1. Foreword
Since the promulgation of China's Consumer Protection Law (hereinafter referred to as Consumer Protection Law) in 1931, litigation and non-litigation cases related to consumer protection have increased sharply. It is reported that in 1996, China's industrial and commercial administrations at all levels accepted 425,8 consumer complaints, 75 times that of 1 years ago. [1] These complaints involve quality, price, false advertisements, counterfeit goods, measurement and fraudulent sales. Among them, fraudulent sales cases increased the most, accounting for 137.9% of the previous year. [2] In this kind of cases, the most striking clause in the Consumer Protection Law is Article 49, which reads as follows:
If an operator commits fraud in providing goods or services, it shall increase the compensation for the losses it has suffered according to the requirements of consumers, and the compensation amount shall be twice the price of the goods purchased by consumers or the cost of receiving services.
It is this provision that has greatly stimulated the anti-fraud struggle known as the "anti-counterfeiting campaign" in recent years. There are many cases in which this provision is applied. In the streets, news media, courts, university classrooms and government agencies, these cases have become the object of discussion and even debate. Article 49 of the Consumer Protection Law has become a hot spot in the field of consumer protection in China.
of course, this is just the beginning. In order to make article 49 of the Consumer Protection Law more effectively used and promote the further development of consumer protection legislation, some legal issues need to be clarified. Therefore, it is worth trying to compare with the experience of Australian interests, especially with Article 52 of Australia's Trade Practices Act. [3] Article 52 of the Australian Commercial Law stipulates as follows:
Article 52 (1) An enterprise shall not mislead or deceive others in its trading or business activities.
(2) The following provisions of this article shall not be inferred as limiting the general provisions of the preceding paragraph.
This paper will first introduce several cases related to Article 49 of the Consumer Protection Law, then raise some legal issues, analyze them by comparative methods, and finally put forward some opinions in the conclusion.
2. Cases related to Article 49 of the Consumer Protection Law
1. Wang Hai's case of counterfeiting
In the spring of p>1995, Wang Hai, a young salesman from a factory in Shandong, came to Beijing on business. He happened to buy a book introducing the consumer protection law. He was attracted by Article 49 of the Consumer Protection Law. In order to verify the feasibility of this regulation, he came to Long Fu Building and saw a kind of "Sony" earphone marked "Made in Japan", the unit price was 85 yuan. He suspected it was a fake, so he bought a pair and found Sony's Beijing office. After being confirmed as a fake, he went back to Long Fu Building to buy 1 pairs of identical headphones, and then requested double indemnity in the shopping mall according to Article 49 of the Consumer Protection Law. The store agreed to return the first pair of headphones and compensate 2 yuan, but refused to give any compensation to the next 1 pairs on the grounds that he "bought fakes knowing them" and "took advantage of the law". Wang also felt angry. He believes that his purpose is not to make money but to protect the interests of consumers, so he is determined to continue fighting.
In the autumn of the same year, Wang Hai came to Beijing again. He visited many shops and bought goods that he thought were fakes. After confirmation, he asked the merchant double indemnity. Most shops met his requirements, but a few refused.
after Wang hai's action was disclosed by the news media, it caused repercussions all over the country. He was praised as a hero by most ordinary people and even many operators, and at the same time shocked the counterfeiters and sellers. In February, 1996,65438, China Consumer Foundation gave him a bonus.
At the same time, Wang Hai's practice has also become a controversial topic in the legal field. Some officials and scholars are critical of this. For example, an official of the Ministry of Internal Trade thinks that people who buy fake goods for profit and then demand double indemnity are not real "consumers" within the scope of current legislation, so people who "buy fake goods knowing they are fake goods" cannot get compensation. If you buy what you think, you are a consumer after using it, but you are not a consumer after using it. [4] There are also some scholars who believe that the behavior of "buying fake while knowing it" is immoral, and the benefits obtained from it belong to unjust enrichment. [5]
On the contrary, many legal workers and scholars support Wang Hai's behavior. They pointed out that the word "consumer" is relative to "operator", and anyone who deals with the operator should be regarded as a consumer except himself. In their view, it is ethical to "buy fakes knowing them" and then demand double indemnity, because it will help to crack down on counterfeit products, thus benefiting people and society. Others believe that the claimant's income cannot be described as unjust enrichment, because such claims are based on legal provisions and require a lot of time, manpower and expenses. [6]
In early 1996, Wang Hai moved to the south and bought fake claims in many big shopping malls. However, the envy of businessmen and the indifference of the local government forced him to return in vain. As some lawyers have summed up, the lesson is that there is no weapon of legal proceedings; It is not enough to rely solely on the pressure of news media and public opinion.
