WeBuyCars already refunded most consumers after settling with Consumer Commission

Car dealer WeBuyCars already refunded most of the 31 consumers who complained about it to the National Consumer Commission because the cars had defects, and they believed that the terms of sale deprived them of their rights in terms of the Consumer Protection Act.

The National Consumer Tribunal (NCT) confirmed the settlement agreement between the National Consumer Commission (NCC) and WeBuyCars. The confirmation carries the same weight as a High Court order.

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The agreement with the NCC

According to the NCC, WeBuyCars agreed to strengthen consumer protection and enhance service delivery by:

• Paying an administrative fine of R2.5 million.
• Refund a total sum of R3 419 971, 83 to 31 affected consumers, with amounts ranging from R2 267 to R649 169.
• Revising its terms and conditions to align with the provisions of the CPA.
• Committing to a Consumer Awareness Programme to enhance consumer education about buying used motor vehicles and consumers’ rights and obligations, as well as the supplier’s rights and obligations under the CPA.
• Create 300 job opportunities at various levels across WeBuyCars over a period of five years, over and above the current planned employment opportunities, to enhance customer service capacity and overall consumer experience.

The order also indicates that the terms and conditions in the agreements of WeBuyCars contravened the provisions of the CPA and therefore constitute prohibited conduct.

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NCC said WeBuyCars cannot exclude liability in terms of CPA

The NCC says a paragraph that WeBuyCars uses in its agreements excludes any liability of WeBuyCars to provide redress to consumers and that this constitutes prohibited conduct because it does not cover the specific defect, considering that the Dekra Used Vehicle Report does not indicate the mechanical condition of the car, falling short of section 55(6)(a) of the CPA. ( WeBuyCars announced that meanwhile, it will not use Dekra reports anymore, but will use its own reports.)

This is the paragraph that the NCC said contravened the CPA: “You confirm that you have read the Dekra Used Vehicle Report in respect of the vehicle you are buying and that you are fully aware of any roadworthy relevant reconditioning, repair and services work required before the vehicle pass roadworthy test. You acknowledge that the Dekra Used Vehicle Report does not indicate the mechanical condition or reliability of the vehicle that you are buying. You further acknowledge that the vehicle may therefore need repair work to prevent mechanical problems, including but not limited to its engine and gearbox.”

In addition, the NCC says WeBuyCars’ sales agreement also directed consumers to use any warranty they bought with the car to pay for repairs and that the consumer will be responsible to pay for any shortfalls. The NCC says any reliance on this provision if the defect is detected within the first six months is a contravention of section 55 of the CPA.

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WeBuyCars maintains there is nothing wrong with its terms and conditions

However, WeBuyCars notes in its integrated annual report that while the company, supported by external legal advice, maintains that its terms, conditions and trading practices are appropriate, it elected to prioritise regulatory guidance, co-operation and business continuity through settlement.

“In doing so, WeBuyCars sought to engage constructively with the NCC, not only in its own interests, but also in the interests of the broader used vehicle industry, recognising the importance of regulatory clarity and consistency.”

The dealer says in the report that the settlement concluded the ongoing discussions with the NCC and brought finality to the NCC’s investigations.

According to the report, the initial engagement with the NCC arose as a result of “differing views on the interpretation of certain terms and conditions” in sales agreements.

“The settlement with the NCC is not expected to impact how WeBuyCars applies its terms and conditions. Our focus has always been on ensuring that our terms benefit the consumer and we anticipate that the changes arising from this settlement will not disrupt our daily operations. The majority of the amendments required are straightforward and align with our existing practices,” WeBuyCars says in the report.

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WeBuyCars warns NCC will not be happy with one or two changes

However, the company notes, “there may be one or two changes” that will provoke healthy debate with the NCC, ultimately aiming to enhance consumer protection and understanding. “We remain committed to constructive dialogue that serves the best interests of our customers while maintaining our operational integrity.”

WeBuyCars says this engagement progressed beyond the resolution of historical matters and developed into a collaborative initiative focused on improving clarity, transparency and practical application of the CPA for the benefit of consumers and industry participants alike.

“Given that a significant portion of WeBuyCars’ vehicles are sold to dealers, the group recognises an additional responsibility to ensure that the interests of all stakeholders are considered. We welcome constructive regulatory guidance as a catalyst for continuous improvement and remain committed to maintaining brand integrity, regulatory compliance and customer trust as foundations for long-term value creation.”