Manufacturers and retailers of goods, other than those for immediate consumption, regularly offer consumers an ‘express warranty’ — an undertaking to repair or replace the goods should they break or otherwise prove defective within a specified period. In some cases these express warranties are ‘voluntary’, in the sense that they are provided by the retailer or manufacturer without additional charge. Another type of express warranty is an extended warranty — an undertaking by the provider of the express warranty (who may be the retailer, the manufacturer or a third party) to repair or replace faulty goods for a specified ‘extended’ period, over and above the period of the voluntary express warranty. It is purchased by the consumer through a contract separate from the original purchase.
The benefits provided to consumers by both of these types of express warranties are dependent largely on the terms of the warranty and the consumers’ own preferences. Two additional critical factors that may be addressed by consumer protection legislation are:
- the rights of the consumer to enforce the warranty against the retailer or manufacturer who provided it
- whether sufficient information is available to consumers to allow them to make meaningful choices based on the existence of the warranty.
This publication discusses best practices in the consumer protection law in place in AMS, Australia, and the European Union in responding to various issues. Consumer rights and guarantees in regard to goods and services that are provided by statute are discussed in Digest 11, included in Volume 1 of this publication.