(photo credit: Courtesy)
Starting December 14, consumers in this country will be able to make a purchase,
take it home and change their minds. Not because there is anything wrong with
the product, not because they were misled, but out of pure
The seller is now required by law to give the buyer his/her
This legislation encourages consumers not to take
responsibility for their actions and promotes reckless shopping practices.
Forcing a merchant to cancel a sales contract without justified cause is against
the law of contracts, which respects the will of both parties in a transaction.
As a rule, once a sale has taken place, after being conducted in a proper manner
(i.e the buyer had all information needed to make a rational decision), both
parties must honor the conditions of the sale.
The Knesset is proud to
announce that this legislation makes us just like Europe or the US. But
overseas, there is no legislation on this. It is a matter of consumer policy,
initiated by the merchant to attract clientele. The fact that stores are proud
to announce that they refund your money if you are unhappy with your purchase is
good for competition.
Many stores and chains here adopted this policy
long ago. Over the last years, we saw a huge improvement in refund policies,
without compulsive regulation.
We should remember that the law already
affords consumers much protection. For example, every store’s return/refund
policy must be clearly visible, enabling the buyer to know what his/her rights
are before a purchase. This regulation balances the rights of the consumer to
enjoy fair trade and the rights of a merchant to act independently.
the law demands refunds, it becomes a different story. There are considerable
costs connected to canceling a sale: The product needs to be examined
thoroughly, repackaged and if that is not possible, it can be resold only as
As long as these costs are carried by the seller
willingly, there is no problem. But once cancellations and refunds become
compulsive, shop owners will surely be harmed financially. Moreover, the new
regulations will affect the seller’s economic sustainability: Even after a
transaction has taken, there is uncertainty as to the outcome of the
The new regulation actively encourages the consumer not to take
responsibility for his actions. There are some reservations however.
example, the new regulations do not include items under NIS 50. Clothes must be
returned within two days of purchase for the refund to be honored. Jewelry over
NIS 3,000 is not included.
Items must be returned unused, creating a
situation in which proving this will cause endless arguments between merchants
Once merchants are required by law to refund consumers
monetarily, it is important to have strict rules, which can be
counter-productive. Shops which previously had a lenient return policy may now
restrict it in order to abide by the law.
Keeping consumer protection in
line with the Western world is a desirable feat. However, the means to this end
should not be different than those enacted elsewhere.The author is head
of the legal department of the Federation of Israeli Chambers of Commerce