Features

Buying quality to protect the interests of consumers

By Naomi Gunasekara

While it is common knowledge that the SLS mark is granted to manufacturers who meet the quality standards set by the Sri Lanka Standards Institute (SLSI), Mr. Perera and the rest who purchase SLS marked products are probably unaware that the SLS mark is 'purchased' and not given free.

The SLSI, established in 1980 and one of the most recognised government certification institutions in Sri Lanka, provides its services to manufacturers who meet the quality standards as well as the prescribed price regulations. The small-scale manufacturer who meets the quality requirements set out by the SLSI is shunned from the fiercely competitive mass-market merely because he cannot afford to acquire the mark.

Over 170 companies have obtained the SLS mark in the 22-year history of SLSI, which was established to ensure that quality products are made available to the consumer. Among the companies that have obtained the SLS mark over the years are industrial giants like Anton PVC and MD. Lak Lunu, Clipsal and Ramco (the first umbrella manufacturer to obtain the SLS mark) joined the SLS club recently.

The Sunday Times Business Desk contacted the SLSI and the Commissioner of Internal Trade, Ms. Sama Kelaniya to discuss the impact made by the SLS mark on the minds of the consumer and the grievances of the small-scale manufacturers, who are trapped within the mass-market driven by open-economic policies and quality standards set by the SLSI.

Gazette regulations

The items include brown sugar, canned fish, cement blocks, cement (masonry), cement (Portland), condensed milk, corrugated asbestos sheets, domestic hot plates, electric bulbs, flat asbestos sheets, fruit cordial concentrates/fruit squash concentrates/fruit syrup concentrates, household electronic lamp-holders, household electric plugs/sockets, household electric switches, ready-to-serve fruit drinks, structural steel angles, structural steel bars, structural steel wire and synthetic cordials.

Suggestions

Most of the products listed here are products that manufacturers incur heavy expenditure on advertising in order to attract the consumer. Hence, on the one hand, the SLS mark will help the consumer to decide what products are fit for human consumption, while on the other hand it will drive small-scale manufacturers out of business and thereby affect the economy. Apparently, the SLS mark serves two purposes. That is, it helps the consumer to identify the quality products in the market while wiping out unfit manufacturers from the market, thereby ensuring consumer safety and quality of products.

Prejudice

"We need standards but the question is that of implementation. We cannot expect a small businessman operating from Ampara or Hambantota to obtain a SLS mark because he may not have the required capital."

Fees structure

n Application form -Rs. 100

n Application fee (non-refundable) -Rs. 1,000

n Pre-certification assessment fee for three visits -Rs. 5,000

n Pre-certification assessment fee for an additional visit -Rs. 2,500

n Permit sub-committee fee -Rs. 3,000

Cost of transport for each inspection/visit to be charged separately at the rate of Rs. 15 per km

Testing fees: the actual testing fee to be recovered from the applicant subject to a minimum fee of Rs. 3,000 per sample (Normally testing involves testing of about three samples, provided all three samples conform to the standard).

The post-certification fees consist of a standard annual payment depending on the total annual sales of the company concerned. SLSI charges this fee under the following scheme:

n Up to 5 million - Rs. 5,000

n Above 5 million up to 10 million - Rs. 15,000

n Above 10 and up to 25 million - Rs. 25,000

n Above 25 and up to 50 million - Rs. 40,000

n Above 50 and up to 100 million - Rs. 75,000

n Above 100 million up to 250 million - Rs. 100,000

n Above 250 million up to 500 million - Rs. 200,000

n Above 500 million - Rs. 300,000

According to Wasantha Meewabana, Director Marketing and Promotions SLSI, the SLSI has to charge a fee because it incurs certain expenditure in testing the quality of the products that are forwarded for assessment. "One can produce goods according to specifications. But that won't be recognised unless we certify the quality of the product," he said.

NDB assistance

Meewabana agreed that the consumer looks for the SLS mark in a competitive market and being driven by quality standards the consumer may prejudice the small-scale businessman who isn't in a position to pay for the mark. "That is why the government introduced the NDB scheme about two years ago."

Despite assistance being rendered by the NDB, the fact remains that most of the small-scale manufacturers are either unaware of the scheme or prefer not to obtain the mark through a loan.

With the proposed expansion of the compulsory SLS list one can only hope that the government would become more manufacturer-friendly and perhaps bear all testing expenses to give the SLS mark free to those manufacturers who satisfy the standards set by the SLSI.

According to Ms. Kelaniya the chances of the manufacturer getting the SLS mark free are bleak. "The SLSI is a profit-oriented institution. They will not be able to give the SLS mark free to the manufacturers. If they can at least give us a concession when we send seized products (from raids) for testing, that will help us a lot and at the same time protect the consumer," she said.

Under consideration

Although maintaining the standards set by SLSI involves high costs on the part of the manufacturer it is becoming increasingly important to protect the consumer from the sub-standard products in the market, said Ms. Kelaniya.

"When there is a wide choice and the consumer does not know what product is good SLS serves as a guideline. One consumer said that when he does the marketing for his wife and does not know what brand to choose he goes for the products that carry the SLS mark. This is unfair by the small entrepreneur because those who satisfy the standards and deposit the money are the ones who will be entitled to this sort of benefit."

Reluctance

When SLSI prepares a standard and sends it to the Commissioner of Internal trade, the commissioner is expected to gazette the standard. "If it is not gazetted I cannot take action against those who don't keep to the standards by conducting raids and seizing sub-standard products," she said. Conducting raids have become a severe problem for her department today. "You need at least three to four inspectors to conduct a raid and we have over 80 vacancies for graduate inspectors," she said.

Although the quality inspectors are expected to cover the whole island, areas like Monaragala, Hambantota and Trincomalee have only two inspectors per station, she said. "The Trincomalee inspector wanted to conduct a raid recently and it was impossible to conduct the raid without assistance from the Polonnaruwa inspectors. These raids have to be carried out when a tip-off is received and it is difficult to wait for help and then conduct raids," she said pointing out some of the difficulties faced by her in carrying out her duties as commissioner.

Bad products

According to Ms. Kelaniya, despite the appointment of an internal trade commissioner, setting up a Consumer Protection Authority and provisions being made under the Consumer Protection Act to protect the consumer, a number of sub-standard products enter the market every day through both local and foreign sources.

While the 20 products on the compulsory SLS list is applicable for all import items of the same product, the question arises as to what can be done regarding the sub-standard electronic items and second hand goods that enter the local market in manifold ways.

In a way, the list suggested by the SLSI seems to deal with this issue because if the list is endorsed then it will also apply to foreign products too.

However, a lot of issues pertaining to consumer protection still seem open. On the one hand the SLS wants to promote quality products by making registration compulsory and encouraging financially sound manufacturers to apply for the SLS mark, while on the other hand, the Commissioner of Internal Trade is protecting the consumer from sub-standard products and complaints that she is unable to carry out her functions due to lack of manpower and the high costs involved in testing seized products.

The commissioner said her department investigates complaints made by consumers on sub-standard products and products sold in breach of the provisions of the Consumer Protection, Fertilizer and Price Control Acts. 

The department website contains 24-hour on-line application forms at www.tradesrilanka.itgo.com for the consumers to lodge their complaints. All complaints made whether via Internet, phone (422610/431156) or letters (Department of Internal Trade, Flat 27/A, Galle Face Court 2 Building, Colombo 3) will be looked into by the department.