Scoop Clothing CC v National Consumer Commission (NCT/178145/2021/101(1)) [2021] ZANCT 39 (3 September 2021)

IN THE NATIONAL CONSUMER TRIBUNAL

HELD VIA THE MICROSOFT ON-LINE PLATFORM

Case Number: NCT/178145/2021/101(1)

In the matter between:

SCOOP CLOTHING CC APPLICANT

AND

NATIONAL CONSUMER COMMISSION RESPONDENT

Coram:

Ms. P A Beck -Tribunal member

Prof. T Woker - Presiding Tribunal Member

Adv. F Manamela - Tribunal Member

Date of adjudication 3 September 2020 via Microsoft audio and video transmission

JUDGMENT AND ORDER

APPLICANT

1. The Applicant is Scoop Clothing CC (the “Applicant,”) a close corporation duly incorporated and registered as such in terms of the Close Corporations Act 69 of 1984 with its principal place of business at 1 Village Park, 2 Inkonka Road, Kloof, 3610.

2. The Applicant was represented by its sole member Ms. Angela Drysdale.

RESPONDENT

3. The Respondent is the National Consumer Commission (the “NCC or the Commission”) an organ of state established in terms of section 85(1) of the Consumer Protection Act 68 of 2008 ( the" CPA") having its registered address at SABS Offices, 1 Dr Lategan Road, Groenkloof, Pretoria, (hereinafter the “Respondent” or the “NCC”.)

4. Mr Ludwick Biyana, a legal advisor in the employ of the NCC represented the Respondent at the hearing.

APPLICATION TYPE

5. This is an application to the National Consumer Tribunal (the “Tribunal”) to review the compliance notice issued by the NCC in terms of sections 60(3) and 101 of the Consumer Protection Act 68 of 2008, (the “CPA.”) The Applicant applied to the Tribunal objecting to the compliance notice dated 10 December 2020, which the Respondent issued against the Applicant in terms Regulation 42 of the CPA.

6. The Applicant brings this application to the Tribunal under section 101 of the CPA. The Applicant asks the Tribunal to review and set aside in whole or in part the compliance notice, or to modify the compliance notice on grounds that the Respondent has incorrectly interpreted the Act and Regulations; and that the actions of the Respondent are unreasonable.

CONDONATION FOR LATE FILING OF THE APPLICANT

7. On 3 February 2021, the Applicant filed an application with the Tribunal to review a compliance notice issued by the Commission in terms of section 60(3) or 101 of the CPA. The Application was filed on the Respondent on the same day.

8. On 10 February 2021, the Registrar issued a Filing Notice and served it on the parties via e-mail.

9. On 25 February 2021, the Respondent served and filed its answering affidavit. On 16 March 2021, the Applicant filed her replying affidavit. On 27 March 2021, the Applicant filed an application for condonation for failing to comply with a rule or procedure in terms of rule 34 of the Tribunal rules. She had filed her replying affidavit on the Registrar of the Tribunal on time on 10 March 2021, but did not know that she had to serve it on the Respondent before filing it with the Tribunal.

10. Condonation for the late filing of the Applicant’s replying affidavit was granted on the basis that the delay was minimal; the Applicant a lay person; and the explanation for the delay reasonable.

APPLICATION FOR A POSTPONEMENT

11. At the hearing of the matter the Respondent requested a postponement of the matter from the bar in order to amend its papers. The need to do so is based on an issue raised in the condonation judgment that the filings on record do not include an investigation report. The Respondent submitted that it had not formerly filed an application for a postponement but had discussed it with the Registrar of the Tribunal. The Registrar told the Respondent that he should file a condonation application. The Respondent’s legal advisor submitted that he had also discussed the request to postpone the matter with the Applicant. The Applicant was not amenable to the request for a postponement.

12. In response to the request for a postponement of the matter, the Applicant submitted that she opposed the request for the postponement. She stated that she had previously requested an earlier hearing date from the Tribunal and that the matter was moved forward from October 2021 to 3 September 2021. She is aware that the Respondent wished to amend its papers but to date she has not received any details of the proposed amendment. The Applicant submitted that her goods have been held at customs since October 2020. She has a very small business and it is her livelihood as a single mother to support herself and her daughter. Her income has been limited since her goods have been held at customs and she wanted the matter to be finalised as soon as possible.

