Edcon to fight back over fees
Consumer tribunal’s ruling a big blow for struggling retailer — but regulator says it will oppose any appeal
SA’s largest clothing retailer Edcon says it plans to appeal last week’s ruling against it by the national consumer tribunal, which could have potentially far-reaching financial consequences on the struggling retailer. The tribunal ruled that Edcon, which owns Edgars and Jet, isn’t entitled to add a "club fee" to its credit agreements with customers. It’s a blow for the company, given that an estimated 3.4m account holders are also club members. For the year to March 2016, these club fees brought in R590m in revenue for the retailer. For the nine months to December, it had clocked up R418m in club fees. At this point, however, the financial consequences for Edcon are unclear — including the size of a potential fine, as well as the quantum of any refunds for customers. The national credit regulator (NCR) first brought the case against Edcon in November 2015. Last week’s ruling will affect other retailers whose customers also belong to a club. Edcon, however, will appeal the finding. ...
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