Gaps and Challenges in the Enforcement Framework for Consumer Protection in Ethiopia

Author:Tessema Elias
Position:Tessema Elias (LL.B; LL.M in Business Law); Lecturer-in-Law (Faculty of Law, Hawassa University, Hawassa, Ethiopia); LLM Student in Maritime Law at University of Oslo, Norway; Former Attorney and Consultant at Law. Earlier versions of some themes that are included in this article in their revised and expanded form were presented at Hawassa ...
Pages:83-107
SUMMARY

The effectiveness of consumer protection in a market economy is, inter alia, determined by the quality of the enforcement framework of competition law and consumer protection law. Despite Ethiopia’s current efforts to bring about an effective consumer protection regime, the country has been experiencing various consumer abuses. This article assesses the gaps and challenges in the existing... (see full summary)

 
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Gaps and Challenges in the Enforcement
Framework for Consumer Protection in
Ethiopia
Tessema Elias
Abstract
The effectiveness of consumer protection in a market economy is, inter alia,
determined by the quality of the enforcement framework of competition law and
consumer protection law. Despite Ethiopia’s current efforts to bring about an
effective consumer protection regime, the country has been experiencing
various consumer abuses. This article assesses the gaps and challenges in the
existing enforcement schemes for consumer protection in Ethiopia. Common
features and practices of effective enforcement strategies and institutional
designs for consumer protection, and experiences from some countries based on
their success and relevance to Ethiopia are used as benchmarks. It is argued that
there is failure to decentralize consumer protection and failure to recognize
representation of major stakeholders in the Consumer Protection Authority.
Moreover, there is lack of extensive pre-intervention study, failure to give
priority to areas of greater consumer risks and failure to take measures against
anti-competitive practices. These major gaps and challenges call for empowering
and enabling enforcement institutions so that they can work more on the
promotion of competition and meanwhile take legal measures against anti-
competitive practices.
Key terms
Consumer protection, enforcement framework, institutional framework, legal
framework.
DOI http://dx.doi.org/10.4314/mlr.v9i1.3
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Introduction
In most developed countries, consu mer1 protection is implemented through the
promotion of competition owing to their hi gh level of faith in the benefits of
Tessema Elias (LL.B; LL.M in Business Law); Lecturer-in-Law (Faculty of Law, Hawassa
University, Hawassa, Ethiopia); LLM Student in Maritime Law at University of Oslo,
Norway; Former Attorney and Consultant at Law. Earlier versions of some themes that
are included in this article in their revised and expanded form were presented at Hawassa
University Annual Research Review Workshop in May 2015.
1 ‘Consumer’ means a natural person who buys goods and services for his personal or family
consumption, where the price is being paid by him or another person and not for
84 MIZAN LAW REVIEW, Vol. 9, No.1 September 2015
well informed and stable markets to consumers. Less emphasis is thus given to
regulatory intervention. In developing market economies, however, there is the
need to follow an interventionist approach toward enhancing competition and
protecting consumers due to the existence of a high level of market failure.2 In
fact, developed or efficient market by it self may not necessarily be sufficient to
bring about consumer welfare. So, nowadays, most countries have adopted
consumer protection laws and institutions.
There is a strong nexus between competition law and consumer protection
law. The former focuses on maintaining the process of competition between
enterprises and tries to remedy behavioural and structural problems in order to
re-establish effective competition in the market the consequences of which are
higher economic efficiency, greater innovation, and consumer welfare.3
Consumer protection law, on the other hand, is concerned with the nature of
consumer transactions by trying to improve market conditions for effective
exercise of consumer choice.4 Consumer protection law addresses the failings in
individual consumer transactions to grant individual consumers remedies5. To
this end, it fills gaps that market forces leave unfille d.6 Thus, the two disciplines
focus on different market failures and offer different remedies. Yet, both aim at
maintaining well functioning competitive market that promotes consumer
welfare. The effectiveness of both laws is, inter alia, determined by the quality
of their enforcement framework.7 Therefore, maintaining both with a well
designed implementation mechanism needs due attention.
Until the enactment of integrated consumer protection law June 8, 2010,
consumer issues were addressed under different legislations such as the
manufacture or resale (See Trade Competition and Consumer Protection Proclamation
No..813/2014, article 2 (4)).
2 CUTS, Competition Policy and Consumer Policy, CUTS Discussion paper series No1,
India, May, 2003. Lack of adequate information, low level of education, existence of
infant or /and non competitive market and existence of gross consumer abuses are among
the characteristic features of dev eloping countries which affect consumer choice or rights.
3 Jaju Kanjo (2005), Recent Development of Consumer Laws in Korea, APEC Information
Paper No.6, Korea, May 2005.
4 Id., p. 5.
5 Max Huffman (2007), “Competition Law and Consumer Protection”, SMU Law Review,
Vol.6, No. 4, pp. 103-202, (Southern Methodist University).
6 Ibid, p. 103
7 Yassmine Afifi (2008), “Independence of the Egyptian Competition Authority: Assessment
and Recommendations”, Global Antitrust Review, Voi.6 No. 34, pp. 339-46. Confirming
the importance of effective enforcement framework for consumer protection, Afifi noted
that “…competition in the market will not be achieved by the mere ado ption of
competition law, i.e. the existence of a perfectly drafted competition law without its
effective enforcement is usel ess ...”

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