1

A Presentation
of business ethics

CONSUMER PROTECTION IN
NEPAL
UNFAIR TRADING PRACTICES
 Consumer Protection in Nepal 2

 Consumer is a person who buys goods or services for

personal use not for resale purpose.
 Consumers are the king of market, but they are often
beguiled by manufactures.
 Consumer Protection has been major concern of
today’s business world.
 Thecontemporary business world is marked with
competition
Consumer Protection in Nepal 3

 Consumer Protection is applicable on:

 Product: Malfunctioning product, defective product,
product quality, wholesomeness, fitness and so on.
 Price: Excessive pricing, price fixing, deceptive pricing
 Place: Artificial Shortage
 Promotion: False advertisement, exaggeration, Product
misinterpretation
 Unfair Trading 4

 An unfair trade practice consists of using various

deceptive, fraudulent or unethical methods to obtain
business. 
 Unfair trade practices include misrepresentation, false
advertising, tied selling and other acts that are
declared unlawful by statute.
 It can also be referred to as deceptive trade practices.
 Protection Against Unfair 5
Trading Practices in Nepal
Assurance of consumer right
1. Right to Safety
2. Right to Choose
3. Right to be Heard
4. Right to seek Redress
5. Right to Consumer Education
6. Right to Healthy Environment
 6
Obligation of Manufacturer

The manufacturers are to mention the following information

in the label of each product:
1. Name, address and registration number of manufacturer.
2. Composition, quantity and weight of products like food
and medicines.
3. Standard mark of certification if given to the product.
4. Method of consumption and any side effects of the
product.
5. Price, batch number, date of manufacturing and expiry
date of product.
 Restriction on substandard 7
goods and services (Section 10)
1. Production, selling, exports and import of any
substandard goods
2. Duplication of any products to cheat consumers.
3. Selling of any sub-standard or lower quality goods.
4. Unfair business practices and commercial transactions
such as false or misleading advertisements of the use,
utility or effectiveness of any goods or services.
5. Manufacturing and selling of any goods or services
injurious to the health of consumers.
 Unfair Trading Restriction 8

 Adverse Impact in the Market

 Section7 of the Act Prohibits the creation of circumstances that
would lead to any adverse impact in the market
 Monopoly
 Section 8 (1) (b) of the Act empowers Government to
formulate policy against monopoly
 Price Fixing
 Section 8 of the Act empowers GON to formulate policies
regarding standard of goods, price discrimination and so on.
 Stock Market Regulations
 SEBON has created rules regarding insider trading
 Examples of Unfair Trading 9
Practices in World
1. Intel Vs. AMD
 Intel accused of selling product below cost of
production and criticizing AMD through
advertisement.
2. Flipkart
 Flipkart accused of selling product at lower than cost
price in Big Billion Day
3. Unilever, P&G, and Hankel: Price Fixing in European
Market
4. Volkswagen Group: Defeat Box fixed in Automobiles
 Example of Unfair Trading in 10
Nepal
1. Price of Sugar surged above Rs. 80: A Cartel By
Sugar Mill
2. Mayos Noodles accused of adding MSG in noodles
3. Insider Trading issue:
1. Everest Bank: 70 percent Bonus Share
2. National Life Insurance Company: 1:1 right share
and 30 percent bonus share
 11

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BUSINESS CODE OF CONDUCT OF
FNCCI,2061

PRESENTED BY:
ANISH PRASAI
Background of FNCCI

 Refers to Federation of Nepalese Chambers of Commerce

and Industry
 Leading the Nations economic progress
 Umbrella organization of business In Nepal
 Established in 1965 with the aim of promoting business and
industry while protecting the rights and interests of business
and industrial communities
  It provides, inter alia, information, advisory, consultative,
promotional and representative services to business and
government and organizes training / workshop / seminar on
a regular basis.
Objectives of FNCCI

 Play a catalytic role in the business, industrial development and

establish sound industrial relations in the country
 Reinforce business community's commitment to the society
 Provide advisory services to government, lobby as and when required
in formulation and execution of business and industry related policies,
acts and programs
 Foster cooperation with related national and foreign organizations
 Provide up-to-date information services to business and government
and the community at large
 Create awareness and support for business and industry efforts on
issues affecting business like quality, social responsibility, corporate
governance, HIV /AIDS, child labor, environment etc.
Business Code of Conduct of
FNCCI,2061
 Members of all associations and organizations affiliated to
the FNCCI shall make special efforts in abiding by the
terms enunciated in the Business Code of Conduct as
follows.
 All members shall hereby undertake to:
 Refrain from engaging in business activities that goes
against the interest of the State
 Pay special attention to the protection and promotion of
public welfare in the conduct of their business. Desist from
activities that jeopardize fair conduct and public norms and
values.
 Abstain from activities considered detrimental to the general health of
the people.
  Maintain smooth supply of quality goods and services in the market at
fair prices. The merchandise shall be of specified weights and standards.
There shall be no adulteration.
  Refrain from activities likely to cause artificial shortages of goods in
the market. In the event of any shortages, shall not conduct business at
unfair prices.
  Abstain from the usage of merchandise or standards prohibited by law.
 Maintaining faith in fair business competition, provide maximum
benefit to the consumers.
  Oppose monopolistic business practices and controlled supply
systems (e.g. syndicates and cartels) and not be involved in any such
groups or systems.
  Settle business disputes through mutual consultations in an amicable
and lawful manner.
  Give precedence to business transparency.
  Make fair and proper utilization of credit and loans.
  Show special sensitivity towards environmental protection.
  Abide by prevalent statutes, laws and process.
 Submit documents, papers, statements of accounts as well as pay taxes,
tariffs and levies as required by law in time.
  Abstain from dealing in any goods categorized as forbidden or banned
by law.
  Refrain from providing donations or financial assistance to political
parties or their leaders with considerations of bearing in business deals
or for personal benefits.
  Fix a ceiling of the value of any gift or present to anyone as not to
exceed Rs.5,000.
  Observe the Business Code of Conduct endorsed by the FNCCI by self
as well as encourage others also to do likewise.