43357481

8/8/2019 43357481

1/39

OECD CONFERENCE ON CONSUMEROECD CONFERENCE ON CONSUMER

EMPOWERMENT AND RESPONSIBILITYEMPOWERMENT AND RESPONSIBILITY

BUSINESS CONDUCTBUSINESS CONDUCT

CONSUMER PROTECTON IN

VIETNAM

Nguyen Dinh Tai

Central Institute for Economic Management

8/8/2019 43357481

2/39

1. Problems with consumer1. Problems with consumer

protection in Vietnamprotection in Vietnam Customers in Viet Nam often have to suffer from

unsafe poor-quality products which break downjust after purchase and are sometimes life-threatening. Even when dealing with life-threatening products, consumers have no legalrecourse for protection, let alone compensation.

A number of high-profile cases have recently

come to light in which consumers have boughtfake, poor quality and/or goods ranging fromvegetables sprayed with pesticides, cosmeticscontaining toxic chemicals and fake medicines.

8/8/2019 43357481

3/39


protection in Vietnamprotection in Vietnam The Ministry of Science and Technology of Vietnam

reported in September, 2008 that over 30 gasoline stationsin the country had been caught overcharging for fuel or

selling adulterated gas mixed with anything from keroseneand water to mud and booze. Many had rigged their scalesto show higher amounts than had been dispensed.

But commercial fraud does not end there. The ministryalso said that over 93 percent of stylized crash-helmets inthe domestic market were unsafe for motorcyclists. All thison top of the fact that market control agencies have blamedkidney stone cases in several Vietnamese children onmelamine-tainted milk.

8/8/2019 43357481

4/39


protection in Vietnamprotection in Vietnam A survey by the Viet Nam Standards and Consumers

Association (Vinastas) in August 2008 showed that only41 percent of consumers in 10 cities and provinces in

Vietnam were fully aware of their rights while halfbelieved it was the job of the government or watchdogorganizations to make sure their rights were protected.

According to Vinastas, this organization receives 1,000complaints and petitions per year, while the ConsumerProtection Unit has received perhaps 100 complaints in thelast 5 years. The fact is most people dont know who toturn to for help, and of those that do, many believe theseofficial bodies are ineffective. Vinastas had settled about70 to 80% of the 1,000 complaints filed with it last yearout of court. The number sounds good, but too small.when

considering Vietnams 87- million plus population.

8/8/2019 43357481

5/39


protection in Vietnamprotection in Vietnam Unfair trade practices were rife throughout nearly

all sectors in Vietnam. The Association estimated

the average consumer lost between 8 to 10 percentof the value of their purchases so far this year due

to unfair practices.

Greedy and irresponsible traders are rarely

brought to court because consumers who complain

about getting cheated fail to provide even the

simplest of evidence, such as a receipt.

8/8/2019 43357481

6/39


protection in Vietnamprotection in Vietnam The relevant agencies have always called on consumers to

wise up. However, it is not easy to become a wiseconsumer, and it is very important to have the necessary

modern facilities to identify the quality of products. Tobecome a wise consumer, consumers should firstly learnabout their rights when making transactions to create acombined strength among the community. In fact, manyrecent scandals over food safety and hygiene have shownthe vital role of consumers in exercising their rights.

In brief, consumer rights in Vietnam have beenseriously violated in various ways. So far, however, nopenalties or sanctions have been imposed on enterprisesand producers that break the law.

8/8/2019 43357481

7/39

2. Ineffective current Ordinance on2. Ineffective current Ordinance on

consumer protetionconsumer protetion

Legislation on protecting consumer rights in Vietnam isOrdinance on consumer protection which has beeneffective since October 1, 1999. This legal document

clearly stipulates that consumers have eight basic rights,including satisfaction, safety, information, choice,compensation, education and having a voice and a healthyenvironment. If their rights are violated, consumers cancomplain and ask for compensation according to legalregulations.

Nevertheless, a recent survey conducted by the Vinatasshowed that nearly half of Vietnamese consumers are notfully aware of their basic rights, while the remainingconsumers do not know or do not care about them.

