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5 ways you can (possibly) get around a no refund policy in Malaysia

over 6 years ago JS Lim





This article is for general informational purposes only and is not meant to be used or construed as legal advice in any manner whatsoever. All articles have been scrutinized by a practicing lawyer to ensure accuracy.



All too many times we have entered shops, chosen what we like, bought our items, and then we find this dangerous line printed on the receipt:-

“No refunds or exchanges allowed”

A lot of Malaysians are not aware of the consumer rights we have under law, and unfortunately some shops take advantage of this, such as by using one of these 5 sales tactics we covered to trick customers. One of these practices is using no refund policies.

Although it depends a little on the exact scenario, many no refund policies have no effect in Malaysian law and the shop must give you a refund or an exchange. However it must be noted that this article is meant to inform you of your consumer rights, not how to game the system. An item still needs to be returned within a reasonable time period and condition – you can’t return a shirt you’ve already washed and worn, or a box of chocolates that’s already half-eaten. There are also exceptions, such as underwear for hygiene reasons.

Here are some scenarios you might find yourself in where you can return the goods you received.

[READ MORE: What can you do if you bought fake food in Malaysia?]


1. You were informed about the no return policy too late

This law is the reason why some parking lots have BIG and sometimes red text at their entrances saying something like “the management does not accept any responsibility for injury or loss suffered in this parking lot” or “park at your own risk”. This is the English case of Thornton v Shoe Lane Parking [1971], in which Thornton was injured because of Shoe Lane Parking’s negligence when he was collecting his car. (We incorporated this law in Malaysia through the local case of Sanggaralingam s/o Arumugam v Wong Kook Wah & Another [1987])

So we’re used to parking lots putting a big sign at the entrance with their parking rates and their terms and conditions. In Shoe Lane Parking, the terms and conditions were displayed on the pillars inside the parking lot. It was decided that the terms and conditions were displayed too late and cannot take effect since the person had already entered the parking lot.

And that’s why we have this big sign. Image from

This applies to receipts you get after buying something as well. In a lot of cases, the “no refund” condition is only printed at the bottom of your receipt. According to Lord Denning in Thornton’s case, any terms and conditions that come on a piece of paper after you have done the deal are invalid. Therefore, if a shop wants to implement a no refund policy, they need to tell you about the policy BEFORE you pay at the counter, else their no refund policy will be invalid by law. This is why shops usually have their refund policy displayed at the checkout counter, and/or the cashier may tell you whether something is returnable or not before they scan it.


2. You’re cancelling a package or membership

Going to the gym gained some popularity in recent years, with their attractive packages for longer term memberships having great discounts. But a lot of us are afraid to commit to an entire year of membership. What if our job transfers us elsewhere? What if our schedule gets tight and we can’t make time for the gym anymore?

Image from The Malay Mail Online

Contracts for spa sessions, facial treatments, and gym memberships are known in law as future services contracts - you get to use the benefits of the contract at a later date. According to Section 17 of the Consumer Protection Act 1999 (CPA), no refund policies for future services contracts are illegal. And under Section 145, any person that breaks this law will be fined up to RM50,000 or jailed for up to 3 years (RM100,000 or up to 5 years for repeat offences). Companies that are found guilty under this law are fined up to RM100,000 (RM200,000 for repeat offences).

Consumers who cancel their future services contracts can only be charged:

  1. 5% of the full price, OR

  2. The cost of any goods you’ve used or kept, OR

  3. The pro-rated price of the services you used (if you used a 1 year gym membership for 6 months, you can only be charged half-price)

Section 17(3) further states that when you cancel and have a balance with the company, the company must make a refund within 14 days of the cancellation. This is one reason why True Fitness is in legal trouble with its members after deciding to cease operations in Malaysia.

Section 17(3) – Consumer Protection Act 1999

“Where the consumer has paid the supplier more money than the supplier is entitled to charge..., the supplier shall refund the extra payment or make a refund available, within fourteen days of cancellation.”

Some companies have tried to write a clause in their terms and conditions saying that they reserve the right to keep the full price or that this law doesn’t apply to their package, but the CPA also makes this illegal in Section 6. No requirements made in the Consumer Protection Act can be excluded by companies, else they will be fined up to RM100,000 again (RM200,000 for repeat offences) under Section 145.

You can get more info about what types of services are considered future service contracts here.


3. When the quality was not good enough

Image from huffingtonpost

Sometimes, there’ll be that item you buy that breaks soon after you start using it. This was really common with goods that were “Made in China” many years ago which led to a running joke - if it’s low quality, it must be “Made in China”. But you probably didn’t know back then that the law says you can ask for a refund (unfortunately a lot of these were dodgy shops which we probably shouldn’t have trusted).

