Consumer bill seeks to block false advertising, unfair trade practices

A draft of what would be Cayman’s first Consumer Protection Law seeks to shield buyers from unfair trade practices, bogus advertising and contract rip-offs, but prescribes no specific legal penalties for many of those activities when they occur.

The draft legislation is not the final word on the matter. It has been put out for public comment by the Cayman Islands Law Reform Commission until March 1. The comment period was extended last week, in order to provide more opportunity for input. Once comments have been received, the bill is expected to be amended further before it goes to the Legislative Assembly for approval.

The law commission has been pushing to create such consumer protection rules for nearly a decade, noting in a 2010 report that “consumer protection is essential against those who profit from mass consumption, engage in cost-cutting measures at all levels of production and, at the same time … adopt predatory practices which ultimately abuse customer interests ….”

Cayman currently operates a “caveat emptor” consumer system, where the buyer is solely responsible for reviewing the quality and suitability of the goods or services being sold prior to purchase. There is some protection against price gouging during emergencies – hurricanes or other natural disasters. The Cayman Chamber of Commerce also functions as something of a “better business bureau” for its membership, but if a business is not a Chamber member, there is little the agency can do to protect buyers.

The draft bill, which was issued last October, seeks to establish “a legal framework for the achievement and maintenance of a consumer market that is fair, efficient and responsible.”

The law, if passed, would apply to “all persons engaged in a trade or business.”

The legislation seeks to create a Cabinet-appointed Consumer Affairs Commission, consisting of five people that would be given the powers of a court to request information in consumer-business disputes and to investigate consumer complaints. The commission is given the power to order certain penalties for those who violate the law and is tasked with providing general information on consumer rights.

Orders given against wayward companies or service providers by the commission can include demands to replace defective or unsafe goods, to discontinue unfair trade practices, to pay compensation to consumers if a breach of law occurs and to correct erroneous advertisements.

Goods and services suppliers that do not comply with commission orders can receive up to a year in prison or a $5,000 fine. A person who is aggrieved by a commission order may appeal to the court within 30 days of the order.

The draft bill encourages the creation of nonprofit groups that might provide for the promotion and protection of consumer rights, but it does not seek to govern such entities within the proposed legislation.

The draft bill also sets out certain “rights” given to the consumer, including the right to refuse unsolicited goods, the right of the consumer to authorize services and rights to avoid “unreasonable” cancellation charges. The draft bill seeks to allow consumers to halt “continuing service agreements” three weeks after giving notice.

The legislation would set out “guarantees” in relation to the supply and quality of goods or services provided. The supplier or manufacturer which breaches those guarantees is said to be “liable to such penalties as may be described” in the draft language of the bill.

The bill seeks to define unfair trade practices in a number of ways including:

  • Falsely representing that goods are of a particular standard or quality
  • Making false or misleading representations concerning the price of goods or services
  • Making false or misleading statements about the existence of a warranty on a product
  • Engaging in conduct liable to mislead the public about the nature of a product or a service.

It also outlaws the practice of “dual pricing,” listing separate prices for an item and charging the higher of the two.

“A supplier shall not, in trade or business advertise for supply at a special price goods or services that he does not intend to offer for supply, or that he has no reasonable grounds for believing he can supply,” section 82 of the draft bill states.

Again, the specific penalties for unfair trade practices have not been defined in the draft bill.


Another area the Consumer Protection Bill introduces, which has not previously existed in Cayman, is the compulsory recall of goods.

For example, supermarkets can voluntarily recall goods they sell, particularly if a recall has been ordered in the U.S., but they are not forced to do so.

The draft bill would allow for mandatory recalls of products if the commission becomes aware that certain goods “are of the kind which will or may cause injury, loss or damage to any person and that the supplier has not taken satisfactory action to prevent the goods from causing injury, loss or damage ….”

The mandatory recall would need to be authorized in writing by the commission members, which can authorize a refund for the product if circumstances warrant.


  1. These are Law Makers making Law to Protect the People of the Islands .
    For example the USA can do a recall on a product, but the Supper market can volunteer to remove it , but are not forced to remove it . So what happens when the Supper market refuse to ? Just like most of the Laws without teeth . So then everything else in the Law is of no protection to the consumer.

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