Consumer Protection Law is just the start

Consumer Protection Law is just the start

By Stevie Emilia

JAKARTA (JP): After pushing for the Consumer Protection Law
for 19 years, the Indonesian Consumers Foundation (YLKI) can now
breathe easy. The law will be implemented April 20, a year after
being signed by former president B.J. Habibie.

The foundation's chairwoman, Indah Suksmaningsih, was deeply
touched when the law was finally passed.

"A huge task has been accomplished and now we must work hard
to make sure the law is effective because a new law is still not
perfect," said the graduate of the microbiology department at
Satya Wacana Christian University in Salatiga, Central Java, and
holder of a Master's degree in public management from Carnegie
Mellon University in Pittsburgh, Pennsylvania.

YLKI proposed the consumer protection bill in 1981, a rare
move made by an NGO at the time. The idea to draft the bill was
started as early as 1975, involving representatives from the
government, NGOs and universities. Unfortunately, such bills,
including those proposed by the Ministry of Trade and Industry,
were abandoned.

The last bill, the House of Representatives initiative law on
consumer protection, was proposed in December 1998. The bill was
finally enacted on 20 April of last year -- an unexpected gift
for YLKI, which celebrated its 26th anniversary on May 11.

"For YLKI, the important thing is that the law exists, no
matter who signed it.... With the law, activities in defending
and protecting consumers will be stronger and also have a strong
legal basis," said the 44-year-old Indah.

She said that the House of Representatives' initiative should
be recognized, but that the role of academicians and NGOs in
pushing for the law should also be praised.

She joined YLKI in 1979, but later moved to another NGO, the
Indonesian Forum for Environment (Walhi), following her senior --
now Minister of Settlement and Regional Development -- Erna
Witoelar.

She later worked in a property company, then left to work for
a foreign company. In 1986, upon Erna's request, Indah worked
part-time at YLKI while keeping her full-time job at the foreign
company.

"If I'm wealthy and don't need to earn a living, maybe I won't
be interested to work in other places besides YLKI. For me YLKI
is a place where I can learn many things. It's also a place to
fight for something. I didn't get the chance to fight before, the
country was independent when I was born...," the single woman
said jokingly.

It was her scholarship to study in Pittsburgh that "forced"
her to work full-time in YLKI upon her return in 1996. She became
the foundation's chairwoman, replacing Tini Hadad in August for a
three-year office term.

"The most important thing is how can YLKI affect decision
makers' pricing policy to make services or products affordable
for consumers," explained Indah.

She has no regret spending most of her time defending
consumers. In fact, she feels satisfied she can do something for
them. "Maybe because I love what I'm doing here...," Indah
stated.

A week before the Consumer Protection Law is implemented,
Indah shared her views about the law with The Jakarta Post. Here
are the excerpts of the interview:

Question: Does the law meet the expected target?

Answer: Amid its shortages, the law has meet the target, yes.
The most important thing is we have the law, which protects a
consumer's basic rights. Whether the law will reach its maximum
target depends on several factors, such as consumers' willingness
to fight for their rights as stipulated in the law.

Another necessary factor is to change the social and cultural
habits of consumers. Many simply accept things as they are. Now,
consumers should have the courage to be critical and brave in
defending their rights. They should also nurture solidarity with
other consumers to defend their rights.

The government needs to shift from a producer-oriented to
consumer-oriented attitude, or at least put a balance between
consumer and producer. And the government should also give good
and satisfactory service to consumers.

What substantial changes will the law make?

First, the elimination of fixed clauses. Fixed clauses mean
one-sided agreements that hurt consumers. Under the law, fixed
clauses will be annulled. It means that any agreements made only
by one side, such as those found in shopping receipts, parking
tickets, or contracts to purchase houses, are annulled.

The law also opens up the opportunity for consumers to do
class action and to shift the burden of proof. By shifting the
burden of proof, any business person (producer), who receives a
consumer's complaint -- for instance, regarding food poisoning --
is obligated to prove it (true or not).

Another substantial change in the law will be the
establishment of a body in charge of solving consumer disputes by
the government. The body will handle disputes between consumer
and producer through mediation, conciliation and arbitration
procedures. The purpose of setting up this body is to speed up
the process and provide more and easy access for people at low
costs.

Are you sure the law will guarantee better bargaining power
for consumers?

Under the law, consumers will have a better advantage. Any
violators will face not only administrative penalties but also
criminal charges. The law has also included consumer rights,
which are defined in the UN Guidelines for Consumer Protections.

