Consumer Ombudsman issues theses on improving the position of consumers

Consumer Ombudsman Päivi Hentunen today made public her six theses to benefit the consumer in connection with the Finnish Competition and Consumer Authority’s FCCA day. At the same time she called on companies to show more responsibility in taking consumers’ rights into consideration. Also needed on the market are more efficient ways to intervene in violations that have been observed, such as those that are familiar from finance, communications, and competition supervision. Nearly 200 representatives of interest groups of the authority took part in a seminar held in Helsinki.

The Consumer Ombudsman has a vantage point over problems confronting consumers on the market. The Consumer Ombudsman has been contacted more than 4 700 times this year, in addition to which, about 69 000 approaches were made to Consumer Advisory Services. There was considerable variation in the reasons for the contacts. However, certain basic problems which recur in the messages could be found in the background. The Consumer Ombudsman has now encapsulated these problems into six theses for the improvement of the lot of consumers. “We work on their behalf, and companies should also make note of this”, says Consumer Ombudsman Päivi Hentunen.

The theses of the Consumer Ombudsman

  1. Consumers must be allowed to move around freely on the market.
  2. Essential services to consumers must be guaranteed.
  3. Advertising must be recognisable as such.
  4. Companies must put their customer service into shape.
  5. Collaboration against fraud must be made to work.
  6. The sanctions of the Consumer Protection Act must be brought up to date.

The Consumer Ombudsman has matters pending for all of these theses, connected with, for instance, influencing legislation, policy lines or policy solutions linked with consumer law, as Market Court applications and as warnings directed at consumers. The Consumer Ombudsman works hard for the implementation of these theses, and directs activities and resources in the coming years accordingly, in addition to solving acute market problems.

“Consumer officials cannot fix the problems on their own. We need support from the business community as well. Companies must also implement in practice principles that have been jointly agreed upon and written into legislation, and must promote greater self-regulation of different sectors. In addition, the selection of means at the disposal of the Consumer Ombudsman needs a boost, and action from decision-makers as well. Now our possibilities to intervene rapidly into faults that have emerged on the market, as well as actual violations of the law are inadequate. This also hurts the competitiveness of companies that abide by the rules set by society,” Hentunen says.

Study of points of contact between competition policy and consumer policy

FCCA day also saw the publication of a study by the authority’s Assistant Director LL.D. Kalle Määttä on the points of contact of competition policy and consumer policy (KKV:n selvityksiä 4/2013). The study indicates that competition policy and consumer policy have more points of convergence than is often assumed.

First of all, fighting the restrictions on competition banned by the Competition Act, along with other means of advancing competition benefits the consumer in many ways. Functioning competition secures access to the markets by new companies, and forms an incentive for all companies to constantly upgrade their methods, and for developing new products and services. In this way consumers have various products and services available with prices and other characteristics, out of which they can choose what they wish to have. In addition, competition helps keep prices in check while generally also improving the quality of products.

Functioning competition also channels the economic resources of society into the most efficient use possible, and also creates incentives for the emergence of completely new fields and possibilities for production. The resulting emergence of economic competitiveness ultimately benefits society as a whole.

However, competition alone does not always secure the status of the consumer. For instance, it has been noted in international studies that establishing competition in the energy and telecommunications markets has not benefited the consumer in the desired way, and consequently, the status of the consumer has had to be upgraded through separate legislation. Competition policy for its part can, nevertheless, help us visualise that legal regulations are not always necessary, because the market itself can often solve its own problems. The competition policy angle also helps in the analysis of what kinds of drawbacks legal regulation itself can cause.

However, interaction among policy sectors works the other way as well: Consumer policy helps competition policy to better visualise the relationship between consumers and companies, and the de facto behaviour of consumers, and to better observe the undesirable consequences of competition. Instruments of consumer policy can also be needed for spurring competition on the market. Collaboration with consumer officials is also likely to increase confidence on the part of the public at large in the initiatives of consumer officials and other activities, as well as the societal weight and influence of both sectors of policy.

In competition policy and consumer policy it is also important to dare to disagree: how else could a combined authority form a critical mass? This, for its part, creates pressures both for the research and study activities of the authority itself, and for the utilisation of research information in general. Ultimately research that leans on empirical evidence, and not entrenched opinions – are a way to reconcile the goals of competition policy and consumer policy with each other.