices on overall poverty reduction in Zambia. According to Jesuit Centre for Theological Reflection (JCTR) the high cost of essential non-food items has eroded the reduction in the cost of food such as water, housing etc. JCTR stated that in the past several months, mealie meal prices which always played a key role on the average cost of basic food items had recorded reductions in Lusaka and many other towns across the country.

JCTR also noted that the upward trend in the cost of essential non-food items was triggered by a significant increase in the cost of electricity. Energy being an important household commodity, any increment in the cost of electricity leads to a rise in house hold expenditure which eventually affects overall welfare as households struggle to meet other competing household needs.

(Source: The Post, 16.09.10)

State Urged to Revisit Fuel Tax
The Economic Association of Zambia (EAZ) has appealed to government to revisit fuel taxes to help reduce the cost of fuel which is still high. The EAZ said the high cost of fuel is negatively impacting the domestic economy because production costs remain high. The Association has also called for accelerated capital projects and empowerment programmes to provide more investment and create employment, if Zambia has to maintain economic growth.

EAZ has also noted that there is need to ensure more deliberate well targeted pro-poor programmes for the vulnerable to achieve greater impact on reducing poverty, especially in rural areas. The EAZ also stated that since Zambia has identified unemployment as a root cause of poverty, there is need for increasing the working population through expedite capital projects which can create jobs.

(Source: Zambia Daily Mail, 24.09.10)

Snapshots on Consumer Issues

Dealers Prosecuted For Fake Products
Fake and expired products are hazardous to the health of every human being, but most dealers do not seem to care because they are interested in making money at the risk of others. It is for this reason that the UN Secretary General’s Special Envoy for AIDS in Africa Elizabeth Mataka called for the prosecution of people dealing in counterfeit and expired products.

Mataka said fake and expired products such as infant and healthy products were dangerous to human lives and that the country needs to strengthen the certification of products to save lives. She also emphasised on imposing quality control on all goods coming to the country and also prosecuting the people involved in dealing with such kinds of goods.

(Source: The Post, 13.09.10)

Government Rules out Fuel Shortage
Every year during the annual maintenance shut down of Indeni, which is the main fuel terminal in Zambia, the country faces a shortage of fuel. In 2010, the government has assured that there would not be any fuel shortages in the country during the annual maintenance shut down of Indeni. The shutdown for the planned maintenance will last for a period of 40-45 days. The government hopes to stockpile enough fuel and import during the maintenance period. It is also rehabilitating a third tank at the Ndola fuel terminal with a capacity of nine million litres for storage of petrol expected to be completed soon.

(Source: The Post, 17.08.10)

Farmers Accused of Manipulating Wheat Prices
Bakers in Zambia have charged that farmers are manipulating wheat prices and urged the government to lift the ban on flour imports. But the Zambia National Farmers Union (ZNFU) has described the charge by the bakers as utter nonsense, accusing them of profiteering and milking customers. ZNFU President Jervis Zimba said the assertions clearly demonstrated that the bakers have scanty knowledge of the whole wheat industry particularly the important contribution of wheat sub sector to the agricultural industry and the economy as a whole and are only pre occupied with milking their Zambian consumers.

(Source: Zambia Daily Mail, 17.09.10)

About the Newsletter
Consumer Watch newsletter is a joint initiative of the CUTS ARC and ZACA, published with the objective of enhancing consumer welfare through sensitisation, information dissemination and capacity building of consumers, business entities and government. While addressing consumer concerns, the newsletter focuses on bringing out issues such as violation of consumer rights and measures to be taken by the relevant authorities to protect stakeholders.

CUTS ARC and ZACA will strive to support and lobby the Government and the stakeholders to ensure resumption of the process to eventually enact a functional Consumer Protection Law in the country and also establish a functional institutional mechanism to implement the law. This is in line with the changes taking place in other countries in the region in the wake of globalisation and liberalisation. Apart from carrying consumer-related information, the publication will also give an analysis on current consumer concerns in the country.