TERM PAPER

ON

UNITED NATION GUIDELINES FOR CONSUMER PROTECTION

(With special attention on Pharmaceutical Sector & a Case Study)

Submitted to

Dr. R.Anita Rao

(Professor, G.S.I.B)

Submitted by-:

Debasish Patnaik

Roll no. 1226109212

Section- B

MBA IB (2009-11)

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 REVIEW OF LITERATURE

Dr. Corinna Hawkes, (2004) got interested to note that the original draft of the UNGCP
apparently included a provision that would have required the regulation of the marketing
of products inappropriate to the dietary requirements and habits of developing countries.
The dynamics that led to the exclusion of the clause in the final version of the guidelines
are, however, not known.

Although the UN guidelines have not stimulated discussion on advertising regulation

internationally, some countries do include marketing clauses in their laws on consumer
protection. The Consumer Defense Code (1990) in Brazil, for example, dedicates an
entire section to advertising (which mentions children), as does the Thai Consumer
Protection Act (1979) (with no reference to children). Finland and Quebec, Canada,
provide two further examples.

Vinod Dhall, (2008) confirmed that competition law and consumer protection are
intricately connected. It is impossible to talk of one without dealing with the other. At a
fundamental level, these two are complementary and mutually reinforcing, both being
elements of a broader framework of social welfare. Competition law by maintaining and
preserving competition enhances consumer interest. On the other hand, consumer
policy strengthens competition between firms. Yet the two are not identical areas and
their boundaries do not coincide. Nevertheless, they overlap or intersect at various
points, reflecting both synergies and tensions. The challenge before authorities is to
maximize the synergies and minimize the tensions thereby smoothing the interface
between the two disciplines. Thus UN guidelines try to meet up this challenge.

Belinda Brassil, (2007) approved that the modern movement of consumer rights led to
the establishment of basic consumer rights by the U.S. president John F. Kennedy,
which was later added to by the IOCU. These eight rights are: the right to safety, the

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right to be informed, the right to choose, the right to be heard, the right to the
satisfaction of basic needs, the right to redress, the right to consumer education and the
right to a healthy environment. The United Nations adopted these eight guidelines in the
UN Guidelines of consumer protection act, 1985.

McGregor, (2003) affirmed that consumerism is a deep form of structural violence,

oppression, and abuse of power. Sandlin, (2005) agreed that consumption is
inextricably linked to human, non-human and environmental oppression. She proposed
that the nature of a consumer culture requires consumer education to become political,
necessitating that people consciously seek to critically analyze and question the taken-
for-grantedness of consumer capitalism. Politicized consumer education will help
consumers become critical, empowered world citizens concerned with sustainability,
solidarity and the human condition as it is shaped by human consumption.

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 EXECUTIVE SUMMARY

Governments should develop or maintain a strong consumer protection policy, taking

into account the guidelines set and relevant international agreements. In so doing, each
Government should set its own priorities for the protection of consumers in accordance
with the economic, social and environmental circumstances of the country and the
needs of its population, bearing in mind the costs and benefits of proposed measures.
2010 marks the 25th year of the adoption of the UN Guidelines for Consumer
Protection. The draft UN guidelines were discussed at great length from the 1970s
onwards before finally being adopted in 1985.
The guidelines of consumer protection act involves broadly: a. physical safety b.
promotion and protection of consumers’ economic interests’ c. standards for the safety
and quality of consumer goods and services d. distribution facilities for essential
consumer goods and services e. measures enabling consumers to obtain redress f.
education and information programmes g. promotion of sustainable consumption h.
measures relating to specific areas

Thereafter a special focus is made on pharmaceutical industry as a growing concern for

consumers, particularly in the context of a liberalizing economy, is the information
discrimination in the market. The consumers simply do not have access to independent
information about certain sectors. A case study has been highlighted so as show how
the consumers are duped and are made to pay heavily.

