The Australian Competition and Consumer Commission has accepted court enforceable undertakings from Optus Mobile following an investigation into alleged misrepresentations about consumers' rights and remedies for faulty mobile phones.
The ACCC was concerned that the remedies made available by Optus to customers who complained of receiving a faulty mobile handset were limited to those under the mobile handset manufacturer's express warranty policy and did not include remedies arising from the implied statutory warranties under the Trade Practices Act 1974*.
Following the ACCC's investigation, Optus introduced a 24 month express repair warranty for mobile phones supplied by Optus on 24 month post paid contracts, and has undertaken for a period of three years to provide this warranty for all brands of mobile phones supplied by Optus, including the Apple iPhone.
ACCC chairman Graeme Samuel said this is a big win for consumers.
"Optus has joined the other major telcos in providing 24 month warranties, and we now have a situation where consumers who purchase a mobile phone on a fixed contract have a warranty for the life of the contract."
The Optus undertaking follows an ACCC investigation in 2009 into Vodafone Hutchison Australia which gave similar undertakings to the ACCC, and recent negotiations with Telstra, both of which now provide 24 month warranties for mobile phones on 24 month contracts.
To address the ACCC's concerns, Optus has undertaken for a period of three years:
- not to make any false or misleading representations to consumers about their statutory rights to the effect that the consumer is not entitled to a refund or replacement mobile handset when this is not the case;
- to continue providing a 24 month express repair warranty for mobile phones supplied on 24 month post paid contracts, including Apple iPhones;
- to provide a replacement mobile handset to those consumers who have purchased a mobile handset from Optus which is found to be a faulty mobile phone within the 'early life failure' period;
- to continue providing an extended 'early life failure' period of 30 days after purchase for faulty mobile phones manufactured by Nokia, Sony, Ericsson, LG, and Research in motion (Blackberry); and
- to take all reasonable steps to ensure repairs are completed in a timely manner.
In addition, Optus has undertaken to provide consumer redress (including where appropriate repairs, replacements or refunds) to customers with active unresolved complaints which are no more than 6 months old, and to review its trade practices compliance program.
"Retailers take note – you cannot wipe your hands clean of a faulty product just because the manufacturer's warranty period has ended, particularly when your product is supplied in conjunction with a lock-in contract that is longer than the manufacturer's warranty period," Mr Samuel said.
"The law gives consumers a basic, guaranteed level of protection for goods and services they acquire and such rights and guarantees cannot be excluded or limited by suppliers. In fact, any representation by a supplier that seeks to exclude or limit these rights and guarantees available to consumers is illegal," Mr Samuel said.
*The new consumer guarantees regime started on 1 January 2011 as part of the Australian Consumer Law. The consumer guarantees are based on the same principles as the previous implied conditions and warranties in the Trade Practices Act 1974, but provide more clarity for businesses and consumers about the circumstances where businesses are required to provide a remedy.
Mr Samuel said it is vital for all businesses to be fully up to speed with these new laws.
The consumer guarantees require that goods must be of acceptable quality, fit for any disclosed purpose, must match any description given or sample shown. Sellers and manufacturers must also honour any express—or extra—warranty they give about the goods they sell. Manufacturers must also ensure they take reasonable steps to ensure repair facilities and spare parts are reasonably available for a reasonable time after they are supplied.
Although the name of the consumer rights has changed, the underlying principles continue—consumers ought to be able to obtain a remedy from a supplier if goods or services do not meet a certain standard, don't do what they are supposed to do, or don't match a description or sample. The ACL also includes misleading or deceptive conduct provisions, and these will continue to apply to store policies and any statements which may misrepresent consumers' rights to a remedy.
The ACCC has developed an online learning module to assist retailers and their staff to understand their rights and obligations under the consumer guarantees regime.
The ACCC encourages any consumer who wishes to learn more about their rights to log on to the ACCC website or to call the ACCC infocentre on 1300 302 502.