ORDER – APPLICATION FOR POSTPONEMENT

13. The Tribunal considered the Respondent’s request for a postponement and the opposing arguments of the Applicant. Rule 34(2) provides that: “The Tribunal may grant the order on good cause shown.”

14. After listening to the parties, the Tribunal refused the application for a postponement for the following reasons:

14.1 The Respondent has not filed a formal application for a postponement in terms of the rules;

14.2 A condonation application is not before the Tribunal in terms of the rules;

14.3 The Respondent received the notice of set down on 10 June 2021 and had ample time to file an application for a postponement or a supplementary affidavit;

14.4 The parties are not in an equal bargaining position and the Respondent had all the resources since 10 June 2021 to deal with the matter;

14.5 The Applicant’s goods have been detained at customs for the past 10 months; and

14.6 It is therefore in the interests of justice for the matter to proceed and to be finalised.

BACKGROUND

15. For the past 19 years the Applicant ran her own small business. Initially she owned a small retail boutique selling mainly women’s accessories. When mall rentals became too high she registered her brand known as “Intangible,” to wholesale a limited range of ladies accessories to the independent retail market.

16. For many years she travelled twice a year to the East to buy small quantities of carefully selected, upmarket goods which were not produced locally. To date she imported about 40 relatively small shipments with customs inspections taking place without failing an inspection.

17. In 2020, date not specified in the Applicant’s affidavit, the Applicant, due to Covid-19 could not travel to the East to view merchandise, negotiate with suppliers, and to give direct and detailed instructions to suppliers. Without being able to properly view the merchandise and with communication challenges, she placed her order with a great difficulty, using “We-Chat,” the Chinese equivalent of “Whatsapp.”

18. In order to minimise her risk, these stock items were by and large repeat items of previous orders in new print designs. Care labelling had previously been attached and the Applicant expected that her supplier would do the same with this order. She requested that her brand label be attached to the garments.

19. The Applicant ordered 95 different styles/designs/colours off pictures. Of this number:

19.1. 17 were silk necktie scarves – which she had purchased before in different designs;

19.2. 33 were polyester satin necktie scarves which she had ordered before; and

19.3. 45 were new print qualities in full size scarves.

20. In an e-mail dated 29 October 2020, the Applicant received notification from the South African Revenue Services (‘SARS”) that a certain consignment imported through the Durban Port of entry on behalf of the Applicant was detained by the Customs Department of SARS under case number 362486574.

21. The detention of the goods was on behalf of the Respondent in terms of Section 113(8)(a) of the Customs and Excise Act 91 of 1964. The basis of the detention was that the goods do not comply with the labelling requirements of Regulation 6 as published in Gazette number 293 of 1 April 2011 (the “Regulations”) published in terms of Section 120(1) of the CPA.

22. The Applicant submits that there was no intention on her part to import goods without the correct labelling; there was no financial advantage in doing so; there was no false labelling on the scarves to mislead the consumer; and there is no loss to SARS by the omission. The Applicant submits that she can only assume that the error came in when the care labelling was removed to add her brand label. When she queried this with her supplier she was told that she had not been specific.

23. The Applicant submits that the total landed cost of the shipment is the amount R159 000.00. The loss mark-up due to her inability to sell the goods is a further R100 000.00. Should the goods be destroyed she would lose R260 000.00 which amounts to a year’s income. The Applicant is a single mother and supports herself and her daughter with the income from this small business.

24. On 10 December 2020 the NCC issued a compliance notice to the Applicant which stated that the contents of the Applicant’s shipments do not comply with Section 24(5)(a) read with Regulation 6(1)(a)(i) and (b) of the CPA.

25. The compliance notice elaborated further that the goods do not comply with the Act in the following respects:

25.1. “The goods do not contain any trade description and they do not contain country of

origin as contemplated in the Act. This is a contravention of section 24(5)(a) read with Regulation 6(1)(a)(ii); and

25.2 the goods do not conform to the South African national standards for fibre content and care labelling as required in terms of the Provisions of Government Notice No 2410 of 2000 published in Gazette of 30 June 2000 and that this is a contravention of Regulation 6(1)(b.)”

