Argentina: Recent Amendments On The Consumer Protection Law In Argentina

On March 12, 2008, the Congress sanctioned Law Nº 26.361, which amended the Consumer Protection Law Nº 24.240 (from now on "CPL") (sanctioned in 1993).

This new law came into force by incorporating:

  • National doctrine and jurisprudence
  • Decisions of the administrative authority
  • Analysis of "de facto" situations that affect consumers rights
  • New practices to prevent the violation of users' rights

Evidently, the amendment to the Consumer Protection Law Nº 24.240 had a clear objective: the update of the terms of said Law and adapting to the new social, economic and legal realities, offering a wider and more effective protection of the social and constitutional rights of the consumers.

It is worth mentioning that the Foreign Banks' Association, most commercial chambers, the Industrial Union of Argentina and most communication companies (cable and phone companies) exerted a large amount of pressure to prevent this amendment. Although they managed to delay approval of Law Nº 26.361, they weren't able to stop it.

The participation and protection of users' rights is broader under the new law, which foresees greater sanctions in the administrative stage for those suppliers who infringe consumer rights as well as more disputes between suppliers and consumers.

In respect to advertising, this new law does not have specific regulations against deceitful or unlawful advertisement and it has not considered the responsibility of actors, models or other "popular" figures when endorse goods or services misleading the consumers. Some consumer associations wanted to prevent these situations and insisted on including specific regulations regarding false endorsement of goods or services. Notwithstanding, the new law does not include the provisions on same.

Detailed below are the main aspects of the referred amendment, namely:

Including corporations under the protection of the Consumer Protection Law

Article 1 of Law Nº 26.361 states a new and wider definition of "consumer," including corporations as objects of protection when they act as final consumers. This legal protection does not apply when the company acts within the framework of its activity or expertise.

It is important to point out that said protection was already granted by national courts. In a recent case law named "Artemis Construcciones S.A. vs. Diyon S.A.", the Commercial Courts of Appeal decided to apply the Consumer Protection Law Nº 24.240 to a construction company perk. The plaintiff –Artemis- had bought a car to drive a group of professionals for the supervision of the constructions and the seller didn't comply with the terms of delivery.

The court considered that the plaintiff was a final consumer and, although it was a corporation, deserved the protection granted by the CPL.

Information provided to the consumer has to be exact, clear, detailed and FREE of charge.

Article 4 states that the supplier is required by law to provide the consumers with exact, clear and detailed information about the essential characteristics of the goods and services commercialized and the conditions of commercialization.

Moreover, the information has to be supplied for FREE. This obligation was incorporated by Law Nº 26.361 and intends granting the right of defense to users, together with the right to have an entire and absolute knowledge of the contractual terms. Furthermore, it grants the equality between all suppliers. As a result, users of phone services, for example, have the right to access information of phone calls and SMS sent without paying any cost.

Decent treatment and abusive conducts

Article 8 of CPL provides that the statements mentioned in ads, leaflets or any other means of communication compel the supplier to fulfill his offer, and they are considered included in the contract set up with the consumer.

In addition, Article 8 bis —incorporated by Law 26.361— describes abusive practices. In particular, suppliers must refrain from using any conduct that intimidates consumers. Such conduct may be sanctioned with punitive damages. Besides, suppliers cannot make distinctions —not in the price or technical/commercial quality of the product or service commercialized— between national and foreign consumers. Thus, suppliers cannot obtain benefits without cause from foreigners.

It is necessary to underscore that the CPL amendment modified and introduced many other related aspects. For example, Article 11 increased the warranty granted to consumers from 3 to 6 months for new goods and to 3 months for used chattels.

On the other hand, Article 40 bis entitles the Directorate of Consumer Protection with the faculty of imposing an economic compensation in benefit of the users for the direct damage caused to their person or goods. The original text of the CPL did not contemplate an economic compensation in the administrative stage, only through a judicial proceeding for damages.

To conclude, Law Nº 26.361 constitutes a legal aid intending to reduce the supremacy of the supplier and find a balance point in the relationship between suppliers and consumers.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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