NEW DELHI: Indian consumers are likely to soon find themselves empowered with significantly enhanced safeguards after the Union Cabinet approved a new Consumer Protection Bill.

Now that the Cabinet has given the go-ahead, the Bill is expected to become law during this winter session of the Indian Parliament and will replace the existing, 31-year-old Consumer Protection Act of 1986.

According to Business Standard, sources said the new Bill seeks to enlarge the scope of existing law and make it more effective and purposeful.

Measures include the creation of a Central Consumer Protection Authority to safeguard consumers’ rights, with provisions for post-litigation mediation as an alternative mechanism for resolving disputes.

There is also a tough new approach to manufacturers and companies that allow misleading ads to be served to the public – and this will extend to celebrity endorsements too.

In case of a first offence, the fine for celebrities will be up to Rs 10 lakh and a one-year ban on any endorsement. For a second offence, the fine will be up to Rs 50 lakh and a ban of up to three years.

However, for manufacturers and companies, the penalty is up to Rs 10 lakh and up to two years’ jail for the first offence, rising to Rs 50 lakh and five years’ jail for any subsequent offence.

The bill also provides for penalties and up to life term jail sentences in case of adulteration.

Responding to the news, the Indian Direct Selling Association said it welcomed the Cabinet’s decision and thanked the Ministry of Consumer Affairs, Food and Public Distribution for its “relentless efforts” to present the Bill to Cabinet for approval.

“For a long time now, IDSA has been advocating for tabling of the new Consumer Protection Bill in the interest of consumers,” said Amit Chadha, Secretary General of the IDSA.

“Direct Selling Industry thrives on consumer satisfaction and the new Act will ensure that consumer's interest remains at the top,” he added.

Sourced from Business Standard; additional content by WARC staff