8/8/2019 43357481

8/39



In fact, complicated formalities have prevented peoplefrom enjoying their rights as consumers. Furthermore, it isnot easy for consumers to provide evidence of violations.

Their purchasing habits such as not asking for receipts orbuying goods in flea markets also make it extremelydifficult for consumers to exercise their rights.

The main reason is that under the ordinance, consumerrights are defined too broadly to be feasibly implemented.Provision 8 of the Ordinance, for example, states thatconsumers are ensured their lives, health and environmentwill be safe when using goods and services. However, noregulations exist to specifically implement the provision;there are no guidelines on how exactly consumers should

be ensured of their safety. Therefore, these provisions

seem to be only meaningful in theory. Moreover, there islack of strong punitive measures for violators.

8/8/2019 43357481

9/39



According to Provision 16 of the Ordinance, manufacturersand service suppliers have a responsibility to settle allcomplaints and petitions from consumers concerning their

products and services in terms of standard, price, qualityand quantity. No provision exists however to bringsanctions on those that do not comply with provision 16.

The shortcomings of these provisions meant Vietnameseconsumers get no protection so far. Without effective laws,the consumer will always lose and they have no choice butto forget it and move on.

8/8/2019 43357481

10/39



Moreover, there should be an agency in charge ofprotecting consumer rights. At present, at the central level,the Consumer Protection Board of the Competition

Management Department under the Ministry of Industryand Trade is the only agency responsible for protectingconsumer rights. However, the board only has sevenemployees, so it is difficult for them to protect the rights ofmore than 86 million consumers. The Vietnam Standardsand Consumer Protection Association currently has

branches in 30 out of the 63 provinces and citiesnationwide, but they mainly deal with violations throughnegotiation and conciliation. However, when public healthand safety is put at risk, those in charge should be

prosecuted.

8/8/2019 43357481

11/39

3. How to improve the situation3. How to improve the situation

All producers must be educated about their

social responsibility, as well as producing

safe food and a good distribution channel

for safe food are musts.

State agencies in charge of food security

must help the government to coordinatefood security control activities in the

distribution of food to society.

8/8/2019 43357481

12/39


In Vietnam, to put regulations on consumer protection intopractice, the relevant agencies should consult withconsumers on the law and make them better aware of their

rights.

The law on protecting consumers rights which is beingdrafted will be submitted to the National Assembly andexpected to be approved by 2010 should focus on boostingthe role of associations in protecting consumers. The lawwill define clearly and specifically the rights of consumersand the methods of ensuring those rights; theresponsibilities of manufacturers and service suppliers andthe sanctions to punish violators.

8/8/2019 43357481

13/39


The law has to force firms to compensate

consumers they swindle by overcharging,

mislabeling or selling counterfeit goods. Moreover, the functions and tasks of agencies who

settle consumers complaints and petitions will

also be defined.

Local buyers need to collect evidence and

officially report their complaints if they want to

challenge businesses that rip people off.

8/8/2019 43357481

14/39


The consumer boycott of bad products can make a seriousimpact on producers, which are now forced to change their

behaviour. It is obvious that if consumers know how to use

their rights and join efforts to boycott poor qualityproducts, producers and retailers will have to respect themaccordingly. On the contrary, if consumers lack aknowledge of the laws, service providers will make use ofthis and take advantage of them.

In other countries, consumers have the power and the

rights to boycott poor quality products. They also knowhow to use their rights to force enterprises to adjust their

policies and fulfill their responsibilities. Apart from asynchronized legal system, consumers in these countriesalso receive support from agencies, such as the Consumer

Protection Association.

8/8/2019 43357481

15/39

THANK YOU FOR ATTENTION

8/8/2019 43357481

16/39

WHAT CONSUMER WANTS?WHAT CONSUMER WANTS?

