The labelling dilemma

We repeatedly get queries from incensed importers who have had goods stopped at the behest of the National Consumer Commission (“NCC”) because the labelling of the goods is not compliant. Such a small thing, which gives rise to disastrous consequences since the NCC issues a directive to the importer:

•  threatening a fine of R10 million or 10% of turnover;
•  that the importer must either destroy the goods or re-export the goods to the place of origin or off the African continent.

The poor importer then believes the directive of the NCC so draconian and unreasonable that it simply cannot be lawful. Wrong! The NCC indeed has these draconian powers and will not allow rectification of the defective labelling after the fact. In June 2023 the powers of the

NCC were upheld in the case of the NCC v Scoop Clothing & another (Gauteng High Court case no A269/2021).

The NCC is tasked with ensuring compliance with the Consumer Protection Act 68 of 2008 ("CPA"), including the labelling requirements provided for therein. Section 24, read with regulation 6 of the CPA deals with product labelling. Annexure D to the CPA contains the items that are regulated. The NCC has been steadfast in its strict interpretation that goods must, at the time of importation, have labelling which:

• reflects the country of origin;
• provides care instructions; and
• contains the fibre content.

Goods not conforming with these requirements are detained. The NCC does not allow compliant labels to be affixed post importation. The detention is often for a substantial period resulting in excessive storage and demurrage costs, making any potential constitutional challenge against the powers of the NCC uneconomical. It bears mention we believe there might be a valid constitutional attack against the provisions which only allow for destruction of the goods or the re-export of the offending goods.

Compliance is key to avoid costly detentions. Importers must be made aware of the labelling requirements and must ensure that their suppliers adhere to these requirements. Perhaps it is necessary to have a pre-shipment inspection given the incredible (and unreasonable) cost of non-compliance.