EU probes Apple's warranties - but why nobody else's?

1 Oct 2012
MacBook Pro Retina

Viviane Reding calls Apple's warranty advertising "unacceptable", but why have the rest of the industry been let off?

The EU has asked governments to look into Apple's failure to alert consumers to a guaranteed minimum warranty.

Apple was fined €900,000 last year by Italian regulators for advertising a one-year warranty with its products, but failing to clearly mention that the EU guarantees a free two-year warranty on new products.

In April, Apple updated its warranty description, making note of the EU consumer law and explaining the difference between what it offers and what European law ensures.

That change doesn't appear to be enough for EU regulators. In a letter leaked to Bloomberg, commissioner Viviane Reding asked member countries to ensure Apple was making it clear to consumers that they are guaranteed a minimum two-year warranty by EU law.

"Apple prominently advertised that its products come with a one-year manufacturer warranty but failed to clearly indicate the consumers’ automatic and free-of-cost entitlement to a minimum two-year guarantee under EU law," Reding said to ministers in the letter, seen by Bloomberg. "These are unacceptable marketing practices."

How the law works in the UK

Clare Francis, commercial law expert at Pinsent Masons, explains: "For the first six months it is for the retailer to prove that the defect did not exist on delivery. After that period the burden shifts to the consumer to prove that the defect did exist on delivery. A consumer in England would have six years to bring the claim (five years in Scotland).

This does not mean it is a six-year warranty, simply that the claim must be brought within that period. The warranty is only effective at the date of delivery.

Clare Francis, commercial law expert at Pinsent Masons, said it's not a retailer's responsibility to point out the rules to consumers. "A retailer is under no specific obligation to point out the statutory warranty protection to a consumer," she told PC Pro. "However, the regulatory authorities in this instance appear to be looking at whether the advertising misled a consumer by suggesting the consumer should take out additional warranty protection."

She said UK regulators would be unlikely to fine a company over such an issue unless consumers - or competitors - had filed complaints that weren't resolved. "A consumer could not bring a direct action himself for damages," she added. The EU can't fine Apple directly over the issue, but it can fine member countries that don't find a solution.

Francis noted that the laws apply regardless of any contract or warranty signed with a company - which is what the phrase "this does not affect your statutory rights" is in reference to - and added that additional warranties, such as Apple's, are designed to "give an additional layer of protection".

Apple didn't respond to a request for comment, but suggests on its warranty page that it views the EU guarantees and its own AppleCare as offering different levels of protection.

Tech warranties

It's unclear why Reding is targeting Apple and not the wider industry; while other tech retailers may not advertise their warranties as strongly as Apple did, catching the EU's eye, some don't clearly note the warranty rules on their sales websites.

For example, PC World doesn't specifically mention the EU law, but does note in its terms that the "Whatever Happens Care Plan" it sells does not "affect your legal rights" for goods that are sold with a defect.

Dell notes on its website that its laptops come with "one-year collect and return hardware support", with no clear mention of the EU rules. Laptops sold on HP's store include a one-year warranty covering "limited hardware, pick-up and return, parts and labour", which can be extended to up to three years. The terms note there may be "other rights that may vary from state to state or from country to country", but don't specify what they might be.

"The approach against Apple in this instance is interesting as it comes at a time when the UK is consulting on proposed reform to consumer laws," Francis added. "Part of that consultation is about improving transparency of consumers' rights under current laws rather than wholesale reform. Apple is a high-profile retailer and the specific focus on its transparency is likely to have an impact on the current consultations and is in line with the European Commission’s European Consumer Agenda."

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