QUALITY PRODUCTS

EFFICIENT SERVICES

TIMELY DELIVERY

EFFICIENT AFTER SALE SERVICE

TRUTHFULADVERTISEMENTS

REASONABLE PRICING STRUCTURE ACCURACY IN WEIGHTS AND MEASURES

8/8/2019 43357481

17/39

WHAT CONSUMER GETS ?WHAT CONSUMER GETS ?

QUALITITATIVELY DEFICIENTGOODS OR SERVICES

QUANTITATIVELY DEFICIENTGOODS OR SERVICES

EXCESSIVE PRICES

INSUFFICIENT INFORMATION MISLEADING ADVERTISEMENTS

UNFAIR TRADE PRACTICES

8/8/2019 43357481

18/39

CONSUMER IS KINGCONSUMER IS KING

A CONSUMER IS THE MOST IMPORTANT

VISITOR ON OUR PREMISES. HE IS NOT

DEPENDENT ON US. WE ARE DEPENDENTON HIM. HE IS NOT INTERRUPTION IN OUR

WORK HE IS THE PURPOSE OF IT. WE

ARE NOT DOING HIM A FAVOUR BY

SERVING HIM. HE IS DOING US A FAVOURBY GIVING US AN OPPORYUNITY TO

SERVE HIM.

8/8/2019 43357481

19/39

CONSUMER RIGHTSCONSUMER RIGHTS

1. RIGHT TO BASIC NEEDS

2. RIGHT TO SAFETY

3. RIGHT TO INFORMATION

4. RIGHT TO CHOICE

5. RIGHT TO REPRESENTATION

6. RIGHT TO REDRESS 7. RIGHT TO CONSUMER EDUCATION

8. RIGHT TO HEALTHY ENVIRONMENT

8/8/2019 43357481

20/39

1. RIGHT TO BASIC NEEDS1. RIGHT TO BASIC NEEDS

TO HAVE BASIC GOODS AND

SERVICES WHICH GUARANTEE

SURVIVAL, LIKE FOOD, CLOTHING,

SHELTER, HEALTH CARE,

EDUCATION.

8/8/2019 43357481

21/39

2. RIGHT TO SAFETY2. RIGHT TO SAFETY

TO BE PROTECTED AGAINST

PRODUCTS, PRODUCTION PROCESS

AND SERVICES WHICH ARE

HAZARDOUS TO HEALTH ORLIFE.

8/8/2019 43357481

22/39

3. RIGHT TO INFORMATION3. RIGHT TO INFORMATION

RIGHT TO BE GIVEN THE FACTS

THAT ARE NEEDED TO MAKE

INFORMED CHOICE OR DECISION. TO

BE PROTECTED AGAINST

MISLEADING ADVERTISEMENTS OR

LEBELLING.

8/8/2019 43357481

23/39

4. RIGHT TO CHOICE4. RIGHT TO CHOICE

RIGHT TO HAVE ACCESS TO

VARIETY OF PRODUCTS AND

SERVICES AT COMPETITIVE PRICESWITH AN ASSURANCE OF

SATISFACTORY QUALITY AND

SAFETY.