But it should be remembered that consumers will have strong
bargaining power not only by knowing their rights, but by being
willing to fight for those rights, too. If consumers realize
their power and know they have the law on their side, they will
become a very strong and united front.

But it seems like there's not enough socialization of the law.
How can consumers gain strong bargaining power if they have never
heard of the law?

It has to be understood that YLKI is not the only organization
responsible for consumer protection, although morally we are very
responsible to the community. But officially, it's the government
-- in this case the Director of Consumer Protection under the
Ministry of Industry and Trade -- that should be fully
responsible in such matters.

But we can't say there is absolutely no socialization process.
And it's not true if we fail (to familiarize the law). As we all
can see, consumers now are getting critical. Urban people, for
instance, now check expiration dates on every product they buy,
know the danger of certain substances and they even openly
protest improper ads.... Maybe their numbers are small, but the
most important thing is, people have started to learn about
consumer problems based on their own experiences.

But is it realistic to implement the law with the lack of
socialization?

The law should be enforced as planned amid its present
shortages. I'm sure we can improve it along the way.

The law is badly needed. If it's being postponed again, it
will only make the position of consumers, who have started to
learn their rights, become weak.

Do you think Indonesian consumers will have the courage to use
the law to their own advantage?

Let me give an example. Previously, even a doctor on economic
law could not do much in dealing with fixed clauses, say, in a
banking transaction. And it's impossible that a doctor on
economic law did not know what fixed clauses were. But then, it
was impossible even for the doctor to question the clauses.
There's no rule about it and producers could do whatever they
liked.

But now, under the law, the fixed clauses are annulled. Such
clauses, which do not consider consumer interests, will not be
tolerated anymore....

Apart from the lack of socialization, it seems like there's
also the lack of preparation in implementing the law. Even the
body in charge of solving consumer disputes is not yet being set
up.

The preparation is relative and depends on the good will of
all, especially of the government, the economic players and
consumers. That way, all of us should have the intention to
improve the law and enforce it....

And the body will be set up once the government regulation on
its establishment is released. At the moment, the consumer
protection director is preparing the regulation. Hopefully, the
body can be set up before the law is enforced.

Once it is set up, will the body's decisions be legally
binding?

This body is different from that of an ordinary court. Here,
the judges, between three to five people at most, are comprised
of representatives from the government, consumers and producers.
Their decisions will be binding, yes, and if they are ignored by
the producer. The body can then report the case to the police for
further investigation.

The body is more geared at solving small scale disputes. The
body's judges go through three stages: mediation, conciliation
and arbitration that should be completed within 21 days.

Although the body's decisions are legally binding, those in
dispute still can appeal to the district court.... If there's
objection, the next appeal can reach the supreme court. So the
overall proceedings might take a maximum of 100 days.

Some business people have requested that the law be postponed.
Does the law pose a serious threat toward businesses?

The demand to postpone the enforcement of the law is mainly a
result of business people's unreadiness to face free trade. In my
opinion, there's no reason to postpone the law. In fact, export-
oriented producers will find an easy market for their products
since many countries have imposed such laws.

Fair and honest business people will find that the law
protects their interests. If they reject the law, maybe it is an
indication of their unhealthy business practices. The law will
force them to change their dirty business tricks. Maybe.

It's not sensible to postpone the law then?

So far, there's two kinds of rejections: to completely
postpone the law and to implement it selectively. Being tolerant
of middle-to-small scale businesses is a still sensible request.
Actually, they had a year to prepare. Some businesses have made
necessary adjustments because they're accustomed to exporting
their products to countries which strictly impose the law. So
they know.

For me, I disagree with discrimination in implementing the
law. But multinational companies should be distinguished from
small scale industries.

For YLKI, every step, including postponement of the law, has
its own consequences. After all this time (pushing for the law),
the effort to postpone it will be seen as an effort to deceive
consumers.

Once the law comes into effect, are we much better than other
countries in terms of consumer protection then?

Well, if we compared it to ASEAN countries, we're the third
after Thailand and the Philippines.

But if we look at the government's will in protecting
consumers, Malaysia is really a good example. Although Malaysia
does not have a national-scale regulation to protect consumers,
it has regulations at the sectoral level and good legal
enforcement to protect consumers. In practice, NGOs are the
government's partner in protecting consumers. In Indonesia, we're
not. One more thing. In Malaysia, consumer protection is handled
by an official at the ministerial level, while in Indonesia it's
only tackled at the director level. So it can be said that we've
only just started.