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The Great Reform to the Consumer Law: How Can It Affect Companies?

Paloma Norambuena's picture

On March 14, 2019, the New Consumer Law begins to govern in Chile.

The reform reflects a reality: consumers increasingly have access to information, with greater ways of organizing and more expeditious ways to make complaints; On the other hand, the massive use of social networks requires companies to speed up their response and transparency towards the consumer. One of the most emblematic cases in which this reality is reflected is the sanction applied to CMPC for the collusion of toilet paper. In this case, the compensation paid by the subsidiary of the company corresponded to 80% of the profits received between 2000 and 2011.

The new law not only establishes the increase in sanctions for companies (the increase can be 6 times higher than what has been contemplated until today), but also provides a mechanism for companies to mitigate their liability or simply not be sanctioned with these fines: the company will be able to elaborate a protocol of preventive fulfillment, that allows to avoid infractions or, to repair them correctly. The idea is that companies adopt real preventive measures and can modify the culture of the company around the Consumer Law. These compliance plans must be approved by SERNAC and its model or requirements are being worked on today by the entity, which in the coming days will give more information to the unions and companies.

The reform that begins to govern today is not the only news regarding the Consumer Law. This year, the Government introduced the Pro Consumer Law Project, which promotes other reforms of great relevance: compensation in cases of overselling of air tickets, the possibility of retraction in electronic purchases and mechanisms for consumers to leave without effect, quickly, the adhesion contracts.

Consequently, the Consumer Law and the powers of SERNAC are being strongly modified. The good news is that SERNAC gives companies the possibility to prevent and minimize risks, through protocols or compliance plans, a tool of great importance when facing complaints or lawsuits.

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