In October 2024, the Department of Trade, Industry and Competition (DTIC) announced draft amendments to the regulations under the Consumer Protection Act (CPA). The proposed changes are aimed at revising regulations 1 and 4 of the CPA regulations established in 2011.
Comments on the amendments were open until the 15th of January 2025. These amendments were one of many made by the government last year. In July 2024, President Cyril Ramaphosa signed into law the First and Second Companies Amendment bills.
The proposed changes to the CPA will give significant attention to legislation empowering South Africans to block unwanted marketing communications.
In this article, we look through the new proposed changes and its effect on elements like POPIA.
Proposed Changes to the Consumer Protection Act
The following are the proposed amendments to the CPA:
Pre-emptive Block
Consumers will be able to register a pre-emptive block in the opt-out registry. This is to help them avoid receiving unsolicited direct marketing electronic communication from direct marketers.
Opt-out Registry
The opt-out registry mentioned in the above-proposed amendment will be operated and managed by the Commission.
Direct Marketer Obligations
In the proposed amendments a direct marketer is defined as a person who engages in direct marketing. In the new changes, a direct marketer will have to register as such in the opt-out registry before contacting any consumer for purposes of direct marketing via electronic communication.
Registration for direct marketers is subject to annual renewal and payment of a prescribed fee. Additionally, direct marketers will have to check their contact list against the opt-out registry before sending messages to consumers. If a consumer has registered on the opt-out registry, direct marketers are not allowed to send marketing messages to the consumer.
Lastly, there is an obligation on the direct marketer to remove from its database everyone who has registered a pre-emptive block by cleansing such data monthly with the Commission.
Consumer Obligations
Under the new changes, consumers must register a pre-emptive block in the opt-out registry through the prescribed form. This is to prevent receiving marketing messages via electronic communication.
Additionally, it’s the consumer’s responsibility to make sure their information in the opt-out registry is always up to date.
Enforcement
Any consumer who receives a direct marketing message despite having registered a pre-emptive block on the opt-out registry may file a complaint to the Commission using the updated complaint form provided in the proposed amendments.
After investigating the complaint, the Commission may issue a compliance notice to the relevant direct marketer. The Commission will outline the required steps that must be taken within a set period and any penalty that may be imposed in terms of the CPA.
If the direct marketer fails to comply with the compliance notice, the Commission may either: (a) apply to the National Consumer Tribunal to impose an administrative fine; or (b) refer the matter to the National Prosecuting Authority for prosecution as an offence.
The Tribunal may impose an administrative fine not exceeding the greater of: (a) 10% of the direct marketer’s annual turnover during the preceding financial year; or R1 million. Furthermore, failure to comply with a compliant notice is an offence and a direct marketer convicted of such may be liable to a fine or imprisonment (12 months) or both.
However, no direct marketer may be prosecuted for the above-mentioned offence if, as a result of the failure of that direct marketer to comply with the issued notice, the Commission has applied to the Tribunal for the imposition of an administrative fine.
These amendments apply to direct marketing in the form of unsolicited electronic communication which is subsequently regulated in terms of Section 69 of the Protection of Personal Information Act (POPIA).
Impact on POPIA
The most impacted section of POPIA is Section 69. This section of the Act prohibits the processing of personal information of a data subject for direct marketing through electronic communication. The exceptions to section 69 are:
- Unless the data subject has given their consent to the processing.
- The subject is a customer of the responsible party (person who determines the purpose of and means of processing the data subject’s personal information).
Implementation of the proposed amendments will not mean that a direct marketer can send marketing messages to an individual just because the individual has not registered a pre-emptive block in the opt-out registry. Direct marketers still need to obtain consent for the purposes of direct marketing.
Additionally, direct marketers will need to check their customer contact list against the opt-out registry before sending marketing messages. This applies to existing customers of any direct marketers.
For more information on any other new regulatory changes, read our article about the Competition Commission ‘Relaxes’ Block Regulations for SMMEs.