26. The compliance notice further detailed the steps the Applicant was required to take in order to satisfy the notice. The Applicant is required to:

26.1. remove the goods to their country of origin at her own cost ; alternatively;

26.2. immediately at her own cost have the goods mentioned in 25.1 (of the compliance notice) destroyed locally at an accredited destruction facility;

26.3. remove or destroy the goods referred to in 25.1 (of the compliance notice) within 15 business days of receipt of the compliance notice; and

26.4. refrain from importing goods, into the Republic of South Africa, in contravention of the following provisions of the Act:

26.4.1 Section 25(5)((a) read with Regulation 6(1)(a)(i) and 6(1)(b).

27. The notice included reference to a penalty that may be imposed in terms of the CPA of an amount of 10% of the Applicant’s annual turnover or 1 million should the steps referred to in paragraph 25 of the compliance above not be taken by the Applicant.

28. The Applicant seeks an order setting aside the compliance notice; in the alternative an order for the amendment of the compliance notice to allow for the embargoed release of the goods to enable the compliant tags to be sewn onto the goods in the Republic.

THE RESPONDENT’S CASE

29. The salient issues raised by the Respondent are set out below.

30. The Respondent contends that the goods are non-compliant and in contravention of the Act and Regulations because at the time of the goods arriving in the Republic:

30.1. The goods did not contain a trade description or indicate the country of origin as contemplated in the Act; and

30.2. The goods did not conform to the South African national standards for fibre and care labelling as required by the provisions of Government Notice No 2410 of 2000 published in Gazette of 30 June 2000 and that this is a contravention of Regulation 6(1)(b.)

31. The Respondent argued that the Applicant’s intention to rectify the non-compliance by attaching compliant labelling whilst the goods are already in the country is not permissible in terms of the CPA.

32. The Respondent avers that the Applicant’s grounds for review of a compliance notice cannot stand in law because they do not constitute valid grounds for the review or setting aside of a compliance notice. The Respondent asks the Tribunal to dismiss the application on the basis that the Applicant failed to make out a proper case for such a relief and for an administrative fine of 10% of the annual turnover of the Applicant or R1 million, whichever is the greater.

33. Respondent submitted further that –

33.1. the compliance notice was issued by an authorised person in accordance with an established legal basis; making it valid for the conduct identified as a contravention of the CPA ; issued to the correct party; and in a fair, reasonable and legal manner; and meeting all the requirements of the Promotion of Administration of Justice Act 3 of 2000; and

33.2. the Respondent avers that the Applicant cannot therefore, pursue a legal remedy to rectify labelling once goods have entered the Republic, if the incorrect labelling arises in connection with the Applicant’s own illegal act.

34. The Respondent asks the Tribunal to dismiss the Applicant’s grounds for the review application and to uphold the compliance notice.

ANALYSIS OF THE CASE – THE LAW AND THE FACTS

35. Chapter 6, Part A of the CPA, titled: “ENFORCEMENT OF ACT”, section 99 thereof, provides the following: “The Commission is responsible to enforce this Act by-

(a) …….

(b)………

(c)…..….

(d)……….

(e) issuing and enforcing compliance notices” (underlining, own emphasis).

36. Section 100 (1) of the CPA provides that, subject to subsection (2), the Commission may issue a compliance notice in the prescribed form to a person or association of persons whom the Commission on reasonable grounds believes has engaged in prohibited conduct. Subsection (4) states that a compliance notice issued in terms of this section remains in force until it is set aside by the Tribunal, or a court upon review of a Tribunal decision concerning the notice, or the Commission issues a compliance certificate contemplated in subsection (5.) In terms of subsection (6), the Commission may either (a) approach the Tribunal for the imposition of an administrative fine; or (b) refer the matter to the National Prosecuting Authority, if a person to whom the compliance notice is issued, fails to comply with the notice.

37. The Applicant appeals to the Tribunal on the following grounds:

37.1 the error on the labelling of the garments was beyond her control;

37.2 the Applicant cooperated with the Respondent in attempting to resolve the issue of the labelling;

37.3 the Applicant offered to rectify the error or the non-compliance;

37.4 the destruction of the goods or sending the goods back to the supplier for re-labelling

would “kill” her small business; is costly which far outweighs the error or the non-compliance;

37.5 should the Tribunal grant the Applicant an opportunity to remedy the labelling she has already identified a company that could undertake and complete the labelling within2/3 days; and

37.6 the Respondent could inspect the correctness of the labelling before the goods are offered for sale to consumers.

