Nepal will have consumer courts as soon as the Consumer Protection Act 2017 is approved by Parliament.

These long-awaited courts will allow consumers to seek compensation for damages caused by defective products or poor services. The proposed has envisioned forming consumer courts in the country’s 75 districts led by district judges.

Law Commission Vice-Chairman Bhesh Raj Sharma said the tribunal structured courts would have a second class officer associated with legal services and an individual with 10 years’ experience in consumer rights as members. “These members will be appointed directly by the government,” said Sharma.

As per the proposed law, a judge will rule on cases concerning consumer rights violations. “However, two judges will be needed to hand down a jail sentence,” Sharma said.

Experts have long been asking the government to establish consumer courts. According to them, the lengthy and complicated procedure required by prevailing laws has allowed offenders to escape without punishment.

After consumer courts are established, people will be able to seek compensation for damages caused by defective goods.

“Victims can file a case against the concerned retailers, importers, stockholders or distributors within six months of purchasing the goods,” states the proposed act. “Based on the type of damages to the consumers’ physical or mental ability or death of consumers, consumer courts can award appropriate compensation to the sufferer or the concerned family members.”

Current laws also say victims can claim compensation, but they have been ineffective. Paras Mani Pokharel, an officer at the Kathmandu District Administration Office, said the government had formed compensation committees in 36 districts.

“The committees have been non-operational since the separation of the Commerce Ministry and Supplies Ministry,” said Pokharel. There is no clear standard on the compensation amount in the existing law, he added.

According to the new act, the absence of proper labeling, hoarding resulting in an artificial crisis, adulteration, selling of date-expired food items, advertisements containing fake information and lack of vital information have been described as serious violations of consumer rights. Regarding food items, manufacturers, importers or retailers are required to clearly mention the ingredients used to make them. Likewise, sellers of medicinal products have to inform consumers about their possible side-effects.

Owners of businesses that violate the rules face a jail term ranging from one to five years. They can also be fined up to Rs500,000. Traders can be fined up to Rs100,000 on the spot for selling defective products or they may be made to buy back or replace such goods.