CI to contribute to revision of UN’s consumer protection guidelines

Indrani Thuraisingham, Head of CI Office for Asia Pacific and the Middle East, reports on activities from the United Nations Conference on Trade and Development.

I was very pleased to be part of CI’s delegation to the United Nations Conference on Trade and Development (UNCTAD) recently. 

This was an important moment for consumer rights - when CI was named to give input into the revision of the UN’s Guidelines on Consumer Protection (UNGCP).

The decision to revise the guidelines was the major outcome of the UNCTAD Ad Hoc Expert Meeting on Consumer Protection: The interface between competition and consumer policies. Its proposals are to be tabled at the General Assembly in July 2014. 

The CI delegation to UNCTAD included myself as the head of the Asia Pacific and Middle East Regional Office and lead on the global coordination of CI’s Consumer Justice and Protection priority programme; Jeremy Malcolm who leads CI’s Consumers in the Digital Age priority programme; and Robin Simpson, CI’s senior policy officer from London who spoke on financial services, another of CI’s priority programme areas. 

We were accompanied by Connie Lau, retiring CEO of the Hong Kong Consumer Council who gave the key note address; and Pradeep Mehta from CI member CUTS India.

A number of ideas for areas in which the Guidelines could be improved were discussed, including the need to strengthen enforcement activities, and the addition of provisions on financial services, energy, consumer representation, and access to knowledge. 

CI also highlighted the need to add “access to basic needs” as part of the legitimate needs in Article 3 of the Guidelines as well as to have a clear definition of ”consumer” in terms of addressing the needs of poor and vulnerable consumers.
 
The agreed conclusions of the meeting specify that UNCTAD is to collaborate with CI, as well as with other relevant bodies such as the OECD, in developing the content of potential revisions.  

To this end, the next step in this process will be for CI to consult with its members on the areas that should be covered and to develop some suggested text for submission to UNCTAD that will be tabled at the upcoming 13th Intergovernmental Group of Experts (IGE) meeting in July 2013 during which the process of negotiations will begin and be approved by July 2014.

This is an exciting time. It means that all CI members will have the opportunity to comment and bring their experience in consumer rights to bear on the Guidelines. I for one look forward to being a part of this important step for consumer rights.

How group action is reinventing consumer activism

Richard Bates, from CI member Consumer Focus, explains how social technologies are revolutionising consumer action—an important lesson for consumer groups around the world

Here’s a theory I’m sure you’re familiar with: foster competition within a market and its benefits – prices held down, service driven up and thriving innovation – will follow, as engaged consumers work to maximise their own interest and seek out better deals.

It’s a notion that underpins our energy, telecoms and financial services markets here in Britain. 

And here’s a reality that I suspect won’t be unique to Britain: mass inertia is the norm across these sectors. It’s a predictable and understandable consumer response in markets where engagement is not a high priority and which suffer from being archetypal ‘confusopolies’.

The result is an impasse. Consumers stay put and competition gives way to complacency on the provider side. The benefits that competition should deliver for consumers are then in short supply. The fabled invisible hand is, well, all too invisible.

But, what if we created an alternative, much simpler, more powerful way of making these markets work for consumers? One where an intermediary works on behalf of consumers to:

• Provide a focal point around which consumers who want better value, but reject the conventional ‘go it alone’ route to market can cluster
• Convert mass inertia into a competitive impetus by grouping participating consumers’ aggregate demand into a winnable block of market share
• Leverage that aggregate demand to secure a better deal
• Manage the mass switch of participating consumers to the provider who makes the best offer to the group

In a new reportfor Consumer Focus, I’ve argued the possibility of doing just that. The report expands on a trend I termed ‘Get it, together’ in a previous CI blog. At the core of this trend are the opportunities for new forms of group action enabled by social technologies.

Of course, coming together as a group in order to pursue a shared objective is nothing new. 

History is rich with examples of people organising in groups and using the consequent power of numbers to advance collective interests and press for change – whether social, political, or economic.

But the costs associated with large-scale group formation and, subsequently, the co-ordination and management of group action meant that only large organisations with hierarchies and management structures could act in this way. And only then if the benefits achieved outweighed the costs incurred.

Instances of people collaborating as a group outside the bounds of an organisation were mostly limited to small scale, local initiatives.

But social technologies have eroded those costs, meaning it’s not only easy for people to form groups now, it’s also easy for the group to achieve critical mass and to co-ordinate and synchronise its actions to achieve a shared goal.