8/8/2019 43357481

24/39

5. RIGHT TO5. RIGHT TO

REPRESENTATIONREPRESENTATION

RIGHT TO BE REPRESENTED SO THAT

THE CONSUMERS INTERESTS

RECEIVE FULL AND SYMPATHETICCONSIDERATION IN FORMULATION

AND EXECUTION OF ECONOMIC

POLICIES

8/8/2019 43357481

25/39

6. RIGHT TO REDRESS6. RIGHT TO REDRESS

RIGHT TO BE COMPENSATED FOR

MISREPRESENTATION, SHODDY

GOODS, UNSATISFACTORY SERVICES

8/8/2019 43357481

26/39

7. RIGHT TO CONSUMER7. RIGHT TO CONSUMER

EDUCATIONEDUCATION

RIGHT TO ACQUIRE KNOWLEDGE

AND SKILLS TO BE AN INFORMED

CONSUMER THROUGHOUT LIFE

8/8/2019 43357481

27/39

8. RIGHT TO HEALTHY8. RIGHT TO HEALTHY

ENVIRONMENTENVIRONMENT

RIGHT TO A PHYSICAL

ENVIRONMENT THAT WILL

ENHANCE THE QUALITY OF LIFE

8/8/2019 43357481

28/39

CONSUMERCONSUMER

RESPONSIBILITIESRESPONSIBILITIES

1. CRITICAL AWARENESS

2. ACTION

3. SOCIAL CONCERN

4. ENVIRONMENTAL AWARENESS

5. SOLIDARITY

8/8/2019 43357481

29/39

1. CRITICAL AWARENESS1. CRITICAL AWARENESS

TO BE MORE ALERT AND

QUESTIONING ABOUT THE PRICE

AND QUALITY OF GOODS ANDSERVICES WE USE.

8/8/2019 43357481

30/39

2. ACTION2. ACTION

TO ASSERT AND ACT TO ENSURE

THAT WE GET A FAIR DEAL.

8/8/2019 43357481

31/39

3. SOCIAL CONCERN3. SOCIAL CONCERN

TO BE AWARE OF IMPACT OF OUR

CONSUMPTION ON OTHER CITIZENS,

SPECIALLY DISADVANTAGED ORPOWERLESS GROUPS.

8/8/2019 43357481

32/39

4. ENVIRONMENTAL4. ENVIRONMENTAL

AWARENESSAWARENESS

TO UNDERSTAND THE

ENVIRONMENTAL CONSEQUENCES

OF OUR CONSUMPTION. TOCONSERVE NATURAL RESOURCES

AND PROTECT THE EARTH FOR

FUTURE GENERARTIONS.

8/8/2019 43357481

33/39

5.SOLIDARITY5.SOLIDARITY

TO ORGANISE TOGETHER AS

CONSUMERS TO DEVELOP THE

STRENGTH AND INFLUENCE TOPROMOTE AND PROTECT CONSUMER

INTERESTS.

8/8/2019 43357481

34/39

RAISING CONSUMERRAISING CONSUMER

AWARENESSAWARENESS

1. GOVERNMENT

2. BUSINESS 3. MEDIA

4. SCHOOLS AND COLLEGES

5.VOLUNTARY ORGANISATIONS

8/8/2019 43357481

35/39

1. GOVERNMENT1. GOVERNMENT

SUPPORT TO CONSUMER

ORGANISATIONS

ENACT CONSUMER FRIENDLY LAW

AND ENSURE ENFORCEMENT

CONSUMER POLICY

CITIZENS CHARTERS

OMBUDSMEN

8/8/2019 43357481

36/39

2. BUSINESS2. BUSINESS

CODE OF CONDUCT AND SELF-

REGULATION

IN-HOUSE CONSUMER SERVICE CELL

CORPORATE SOCIAL

RESPONSIBILITY

8/8/2019 43357481

37/39

3. MEDIA3. MEDIA

ADEQUATE COVERAGE TO ACTIVITIES OFCONSUMER ORGANISATIONS

REGUALAR COLUMN ON CONSUMEREDUCATION

SPECIAL SUPPLEMENTS ON CONSUMERPROTECTION

INTERVIEWS WITH PEOPLE ENGAGED INCONSUMER GUIDANCE ACTIVITIES

PUBLICATION OF JUDGMENTS ONCONSUMER PROTECTION CASES

REFUSING TO RELAESE MISLEADING

8/8/2019 43357481

38/39

4. SCHOOLS AND4. SCHOOLS AND

COLLEGESCOLLEGES

INCORPORATING CONSUMER

EDUCATION AT SCHOOL AND

COLLEGE LEVEL.

BASICS OF CONSUMER PROTECTION

AT SCHOOLLEVEL

LEGAL ASPECTS OF CONSUMERPROTECTION AT COLLEGE LEVEL

8/8/2019 43357481

39/39

5. VOLUNTARY5. VOLUNTARY

ORGANISATIONSORGANISATIONS

EDUCATION & TRAINING

COMPLAINTS HANDLING

PRODUCT TESTING

RESEARCH & SURVEY

LOBBYING & ADVOCACY

Documents

43357481