38. According to the Respondent, the Applicant has proposed to rectify the non-compliance by removing the “incorrect labels,” and replacing them with the “correct’ ones.” The Respondent, although sympathetic to the Applicant, argues that by replacing the “incorrect labels,” the Applicant has to be allowed to complete the importation of the goods. This alone, according to the Respondent, is a contravention of the CPA. The Respondent is bound by the CPA that only provides or two options in the case of non-compliance to (i) return the goods to their country of origin for correct labelling or (ii) to destroy the goods. The Respondent cannot act outside of the CPA.

39. At this point it would be pertinent to look at the purpose of the compliance notice. The purpose of the compliance notice is to bring an end to the prohibited conduct of importing goods in contravention of the CPA and the Regulations, and to prevent the repeat of similar conduct from occurring in the future. The compliance notice is issued on account of a violation, which may be escalated to higher level in the event of non-compliance by the recipient of the notice. It is a step to correct a certain breach of law or by-law. If the recipient of the notice queries or disputes the issuing of the notice, he/she may apply for its variation through established tribunals. By issuing the compliance notice, the Respondent requires the Applicant to amend its conduct. In the matter before us the Applicant has not disputed the purpose of issuing the compliance notice; or that she has contravened the CPA.

40. Section 22(1)(b) of the CPA states as follows:

“The producer of a notice, document or visual presentation that is required, in terms of this Act or any other law, to be produced, provided or displayed to a consumer, must produce, provide or display that notice, document or visual representation –

(a)….

(b) in plain language, if not form has been prescribed for that notice, document or visual representation.”

41. Regulation 6(1)(a)(i) states as follows:

Product labelling and Trade descriptions: textiles, clothing, shoes and leather goods.

“(1) In order to assist consumers in making informed decisions or choices, for purposes of subsections (4) and (5) of section 24 of the Act and subject to sub regulation (2), the importation into or the sale in the Republic of the goods specified in Annexure “D,” irrespective of whether such goods were manufactured or adapted in the Republic or elsewhere, is prohibited unless –

(a) A trade description, meeting the requirements of section 22 of the Act, is applied to such goods in a conspicuous and easily legible manner stating clearly –

(i) The country in which they were manufactured, produced or adapted.”

42. The Applicant undertook to amend the labelling of the goods and in so doing has admitted that

the goods are in contravention of the CPA and the regulations.

43. The definition of an importer is as follows:

“with respect to any particular goods, means a person who brings those goods, or causes them to be brought, from outside the Republic into the Republic, with the intention of making them available for supply in the ordinary course of business.”

44. It is obvious to the Tribunal on a plain reading of the definition of an “importer” in the Act, that the Applicant falls squarely within the definition of an importer, and that any argument that the Applicant only becomes an importer of goods once the goods enters the Republic cannot be sustained, and is therefore rejected by the Tribunal.

THE INVESTIGATION REPORT

45. If regard is had to the content of the compliance notice, it is evident that it does not contain the results of an investigation by an inspector on behalf of the Respondent. This is apparent from the fact that paragraphs 1.1 to 1.3.2 of the compliance notice merely set out the allegations made by the Respondent without substantiation which presumably would have resulted from an investigation.

46. There is no indication of the veracity of these complaints having been investigated by the Respondent. There is no evidence before the Tribunal that the Respondent engaged with the Applicant beyond what has been set out in the chronology of events as set out in its founding papers.

47. Section 73(1) of the CPA provides as follows:

“73 Outcome of investigation

(1)After concluding an investigation into a complaint, the Commission may…”

48. It is evident from the provisions contained in this section that the “investigation” by the Respondent is a jurisdictional fact which is a pre-condition for the exercise of the Respondent’s powers to issue a compliance notice or take any other action provided for in the remainder of that section.

49. In the matter of City of Johannesburg v NCC[1] the Tribunal considered this issue and held as follows:

“The Tribunal is of the view that the Respondent should have conducted an investigation into each complaint before issuing a compliance notice for the following reasons:

Section 72 sets out a number of different options which the Respondent may elect to follow when a complaint is received. This applies regardless of whether a consumer or the Respondent initiates the complaint and it is unclear why the Respondent is of the view that there is a distinction between the situation where a consumer lays a complaint and the Respondent itself decides to initiate an investigation. It seems that the Respondent’s interpretation of the Act is incorrect on this point. Although section 72 uses the word “may”, it concludes with the words ‘in any other case’ which is a clear indication that the Respondent chooses from one of these four options when it receives or initiates a complaint. It must be noted that this approach is supported by the Respondent itself in the compliance guidelines which it has published. Section 73 states as one of the outcomes of an investigation, that the Respondent may issue a compliance notice in terms of section 100. This compliance notice is issued after an investigation is concluded.

