4. Consumer Law’s Scope of Application and Qualification of Professional Claimants as Consumers
Article 2 of Consumer Law expressly stipulates that its object of protection is consumers that need to buy, use commodities or accept services for life needs. Clarification is needed in two concepts: first, what is life needs? Second, can a legal person be an object of protection?
Life need is not a description of legal implication, which triggers two views: the first view believes that life needs are for the daily needs of natural persons, not for production or professional needs. For instance, if a person buys one or two sets of tables and chairs, it is generally believed for daily needs. If a person buys 20 sets of tables and chairs, few can be convinced that it is for daily needs, though the consumer’s needs can’t be disproved. The second view believes that whether consumers buy for daily use, as presents, for processing or sales, the products bought are considered commodities, and the identity of consumers can’t be denied solely based on the role of the buyer. The difference of the two views lies in that the first view concerns the actual motive of the buyer while the second view concerns the nature of commodities in consumption.
Both views have innate weaknesses. If one has to judge life needs according to the first view, one cannot prove the subjective attitude of buyers. As a natural person determines the subjective mood of another natural person based on his or her own life or professional experience, no one can study the true status of the natural person under scrutiny. The one under scrutiny has a purpose only known to himself or herself, and it is challenging for another natural person who has no such knowledge to determine what he or she wants. The second view seems more objective. However, the attribute of a commodity is exchange, for life or production needs, which is part of the commodity before it is used by the end user.
There is not yet judicial practice in Mainland China to support the belief that a legal person can be tantamount to a consumer. The yardstick for judging the identity of consumer is natural person. The author of this paper believes that in actual trade, a legal person buys commodities in the form of contracts to protect their interest. The cases of rights violation are more clearly defined in Contract Law, and Consumer Law isn’t needed.
Back to the legislative purpose of Consumer Law, the author believes that it is for the natural weakness of consumers in consumptions, including insufficient knowledge and bargaining power. If a legal person makes purchase for processing or professional purposes, information asymmetry will enhance the ability to bargain. If Consumer Law is applied, which protects consumers and punishes operators indiscriminately, there will be a huge strain on normal market operation and fair trade. Therefore, consumers defined in Consumer Law are supposed to be natural persons with social cognition that buy for meeting daily or social needs. As for the definition of social cognition, a judge may exercise discretion based on case facts.
Professional claimant and anti-counterfeit professionals are different in connotation. Legal practitioners must judge whether it is a pure blackmail or exposing counterfeits with enough knowledge. What professional claims buy is not fake, shoddy products as most would understand, but those with problematic labels. What anti-counterfeit professionals look at are fake, shoddy products. Professional claimants focus on commodities that have no quality issues but inconsistencies with regulations. The inconsistencies may appear in production, sales or change of standards. Operators face mounting pressure of claim in this aspect, and most of the time they refuse to accept the court’s support of punitive damage by professional claimants. Operators believe that it’s unfair to apply Article 55 of Consumer Law indiscriminately without considering the poor logic of the whole law, and penalty is to a fault and violates the justice of laws. Food and medicine are special as their quality and description affect consumers’ rights and safety. When discussing these two products, the legislature may define non-fault practice considering their traits. For general products, consumers should be put under strict scrutiny considering justice for both parties (consumer and operator) in the market.
Moreover, professional claimants are more familiar with test standards than average consumers. They buy commodities with problematic labels no more than what seems to be reasonable for personal use, and still their consumption is considered as professional or production ones. The sole purpose of buying is to pursue a claim based on problematic labels. They don’t form mistaken view or make ill-informed purchase due to label issues, and they make purchase with these knowledge. Therefore, professional claimants are not protected by Consumer Law and their purchase doesn’t constitute fraud.
5. Conclusion and Suggestion
The complex realities, indiscriminate application of Consumer Law and its obscure definitions lead to dissatisfactory results of handling claims based on Consumer Law. The making of any law has its legislative purpose. Whatever the purpose, justice is the fundamental and visionary purpose. The author likes to make the following summary and suggestion:
First, formulate rules for implementing Consumer Law; classify consumers’ right to information; increase relief methods and specify remedies, penalties. Penalty varies for different degrees or types of breach of consumers’ right to information.
Second, specify burden of proof; differentiate between general consumer goods, food, medicine, and special-function commodities; penalty and liability vary for breach of consumers’ right to information for general consumer goods and special consumer goods.
Third, make a clearer definition of consumer; specify the scope of protection and application for Consumer Law.
Fourth, define the scope of application for Article 55 of Consumer Law; avoid indiscriminate application of punitive damage.
Fifth, apart from existing typical cases of food and medicine, typical cases of sales contract dispute that concern fraud and require punitive damage should be issued to guide judicial work of courts at all levels.