• Penalties Imposed for Violations of Consumer Rights Provisions
  • May 15, 2012 | Authors: Dao Nguyen; Eddie O'Shea
  • Law Firm: Mayer Brown JSM Vietnam Limited - Ho Chi Minh City Office
  • Background

    On 16 March 2012 the Vietnamese Government issued Decree No. 19/2012/ND-CP ("Decree 19") setting out sanctions for administrative offences of consumer rights legislation. For each administrative offence the violating organisation or individual may be given a warning or a fine of up to VND 70 million depending on the nature of the breach. We set out the key provisions of Decree 19.

    Offences

    Administrative breaches are defined as intentional or unintentional acts committed by individuals or organisations (both Vietnamese and foreign) in Vietnam that violate consumer protection legislation. Decree 19 sets out a list of specific offences including violations relating to:

    • misuse of personal information of, and information supplied to, consumers;
    • consumer contracts and standard form supply conditions;
    • warranties for goods; and
    • liability for defective goods.

    Penalties and Fines

    A party committing an administrative offence shall be subject to either a warning or a fine. Depending on the nature and seriousness of the breach the operating certificates and licenses may be revoked and anything used to commit the breach confiscated. There may also be a requirement that the consequences of the offence are remedied.

    • Consumers' Information

    A fine of VND 10-20 million shall be imposed for misuse of consumer's personal information of consumers.

    • Consumer Contracts & General Supply Conditions

    A fine of VND 10-20 million shall be imposed for failing to give consumers the opportunity to consider the contents of a contract before signing by electronic means, or if the supplier failed to keep signed contracts until their expiry, or failed to provide the consumer with a copy of the contract in the event the consumer's contract is lost or damaged.

    A fine of VND 20-30 million shall be imposed for failing to implement the instructions of the relevant State body to cancel or amend standard form supply conditions if, for example, they contravene consumer rights protection legislation or which are unfair contract terms.

    A fine of VND 30-50 million (VND 50-70 million if the offence covers two or more provinces/cities) shall be imposed for using invalid contract terms in the case of standard form contracts and general supply conditions.

    A fine of VND 50-70 million shall be imposed for violating legal provisions on registering with the appropriate authorities the form of a consumer contract used by a seller and standard form supply conditions (including failure to re-register) as well as failure to inform consumers about any changes to such contracts.

    • Warranties

    Violations in respect of warranties will incur a fine from VND 5-70 million depending on the value of the goods.

    • Misleading Advertisements

    Fine from VND 20-30 million will be imposed.

    Competent Authority for Imposing Penalties

    The Head of the Competition Administration Department, the Presidents of all People’s Committees and the Market Management Force are designated as competent bodies to impose sanctions.

    Effectiveness

    Decree 19 came into force on 1 May 2012.

    Conclusion

    Decree 19 enhances the legal framework in ensuring consumer rights protection, particularly in the implementation of the regulations on form of contracts and general supply conditions stipulated in Decree No. 99/2011/ND-CP.