Section 100 states that the Commission may issue a compliance notice to a person whom the Commission on reasonable grounds believes has been engaged in prohibited conduct. If all these sections are read together, it seems to the Tribunal that the legislature intended that a compliance notice should be issued after an investigation was completed because only after having conducted an investigation, can an investigator have reasonable grounds for believing that prohibited conduct is involved. If an investigation is not conducted, then the compliance notice will be based on unsubstantiated allegations and assumptions. The Respondent will also not be able to supply details relating to the nature and extent of the non-compliance.”

50. The same aspect was addressed in the judgment in the matter of Murray, Cloete N.O., Klein, Norman N.O & Edwards, Elizabeth Margaret NO v NCC and 3 others and Auction Alliance (Pty) Ltd v NCC & 2 Others[2] and the considerations need not be repeated herein. It has become trite that a compliance notice may only be lawfully issued once an investigation is concluded.

51. The Tribunal notes that in the answering affidavit the Respondent does not mention the name of the investigator who conducted the investigation nor is the name of the investigator mentioned in the compliance notice. In paragraph 9 of the Respondent’s answering affidavit, the deponent Ms. Thezi Mabuza, the Deputy Commissioner of the Respondent stated: “Respondent in response thereto dispatched its investigator Mr ( ) to conduct an inspection to verify the information contained in the detention notice from SARS.” Furthermore the Respondent did not file the nameless investigator’s report and confirmatory affidavit which is critical before issuing a compliance notice to the Applicant. Thus all of Ms. Mabuza’s averments concerning the investigation would constitute inadmissible hearsay evidence. On the strength of this failure alone the compliance notice is fatally defective and stands to be set aside.”

52. It was further established in the matter of City of Johannesburg v NCC that the issuance of a Compliance Notice by the Respondent constitutes administrative action. Section 3 of the Promotion of Administrative Justice Act (“PAJA”) sets out the requirements for procedurally fair administrative action and provides that an administrator must give a person whose rights are affected by such action:

52.1 adequate notice of the nature and purpose of the proposed administrative action;

52.2 a reasonable opportunity to make representations;

52.3 a clear statement of the administrative action;

52.4 adequate notice of any right of review or internal appeal, where applicable; and

52.5 adequate notice of the right to request reasons in terms of section 5.

53. It is specifically the requirement of “adequate notice of the nature and purpose of the proposed administrative action” and “a reasonable opportunity to make representations” that is relevant to the present matter. In order for the issuance of the compliance notice to be lawful, the Respondent would have had to adhere to these requirements. There is no evidence before the Tribunal that this was done. Upon being questioned by the Tribunal as to whether or not the action of the Respondent when issuing a compliance notice is administrative action, the Respondent confirmed that the action of the Respondent is an administrative act.

54. There is no evidence before this Tribunal that there was any communication between the nameless investigator and the Applicant before the compliance notice was issued as envisaged by section 3. It is evident from these submissions that the procedure followed by the Respondent does not comply with the requirements for procedurally fair administrative action as set out in Section 3 of PAJA. The administrative action taken by the Respondent is therefore unlawful. Accordingly, the compliance notice for these reasons alone stands to be set aside.

THE MERITS

55. It is clear when applying the law to this set of facts that the CPA prohibits the importation of incorrectly labelled goods. The Respondent, although stating at the hearing that it is sympathetic to the Applicant’s problem, is of the view that there is no procedure in the CPA to deal with this situation. According to the Respondent there are only two alternatives available to the Applicant – send the goods back to the manufacturer for correct labelling or destroy the goods. This approach has enormous financial consequences for any importer. This is extremely harsh from the Applicant’s perspective, especially when the circumstances of this particular case are taken into consideration.

56. The effect is that despite the Respondent arguing that this is not to be regarded as a punishment, there is no doubt that the compliance notice’s directive is punitive in nature. This is not (as confirmed by the Respondent at the hearing) the purpose of a compliance notice.