from 165438 to October, 1996, Wang Hai became the winning party in a court in Tianjin. Following the case of He Shan v Lewanda Commercial Bank (see below), he sued Isetan Co., Ltd. for fraudulent telemarketing. Therefore, he obtained the double indemnity in accordance with Article 49 of the Consumer Protection Law. [7]
2. Geng v. Nanjing Central Shopping Mall.
In the spring of p>1996, when Wang Hai was frustrated repeatedly in Nanjing, a consumer named Geng also experienced the same fate in a court in Nanjing. On October 4th, 65438, Geng bought three "Bai Sheng" brand warm shirts marked with "cashmere sweater" in Nanjing Central Shopping Center. On the invoice issued by the shopping mall, it is indicated that the goods are "cashmere shirts", but in fact the cashmere content of the goods is less than 2%. The next day, Geng asked the mall to pay double indemnity in accordance with Article 49 of the Consumer Protection Law on the grounds that the shirt was not cashmere and the mall was fraudulent. After being rejected, he filed a lawsuit with the court. The court rejected his request. The court held that the plaintiff had bought the same shirt in another shopping mall and received compensation before buying it from the defendant on October 4, 65438, and had a certain understanding of the goods. Another reason for the court's decision is that it is not improper to label a shirt containing 2% cashmere as a "cashmere shirt" and the defendant does not constitute fraud.
Li Yougen, a young scholar and a lecturer at Nanjing University Law School, wrote a paper and commented on the case of Gengmou v. Nanjing Central Shopping Mall. [8] He raised three issues that are considered to be very important in this case: First, whether the person who knows the fake belongs to the consumer, and whether he is entitled to the relief of the Consumer Protection Law? Second, can the defendant's way of selling goods be regarded as fraud? Thirdly, if the plaintiff knows the truth, can this way of the defendant still be regarded as fraud, so the provisions of the Consumer Protection Law on double indemnity can be applied?
Li Yougen pointed out that there is a paradox in the judgment that "those who know and buy fakes are not consumers". If you know that the buyer of fake goods is not a consumer, according to the Consumer Protection Law, he is not qualified to ask for a return, so you can only use it. In this way, he became a real consumer.
Li Yougen believes that one of the criteria for determining fraud is the provisions of the law. Article 19 of the Law on the Protection of Consumers' Rights and Interests stipulates: "Business operators shall provide consumers with true information about goods or services, and shall not make misleading false propaganda." According to the relevant regulations of the Ministry of Textile, cashmere products with cashmere content less than 5% cannot be called cashmere products. Another criterion is the cognitive level of ordinary consumers (not experts). On this basis, he believes that shopping malls constitute fraud, because shirts with only 2% cashmere content cannot be called "cashmere shirts" in the eyes of ordinary consumers.
3. He Shan v. Lewanda Commercial Bank He Shan is an official of NPC Law Committee and participated in the drafting of Consumer Protection Law. In April 1996, I bought two paintings in Lewanda Commercial Firm, which deals in celebrity calligraphy and painting. These two paintings, one of which is a single horse and the other is a group of horses, are sold as the original works of the late master of Chinese painting, Mr. Xu Beihong. A month later, He Shan filed a lawsuit in Beijing Xicheng District Court on the grounds of "suspected falsehood and requesting protection". In August 1996, the court ruled that the two paintings were imitations, and the defendant had committed fraud. Therefore, according to Article 49 of the Consumer Protection Law, the defendant was ordered to sue the plaintiff double indemnity. [9]
This case has aroused widespread concern and many discussions. In October, 1996, the second double indemnity Symposium on Stopping Fraud was held in Beijing. At the meeting, how to correctly understand the legislative intent of Article 49 of the Consumer Protection Law once again became the central topic. Su Chi, vice president of No.1 Middle School, expressed his opinions at the meeting. He pointed out that the meaning of "for daily consumption needs" mentioned in Article 2 of the Consumer Protection Law should not be interpreted restrictively. According to its original intention, the word "consumer" only refers to people other than producers and operators. [1] He advocates treating all customers who go to the store as consumers; As for the motivation and purpose of buying, it may involve moral issues, but it does not belong to legal issues. [11] Zhang, the president of the civil trial court of Haidian District People's Court in Beijing, reached the same conclusion according to the trial practice of his court. In his view, article 49 of the Consumer Protection Law should be applied as long as there is fraudulent behavior by commodity operators, regardless of consumers' shopping motives. [12]
Mr. Su Chi responded to the view that "fraud must be intentional". He pointed out that merchants are obliged to carefully check the goods they operate when purchasing. Those who fail to fulfill this obligation are at least subjectively laissez-faire and should be regarded as intentional. [13]
After He Shan v. Lewanda Commercial Bank, many cases based on this model were brought to court. But not all plaintiffs have got satisfactory results. The next case is an example.
