SG Vehicles to Cease Unfair Trade Practices

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1. By parties’ mutual agreement, the State Courts have made an order for the SG Vehicles group of companies^[1] (“SG Vehicles”) and their director, Ms. Tan Whye Peck, Juliet (“Ms. Tan”), to stop engaging in unfair trade practices under the Consumer Protection (Fair Trading) Act (Cap 52A) (the “CPFTA”). The Court Order takes effect from 18 April 2019.

Background

2. SG Vehicles were first placed under the Consumers Association of Singapore’s (“CASE”) Company Alert list in December 2015 and again, in July 2017, due to rising consumer complaints against them despite efforts by CASE to resolve these complaints through negotiation and mediation. From January 2015 to November 2017, CASE received a total of 92 complaints against SG Vehicles.

3. Specifically, these complaints cited misrepresentations over the terms and conditions of the sale agreement, mainly relating to the delivery dates of motor vehicles and the bidding for Certificates of Entitlement (“COE”). In several cases, consumers also reported being required to make additional payments due to a change in circumstances beyond their control. In July 2017, CASE requested for SG Vehicles to sign a Voluntary Compliance Agreement^[2] to stop engaging in unfair trade practices, but SG Vehicles declined to do so.

Court Order

4. SG Vehicles did not dispute CCCS’s investigations of the complaints against SG Vehicles which revealed evidence of unfair trade practices under the CPFTA. By parties’ mutual agreement, the Court Order was issued, following an injunction application filed by CCCS against SG Vehicles with the court on 19 December 2017. Specifically, the Court Order prohibits SG Vehicles, whether by themselves, their directors, servants, agents or otherwise from:

(a) engaging in unfair practices under the CPFTA;
(b) doing or saying anything, or omitting to do or say anything, if as a result a consumer might reasonably be deceived or misled into believing that the purchase price and/or COE is/are fixed or guaranteed;
(c) making any false claim to a consumer as to any guaranteed delivery date of a motor vehicle; and
(d)  taking advantage of a consumer if the supplier knows or ought reasonably to know that the consumer is not reasonably able to understand the character, nature, language or effect of the transaction or any matter related to the transaction.

5. The Court Order also requires SG Vehicles to install a prominent sign outside their shopfront(s) stating the full text of the Order, for a period of six months from the date of the Order, and notify CCCS of any changes related to their businesses, such as changes to the premises or number of premises which they operate; corporate changes such as the conversion from a firm or company to a limited liability partnership; and in respect of Ms. Tan, the status of her employment, directorship and partnership.

6. The Court Order does not require SG Vehicles to cease its business operations. SG Vehicles are not prohibited from carrying on their businesses, and all existing sales agreements they had made with their customers remain valid and legal binding and must be honoured. Should SG Vehicles fail to do so, consumers can contact CASE for assistance at the hotline 6100 0315 or www.case.org.sg. In addition, consumers can take civil action via the Small Claims Tribunal. Please refer to Annex A for tips for consumers purchasing a motor vehicle.

Top Industries with Consumer Complaints

7. In 2017, the motoring industry ranked as the top industry with the highest number of consumer complaints (2,335) received by CASE. In 2018, the beauty industry overtook the motoring industry as the number of complaints against the latter decreased by over 20% (from 2,335 to 1,802). CASE received 1,829 complaints against the beauty industry in 2018, a 31% increase from 2017. 44% of the beauty complaints received were related to loss of consumers’ prepayments due to abrupt business closures, and aggressive sales tactics used on consumers, such as coercing and following consumers to obtain monies for the payment of services.

8. CCCS is monitoring the beauty industry closely. Businesses in the beauty industry are reminded that it is an unfair trade practice to take advantage of a consumer by exerting undue pressure or undue influence on a consumer to enter into a transaction, or to charge a price that is substantially higher than the estimate earlier provided to the consumer, except where the consumer has expressly agreed to the higher price in advance. It is also an unfair trade practice to omit disclosing a material fact to a consumer, mislead a consumer on a material fact such as price, or demand payment for the supply of unsolicited goods or services.

9. Besides the beauty industry, CCCS is also investigating into consumer complaints into other industries such as e-commerce and food & beverage.

10. The majority of retailers in Singapore are legitimate businesses who want to serve their customers well. However, there are a small number of errant retailers who persist in unfair trade practices. CCCS will not hesitate to take action against persistent, errant businesses. It is also important for consumers to know their rights and be alert to unfair trade practices so that they can better safeguard their interest. CCCS will continue to raise general awareness of unfair trade practices among businesses and consumers.

About the Competition and Consumer Commission of Singapore

The Competition and Consumer Commission of Singapore (“CCCS”) is a statutory board of the Ministry of Trade and Industry. CCCS administers and enforces the Competition Act (Cap. 50B) which empowers CCCS to investigate and adjudicate anti-competitive activities, issue directions to stop and/or prevent anti-competitive activities and impose financial penalties. CCCS is also the administering agency of the Consumer Protection (Fair Trading) Act (Cap. 52A) or CPFTA which protects consumers against unfair trade practices in Singapore. Our mission is to make markets work well to create opportunities and choices for business and consumers in Singapore.

For more information, please visit www.cccs.gov.sg. 

^[1] SG Vehicles comprises the following entities: SG Vehicles Asia Private Limited, SG Vehicles Continental Private Limited, SG Vehicles Global Private Limited and SG Vehicles Trading. 

^[2] Voluntary Compliance Agreement (VCA) is a non-litigious alternative to an errant retailer before the retailer faces an injunction application in court. Under the CPFTA, CASE is empowered to enter into a VCA with errant retailers, following unsuccessful negotiation and/or mediation with the errant retailers. Errant retailers entering into a VCA will agree in writing to stop the unfair practice and in some cases, offer compensation to affected consumers or tourists.

Annex A - Infographic 6 Smarter Ways to Buy a Motor Vehicle

Annex B

ROLES OF AGENCIES UNDER THE CONSUMER PROTECTION (FAIR TRADING) ACT
The Consumers Association of Singapore (CASE) and Singapore Tourism Board (STB) remain the first points of contact for local consumers and tourists respectively to handle complaints. They will assist in obtaining redress and/or compensation through negotiation and/or mediation. Errant retailers may enter into a Voluntary Compliance Agreement (VCA) with CASE or STB, where they will agree in writing to stop the unfair practice, and compensate affected local consumers or tourists. Errant retailers who persist in unfair trade practices will be referred to Competition & Consumer Commission of Singapore (CCCS) for investigation and follow-up actions.

CCCS is the administering agency for the CPFTA and has investigative and enforcement powers to take timely actions against recalcitrant retailers. CCCS looks into cases of errant retailers who persist in unfair trade practices. Specifically, it is able to:

• Gather evidence against persistent errant retailers;

• File timely injunction applications with the courts; and

• Enforce compliance with injunction orders issued by the courts

Annex C

Top Industry with Consumer Complaints: Industry Size and Value

* Source – Department of Statistics

Annex D - Court Order