Having indicated early this year that it was reviewing and researching the possibility of introducing a lemon law in Malaysia, the government now says it is looking at getting something along those lines in place by next year.
According to domestic trade and cost of living (KPDN) minister Datuk Armizan Mohd Ali, his ministry is aiming to introduce such a law or amend existing acts related to defective vehicles in March next year to establish a more comprehensive consumer protection framework, Bernama reports.
He said that with that in mind, a group of law experts has been appointed to prepare a report on best practices implemented in several countries and hold engagement sessions with relevant parties. “They will start work from June until the end of September and submit a comprehensive report to the ministry,” he said.
Lemon laws are a form of consumer protection, and there have been calls to implement it here in the past. In essence, it requires cars under warranty that are found to be defective or unsafe to be fully repaired by the manufacturer. In the event the vehicle is deemed to be irreparable after a reasonable number of repair attempts, the buyer can be offered a refund or replacement.
The scope of what’s covered by lemon laws vary depending on how they are implemented, but it generally covers defects that can significantly impact the functionality or safety of the car. Countries such as the United States, Australia, Canada, Singapore and the Philippines have already adopted some form of lemon law.
Armizan said there are four laws with lemon law features such as the Consumer Protection Act (Act 599), the Contract Act 1950, the Sale of Goods Act 1950 and the Hire-Purchase Act 1967.
In the meantime, KPDN will implement two interim consumer protection strategies, the first of which is the establishment of a negotiation task force for motor vehicle complaints involving a tripartite negotiation between the ministry, buyers and distributors/manufacturers.
The special negotiation process will cover new private vehicles (cars or motorcycles) not more than six months old from the date of registration that are still under the valid warranty period and have yet to be modified, among other things. Armizan said consumers facing issues with their new motor vehicles, where initial claims or rectification with manufacturers have been unsuccessful, can submit their complaints through the ministry’s official channels.
The second strategy is strengthening the avenue involving the Tribunal for Consumer Claims Malaysia (TTPM), through the cooperation with Bank Negara Malaysia (BNM). He said the ministry is getting the central bank’s cooperation to facilitate the issuance of consent letters by banking or financial institutions to allow consumers to make compensation claims at TTPM or the court.
He said one of the constraints consumers face when seeking compensation for faulty new vehicles is the difficulty in obtaining consent letters due to ownership issues under the Hire-Purchase Act 1967, which only allows a vehicle to be transferred to the consumer upon the completion of payment. Armizan said that through this second strategy, it is expected that consumers can successfully resolve their claims at TTPM.
He added that the government hopes that industry players are willing to respond to the government’s aspirations in helping consumers and cooperate in protecting consumer rights, thereby fostering a fair and transparent market.
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