Frequently Asked Questions

There are several Acts that cover specific aspects of consumer protection. As an example, pyramid selling is governed by the Multi-Level Marketing And Pyramid Selling (Prohibition) Act. However in November 2003, Singapore passed the Consumer Protection (Fair Trading) Act 2003 and the Consumer Protection (Fair Trading) (Cancellation of Contracts) Regulations 2003. Both the Act and Regulation came into force on 1 March 2004. These are the first general consumer protection laws in Singapore.

Prior to the Act, consumers in Singapore had to sue traders/suppliers under the contract or in tort. The Act introduces a new statutory right for consumers to claim against traders/suppliers for 'unfair practices'.

It is an unfair practice for a trader, in relation to a consumer transaction-

1. to do or say anything, or omit to do or say anything, if as a result a consumer might reasonably be deceived or misled;
   
2. to make a false claim;
   
3. to take advantage of a consumer if the trader knows or ought reasonably to know that the consumer
   • is not in a position to protect his own interests; or
     
   • is not reasonably able to understand the character, nature, language or effect of the transaction or any matter related to the transaction; or
4. to do any of the 20 acts listed in the Second Schedule of the Act(a list of such acts are below).

Specific Unfair Practices
1. Representing that goods or services have sponsorship, approval, performance characteristics, accessories, ingredients, components, qualities, uses or benefits that they do not have.
2. Representing that goods or services are of a particular standard, quality, grade, style, model, origin or method of manufacture if they are not.
3. Representing that goods are new or unused if they are not or if they have been deteriorated or been altered, reconditioned or reclaimed.
4. Representing that goods have been used to an extent different from the fact or that they have a particular history or use if the supplier knows it is not so.
5. Representing that goods or services are available or are available for a particular reason, for a particular price, in particular quantities or at a particular time if the supplier knows or can reasonably be expected to know it is not so, unless the representation clearly states any limitation.
6. Representing that a service, part, repair or replacement is needed or desirable if that is not so, or that a service has been provided, a part has been installed, a repair has been made or a replacement has been provided, if that is not so.
7. Representing that a price benefit or advantage exists respecting goods or services where the price benefit or advantage does not exist.
8. Charging a price for goods or services that is substantially higher than an estimate provided to the consumer, except where the consumer has expressly agreed to the higher price in advance.
9. Representing that a transaction involving goods and services involves or does not involve rights, remedies or obligations where that representation is deceptive or misleading.
10. Representing that a person has or does not have the authority to negotiate the final terms of an agreement involving goods or services if the representation is different from the fact.
11. Taking advantage of a consumer by including in an agreement terms or conditions that are harsh, oppressive or excessively one-sided so as to be unconscionable.
12. Taking advantage of a consumer by exerting undue pressure or undue influence on the consumer to enter into a transaction involving goods or services.
13. Representing in relation to a voucher that another supplier will provide goods or services at a discounted or reduced price if the supplier making the representation knows or ought to knows that the other supplier will not do so.
14. Making a representation that appears in an objective form such as an editorial, documentary or a scientific report when the representation is primarily made to sell goods or services, unless the representation states that it is an advertisement or a promotion.
15. Representing that a particular person has offered or agreed to acquire goods and services whether or not at a stated price if he has not.
16. Representing the availability of facilities for repair of goods or of spare parts for goods if that is not the case.
17. Offering gifts, prizes or other free items in connection with the supply of goods or services if the supplier knows or ought to know that the items will not be provided or provided as offered.
18. Representing that goods or services are available at a discounted price for a stated period of time if the supplier knows or ought to know that the goods and services will continue to be so available for a substantially longer period.
19. Representing that goods or services are available at a discounted price for a particular reason that is different from the fact.
20. Using small print to conceal a material fact from the consumer or to mislead a consumer as to a material fact, in connection with the supply of goods or services.

Only a consumer can make a claim under the Act. A consumer is an individual who, not in the course of business, receives goods or services from a supplier or has a legal obligation to make payment for goods and services which have been supplied or are to be supplied to another person.

A "Supplier" is defined in the Act to also include a person who in the course of his business provides goods or services to consumers, or a person who manufactures, assembles or produces goods. The Act will also apply to any agents or employees of the supplier.

"Goods" and "services" are defined widely in the Act. "Goods" include personal property (tangible or intangible), chattels, credit, vouchers and residential property. "Services" include services offered or provided in relation to maintenance, repair or alteration of goods or residential property, membership in any club or organisation that operates for profit, and the right to use time share accommodation.

No. The Act only applies to "consumer transactions" which means:-<ol type=a>

Excluded Transactions
1. The term "consumer transaction" does not include any of the following transactions: -
(a) acquisition of an estate or interest in any immovable property (but not including any lease of residential property granted in consideration of rent or any time share contract);
(b) (for the avoidance of doubt) service provided under a contract of employment; or
(c) any transaction or activity that is regulated under any written law specified in paragraph 2.