Governments should, especially in a regional or sub regional context develop, review,

maintain or strengthen, as appropriate, mechanisms for the exchange of information on
national policies and measures in the field of consumer protection.

Consumer protection movement has got a bright future in India. A part from
Governmental seriousness in the matter, consumer activism, organizations, civil society

1
and other voluntary associations needs to play their part in the furtherance of consumer
movement.
While the Guidelines, and subsequent development of a framework by the umbrella
body UN, require the government to ensure these rights, they also recognize that it is
unrealistic to expect the government to intervene in every case.

CONTENTS
Particulars Page No.

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 1. Objective of the study 7

2. Introduction 8
3. UN Guidelines 8-9
a. Physical safety 9
b. Promotion and protection of consumers’ economic interests 9-11
c. Standards for the safety of consumer goods and service 11
d. Distribution of facilities for essential consumer goods & services 11-12
e. Measures enabling consumers to obtain redress 12
f. Education and information programmes 12-13
g. Promotion of sustainable consumption 13

h. Measures relating to specific areas 14-15

4. Understanding the importance of pharmaceutical sector 15-16

5. Case study 17-18
6. International cooperation 18-19
7. Consumer protection act in India 19
8. Conclusion 19-20
9. Bibliography 21

OBJECTIVES OF THE STUDY

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a. To have a sound knowledge on consumer protection.

b. To have an idea what are guidelines that are laid by the united nation for
protecting Consumer from any kind of exploitation.

c. To exercise the insightful through case studies.

d. To have an enhanced comprehension about the commercial and personal

concern related to consumer protection act.

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INTRODUCTION

2010 marks the 25th year of the adoption of the UN Guidelines for Consumer
Protection. The draft UN guidelines were discussed at great length from the 1970s
onwards before finally being adopted in 1985. After extensive work from CI, the
guidelines were formally expanded in 1999 with Section G on sustainable consumption,
and were re-adopted in the UN General Assembly decision 54/449. They provide a vital
context and indeed legitimacy for CI's work. For example, when governments are
reluctant to allow such rights they can be reminded of their obligations as UN members.

On 9 April 1985 the General Assembly of the United Nations collectively adopted a set
of general guidelines for consumer protection. The Guidelines represent an
internationally recognized set of minimum objectives for protecting consumers
throughout the world and potentially being of particular assistance to developing
countries. The adoption of these guidelines strengthen the increasing recognition in
recent years that consumer policy issues can no longer be seen as being of purely local
concern but must be seen in an international context.
After discussing certain objectives and general principles, this covers seven areas of
UN Guidelines on: physical safety, promotion and protection of consumers' economic
interests, standards for the safety and quality of consumer goods and services,
distribution facilities for essential consumer goods and services, measures enabling
consumers to obtain redress, education and information programmes, and measures
relating to specific areas (food, water, and pharmaceuticals).
Then finally makes a number of recommendations on international co-operation on
consumer policy issues.

GUIDELINES

The UN Guidelines for Consumer Protection (UNGCP) were adopted by the UN

General Assembly in 1985. According to Consumers International, an NGO working to
encourage their national implementation, the UNGCP aim to provide a framework for

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consumer protection, advice and support which would enable consumers to operate
confidently and effectively in a market economy.

The following are the guidelines regarding consumer protection which should apply to
both home-produced goods and services as well as to imports.

While applying any procedures of regulations for consumer protection, consideration to

be taken that these regulations do not become barriers nor do become inconsistent to
the international trade obligations.

1. PHYSICAL SAFETY.

Government should adopt or encourage the adoption of appropriate policies and

measures to ensure that the products are safe for either intended or normally likely use.
The appropriate policies should ensure that the products produced are safe to use.
Utmost care and due diligence should be adopted or taken by persons (suppliers,
exporters, importers, retailers and the like) responsible for bringing goods to the market.

Proper handling, storage of the goods should be done and care should be taken that the
goods do not become hazardous. Moreover consumers should be informed about the
proper usage of the goods and vital information should be provided by using
internationally understandable standards wherever possible.

