When the Consumer Protection Act comes into effect in October 2010, companies are going to need to adjust their customer loyalty programmes in order to comply with the new requirements of the Act.An article on Bizcommunity reports that loyalty programmes will need to be revised in order to ensure that consumers’ fundamental rights are protected, including the right to fair, reasonable and responsible dealings with companies and their loyalty programmes.

Ina Meiring, the Director at Werkman’s Attorneys, is encouraging companies to start revising their loyalty programmes sooner rather than later, in order to comply with the Act when it becomes law in October next year. She stresses that “this is not a matter of ‘tweaking’ here and there but, in many cases, of completely rewriting the terms and conditions of loyalty programmes.”

Below is a brief outline of how customers will be protected in terms of the new restrictions on loyalty programmes:

• The terms and conditions of the loyalty programme and its awards must be made clear to customers at all times.
• The goods and services offered to customers (in exchange for loyalty points) need to be available at all times. Companies need to follow a specific procedure which gives customers ample warning if a good or service will not be available at any given time.
• Companies cannot ask customers to pay additional charges for goods or services associated with loyalty points.
• The goods or services involved in loyalty programme-related transactions will be of good quality, and there will be recourse for defective products.

For a detailed version of these requirements, click here to read the full Act.