57. The purpose of a compliance notice is to ensure that the supplier/importer complies with the CPA and other legislation – it is not to punish the importer – otherwise surely the Respondent would simply have imposed an administrative penalty. Even the Respondent confirmed this at the hearing – that the true aim of a compliance notice is to ensure compliance by an importer such as the Applicant with the CPA. The purpose of a compliance notice as explained by the Tribunal in Murray, Cloete No, Klein, Norman No and Edwards v National Consumer Commission and 3 others[3] is to ensure that a party who has not complied with the CPA is informed of its non-compliance and is given an opportunity to amend its ways and ensure that in future it complies with the Act. In CJ Digital Marketing Consumer SMS Marketing CC v the National Consumer Commission[4] the Tribunal stated that a compliance notice is a ‘second chance’ for a transgressor to ensure that it brings its conduct within the ambit of the CPA. If the transgressor complies with the compliance notice, then that is the end of the matter, but if a transgressor fails to comply with the compliance notice, the matter can be referred to the Tribunal for the imposition of an administrative penalty.

58. Compliance with the CPA means that the goods must be correctly labelled not that they must be destroyed. There is no evidence to suggest that these are harmful goods or that anyone is being harmed by their importation. The NCC’s concern seems to be that by allowing the goods into SA to enable the supplier to rectify any problems, it is in fact condoning non-compliance with the CPA. This is because the importation process will have been completed the moment the goods are released to the importer so that it can carry out any corrective measures in order to comply (which is the aim of a compliance notice).

59. All cases must be dealt with by the NCC on a case by case basis with due consideration of each case based on its own set of facts; and for the law to be applied to each set of facts. This in our view would substantially comply with just administrative action. The reasonableness standard was dealt with in Bato Star Fishing (Pty) Ltd v The Minister of Environmental Affairs and Tourism[5] where judge O 'Regan set out a number of factors which can be used to determine if a decision is reasonable. These include: “the nature of the decision, the identity and expertise of the decision maker, the range of factors relevant to the decision, the reasons given for the decision, the nature of the competing interests involved and the impact of the decision on the lives and well-being of those affected.”[6]

60. Hoexter[7] indicates that to determine whether or not a decision is reasonable, both the rationality and the proportionality of the decision need to be determined. The test to determine rationality was first formulated in Carephone (Pty) Ltd v Marcus,[8] and it was confirmed in the decision of the Sidumo[9] as follows: “[I]s there a rational objective basis justifying the conclusion made by the administrative decision-maker between the material properly available to him and the conclusion he or she eventually arrived at?”[10]

61. A rational decision therefore means that one must be able to justify the decision based on the information known to the administrator and the reasons supplied for that decision.[11] According to Woof et al,[12] proportionality refers to whether manifestly disproportionate weight has been allocated to one or other consideration, relevant to the decision. Proportionality may also be defined as "the notion that one ought not to use a sledgehammer to crack a nut.”[13] Hoexter states that proportionality's essential elements are balance and necessity, together with suitability.[14]

62. In our view such an approach confirms that the discretion exercised for each compliance notice must be on a case-by-case basis and that the Commission should consider whether there are other less drastic or more proportional powers available to secure compliance with the CPA.

63. On this set of facts the approach should be for the compliance notice to allow the Applicant to apply for the conditional release of the goods to enable the Applicant to rectify any problems which may exist with the labelling of the goods. In these circumstances where the Applicant was not intending to deceive and there was a genuine miscommunication based on the circumstances when placing the order. The Applicant has a long history of importing without problems and the Applicant should be granted the opportunity to rectify the incorrect labelling.

64. The goods are currently detained by customs and fall under the customs policy pertaining to the detention of goods. This policy document sets out the clearance process which importers and exporters must follow. In terms of this policy, importers may apply for the conditional release of goods. (see page 41 of the policy clause 2.21 Conditional Release.) Very importantly the policy states that the imported goods remain under Customs control until the declarant has complied with the provisions of the Customs Act or any other applicable legislation (which in this case would be the Consumer Protection Act) ceases to apply to the goods.

65. It would therefore be appropriate for the Applicant to apply for the conditional release of the goods from Customs and to attach this judgment in support of her application as part of her application for Customs to grant a conditional release of the goods.

66. In other words, even though the goods have been released to the importer, the goods are still regarded as being under the control of Customs, until the importer can show that it has complied with the law. This then deals with the NCC’s concern that the goods have now been finally imported into South Africa – even though the goods have been released to the importer, they will remain under the control of Customs until the importer has complied with certain specified conditions. In this situation, it would be until the importer, the Applicant, can show that the goods have been correctly labelled.