And if manufacturers become aware about the hazardous effects of the products after
they are placed in the market, then it their duty to inform the relevant authorities without
delay, about informing the consumers. Government should adopt appropriate policies
whenever required and the manufacturers should even recall the products from the
markets and replace them or modify them or provide a substitute for it, within a
reasonable period of time or else the consumer should be adequately compensated for
the defective product served.

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 2. PROMOTION AND PROTECTION OF CONSUMERS’ ECONOMIC
INTERESTS.

Government policies should seek out to enable consumers to obtain maximum

satisfaction out of their economic resources. They should also seek to achieve the goals
of satisfactory standards and practices regarding production, performance, information
about the products so that it does not adversely affect the economic interests of the
consumers.

Government should ensure that the manufacturers, distributors and others involved in
the provision of the goods and services adhere to the established laws and obligatory
norms so that economic interests of the consumers are protected. Moreover the
consumer organizations should be encouraged to scrutinize any adverse practices
adopted by the manufacturers, distributors and other parties involved.

Government should take up measures relating to the control of restrictive and other
abusive business practices which may be harmful to the consumers. In this link,
Government should be guided by their commitment to the set of Multilaterally agreed
Equitable Principles and Rules for the control in Restrictive Business Practices adopted
by the General Assemble in Resolution 35/63 of 5 December 1980.

Government should adopt and maintain policies that clear the responsibility of the
producer to ensure that the products and services should meet the reasonable
demands of durability, utility, reliability and suitability for the purposes they are intended
for.

Government should promote fair and effective competition so that goods and services
are made available to the consumers at the lowest possible costs and see that
manufacturers and retailers provide reliable after-sales services and spare parts.
Consumers should be protected from contractual abuses and unconscionable
conditions of credit by sellers.

Governments should encourage all concerned to participate in the free flow of accurate
information on all aspects of consumer products.

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Consumer access to accurate information about the environmental impact of products
and services should be encouraged through such means as product profiles,
environmental reports by industry, and information centers for consumers, voluntary and
transparent eco-labeling programmes and product information hotlines.

Governments, in close collaboration with manufacturers, distributors and consumer

organizations, should take measures regarding misleading environmental claims or
information in advertising and other marketing activities. The development of
appropriate advertising codes and standards for the regulation and verification of
environmental claims should be encouraged.

3. STANDARDS FOR THE SAFETY AND QUALITY OF CONSUMER GOODS

AND SERVICES.

Governments should, as appropriate, formulate or promote the amplification and

execution of standards, voluntary and other, at the national and international levels for
the safety and quality of goods and services and give them appropriate publicity.
National standards and regulations for product safety and quality should be reviewed
from time to time, in order to ensure that they conform, where possible, to generally
accepted international standards.
Every effort should be made to raise that standard as soon as possible when a standard
lower than the generally accepted international standard is being applied because of
some local economic conditions
Governments should encourage and ensure the availability of facilities to test and certify
the safety, quality and performance of essential consumer goods and services.

4. DISTRIBUTION FACILITIES FOR ESSENTIAL CONSUMER GOODS AND

SERVICES.
Government should where appropriate consider the following:
a. Taking up policies and maintaining them so that there is efficient distribution of
goods and services to the consumers and even considering appropriate specific
policies about the distribution of essential goods and services to the consumers
particularly in rural areas where such distribution is endangered.

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 b. Encouraging the establishment of consumer cooperatives, relating trading
activities as well as information about them, especially in rural areas.

5. MEASURES ENABLING CONSUMERS TO OBTAIN REDRESS.

Government should take the responsibility of maintaining legal and administrating to
obtain redress through formal and informal of the low income consumers. Government
also take encourage all the enterprise to resolve any kind of disputes in a fair,
expeditious and informal manner, and should also provide assistance to the consumers.
And all the information related to the verdicts should e made available to the
consumers.

