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Commercial Anti-Discrimination Bill resurfaces in Puerto Rico Legislature

By on March 1, 2018

SAN JUAN — After two failed attempts in the Puerto Rico Legislature, Rep. José Aponte hopes the “third time will be the charm,” as he attempts to deliver to Gov. Ricardo Rosselló legislation that would create the Commercial Anti-Discrimination Act to protect local consumers from unfair transactions with U.S. businesses.

“For years, Puerto Rico residents have been discriminated against by some commercial entities, which for multiple reasons, decline to provide the same goods and services [to customers] as the rest of their fellow citizens in the North American nation,” reads House Bill 1217, which is nearly the same as the original legislation filed in 2011.

Some of the practices that could be considered discriminatory are differences in “access, sale, products, goods, services, guarantees and delivery”; selling products at greater prices in relation to prices consumers pay stateside; and not offering Puerto Ricans the same benefits and guarantees, such as gift cards, webpage access and discounts.

On multiple occasions, Caribbean Business tried to contact Rep. Aponte, who authored the bill, but he never responded. It is undetermined whether the bill would provide the Consumer Affairs Department (DACO by its Spanish acronym) the tools to tackle discriminatory practices from companies such as Amazon, about which the agency has received numerous complaints, even though the company has no locations on the island.

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Anti-discrimination plan already in force

In 2011, former DACO secretary and the current secretary of State, Luis G. Rivera Marín, founded the Commercial Anti-Discrimination Office (CADO) to address complaints regarding discrimination from companies such as Home Depot, Best Buy, Apple and DirecTV.

During its first year of operation, CADO received more than 500 complaints and issued several fines on Amazon, reaching $470,000, and Best Buy for $10,000, for denying free shipping to the island.

The legislation encompasses several ordinances already being utilized by CADO, such as fining companies up to $10,000 per infraction; investigating consumer complaints; contacting the defendant company; and representing civilians in court.

This program remains active to date, which is why the chairwoman of the Puerto Rico Chamber of Commerce, Alicia Lamboy, stressed it should be evaluated before the Legislature approves new actions.

“There is already a road; we must consider that road before reinventing the wheel. We have the benefit that several years have passed since [CADO] was created, and I understand it has had a trajectory that should be considered when assessing the need for this type of legislation,” she said.

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Companies would lose incentives

The proposed legislation would allow the government to decline financial incentives, exemptions or tax credits to companies that “discriminate” against local consumers. The bill does not establish a clear process on how those benefits would be revoked, beyond noting that DACO would maintain a register of companies “that have refused to eliminate their discriminatory practices.”

“Beyond moving to an orientation phase, we don’t have a problem with that, it also provides for the elimination of tax incentives. […] The problem is that we are already moving on to the discrimination phase, when there hasn’t even been an investigation,” Lamboy argued.

The bill does not establish a timeframe for the company to respond to allegations of discrimination before risking the loss of its incentives.

“Here, there could even be considerations in terms of costs of operations, of doing business in Puerto Rico,” Lamboy remarked, on factors that could impede equal commercial treatment for the island. “We aren’t talking about an equal condition to establish a business [in Puerto Rico], versus establishing it in [a U.S. state],” she added.

Recycled bill

Aponte’s proposal is not new. Its first failed attempt was made under Luis G. Fortuño’s administration. On that occasion, the Justice Department suggested allocating funds from DACO to afford consumers’ legal representation during the judicial process.

Three years after that Fortaleza bill was presented, it only managed to pass through the sieve of the House of Representatives. A second attempt only led to another public hearing in 2015.

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