As a result, we are seeing a proliferation of new kinds of groups, including consumers working together or through intermediaries to achieve a shared objective in the marketplace. The Bank Transfer Daycampaigns in the USA harness precisely these dynamics, as do local Carrotmob initiatives.

What’s more, in the past effective group effort often depended on a division of labour that assigned all members a task to undertake in pursuit of the group’s aims. Not anymore.

An active intermediary can now work on behalf of the group and harness the power of its numbers - rather than the efforts of its members - to achieve the shared goal. Other than aligning with the group and signalling assent to an action being undertaken on their behalf, individual members can now be effective in aggregate while remaining largely passive in practice.

In a consumer context, this solves the problem of inertia and minimises the costs of market participation for consumers, offering them the attractive proposition of better outcomes for less effort.

Today, we’re seeing the first wave of initiatives that look to put these ideas into practice and disrupt the markets to which they’re applied. Within the next three to five years collective switching could well turn the status quo on its head and create a situation where providers will have to work much harder to win and retain the custom of large groups of consumers.

Already, collective switching pioneer – iChoosr – has secured significant savings on energy bills for hundreds of thousands of consumers in Belgium and the Netherlands. Consumentenbond has also applied the approach successfully in the Dutch energy market. Which? has just overseen the first instance of collective switching in the British energy market, resulting in a straightforward route to an average saving of £123  for up to 200,000 participating consumers. Choice provided a much needed jolt to the Australian mortgage market by applying a variation of the approach there. 

As you may have noticed, three of those four initiatives have been offered by consumer bodies. The success of the exception, iChoosr, has been built on working in partnership with community organisations that consumers know and trust.

This suggests that integrity – a quality with which consumer and community bodies are strongly associated – will be key for consumer adoption of this approach. That’s hardly a surprise given that having the confidence to engage with an intermediary platform on a novel approach to markets that can represent a major financial commitment, will be a key issue for consumers.

Collective switching and wider initiatives harnessing the group dynamic have the potential to disrupt and rebalance how power and information flows in markets. Therefore, existing players who have most to lose are likely to resist the sea change rather than make the running in developing this kind of service.

Bodies working in the consumer interest therefore have vital roles to play as catalysts for collective switching. This could take the form of supporting pioneering intermediary services that work on behalf of consumers in markets; or, wherever necessary, involve the direct development and deployment of the platforms that can open this alternative approach up for consumers.

Richard Bates leads the Consumer Empowerment Programme at Consumer Focus @rchrdbts

Freed consumer activist speaks of hope for human rights in Malawi

John Kapito, consumer rights activist and human rights defender, talks about his recent detention by the late President of Malawi.

I have been an activist for the past 20 years.

Advocacy and the promotion of rights is at the centre of the work of the Malawi Human Rights Commission for which I am chairperson and of CI member organisation the Consumers Association of Malawi for which I am executive advisor.

In both of these organisations, we are driven by our passion to work with the most vulnerable members of our society by ensuring that their rights are protected at all times. We are seen to be the voice of the voiceless, who are many in the developing world. 

The Commission, with support from the Consumers Association, made a number of public statements attacking the state on its continued disregard for good governance and various human rights abuses that included the limitation of the rights of people to demonstrate, to have freedom of speech and total elimination of space for consumers to speak and make demands for a better quality of life. 

In Malawi, like many African and developing countries elsewhere, the distribution of goods and services is under state control and, as such, the majority of the poor are unable to speak against the state for fear of being intimidated and victimised. Because of this, the landscape for participatory advocacy is very limited. 

I have had many disagreements with my state President, the late Bingu wa Mutharika. During the many meetings I held with him over the years, he continuously threatened to dismiss me from the Commission and even threatened my life and the lives of my family.

The President’s advisors recommended that the time had come for me to be eliminated. I challenged the President that what was said by his advisors was hate speech which must be condemned. The President accused me of insulting him and said that this was reason to eliminate me.

Two days later, I was told the President had died.

My detention

On 17 March, I was approached by a group of policemen outside a hotel in the capital city, Lilongwe. They searched my car and said they were looking for seditious materials that they believed I was printing and taking to Geneva for the annual meeting on human rights at the Human Rights Council.

I was taken to police headquarters and I was denied access to my lawyer at that point. I was moved between four police stations before I was charged with sedition and possession of illegal foreign currency.

They then acquired a search warrant for my house. Close to midnight, they took me home and searched my house until the morning.