6. EDUCATION AND INFORMATION PROGRAMMES.

Governments should widen or persuade the development of general consumer
education and information programmes which includes information on the
environmental impacts of consumer choices and behavior and the probable proposition.
In developing such programmes special care should be given to the needs of consumer
in rural and urban areas.
Consumer education and information programmes should cover some important
aspects of consumer protection as the following:
a) Health, nutrition, prevention of food-borne diseases and food adulteration.
b) Product hazards.
c) Product labeling.
d) Relevant legislation, how to obtain redress, and agencies and organizations for
consumer
e) Protection.
f) Information on weights and measures, prices, quality, credit conditions and
availability of basic necessities.
g) Environmental protection.
h) Efficient use of materials, energy and water.

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Government should also involve the mass media to promote and educate the rural and
urban consumers.

7. PROMOTION OF SUSTAINABLE CONSUMPTION.

Sustainable consumption includes meeting the needs of present and future generations
for goods and services in ways that are economically, socially and environmentally
sustainable. Responsibility for sustainable consumption is shared by all members and
organizations of society, with informed consumers, Government, business, labour
organizations, and consumer and Environmental organizations playing particularly
important roles. Informed consumers have an essential role in promoting consumption
that is environmentally, economically and socially sustainable, including through the
effects of their choices on producers. Governments should encourage the design,
development and use of products and services that are safe and energy and resource
efficient, considering their full life-cycle impacts. Governments should encourage
recycling programmes that encourage consumers to both recycle wastes and purchase
recycled products. Governments should promote the development and use of national
and international environmental health and safety standards for products and services;
such standards should not result in disguised barriers to trade. Governments should
encourage impartial environmental testing of products. Governments, in cooperation
with business and other relevant groups, should develop indicators, methodologies and
databases for measuring progress towards sustainable consumption at all levels. This
information should be publicly available.
Governments and international agencies should take the lead in introducing sustainable
practices in their own operations, in particular through their procurement policies.
Government procurement, as appropriate, should encourage development and use of
environmentally sound products and services. Governments and other relevant
organizations should promote research on consumer behavior related to environmental
damage in order to identify ways to make consumption patterns more sustainable.

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 8. MEASURES RELATING TO SPECIFIC AREAS
In paving the way for the consumer wellbeing, particularly in developing countries,
Governments should, Put more focus and give more priority to areas of fundamental
concern for the health of the consumer, such as food, water and pharmaceuticals.
Policies should be adopted or maintained for product quality control, adequate and
secure distribution of facilities, standardized international labelling and information, as
well as education and research programmes in these areas. Some of the fundamental
areas are-:
a) Water-: Governments should formulate maintain and strengthen national
policies to improve the supply, distribution and quality of water for drinking within
the goals and targets set for the International Drinking water Supply.
Governments should also assign high priority to the formulation and
implementation of policies and programmes concerning the multiple uses of
water, taking into account the importance of water for sustainable development in
general and its finite character as a resource.

b) Food-: When formulating national policies and plans with regard to food,
Governments should take into account the need of all consumers for food
security and should support and, as far as possible, adopt standards from the
Food and Agriculture Organization of the United Nations and the World Health
Organization Codex Alimentarius or, in their absence, other generally accepted
international food standards. Governments should maintain, develop or improve
food safety measures, including, inter alia, safety criteria, food standards and
dietary requirements and effective monitoring, inspection and evaluation
mechanisms. Governments should promote sustainable agricultural policies and
practices, conservation of biodiversity, and protection of soil and water, taking
into account traditional knowledge.

c) Pharmaceuticals-: Governments should develop or maintain adequate

standards, provisions and appropriate regulatory systems for ensuring the quality
and appropriate use of pharmaceuticals through integrated national drug policies