4. Xue Ping v. Beijing Yansha Friendship Mall.
in March p>1997, Xue Ping bought three terracotta warriors and horses of Qin Shihuang in Yansha Friendship Mall. A few days later, she learned that the terracotta warriors and horses were imitations, so she negotiated with the shopping mall and demanded compensation at twice the selling price. After being rejected, she filed a lawsuit with the People's Court of Chaoyang District, Beijing on the grounds that the goods did not have any marks that could indicate that they were imitations. The mall counterclaimed that the plaintiff knew that these terracotta warriors and horses were imitations when they bought them, and the purpose of their purchase was to obtain double indemnity, which constituted fraud. The court held that the plaintiff should know that the goods she bought could not be genuine, because the Terracotta Warriors and Horses of the First Qin Dynasty were precious cultural relics prohibited from market transactions by the state. That is to say, normal consumers should realize that goods are imitations when sellers neither tell the truth nor call them genuine. On the other hand, the court also held that the defendant should have made a rigorous and clear explanation of the nature of the goods by clearly stating that the Terracotta Warriors and Horses were imitations, so that no one would misunderstand. Finally, the court ruled that the defendant returned the goods, rejected the plaintiff's other claims, and both parties bear half of the litigation costs. [14]
Third, the legal analysis of Article 49 of the Consumer Protection Law
As can be seen from the above cases, the provisions of Article 49 of the Consumer Protection Law are still inconclusive in some major aspects. Many different opinions expressed by people are certainly valuable, but most of them are limited to the interpretation of legal provisions. Besides, we should realize that we should not only interpret the law, but also reform and develop it.
as far as article 49 of the law on the protection of consumers' rights and interests is concerned, I want to point out that in the discussion around the above cases, an important thing has been neglected, that is, the nature of this article, which should have been the starting point of argumentation and reasoning.
1. nature and purpose
in China, it has been recognized that article 49 of the consumer protection law belongs to punitive damages in nature, which is the first legislative case in China to apply punitive damages. [15] As we all know, punitive damages have never been recognized as a form of civil liability in the civil law system. China's General Principles of Civil Law follows this tradition, so there is no provision for punitive damages in this law. It is believed that "civil liability aims at restoring infringed civil rights" in principle, so "most forms of civil liability are not punitive". [16] However, some civil law scholars insist that civil liability has dual functions: on the one hand, it can curb illegal acts through sanctions; On the other hand, through compensation, the damaged rights are relieved. [17] This view leaves room for the determination of punitive damages. Another factor to be mentioned here is China's compromise attitude towards major legal systems in "learning from foreign experience". We do not hesitate to adopt the punitive damages system, because it meets the needs of our society, regardless of whether it conforms to the conceptual system of the civil law system. In addition, we adopt this system according to the social conditions in China. Therefore, there is a certain degree of difference between punitive damages in China's current law and punitive damages in common law system.
in the common law system, "punitive" compensation refers to the compensation awarded to one party to punish the other. In addition to compensatory damages, courts usually apply this principle in some cases (such as fraud). "It not only declares the court's disapproval of the defendant's behavior, but also aims to prevent him from repeating this behavior and may further prevent others from imitating it." [18] The main purpose of punitive damages is to "punish and stop" offenders. [19]
However, in China, Article 49 of the Consumer Protection Law has another purpose, which is to encourage consumers to crack down on fraud and counterfeit goods (besides punishing and stopping them). [2] According to the experience of Chinese and foreign consumer protection movements, this kind of encouragement is very important for the purpose of punishment and suppression. We know that in the modern market, there are many scattered incidents of selling fakes and committing fraud. First of all, because of the high frequency of this kind of behavior, selling fake goods or providing services fraudulently is not only an infringement on the private interests of individual consumers, but also an infringement on the interests of all consumers. In China, consumer rights are essentially social rights, not pure private rights. Therefore, fraud in consumer protection law is a special tort; The law should take special measures to control this kind of behavior. Secondly, due to the dispersion of this behavior, there is a problem of "responsibility probability". That is to say, in practice, a large number of consumers give up their claim for various reasons, which makes the cost paid by the actor because of his illegal behavior far lower than the profit he gets from it, and the implementation of this kind of infringement has become a profitable activity. The provision of punitive damages can increase the number of cases in which the right of claim is exercised and the amount of compensation in a single case, and increase the "probability of taking responsibility", thus making the wrongdoer feel unprofitable and even suffer losses. In this way, this behavior can be reduced. Another consideration in adopting punitive damages in legislation is the claimant's expenses. In legal practice, the compensatory damages received by the injured consumers are often lower than their actual losses. Some costs, such as cost and time, energy and anxiety, are also difficult to be compensated through judicial procedures. This is also a reason why many consumers are unwilling to take their rights seriously. Punitive damages are expected to provide more adequate compensation for the claimant.