Hire purchase law passed to protect consumers, sellers
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Minister of Tourism, Industry and Commerce, Oneidge Walrond (Elvin Carl Croker photo)
Minister of Tourism, Industry and Commerce, Oneidge Walrond (Elvin Carl Croker photo)

–creates a level playing field for all

THE amended Hire Purchase Act of 2020 was, on Wednesday, passed in the National Assembly, seeking to level the playing field between consumers and sellers in relation to hire purchase, credit and conditional sales agreements.

The Bill, which was first read in the National Assembly in December 2020, was sent to a special select committee for consideration. That committee had its first meeting in June 2021 but commenced work in April 2022.

When work commenced on the Bill, there was a wide and inclusive consultation process held which included stakeholders from the private sector and input from the general public.

As a result of the consultation process, some 27 clauses of the Act were amended in the committee following representation from the various stakeholders. It was noted that only three clauses came back to the House without any form of an amendment.

Presenting the bill was Minister of Tourism, Industry and Commerce, Oneidge Walrond.

Walrond highlighted that the Bill, while seeking to level the playing field does not seek to distort it as she noted that they were mindful and determined to avoid replacing a regime that substantially disadvantaged the buyer with one that disadvantaged the seller.

She said, “Thus, you will find, Mr Speaker, that when I come to explaining the actual provisions of the Bill that there are some there that also provide protection to the seller.”

Minister of Agriculture, Zulfikar Mustapha (DPI photo)

As she presented the Bill for its second reading, the Minister noted that it will make a consequential contribution to the environment for trade and commerce in Guyana and importantly to the lives of everyday people.

Walrond told the House that hire purchase and these kinds of agreements have significant benefits for sellers and consumers. However, she added that there are many pitfalls in these types of arrangements.

A vast majority of these perils, the minister noted, devolve under the relatively powerless consumer under the current framework which, she added, is largely governed by the common law of contract.

Meanwhile, adding to the debate on the Bill was Minister of Agriculture, Zulfikar Mustapha who stated that the Bill served as part of the government’s plan to modernise Guyana’s laws in keeping with the positively growing economy.

He noted that, as “business booms” in the country, it is necessary that there is updated legislation that protects both businesses and consumers. He also said that, in the line of hire purchase and credit sales, this represents a large portion of the retail trade in Guyana.

Mr Mustapha indicated that hire purchasing is done by many of the small businesses, Agro-processors and farmers in the country.

As such, he added, “This will allow our farmers to confidently invest in high-value assets to improve their production as hire purchase will now be seen by many farmers as a financial solution for expanding the agriculture business.”

Adding to this, the acting Director of the Competition and Consumer Affairs Commission, Anil Sukhdeo, on a televised programme stated that over 100 complaints were received over the last few years. The complaints accounted for a cumulative value exceeding $200 million.

This dollar value, he added, is very significant to the average consumer and these are usually items of high value. Sukhdeo stated that the industry where most of these complaints come from is the automotive industry and he noted that resolving these issues has always been a problem.

“Now that we have this Bill here that’s a footing that at least the consumers can stand on to seek redress via the magistrates’ court,” Sukhdeo said.

The acting director stated that they now foresee that, with the amendments, consumers will now have an avenue where they can access this redress even as he noted that there may be fewer complaints based on the provisions in the amendments of the Bill.

During the Bill’s second reading, Minister within the Ministry of Housing and Water, Susan Rodrigues, Minister of Labour, Joseph Hamilton and Member of Parliament, Sanjeev Datadin all rose in support of its passage.

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