ConsuWijzer mid-year bulletin: consumers underestimate their warranty rights

Consumers have a lot of questions and misconceptions about their rights when it comes to faulty products. They often feel they have no rights at all, and that they are passed around like hot potatoes. In order to save a lot of hassle, many consumers consider paying for repairs themselves (in full or in part) or buying a brand-new product instead. This is the picture that emerges from the many phone calls and emails ConsuWijzer receives from consumers. ConsuWijzer is the consumer information portal operated by the Netherlands Authority for Consumers and Markets (ACM). It helps consumers by giving practical advice and tools such as a discussion rehearsal guide (for discussions with salespeople) and sample letters. It turns out that consumers often do not exactly know what their rights are, and are thus more inclined to let it just go. Whereas consumers who know their rights find it easier to ask the seller for a satisfactory solution.

In the first six months of 2015, ConsuWijzer received over 29,000 questions and complaints from consumers. Like in previous years, most questions and complaints in the first half of 2015 (one in ten) were about warranty rights. Between mid-March and late-June, the website of ConsuWijzer was visited almost 800,000 times.

Structurally informing consumers incorrectly is an unfair commercial practice

Although it is important that consumers know the rules themselves, and that they actively make clear to businesses that they are aware of these rules, businesses, on the other hand, are legally required to inform consumers correctly prior to the purchase about their rights in case of a faulty product. If businesses fail to do so, or if they structurally mislead or inform consumers incorrectly, it is considered an unfair commercial practice, which is something businesses can be fined for. The highest court (in these kinds of cases) recently reconfirmed this in a case from 2010 between ACM and a major electronics firm in the Netherlands.

In that case, ACM imposed a fine of EUR 90,000 on the electronics firm for offering an extended warranty to consumers purchasing a particular product, while giving them incorrect information about the legal rights these consumers already had. As a result, consumers thus made decisions about taking out an extended warranty, which they might not have made if they had had the right information.

Dutch Trade and Industry Appeals Tribunal (CBb) disallows appeal by BCC in warranty case (in Dutch)

Three important facts about warranty rights that consumers often do not know

The questions and complaints ConsuWijzer receives reveal that consumers often are not aware of the rules of thumb that apply to warranty rights:

The seller is your contact person. The seller must solve the problem or needs to call in the manufacturer.
Does the manufacturer or the seller offer you a warranty? If so, that is something extra, because, even without a warranty, you are entitled to a properly-functioning product.
According to the law, you have a very solid case in the first six months after the purchase. In that period, it is up to the seller to prove that you have used the product improperly.

If a product does not do what the consumer could have reasonably expected it to do when using it normally, the seller is required to find a satisfactory solution. Depending on the situation, the seller must, for example, have the product repaired free of charge or must offer the consumer a new product.

More information about what consumers can expect from sellers in case of a faulty product can be found on ConsuWijzer’s website and/or in the ConsuWijzer video ‘Product warranty: returning a faulty product’.

Top three per category

In the first half of 2015, the top three categories of questions and complaints that ConsuWijzer received concerned:

Questions about warranty rights in case of faulty products/services
Questions about bills and payments.
Customer-recruitment methods and advertisements, including the Do-Not-Call-Me Register.

Top three per industry

The industries about which consumers had the most questions and complaints in the first half of 2015 were:

Telecom companies
Energy companies
Retail non-food (electronics and domestic appliances)

The complaints and questions about telecom companies and energy companies mostly concerned consumers that did not agree with their bills. More than half of the questions and complaints about the retail industry (non-food) concerned questions from consumers about their rights in case of a faulty or divergent product.

The number of complaints and questions about telemarketers that fail to consult the Do-Not-Call-Me Register has dropped to 6 percent. This downward trend has already been observed over a longer period of time. In the first half of 2013, 10 percent of all complaints and questions concerned unsolicited sales calls.

Enforcement actions taken by ACM

Based on, among other sources, the complaints and questions received by ConsuWijzer, ACM has taken several enforcement actions over the past six months such as the following below:

Oversight of unsolicited follow-up shipments (‘subscription traps’) has been stepped up as part of the public awareness campaign of ConsuWijzer “No order, no pay!” (in Dutch: “Niet besteld? Geef geen geld!”);
ACM has pointed out to gyms that they used unfair conditions in their membership contracts, and that they gave consumers incorrect information;
Online fashion stores have been reminded that they gave consumers incorrect information about the refund rules when returning merchandise within the statutory cooling-off period;
A Dutch hobby and collecting company was fined for unfair commercial practices such as sending unsolicited follow-up shipments, and violation of telemarketing rules.