Section 32 of the Consumer Protection Act basically says that when you buy something, the seller automatically promises you that the items you bought are of acceptable quality.

Section 32(1) – Consumer Protection Act 1999

“Where goods are supplied to a consumer there shall be implied a guarantee that the goods are of acceptable quality.”

The law considers something as of “acceptable quality” by looking at whether the item can function, as well as its appearance, safety, and durability. It also depends on the price and whether any minor defects were brought to your attention. For example, if the shop attendant shows you a pair of leather shoes that are 50% off because there are scratch marks on the leather, it can be considered to be “acceptable quality”. Similarly, a second-hand book will not need to look like a new book to be of “acceptable quality”.

Again, it is also illegal under Section 6 of the CPA for the shop to say they “make no guarantees on the quality of items”. If you bought any low quality items,  you have the right to ask for compensation, either in the form of an exchange or refund. This is provided for in Section 41 of the CPA.


4. When you were given the wrong items

You went to your local shoe store to buy a new pair of shoes on sale. You tried on a few to make sure you get the right size, you even leave room for the thickness of your socks. But after you’ve paid and got home, you find that the shopkeeper gave you shoes 1 size too small! And they say they have a strict no refund policy, so... are you stuck with the wrong shoes?

Image from buzzerg

Other than promising acceptable quality, the Consumer Protection Act also says in Section 33 that the seller makes an automatic promise to customers that items sold will be fit for the purpose you ask for. So let’s say you asked for a UK Size 8 shoe, the shopkeeper needs to give you an exchange if they gave you a US Size 8 shoe by mistake.

Similarly, if you need an aquarium to put an arowana in, the shopkeeper had better sell you a big enough tank to give that monster of a fish enough room to move in. As you'll see in Section 33(1)(a):

“...that the goods are reasonably fit for any particular purpose that the consumer makes known, expressly or by implication, to the supplier as the purpose for which the goods are being acquired by the consumer"

Keep in mind that this only applies to what you actually told the shopkeeper. So if you walked in asking for an aquarium and didn’t say anything about the arowana, the shopkeeper can’t be held responsible if he sells you any ol’ fish tank.

Bob the arowana is not happy at his tank. Image from tripadvisor


5. Some no refund policies are illegal

Image from wisegeek

Some contract terms are so biased that they are considered “unfair contract terms” in law. We used to have no laws for unfair contract terms, but we finally got them through the Consumer Protection (Amendment) Act 2010 (the UK had one since 1977!). These are terms such as those excluding liability for personal injury and death (like if the roof falls on top of your car in a shopping mall).

Section 24D of the Consumer Protection Act now makes a contract term illegal if...

  1. It’s harsh - Like getting charged 20% interest on your phone bill

  2. It’s oppressive - Like saying you have no right to check the expiry date on food items

  3. It’s unconscionable - Basically means anything unfair, like lying about product features or having hidden charges

  4. The management limits their liability for their mistakes - An example of these is those “park at your own risk” signs and “the management will not be responsible for X” type of clauses. They won’t be responsible if third parties cause damage to you, but if a shop’s staff overcharges your credit card for example, they have to accept full responsibility for it.

  5. The management limits their liability for breaching the contract without a good reason - This is a favourite of event organizers. You’ll normally find terms like this on registration forms or tickets saying something along the lines of “The organiser reserves the right to cancel or postpone the event without prior notice. The organiser will not be responsible for any loss or inconvenience caused.” These terms are illegal if they don’t come with proper justification.

Coming back to no refund policies, this means that if a no refund policy was for hygiene purposes, it may be a fair term. But if the no refund policy is for items on sale for example, it may be considered oppressive and therefore illegal.

According to Section 24i, companies who put unfair terms into a contract can be punished with a fine up to RM250,000 (RM500,000 for repeat offences), and individuals who do it can be fined up to RM100,000 or imprisoned for up to 3 years (RM250,000 or up to 6 years for repeat offences).


You can lodge a report or file a claim at…

If you run into a dispute with a merchant and are unable to settle it, you can file a complaint with the Domestic Trade, Cooperatives and Consumerism Ministry (KPDNKK) over at this website.

You can also file a claim against the merchant with the Tribunal for Consumer Claims Malaysia. The tribunal has specific types of cases it can deal with, so check with them or their information page if you’re unsure of your case.

no refund policy
malaysian law
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JS Lim

Jie Sheng knows a little bit about a lot, and a lot about a little bit. He swings between making bad puns and looking overly serious at screens. People call him "ginseng" because he's healthy and bitter, not because they can't say his name properly.