67. In terms of the letter dated 29 October 2020, from SARS to the Applicant the goods remain under Customs control until authorisation is received from the National Consumer Council (which presumably is the National Consumer Tribunal) authorising the release of the goods.

CONCLUSION

68. The Applicant in its submissions, asks the Tribunal to order that the Applicant “take embargoed” release of the “non-compliant” goods and for the Applicant to be permitted, as was always her intention, to sew on labels which are compliant with the CPA. Thereafter, have the NCC re-inspect the goods and issue a release or certificate once satisfied that the goods comply with the CPA. An alternative would be to allow the goods to move to an appropriate alternative facility, for the labelling to take place.

69. The Act clearly prohibits the importation or sale of goods with non-compliant labels. The only conclusion that can be drawn from this is that the legislature intended that goods must be fully compliant with the Act before they are offered for sale to consumers in the Republic of South Africa.

70. The Tribunal finds that the Applicant in this matter has established valid grounds for the setting aside of the Compliance Notice in its entirety.

71. For all the reasons set out above the Tribunal concludes that:

71.1 The Respondent did not conclude an investigation into a complaint as enjoined in section 73 (1) of the CPA;

71.2 The compliance notice is defective because the Respondent’s actions before it issued

the compliance notice did not amount to just administrative action;

71.3 The compliance notice did not give the Applicant an opportunity to comply. All it did was to direct the Applicant to “return or destroy”. The Applicant did not knowingly apply to any goods, a trade description intending to mislead consumers; and

71.4 The compliance notice should have and could have allowed for the conditional release of the goods so that compliance could be achieved. Only thereafter would the goods be released and only then would they have been “imported” in the sense intended in section 24 of the CPA.

ORDER

72. After considering all the submissions made by the parties, the following order is handed down:

72.1 The compliance notice is hereby cancelled;

72.2 The Applicant is hereby permitted to apply for the conditional release of the goods from customs which application must be accompanied by a copy of this judgment;

72.3 The Commissioner of Customs and Excise is authorised to release the goods to the Applicant on the following condition and any other condition he/she deems appropriate:

72.3.1 Within 60 days of this judgment being issued, a compliant label must be attached to each of the goods indicating the country of origin, fibre content and wash care;

72.3.2 Within 20 business days of having been notified by the Applicant that the compliant labels have been attached, the Respondent must inspect the goods and if satisfied authorise the final release of the goods to the Applicant; and

72.4 No order is made as to costs.

DATED AT CENTURION ON THIS 3RD DAY OF SEPTEMBER 2021

MS. P A BECK

TRIBUNAL MEMBER

Prof. T Woker (Presiding Tribunal Member) and Adv. F Manamela (Tribunal Member) concurring.

[1] NCT/2667/2011/101(1)(P), NCT/2081/2011/101(1)(P)) [2012] ZANCT 6 (30 March 2012

[2] NCT/4570/2012/101(1)(P)CPA

[3] NCT/4570/2012/101(1)(P)CPA

[4] NCT/3584/2011/101(1)

[5] Bato Star Fishing (Pty) Ltd v The Minister of Environmental Affairs and Tourism [2004] ZACC 15; 2004 4 SA 490 (CC) para 45

[6] Bato Star Fishing (Pty) Ltd v The Minister of Environmental Affairs and Tourism [2004] ZACC 15; 2004 4 SA 490 (CC) para 45

[7] Currie and De Waal Bill of Rights Handbook 670.

[8] Carephone (Pty) Ltd v Marcus 1999 3 SA 304 (LAC).

[9] Sidumo and Another v Rustenburg Platinum Mines Ltd and Others (CCT 85/06) [2007] ZACC 22; [2007] 12 BLLR 1097 (CC); 2 008 (2) SA 24 (CC) ; (2007) 28 ILJ 2405 (CC)[2007] ZACC 22; ; 2008 (2) BCLR 158 (CC) (5 October 2007) This case established the test to be used by judges in reviewing awards made by commissioners

[10]Carephone (Pty) Ltd v Marcus 1999 3 SA 304 (LAC) para 25.

[11] Hoexter Administrative Law 340.

[12] Woof et al De Smith's Judicial Review Glossary.

[13] S v Manamela [2000] ZACC 5; 2000 3 SA 1 (CC) para 34

[14] Hoexter Administrative Law 344.