Consumer Warranties Welcomed To The Digital Age With E-Warranty Act
Thanks to changes in the federal statute governing warranties on consumer products, manufacturers and other suppliers are now able to post warranties online rather than including on a piece of paper with the product. The passage of the E-Warranty Act marked a modernization of the warranty laws that have been around for decades and should be welcome news for manufacturers.
Magnuson-Moss Warranty Act
The Magnuson-Moss Warranty Act of 1975 imposes specific obligations on manufacturers and other suppliers who provide written warranties on consumer products. For the purposes of the act, "consumer products” is defined as property that is distributed in commerce and normally used for personal, family or household purposes. The MMWA requires that warranty terms be provided to consumers before the sale (the Pre-Sales Availability Rule). It also requires written warranties on products costing more than $15 be disclosed in simple, easy to understand language in a single document, and that any limitations on the duration of implied warranties appear “on the face of the warranty” (the Disclosure Rule).
The E-Warranty Act, signed into law in late 2015, amended the Magnuson-Moss Act to allow a manufacturer to make its warranties available online. Rather than having to include a printed document in the product’s packaging, manufacturers can direct customers to their website to find the terms and conditions of their consumer warranties. Those who elect to do so must include the relevant URL, either in the product’s packaging or the product manual. Manufacturers also have to include a non-Internet way for consumers to obtain a copy of the warranty terms, such as a phone number or mailing address.
Following the passage of the E-Warranty Act, the FTC was given one year to revise its regulations accordingly. The FTC issued its final rule in September adopting amendments to the Disclosure Rule and the Pre-Sales Availability Rule to give effect to the act.
The E-Warranty Act is good for consumers as it makes warranty information easily accessible. It is also a benefit to manufacturers and suppliers, providing them with more flexibility and reducing the burden of having to include printed warranty terms with the product itself. It should be noted that not all products fall within the scope of the MMWA. In those instances, state law controls how the warranties must be provided.