CIPS News


Tighter laws for suppliers who provide warranties to consumers

CIPS 13 December 2011

From 1st January 2012, companies that do not comply with Regulation 90 of the Competition and Consumer Act 2010 when providing warranty against defects to a consumer, face potential penalties.


Source: Madgwicks Layers

From 1st January 2012, companies that do not comply with Regulation 90 of the Competition and Consumer Act 2010 when providing warranty against defects to a consumer, face potential penalties.

Regulation 90 now requires that companies must provide certain information with warranties they provide to consumers. The information includes how the consumer can claim under the warranty, details of the supplier and a mandated set of wording which sets out the consumer’s rights.

The requirements only apply if the warranty against defects is made to a ‘consumer’. 

In general, a person is a consumer if they acquire goods or services and:
• the price for the goods or services is $40,000 or less; or
• the goods or services in question are of a kind ordinarily acquired for personal, domestic or household use or consumption.

Failure to comply with the new warranty information requirements could expose suppliers to fines of up to $50,000 per offence for bodies corporate and $10,000 for individuals.

Companies are encouraged to review and, if necessary, revise their 2012 warranty documentation to ensure compliance with the new requirements.

See more on the new regulations here.

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