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Apple Fined By Italy For Misleading Customers About Warranty Terms
beaverdownunder writes "An Italian watchdog has fined Apple 900,000 euros ($1.2m, £750,000) for failing to inform Italian shoppers of their legal right to two years of technical support, recognizing instead only a one-year standard warranty. This had led people to pay extra for Apple's own support service, AppleCare, which overlapped with the government-mandated guarantee."
Service plans are probably the most profitable thing anybody sells. Just like rebates, odds are very very high that the person buying said plan won't ever use it, so it's pretty much free money a lot of the time...
It's pretty common with corporations - especially US corporations - in the EU. There are quite strong consumer protection laws that mean that a lot of 'extended warranties' are just promises to honour the terms required by law. They just offer the same service that they offer in the USA, where there are much weaker minimum standards.
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Tho years of guarantee on consumer goods is not just an Italian law, it is a European Union directive.
In the EU, companies still aren't people, so it's not bullying.
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Sure but thats not the point. If they had informed their customers of the 2 year warranty that they were entitled to by law, that would have informed their decision as to whether to go for the extra AppleCare or not. The thing is, they thought the choice was between AppleCare and a 1 year warranty.... but it wasn't. They were misinformed, by the same party who was profiting from decision, and thus had motive to mislead them.
"I opened my eyes, and everything went dark again"
No, the mandated two year warranty has to be given by the seller of a product, not the manufacturer.
It's the italian Apple Store that is liable, and this is an italian company. That the italian Apple Store is owned by Apple Inc., doesn't change anything.
DIRECTIVE 1999/44/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 25 May 1999
on certain aspects of the sale of consumer goods and associated guarantees
THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty establishing the European Community, and in particular Article 95 thereof,
Having regard to the proposal from the Commission(1),
Having regard to the opinion of the Economic and Social Committee(2),
Acting in accordance with the procedure laid down in Article 251 of the Treaty in the light of the joint text approved by the Conciliation Committee on 18 May 1999(3),
(1) Whereas Article 153(1) and (3) of the Treaty provides that the Community should contribute to the achievement of a high level of consumer protection by the measures it adopts pursuant to Article 95 thereof;
(2) Whereas the internal market comprises an area without internal frontiers in which the free movement of goods, persons, services and capital is guaranteed; whereas free movement of goods concerns not only transactions by persons acting in the course of a business but also transactions by private individuals; whereas it implies that consumers resident in one Member State should be free to purchase goods in the territory of another Member State on the basis of a uniform minimum set of fair rules governing the sale of consumer goods;
(3) Whereas the laws of the Member States concerning the sale of consumer goods are somewhat disparate, with the result that national consumer goods markets differ from one another and that competition between sellers may be distorted;
(4) Whereas consumers who are keen to benefit from the large market by purchasing goods in Member States other than their State of residence play a fundamental role in the completion of the internal market; whereas the artificial reconstruction of frontiers and the compartmentalisation of markets should be prevented; whereas the opportunities available to consumers have been greatly broadened by new communication technologies which allow ready access to distribution systems in other Member States or in third countries; whereas, in the absence of minimum harmonisation of the rules governing the sale of consumer goods, the development of the sale of goods through the medium of new distance communication technologies risks being impeded;
(5) Whereas the creation of a common set of minimum rules of consumer law, valid no matter where goods are purchased within the Community, will strengthen consumer confidence and enable consumers to make the most of the internal market;
(6) Whereas the main difficulties encountered by consumers and the main source of disputes with sellers concern the non-conformity of goods with the contract; whereas it is therefore appropriate to approximate national legislation governing the sale of consumer goods in this respect, without however impinging on provisions and principles of national law relating to contractual and non-contractual liability;
(7) Whereas the goods must, above all, conform with the contractual specifications; whereas the principle of conformity with the contract may be considered as common to the different national legal traditions; whereas in certain national legal traditions it may not be possible to rely solely on this principle to ensure a minimum level of protection for the consumer; whereas under such legal traditions, in particular, additional national provisions may be useful to ensure that the consumer is protected in cases where the parties have agreed no specific contractual terms or where the parties have concluded contractual terms or agreements which directly or indirectly waive or restrict the rights of the consumer and which, to the extent that these rights result from this Directive, are not binding on the consumer;
(8) Whereas, in order to facilitate the application of the principle of conformity with the contract, it is useful to introduce a rebuttable presumption of conformity with the contract c
Its not just the EU, Australia, New Zealand and Japan also have heavy consumer protection laws.
The US is just a free for all fuck the consumer kind of country. Its no wonder then that american companies think they can act with impunity everywhere else.
That is not so simple. Misleading bit is that Apple advertises "included 1 year AppleCare, + extra 2 years for extra money," while saying nowhere that customers actually by law have 2 years of warranty.
Now, the simplest distinction of AppleCare and standard support is that former is international, latter is local.
IOW, there are some extras AppleCare covers, but they avoid mentioning how precisely it differs from the standard support, what's covered for 1 year, what's covered for 2 years, what's covered with the optional AppleCare.
All hope abandon ye who enter here.
What really happened:
1. EU mandates 6 month + 18 months of warranty for manufacturing defects. Six months the burden of proof is on the seller, 18 on the consumer. There are some exceptions and the rules are defined quite well, but this is the general way it works. This warranty doesn't cover wear and tear (unless wear and tear is caused by manufacturing defect).
2. Apple complied with the warranty, but tried to market apprecare plan by obfuscating the fact that customer had the right to warranty during two years anyway.
3. Apple got fined for illegal form of marketing.
Actually, the UK implements this directive through the Sales of Goods Act, which gives a consumer redress against the retailer for up to 6 years if goods do not conform with the sales contract, or last a 'reasonable' length of time.