Consumer legislation which has lain on the statute books untouched since it was passed in 2001 could soon be brought in to force after a review by the Office of Fair Trading.
OFT chief officer Mike Ball said it was part of a rolling programme to re-examine legislation not yet in force.
In this case the Fair Trading (Amendment) Act, 2001 was principally to address the need for a financial services ombudsman. This came into force around 12 years ago but the remaining parts, dealing with unequal terms in contracts between businesses and consumers were never implemented.
Because of the time lapse, further consultation is being held – ending on September 30. The legislation mirrors similar provisions in the UK where considerable time has been spent on interpretation, providing precedents which will assist the Isle of Man implementing it.
‘There was a lot of common sense in letting the legislation settle down before we activated it over here,’ Mr Ball said.
In fact many of the consumer contracts used in the IOM are imported from the UK and so will already be compliant with the legislation.
The latest consultation is to identify unforseen problems. ‘This is the minor bit of the bill that went under the radar really.’
‘The finance sector is one of the few areas of the economy where we are trading internationally rather than into the EU where people are likely to be compliant with these regulations anyway.’
The new regulations will give a remedy to consumers if they enter into a contract which is skewed so far in favour of the business as to be unfair.
‘A good example which came up in the UK was the issue of contracts for gym membership,’ Mr Ball said.
‘Contracts would be renewable and last for a year but to cancel you had to give say six months’ notice. So people would reach seven months, and decide to cancel only to find they were tied in for another year.
‘That’s something that was stamped on in the UK,’ he said.
To be formally brought into force, the legislation requires an order from the Minister for Community Culture and Leisure, Graham Cregeen MHK, whose department is responsibe for the OFT. If the consultation goes smoothly, it could be in force by Christmas.
For more information see www.gov.im/lib/docs/oft/consultations/unfairtermsinconsumercontracts.pdf. or call 686507.