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 which could address, inter alia, procurement, distribution, production, licensing
arrangements, registration systems and the availability of reliable information on
pharmaceuticals. In so doing, Governments should take special account of the
work and recommendations of the World Health Organization on
pharmaceuticals. For relevant products, the use of that organization Certification
Scheme on the Quality of Pharmaceutical Products Moving in International
Commerce and other international information systems on pharmaceuticals
should be encouraged. Measures should also be taken, as appropriate, to
promote the use of international nonproprietary names (INNs) for drugs, drawing
on the work done by the World Health Organization.
In addition to the priority areas indicated above, Governments should adopt
appropriate measures in other areas, such as pesticides and chemicals in
regard, where relevant, to their use, production and storage, taking into account
such relevant health and environmental information as Governments may require
producers to provide and include in the labelling of products.

UNDERSTANDING THE IMPORTANCE OF PHARMACEUTICAL SECTOR

A growing concern for consumers, particularly in the context of a liberalizing economy,

is the information discrimination in the market. The consumers simply do not have
access to independent information about certain sectors.
This is made clear in specific sectors, for example in pharmaceuticals, where the wide
spread availability of substandard, counterfeit and spurious drugs does not deter
consumer-patients from making the drugs industry one of the strongest performers in
any economy. Four key issues that are prime determinants of this sector are-:

a) Pharmaceuticals are not affordable to a vast majority of people. Some estimates

say that, people who have no access are half of the population. Much of the
population cannot even afford to approach this health care system in the first
place and thus pharmaceuticals remain out of their lives, while another large

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 section of patients who consult the modern health care system cannot afford to
pay for what is prescribed.
b) Poor and illiterate consumers have further disadvantaged since the treatments
for the diseases of the poor majority remain unavailable in developing countries.
While the rich minority is overwhelmed by treatment options for their ailments,
real or perceived. Time-tested treatments fall out of favor of companies as soon
as they outlive their patent periods and the subsequent competition forces down
their prices. Making available the time-tested and much-needed cheap
medicines, essential Drugs, is a formidable challenge for economies developing
in this century.
c) Corporations are throwing products in global market at a great speed. They have
secured the right to enter national markets through global financial institutions
and trade agreements. But the nation states are not capable of checking all
corporate moves and protecting the interests of their population. This is why
pharmaceutical products banned in countries of origin are available in other
countries like Afro- Asian countries. Products can be available in different
countries for different indications and uses as well. Guarding people against the
dangers of unsafe drugs is another challenge.
d) Some of the developing nations have the largest number of unregistered drugs
and among the absolute highest rates in the world for unnecessary prescriptions
of antibiotics, injections and numbers of medicines per prescription. Absurd use
of unsafe and unessential drugs can make them harmful and even dangerous
products. It not only burdens health budgets, it also causes drug resistance,
which is responsible for increasing mortality caused by TB, malaria and other
such diseases. Irrationality can be ignorance but it can also be a deliberate
attempt to get quick and handsome returns on a prescriber’s investment. The
responsibility among many medical professionals and most of the industry is very
complex.

Responsible health service systems, ethical marketing practices and aware

consumers are the basic ingredients of rational use of pharmaceuticals.

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 CASE STUDY

C.J. LAWRENCE v. APOLLO HOSPITALS (Tamilnadu SCDRC O.P. No. 8/94

Decided on 05.08.1998)

Facts of the Case-:

 Mr. C.J Lawrence the plaintiff was admitted in Apollo hospital for pain in the neck
on the right shoulder.
 Investigations reveled that he was a diabetic and had right hydronephrosis with
obstruction at right uretrovesical junction.
 The plaintiff underwent a surgery by retroperitoneal approach.
 The affected portion of the ureter was removed and uretric reimplantation was
done. During the postoperative period, the complainant developed high fever.
 Further investigations showed that a stapler pin was seen in the gastrointestinal
tract.
 The Plaintiff got discharged against medical advice.

Relevant Facts of the Case-:

 The affected portion of the ureter was removed and uretric reimplantation was
done. During the postoperative period, the complainant developed high fever.
 Further investigations showed that a stapler pin was seen in the gastrointestinal
tract.