I was then taken back to the police station where I was told that the authorities advised that I be granted bail on my charges of possessing alleged seditious materials and ‘illegal’ foreign exchange. I managed to get my passport back and was also allowed to travel to Geneva after two days.

Upon my return from Geneva, I was scheduled to meet the President for the human rights briefings. That meeting was very tense, with the President accusing me of undermining him and behaving as if I was an elected President.

I was also accused of taking human rights reports to the international bodies and, in so doing, I was responsible for the economic meltdown in Malawi due to my revelations of

human rights abuses to the international community.

It has been a long and painful battle with the state. It has caused many friends to avoid me for fear of being associated with the tough positions I took. 

But today I am glad to say that I have become a darling of many Malawians who continue to celebrate the death of the President for his hard autocratic policies. It is exciting once again to be a respected activist. The battle goes on for economic and social justice for our people.

The latest news from Malawi is that the new President, Joyce Banda, a former activist, is saying that Britain, the biggest bilateral donor to Malawi, is now planning to resume aid and normalise diplomatic relations.

All the charges against Jon Kapito have been dropped.

Breaking ground in the fight for consumer rights in Asia Pacific and Middle East

Following the success of World Consumer Rights Day, Indrani Thuraisingham, Head of CI Office for Asia Pacific and the Middle East, explains why it’s an exciting time for the region.

 
 

World Consumer Rights Day (WCRD) is a great opportunity to see the strength of our members in the Asia Pacific and Middle East region. This year, WCRD focused on consumer choice in financial services. Members from more than 23 countries in our region participated in events to mark the occasion.

Even the newly-formed, one-month-old consumer organisation in Afghanistan, the Consumer Rights and Services Organization (CRSO), (who is in the process of applying for CI membership) joined in by having the first-ever WCRD celebration in their country.

I travelled to Bangladesh to celebrate WCRD with the Consumers Association of Bangladesh, a CI member. There are more than seven million Bangladeshis working overseas and these workers often face high charges of between 5% and 20% every time they send money home.

We are working on this issue as part of our Global Money Transfers project.

In Bangladesh, if you want a copy of your bank statement urgently, you would need to pay USD10 for it. If you’re willing to wait up to five days, then you would need to pay only USD3. All this for your own bank account statement!

Our Consumers for Fair Financial Services campaign fighting for this to be something everyone should be entitled to for free.

The following day I was in India where I was one of the guests of honour at CI member Consumers Association of India’s 10^th anniversary international conference on the theme, ‘Is the consumer really the king?’ Here I talked about the need for consumer organisations to use Facebook and other social media tools to raise awareness on consumer rights and responsibilities.

Come and ‘like’ CI’s Facebook pageand see how we are using social media to raise awareness of consumer issues around the globe.

The CI regional meeting for Asia Pacific and the Middle East

Our office for Asia Pacific and the Middle East hosted the regional members’ meeting and conference: ‘Consumers in the Information Society: Access, Fairness and Representation’ in Kuala Lumpur. Fifty-one participants representing 37 organisations from 20 countries attended this meeting.

In-depth discussions were held on CI’s new strategic direction for the next four years and the five priority programmes that CI will focus on: financial services, food, consumers in the digital age, sustainable consumption, and consumer protection and legislation. In addition, our new strategy has a renewed focus on organisational empowerment; where CI helps members to help themselves.

Member organisations were reminded to be in continuous communication with CI on their activities in relation to CI’s priority programmes as well as emerging issues and concerns. This gives us the strength as a unified voice to collectively bring changes in terms of policy as well as corporations’ behaviour and practices.

One of these areas was taken up at the conference by CI's Director General Helen McCallum, who delivered a speech on emerging ICT technologies. The speech considered the networks we use to communicate (such as the Internet); the devices we use to do so (such as smartphones and computers); and the rules that regulate content passing through these devices and networks (such as intellectual property rights and privacy law). All of these are major issues for consumers in our region.

This office will work towards building a CI brand that is synonymous with consumer rights and protection. We will encourage and ensure all members from the region belong to at least one priority programme that is relevant to their work.

It’s an exciting time. We will form partnerships with relevant stakeholders to achieve our objective of bringing change, and look for strategic members to further strengthen our presence as the sole global consumer voice championing consumer rights.

We do this work because CI belongs to its member organisations; organisations that are fighting for consumer rights across the Asia Pacific and Middle East region.