2. The following Acts are specified for the purposes of paragraph 1(c):
(a) Banking Act (Cap. 19);
(b) Commodity Trading Act (Cap. 48A);
(c) Finance Companies Act (Cap. 108);
(d) Financial Advisers Act (Cap. 110);
(e) Insurance Act (Cap. 142);
(f) Section 28 of the Monetary Authority of Singapore Act (Cap.186);
(g) Money Changing and Remittance Businesses Act (Cap. 187);
(h) Moneylenders Act(Cap.188);
(i) Pawnbrokers Act (Cap. 222);
(j) Securities and Futures Act (Cap. 289)

The consumer should first seek to resolve the dispute with the supplier. Currently, mediation services are available through Community Mediation Centres, Singapore Mediation Centre, CASE and various industry-specific mediation facilities.

If the dispute cannot be settled, the consumer may file a claim in court or with the Small Claims Tribunal to claim for unfair practices. The claim amount cannot be more than S$20,000.00. When considering a claim for unfair practice under the Act, the court will take into account whether the consumer made a reasonable effort to minimise any loss or damage resulting from the unfair practice and resolve the dispute with the trader before commencing action.

If the claim amount is more than S$20,000.00, the consumer can only have rights of action under contract or tort law. However the consumer can abandon any excess over $20,0000 so as to bring it within the ambit of the Act.

Yes. Consumers must file their claim within one year from the occurrence of the unfair practice or the earliest date when the consumer could reasonably have discovered the unfair practice, whichever is later.

The Small Claims Tribunal has different powers from the Court in terms of its ability to grant orders and reliefs. The Small Claims Tribunal can only hear claims below S$10,000.00 unless both parties agree to have their claim heard by the Tribunal, then the limit is S$20,000.00 Further the Small Claims Tribunal can only make Money Orders or Work Orders.

The Small Claims Tribunal also does not have jurisdiction over any claim arising out of a hire purchase agreement, time share contract or rental agreement or sale of immovable property.

Where the court finds that a supplier has engaged in an unfair practice, the court can:<ul type=a>

Under the Act, a District Court or a High Court could grant a declaration and an injunction against an errant supplier/trader, on the application of a specified body. CASE and the Singapore Tourism Board are appointed as specified bodies under the Act to look after the interests of local consumers and tourists respectively.

Before filing an injunction, the specified body must first obtain the endorsement of an Injunction Proposals Review Panel. The Panel will review whether there is a public interest to be safeguarded through the injunction.

Usually, the specified bodies will first invite the errant supplier/trader to enter into a Voluntary Compliance Agreement (VCA) before applying for such an injunction or declaration. A VCA is a voluntary agreement between a specified body and the errant supplier/trader, whereby the supplier/trader agrees not to engage in an unfair practice.

The Act makes certain modification to a few rules that govern court procedures and law. They are:

No contracting out
Save for any release/agreement made by a person in settlement of a dispute, any attempt by parties to contract out of the provisions of the Act and any waiver or release given of any rights, benefit or protection conferred under the Act are void. Thus it is not possible for a supplier or trader to include in his invoice a term to say that the provisions of the Act do not apply to the transaction.

Parol evidence rule abolished
Under existing laws, a party to a written contract cannot adduce oral or extrinsic evidence in Court which varies or contradicts written terms of the contract. The Act abolishes this rule in relation to transactions governed by the Act.
Accordingly, a consumer can give oral or extrinsic evidence which varies or contradicts the written terms of the contract. Thus even if the contract states something very different from that represented to you by the salesperson, you can give evidence in court of what that salesperson told you.

Interpretation of documents
Where any written clause of a consumer transaction are ambiguous, the Court in interpreting that clause will adopt an interpretation favourable to the consumer.

The Consumer Protection (Fair Trading) (Cancellation of Contracts) Regulations 2003 allows for cancellation of time share and direct sales contracts within a 3-day cooling off period (excluding Sat, Sun and public holidays). Suppliers/Traders must inform the consumer of this colling off period by a regulated consumer information notice. The cooling off period is specifically targeted at situations where the consumer is subjected to high-pressure sale tactics. During the cooling-off period, consumers should review their purchasing decision and, if they decide to cancel the contract, give the trader notice of cancellation.

In the event that the consumer encounters an unfair practice in the course of a time share or direct sales transaction, he would still be able to commence action under the Act and seek civil remedies. He may also exercise any other rights of action he may have under any other law, for example, contract or tort law. This is irrespective of whether the 3-day cooling off period has lapsed.

Suppliers/traders should look at the way they conduct their business. They should carry out the following to ensure that they meet with the requirements under the Act:
(a) Train their Employees and Agents to make sure that they do not make any unwitting representations about the products or services.
(b) Provide Written Information about their Goods and Services. This ensures that correct information is passed on to the consumer.
(c) Implement a System of Record Keeping. This ensures that any special representation made to particular consumers are recorded. If it can be demonstrated that a reliable recording system is in place, this can rebut any wrongful allegation made by consumers.
(d) Review Standard Contracts to ensure that they comply with the Act.