The three gateways
Before any of the Consumer Protection Act’s rules on fair terms, returns or liability matter, one prior question has to be answered: does the Act apply to this deal at all? The answer turns on three gateways, all of which must be open. There must be a supplier and a consumer; the deal must be in the ordinary course of business and occur within South Africa; and the consumer must not be excluded — in practice, a natural person, or a business below the R2 million threshold. The starting point is the application provision itself.
“This Act applies to— (a) every transaction occurring within the Republic, unless it is exempted by subsection (2), or in terms of subsections (3) and (4); (b) the promotion of any goods or services, or of the supplier of any goods or services, within the Republic…; (c) goods or services that are supplied or performed in terms of a transaction to which this Act applies…; and (d) goods that are supplied in terms of a transaction that is exempt from the application of this Act, but only to the extent provided for in subsection (5).”
Everything below unpacks those gateways: who counts as a consumer and a supplier, what “ordinary course of business” means, how the R2 million threshold works, and the specific exclusions in section 5(2). If any gateway is closed, the Act generally does not apply — with two important exceptions (franchises and unsafe goods) that we flag at the end.
Who is a consumer, and who is a supplier
A supplier is any person who markets — promotes, sells, supplies, rents or services — goods or services in the ordinary course of business. That includes manufacturers, importers, distributors, retailers, landlords letting in business, and service providers. A consumer is the person to whom those goods or services are marketed or supplied, and it reaches beyond the buyer to the user or beneficiary of the goods or service. It does not matter whether the supplier is local or foreign, large or small, or for profit or not.
Crucially, the Act treats franchise dealings as supplier–consumer transactions in their own right, so that a franchisee is always a consumer of the franchisor — a point we return to under franchise agreements.
“For greater certainty, the following arrangements must be regarded as a transaction between a supplier and consumer, within the meaning of this Act… (b) a solicitation of offers to enter into a franchise agreement; (c) an offer by a potential franchisor to enter into a franchise agreement with a potential franchisee; (d) a franchise agreement or an agreement supplementary to a franchise agreement; and (e) the supply of any goods or services to a franchisee in terms of a franchise agreement.”
The gatekeeper: “ordinary course of business”
This phrase decides most borderline cases. The CPA reaches deals made by a supplier in the ordinary running of its business; a private or once-off deal is usually outside the Act. If you privately sell your own car, or let your own home as a one-off, you are not a “supplier” and the buyer or tenant is not a “consumer”. The Supreme Court of Appeal settled exactly this point in 2025.
Els v Venter and Another
“Applied to the present case, the respondents are not in the business of letting property for consideration. They were not engaged in any trade, or business – the continual marketing of services – when they concluded the second lease with the appellant. This is not a case where property was let from rental housing stock… Thus, the appellant is not a ‘consumer’ as contemplated in the Act. The respondents are not suppliers, and the second lease is not an agreement concluded in the course of any trade or business conducted by them for consideration, let alone in the ordinary course of business.”
The couple in Els v Venter let out their own family home once while emigrating to Australia. When the tenant tried to invoke the CPA’s fixed-term rules, the Court held the Act did not apply: the owners were not in the business of letting property, so the lease was not in the ordinary course of business. The Court anchored the test in the meaning of the phrase itself.
Els v Venter and Another
“The concept ‘ordinary course of business’, is defined as the ‘normal and routine day-to-day operations consistent with the past practices and customs of the business’. These day-to-day operations are obviously not once-off transactions.”
The R2 million threshold for businesses
There is no value limit on an individual customer — a natural person is never shut out by size. But a juristic person (a company, close corporation, trust, partnership or association) loses the Act’s protection once it is large enough. Section 5(2)(b) excludes a deal where the juristic consumer’s asset value or annual turnover, at the time of the transaction, equals or exceeds the threshold the Minister sets under section 6.
“On the early effective date as determined in accordance with item 2 of Schedule 2, and subsequently at intervals of not more than five years, the Minister, by notice in the Gazette, must determine a monetary threshold applicable to the size of the juristic person for the purposes of section 5(2)(b).”
That threshold was set at R2 million when the Act came into force on 1 April 2011 and has not been revised since — even though section 6 contemplates a review at least every five years. Note the “or”: if either asset value or turnover reaches R2 million, the business is too big and the deal is not covered. A sole proprietor is a natural person, not a business, so the threshold never shuts them out.
When the CPA does not apply (section 5(2))
Beyond the threshold, section 5(2) carves out a defined list of transactions. The Act does not apply where the customer is the State, where the deal is credit under the National Credit Act, where it concerns services under an employment contract, or where it gives effect to a collective agreement.
“This Act does not apply to any transaction— (a) in terms of which goods or services are promoted or supplied to the State; (b) in terms of which the consumer is a juristic person whose asset value or annual turnover, at the time of the transaction, equals or exceeds the threshold value determined by the Minister in terms of section 6; … (d) that constitutes a credit agreement under the National Credit Act, but the goods or services that are the subject of the credit agreement are not excluded from the ambit of this Act; (e) pertaining to services to be supplied under an employment contract; (f) giving effect to a collective bargaining agreement…; or (g) giving effect to a collective agreement…”
The credit carve-out in paragraph (d) is the one most often misread. Only the financing is excluded; the goods or services bought on credit stay within the CPA. A car bought on a bank instalment sale is governed by the National Credit Act on the loan and by the CPA on the car. For the credit side — registration, affordability, reckless lending, interest caps and in duplum — see our Finance & Credit Law hub. Where two laws overlap, they apply concurrently and the one giving the consumer greater protection prevails.
Two exceptions where size never matters
Two regimes ignore the threshold entirely. First, every franchisee is a consumer, no matter how large — the threshold can never shield a franchisor from the franchise rules.
“Despite subsection (2)(b), this Act applies to a transaction contemplated in subsection (6)(b) to (e) irrespective of whether the size of the juristic person falls above or below the threshold determined in terms of section 6.”
Second, the product-safety and product-liability rules in sections 60 and 61 apply to unsafe or defective goods even where the deal is otherwise exempt — including supplies to large businesses above the threshold.
“If any goods are supplied within the Republic to any person in terms of a transaction that is exempt from the application of this Act, those goods, and the importer or producer, distributor and retailer of those goods, respectively, are nevertheless subject to sections 60 and 61.”
The reach of section 61 still has an outer limit. In Eskom v Halstead-Cleak [2016] ZASCA 150 the Supreme Court of Appeal held that the strict-liability remedy needs a supplier–consumer relationship, so a bystander injured by goods they were not a consumer of fell outside it. We deal with that fully under strict product liability.
Worked examples
Putting the gateways together, here is how common situations resolve. The “why” column points to the gateway that decides it.
| Situation | CPA applies? | Why |
|---|---|---|
| A retailer sells a fridge to a member of the public | Yes | Individual consumer; ordinary course of business |
| A supplier sells equipment to a start-up with R800k turnover | Yes | Juristic consumer below the R2 million threshold |
| A wholesaler sells R3m of stock to a large retailer (turnover over R2m) | No | Juristic consumer over the threshold (but ss 60–61 still apply to the goods) |
| You sell your own second-hand couch online | No | Private, once-off sale — not in the ordinary course of business |
| A family lets out their own home once while abroad | No | Not in the ordinary course of business — Els v Venter |
| A franchisor signs up a franchisee with turnover over R2m | Yes | Franchisees are always consumers — the threshold never applies (s 5(7)) |
Once you have confirmed the Act applies, the next questions are about the contract itself — its fairness and the grey list, your customers’ cooling-off and cancellation rights, and the quality warranty and returns.