Second-hand vehicle retailer We Buy Cars has been hit with a R2.5 million administrative fine and ordered to refund more than R3.4 million to customers after regulators found its sales terms violated South Africa’s Consumer Protection Act (CPA).
The penalty follows a three-year investigation by the National Consumer Commission (NCC) into complaints from consumers who alleged that the company failed to honour remedies promised in signed sale agreements.
The settlement agreement was confirmed as a binding consent order by the National Consumer Tribunal on 19 December.
Refunds Ordered for Affected Consumers
In terms of the order, We Buy Cars (Pty) Ltd must repay R3 419 971.83 to 31 consumers who were affected by the company’s unlawful sales terms.
According to the NCC, multiple complaints were received over several years, with customers claiming that We Buy Cars’ warranty clauses and terms of sale unfairly limited their legal rights.
Following its investigation, the commission concluded that the contracts used by the company contravened several provisions of the Consumer Protection Act.
Changes to Contracts and Consumer Education
Beyond the financial penalties, We Buy Cars has been instructed to revise its terms and conditions to ensure full compliance with the CPA.
The company must also implement a consumer awareness programme aimed at educating buyers about their rights when purchasing pre-owned vehicles.
Regulators said this programme is intended to improve transparency in the second-hand car market and reduce future disputes between dealers and consumers.
Job Creation Requirement
In an unusual but significant aspect of the order, We Buy Cars has also been directed to create 300 additional jobs over the next five years.
The NCC said the requirement is aimed at improving customer service capacity and enhancing the overall consumer experience across the company’s operations.
NCC Welcomes Settlement
Acting NCC Commissioner Hardin Ratshisusu said the settlement brings the long-running investigation to a close and ensures that affected consumers receive proper redress.
“This settlement concludes investigations against We Buy Cars on contraventions of the CPA,” Ratshisusu said. “The company has agreed to amend its terms and conditions to ensure full compliance, which will strengthen the protection of consumer rights.”
The ruling serves as a warning to businesses operating in the used vehicle sector that contractual terms which limit consumer protections will not be tolerated under South African law.
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