/ Congress Dispatches Pro-Consumer Law that Grants Supervisory Powers to Sernac and Collective Actions on Data Protectionection

Camila Lira
Alessandri Associate

The Pro-Consumer Law proposes a series of new obligations to suppliers of different markets (financial, aeronautical, among others), highlighting in its content, the incorporation of obligations regarding the protection of personal data, which will significantly modify their processes of commercialization of products and services. It is currently being processed with the utmost urgency, and now it is before the Joint Commission of the Senate.

After the message of the President of the Republic, dated January 24, 2019, the processing of the Bill that “Establishes measures to encourage the protection of consumers’ rights”, Bulletin 12,409, better known as Pro-Consumer Law, and which modifies relevant aspects of Law No. 19,496, Consumer Rights Protection Act (“Consumers Act”), as well as the Aeronautical Code was started, thus tending to strengthen consumers’ rights and incorporating new obligations to consumers.

As regards the main lines of amendment of the law, we highlight the following:

1. Personal data protection

One of the most relevant changes introduced by this regulation is the express recognition of Sernac’s supervisory powers in personal data protection matters. Although Sernac previously exercised actions in defense of the personal rights of consumers, the case law was not unanimous in recognizing this power, therefore, this law comes to settle this discrepancy. Likewise, the exercise of collective actions in relation to the personal data of consumers is established.

It should be noted that this power of Sernac is limited to a consumer relationship and provided that such powers are not within the scope of legal powers of another body. This leaves aside the existence of a future data protection agency and other bodies, such as the CMF with respect to financial customer protection.

Although this amendment remedies one of the defects of Law 19,628 on privacy protection, that is, the lack of a control body, we consider that Sernac is not the appropriate body, since it does not have the technical knowledge required for the protection of personal data and information security, it does not have an adequate rule/standard for supervision and only protects consumers’ personal data, discriminating against data holders who do not have such capacity, when the Constitution guarantees personal data protection to all persons.

Finally, this provision does not contemplate legal vacancy.

2. Recognition of the “Pro-Consumer” Principle

The law intends the incorporation of Article 2 ter, where this “Pro-Consumer” principle would be enshrined as an interpretative rule of the meaning and scope of the Consumers Act, in order to establish a criterion to understand the relationship between the Consumers Act and special laws, constituting a guideline to be considered by judges in the resolution of this type of conflicts.

3. New Basic Rights for Consumers

The law seeks the incorporation of two new basic consumer rights, incorporating paragraphs g) and h) to Article 3 of the Consumers Act, which mainly include:

• The right to always submit a dispute to the competent court. This right must be informed by the supplier to the consumer at the time of entering into the contract (new Article 3 paragraph h).
• Alternative dispute resolution mechanisms that may be used by the parties once the conflict has arisen (mediation, conciliation or arbitration).
• Possibility of submitting possible conflicts to the Dispute Settlement System provided for in Articles 56 A et seq. of the Consumers Act.
• To exercise other rights established in the laws that in turn refer to consumer rights and, in particular, the rights enshrined in Law No. 18,010, which establishes rules for credit operations and other money obligations (new Article 3 paragraph g).

4. Right of Withdrawal and Modifications in the Area of E-Commerce

The right of the consumer to terminate the consumer contract “without cause”, within 10 days from receipt of the product or from some of the assumptions set forth in the new Article 3 bis of the Consumers Act.

• The duty of all suppliers to inform, prior to purchase, the cost and time it will take to deliver their products is established, constituting “basic commercial information”.
• Right to exercise the right of withdrawal in face-to-face purchases in which the consumer has not had direct access to the good.

5. Changes in Higher Education, Professional Institutes and Technical Education

The law incorporates a new Article 3 quater, which establishes the obligation of these actors to grant free of charge and within a term of 10 days, the certificates of studies, grades, debt status or other similar, at the request of the student, former student or the one who has suspended his studies or is in arrears in the relevant educational institution.

6. Legal Warranty

Extension of the right to the legal warranty from three to six months.

7. Standard Form Contracts

The law intends to incorporate new requirements for standard form contracts:

• These contracts will have to be adapted in order to guarantee their understanding to persons with visual or hearing disabilities (new Article 17 of the Consumers Act).
• These contracts must be sent to the competent supervisory body (new Article 17 of the Consumers Act).
• At the time of entering into a standard form contract, the supplier must inform consumers about the mechanisms and conditions to terminate it, not being able to condition such act to the payment of amounts owed and/or restitutions (new Article 17 A of the Consumers Act).

8. Modifications for Motor Vehicles Suppliers

The law incorporates the obligation to inform the voluntary warranty, mandatory maintenance, including estimated values and the authorized technical service establishments that perform them, among others; and must also deliver to the consumer another vehicle similar to the one purchased in case of repair (provided that it is the exercise of the legal or voluntary warranty) (new Article 12 C of the Consumers Act).

9. Modifications for Financial Products Suppliers

In financial matters, the law provides for the following modifications:

• Analysis prior to a money credit operation, of the economic solvency of the consumer to be able to comply with the obligations arising therefrom, on the basis of sufficient information obtained through official means for such purpose, and the consumer must be informed of the result of such analysis.
• Prohibition of offering, by higher education institutions, of money credit operation contracts, which are not related to the financing of contracts for the provision of educational services.
• The right of the consumer to request, without expression of cause, the permanent blocking of payment cards, without the supplier being able to charge the management, operation and/or maintenance fees during said period.

10. Amendments to the Aeronautical Code

Finally, and regarding aeronautical matters, the law intends to include the following amendments to the regulatory body in question:

• Duty of the supplier to inform passengers of their rights in accordance with the conditions established by the Civil Aeronautics Board, after consulting the National Consumer Service, without prejudice to the obligation of the carrier to make available to the public informative brochures specifying their rights, both in sales offices and at airport counters.
• The obligation to inform any change in the itinerary, due to an advance, delay or cancellation of the flight, by means of a written communication by the most expeditious means possible, indicating the reason for the change.
• In the event that the trip does not take place, the obligation to refund taxes, charges or aeronautical fees, with or without the passenger’s request, within 10 days, through the same means used to pay the ticket, is provided.
• The scheduled date of travel may be changed, or a refund of the amount paid may be requested, if the passenger proves, through a medical certificate, that he/she is unable to travel.
• In the event that a passenger decides to persevere with the contract in the face of denied boarding, the latter shall be entitled, among others, to meals and beverages equivalent to at least 0.5 UF when the time elapsed between the scheduled departure time for the flight initially booked and the new departure time is equal to or more than 2 hours.