The government must crack down on foreign online vendors beyond the jurisdiction of SA consumer protection bodies, argues columnist Chris Barron in BusinessLIVE.

He adds that compliance must be a condition of access because allowing non-compliant suppliers into the market and then trying to get them to comply is a losing battle for the Consumer Goods & Services Ombud (CGSO).

'CGSO CEO Queen Munyai warns: "If they don’t comply with our consumer laws they must be barred from accessing our market." By far the highest number of consumer complaints to her office are related to online transactions. "Our laws should be able to accommodate redress for consumers and hold suppliers accountable. There’s a serious mismatch between consumer expectations in terms of protection from online scams and what the law allows," Munyai warns.'

Barron notes that Munyai believes more can be done in terms of education and legislation to improve e-commerce safety.

'The CGSO’s job is to maintain a fair marketplace. But online marketplaces deny responsibility for transactions between third-party sellers and consumers. This means although contractual liability lies with the third party it can decide whether to refund consumers for defective goods, repair them, replace them or walk away and there is little the CGSO in SA can do about it,’ warns Munyai, according to Barron, adding that the rising number of complaints reveals that more online suppliers are taking the gap.

'A recent report by research firm BMA, which says e-commerce sales climbed from just 2.4% of the SA market in 2015 to nearly 10% last year, calls for stronger compliance and consumer protection. But the Consumer Protection Act (CPA) is only applicable where the consumer and supplier are both in SA.'

Barron says Munyai proposes that the CPA and the Electronic Communications & Transactions Act be updated so they apply to suppliers outside SA.

‘Government must make it more difficult. If SA suppliers want to do business in other countries it’s not that easy. There are a lot of hoops you must go through. It should be the same here,’ Munyai argues, according to Barron, who observes that the CGSO has no jurisdiction over platforms such as Chinese online giants Shein and Temu, which according to BMA are rapidly swallowing the market share of local retailers and manufacturers.

'In 2024, according to BMA, they raked in an estimated R7.3bn in SA sales, more than a third of all online clothing purchases in SA. Temu has just opened a warehouse in SA, which Munyai notes makes it "more eligible to comply" with the CPA and ECTA. "But it’s not a clear-cut process to enforce the law inside SA. We are engaging with them. They are co-operating but it’s low. It’s not happening the way we would like to see"'.

When push comes to shove the CGSO cannot force Temu or Shein to comply with either the CPA or ECTA.

Barron explains that Munyai is calling for more enforcement and for consumer bodies to have more teeth to hold both local and offshore suppliers accountable.

Her office has made a submission to the government regarding this legal problem. 

Full analysis on the BusinessLIVE site