Issues of the Case-:

 The allegation was that the pin was left there during the operation.
 The surgeon stated that the surgical staplers are V or U shaped and used in
clusters in surgeries involving large intestine.
 The stapler pin seen in the x-ray is not a surgerical stapler pin.

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  It resembles the stapler pins that are used in food pockets.
 Evidently, this stapler pin should have been swallowed.

Analysis of the Case-:

The court held that there is no negligence or deficiency of service on the part of the
hospital and dismissed the complaint without costs. In this case it was very prominent
that the fault was with the hospital because the pin was diagnosed in the hospital after
the operation. After an operation no patient would dare to take any outside food without
doctors’ permission. So it is never possible for an outside pin to be inside the body. The
plaintiff was discharged without further medical advice. And moreover the
retroperitoneal area is very near the gastrointestinal tract. The surgeon also never
ignored the fact that they haven’t used the surgerical stapler pin during the operation.

Verdict of the Case-:

The court dismissed the case because the plaintiff had no knowledge about the
consumer right against this sector. Had he been aware about his right, he could have
been compensated by the Apollo hospital. So it is very important for the government to
make the consumers aware about their rights of the consumer under the Indian
consumer protection Act of 1986.

INTERNATIONAL COOPERATION

Governments should, especially in a regional or sub regional context develop, review,

maintain or strengthen, as appropriate, mechanisms for the exchange of information on
national policies and measures in the field of consumer protection. Governments should
develop or strengthen information links regarding products which have been banned,
withdrawn or severely restricted in order to enable other importing countries to protect
themselves adequately against the harmful effects of such products.

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Governments and international bodies, as appropriate, should promote programmes
relating to consumer education and information. Governments should work to ensure
that policies and measures for consumer protection are implemented with due regard to
their not becoming barriers to international trade, and that they are consistent with
international trade obligations.

CONSUMER PROTECTION IN INDIA

Consumer protection movement has got a bright future in India. A part from
Governmental seriousness in the matter, consumer activism, organizations, civil society
and other voluntary associations needs to play their part in the furtherance of consumer
movement. In the current scenario media can play a vital role in infusing the consumer
behavior and can easily generate opinions or enhance awareness about the possible
unfair practices in the market.
Above all, the consumers have to be aware of their rights and should assert themselves
in the market place.

CONCLUSION

While the Guidelines, and subsequent development of a framework by the umbrella

body UN, require the government to ensure these rights, they also recognize that it is
unrealistic to expect the government to intervene in every case. But a strong judicial
system can act better as a deterrent that actual litigation in every matter, which would
cause its own problem. In the final analysis, as understood by advocates of functional
democracy, it is the demand raised by citizens themselves; in this case as consumers,
that determines the efficacy of systems of protection. And for this, consumers need to
be critically informed. Without a doubt low literacy levels hamper mass awareness to an
extent, but this barrier is neither insurmountable (given developments in electronic
media) nor a deterrent to the awareness of the literate sections of the population.
However, consumers in the developing countries remain unaware both of their rights,
and of the increasingly insidious ways in which those rights are being violated.
Governments of different countries should come forward and unite themselves to create

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a world which gives the power to the consumers and eradicate the exploitation of
consumers in any form. This is only possible with sharing of information.

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BIBLIOGRAPHY
1. Department of Economic and Social affairs: UN guidelines for consumer
protection act, 1985
2. Yearbook of the United Nations, 1985, By United Nations, Department of Public
Information, United Nations Staff
Websites
3. http://www.medindia.net/indian_health_act/consumer_protection_act_and_medic
al_profession_lank_mark_related_cases.htm#ixzz0xdPMCFbL
4. http://www.un.org/documents/ga/res/39/a39r248.htm
5. http://www.consumersinternational.org/our-work/consumer-protection-and-
law/un-guidelines-on-consumer-protection