Once a consumer pays more than 70 per cent of the cost of an item bought through a hire purchase arrangement, companies will have to get a court order to seize that item if a payment is missed because of the newly-passed Hire Purchase Bill.
The Bill, piloted by the Minister of Tourism, Industry and Commerce Oneidge Walrond, was passed with amendments in the National Assembly on Wednesday.
The Bill was tabled in 2020, after being pursued for a number of years. It was subsequently referred to a special Parliamentary Select Committee and underwent consultations with stakeholders in the wider public.
During that time, the Bill was amended to deny sellers the ability to forcibly enter a customer’s premises to reclaim goods sold in a hire purchase arrangement. If they wish to do so but the customer has paid a majority of the hire purchase price (70 per cent), a court order must first be sought.
But government parliamentarian Sanjeev Datadin explained that if a court can be guaranteed that the consumer will make the payments in a timely manner, having already paid that majority, then the court can protect the consumer from having the goods seized.
Once the Bill becomes law, Minister Walrond said that consumers’ rights will be better protected. In particular, the worrisome practice of repossessing goods, even when consumers have nearly repaid the cost and interest accumulated, will be addressed.
“Nothing could be more unconscionable than this and the bill would cure such mischief once and for all,” Minister Walrond said.
She also related that the Consumer and Competition Affairs Commission, over a five-year period, recorded numerous complaints of this specific issue. Those complaints accounted for some $200 million in goods/ products.
Notably, though, if the consumer has paid less than 70 per cent of the cost, the seller must first serve a 21-day notice indicating that the product will be seized if payments due are not made.
If those payments are not made, a court order would not be required before sellers seize their products.
She also noted that sellers will be mandated to prominently incorporate the new provisions in agreements of sale.
Other provisions included in this Bill a seven-day “cooling off period” wherein the buyer may cancel the agreement of sale; if that is done, the buyer can recover monies paid but a restocking fee of no more than 10 per cent can be taken out.
The commercial registry has also been designated as the body to register notices of sale and subsequent cancellations of those. An electric register shall also be created.
This Bill did receive bipartisan support but some opposition parliamentarians opined that the Bill should have addressed the high interest rates that some sellers include in hire purchase arrangements.
Opposition parliamentarian Haimraj Rajkumar, who served as a Minister of Business under the previous APNU+AFC administration, suggested that the Bill be sent back to a special select committee for further review.
APNU+AFC Member of Parliament (MP) Khemraj Ramjattan expressed similar sentiments, noting that high interest rates plague many consumers.
“Yes, indeed we support but please do not give the impression that we did not do something to further enhance the plight of the working class people,” Ramjattan said
Government MPs, however, noted that doing so may lead to worrying concerns of price controls in Guyana. Minister Walrond, in closing statements, alluded to the possibility of further revisions eventually.